Posts

Getting Your Small Business Year-End Reporting Financials in Order

/0 Comments/in /by

It is not uncommon for small businesses to put aspects of their accounting on the backburner, until the end of the year rears its head. At this time, businesses begin to feel the squeeze for having  – all their financial papers and bookkeeping in order.  On top of all that, as an employer, you also have the responsibility for preparing and distributing required federal forms such as W-2 and 1095s for wage and health care reporting respectively.

Before you panic, let’s review the list of required reporting, forms and documents and prioritize them by deadlines.

Remember that there are two parts to providing employees or independent contractors with data required to complete their individual tax returns – the employee reporting and employer required reporting to the IRS.

January 31:

  • W-2 – Form W-2 provides employees with a summarization of all their payroll wages, earnings, pre-ad post-tax healthcare, cafeteria plans, retirement accounts, loans, or other legally required payments.
  • W3 – is the summary document that must be filed to the IRS to report the total number of W-2 forms distributed to employees.
  • 1099-MISC – Form 1099-MISC provides earnings information to independent contractors who are not ’employees’ of an organization, but have been paid to perform work.
  • 1096- summary document that must be filed to the IRS.
  • 1095-C – If the business is an Applicable Large Employer (ALE) with more than 50 full time employees, the Form 1095 must be provided to employees to provide information on the business’s health care offer of minimal essential coverage (MEC) and affordability.
  • 941, 943, 940  –
    • Form 941 – an employer’s way of reporting IRS withholdings taken from an employee’s pay.
    • Form 943 – This form works the same as the Form 941 except it is used for agricultural employers.
    • Form 940 – Annual Federal Unemployment Tax Return – This form is coupled with an employer’s last quarterly FUTA payment and outlines how much of the tax was paid each quarter.

Februrary 28:

  • 1095-C  and 1094 . If you are paper filing these forms, you have until this date to send them to the IRS. If you are efiling, you have until April 1.

March 15 :

  • 1120S and1065 – These are forms a company must file for reporting S Corporation and Partnership taxes.

April 15 (or date specific to a company’s tax year):

  • 1120 – These are forms a company must file for reporting C Corporation taxes, due 3 1/2 months after their fiscal yearend.

 

Why You Should Hire a Small Business Accountant Rather Than Go It Alone

While waiting until the last minute to get yourself organized and informed about your small business taxes is not recommended, hiring a small business tax professional can help you get on track and stay there. Organization is the key element to making your tax preparation and filing a smooth process. If organization of receipts and financial papers is not your strong suit, hiring a bookkeeper or accountant can do you good as they will solely focus on this essential small business record keeping.

Moreover, your professional small business accountant may be able to locate other money saving loopholes that you may not have been able to discover yourself or through a run of the mill tax preparation agency.

PASBA member accountants bring the collective resources of a nationwide network of Certified Public Accountants, Public Accountants,  Enrolled Agents and other practitioners available to answer your tax and financial questions and streamline your business accounting, bookkeeping, and payroll operations. To find a trusted accountant in your area, visit www.SmallBizAccountants.com.

Please be advised that, based on current IRS rules and standards, any advice contained herein is not intended to be used, nor can it be used, for the avoidance of any tax penalty that the IRS may assess related to this matter. Any information contained in this article, whether viewed or subsequently printed, cannot be relied upon as qualified tax and accounting advice.  Any information contained in this article does not fall under the guidelines of IRS Circular 230.

Copyright Information 201894 Professional Association of Small Business Accountants

 

ACA Reporting Extension Announced

/in /by

If you were panicking about getting those pesky Forms 1095-B and 1095-C’s out to your employees by January 31, 2018, there’s a little good news.  The IRS announced an extension on December 22, 2017 that now provides additional time for Applicable Large Employers (ALEs), those employers with 50 ore more full time employees, to prepare and send the Form 1095-B/1095-C to report information about each employee’s offer of health coverage, affordability and month’s actually covered by the employer plan.  Employers that also offer employer-sponsored self-insured coverage will also use Form 1095-C.  The new deadline, which is a 30-day extension from the original and is automatic, is now March 2, 2018 to provide the Form 1095-B or 1095-C to individuals.  Due dates for filing the 2017 information returns with the IRS are not extended and remain February 28, 2018 for paper filers and April 2, 2018 for electronic filers.

 

But you thought that the Tax Cuts and Job Act (TCJA) of 2017 put an end to employer ACA reporting?

Well, yes and no.  The only item related to the Affordable Care Act was the repeal of the individual mandate, which was the penalty for not actively seeking out and obtaining health coverage.  The penalty still remains in effect throughout 2018 and will be $695 per adult or 2.5% of household income in excess of tax filing thresholds, whichever is greater. Employers must continue to report under Section 6055 and 6056 of the Internal Revenue Code regarding minimal essential coverage (MEC). This information is reported on Forms 1094-C (the IRS transmittal) and 1095-C, the employee informational form. For other plan sponsors such as multi-employer plans, health plan issuers, etc., the reporting is done on Forms 1094-B and 1095-B respectively.

 

Employees do not need to submit the 1095-B or 1095-C with their 2017 individual income tax return.

If you have questions or still aren’t clear on your business’ responsibilities, talk with a Small Business Advisor. You can find one in your area by clicking on the Find an Accountant link above.

PASBA member accountants bring the collective resources of a nationwide network of Certified Public Accountants, Public Accountants, Enrolled Agents and other practitioners available to answer your tax and financial questions and streamline your business accounting, bookkeeping, and payroll operations.

To find a trusted accountant in your area, visit www.SmallBizAccountants.com.

Please be advised that, based on current IRS rules and standards, any advice contained herein is not intended to be used, nor can it be used, for the avoidance of any tax penalty that the IRS may assess related to this matter. Any information contained in this article, whether viewed or subsequently printed, cannot be relied upon as qualified tax and accounting advice. Any information contained in this article does not fall under the guidelines of IRS Circular 230.