Look beyond day-to-day financial management.

Many business owners reach a point where managing the financial side of their enterprise becomes overwhelming. This is usually a good thing; the company has grown to a point where simple bookkeeping and basic financial reporting no longer suffice.

If your business has similarly expanded past its capacity, it may be time to add a chief financial officer (CFO) or controller – on either a full-time or part-time basis. Before taking the leap to hire, consider whether your payroll can take on this high-paying position as a full-time employee, or if hiring a part-time CFO consultant is a better fit. Read more to understand exactly what services you are paying for and what makes the most business sense for your company.

The broad role

The role of a CFO or controller is to look beyond day-to-day financial management to more holistic, big-picture planning of financial and operational goals. CFOs take a seat at the executive table and serve as a higher level of support for all matters related to the company’s finances and operations.

CFOs go far beyond merely compiling financial data. They interpret the data to determine how financial decisions will impact all areas of your business. These individuals can plan capital acquisition strategies, so your company has access to financing, as needed, to meet working capital and operating expenses.

In addition, a CFO or controller will serve as the primary liaison between your company and its bank to ensure your financial statements meet requirements should you require help negotiating any loans. Analyzing possible merger, acquisition and other expansion opportunities also falls within a CFO’s or controller’s purview.

Specific responsibilities

A CFO or controller typically has a set of core responsibilities that link to the financial oversight of your operation. This includes making sure there are adequate internal controls to help safeguard the business from internal fraud and embezzlement.

The hire also should be able to implement improved cash management practices that will boost cash flow and improve budgeting/cash forecasting. They should be able to perform ratio analysis and compare the financial performance of your business to benchmarks established by similar-size companies in the same geographic area. A controller or CFO should analyze the tax and cash flow implications of different capital acquisition strategies — for example, leasing vs. buying equipment and real estate.

Major commitment

Make no mistake, hiring a full-time CFO or controller represents a major commitment in both duration of the hiring process and dollars to your payroll. These financial executives typically command substantially high salaries and attractive benefits packages. Another option is to outsource this role to a part-time or fractional CFO consultant who provides business advisory services for a set amount of time. Starting with a part-time CFO may help you assess your current processes and internal controls, then help your company to transition to a full-time CFO position down the road.

Regardless of the route you choose, contact your trusted advisor to help you assess the financial impact of the idea.

Many companies use payroll software or a payroll service to issue checks based on a set pay period. Occasionally, the need to write a manual check arises – like paying an employee a special bonus or as a gift for a job well done. These off-cycle manual checks may trigger time-sensitive tasks for your accountant or payroll provider; notifying them prior to, or immediately after, is recommended.

Your accountant or payroll person will be able to clarify:

Paying company taxes on time avoids potential penalties and late fees that range from 2% to 15%.
Deadlines vary based on the receiving agency and amount of taxes you report. For an example, see “Federal Payroll Tax Deadlines” below. 
Since each company is different, your accountant or payroll person may have more questions. Accordingly, keeping them in the loop will permit you to confidently issue an occasional manual paycheck; knowing you are better positioned to avoid potential pitfalls. If you have questions about your company’s tax deadlines or have other financial needs, please contact us at your convenience.

Federal Payroll Tax Deadlines

There are two types of Federal deposits made to the IRS: monthly schedule deposits and semiweekly schedule deposits. The schedule appropriate for your company depends on how many taxes you report, therefore determining when you schedule your deposits. If you report taxes of $50,000.00 or less, your monthly deposit is due on or before the 15th of the following month. If the 15th of a calendar month falls on a Saturday, Sunday, or legal holiday, the deposit is due by the next business day. If you report taxes of more than $50,000.00, you make semiweekly schedule deposits based on the following schedule:

When a business generates a financial transaction, it creates a paper trail. This paper trail is called a “Source Document.” Your bookkeeper or accountant may ask you to provide them with some sort of source document to verify data and record transactions correctly. A good source document should describe the basic facts of the transaction such as the date, the amount, the purpose, and all parties involved in the transaction. 

Some examples of source documents include:

The source document is a good internal control and provides evidence a transaction occurred. Providing source documents to your bookkeeper or accountant in a timely manner assists them in preparation of financial statements and accurately analyzing your business activity. 

 

 

In the Accounting Services Department at Stockman Kast Ryan + Co, we take a balance sheet approach when closing a set of books. This means each account on the balance sheet (assets/liabilities and equity) is reconciled to source documents (bank statements, amortization schedules, payroll and sales tax returns, etc.) before closing the net income for the year. We view all the transactions during the year to capture any reclassifications that may need to be reallocated to a different account as well as reconciling expenses such as payroll. 

There are many things to take into consideration when finalizing a Year End Closing.

Here are some tips for closing your books:
 

  1. Make sure all cash/bank/checking accounts are reconciled. Pay special attention to stale checks or old deposits that have not cleared the bank and investigate the problem.
  2. Reconcile your Accounts Receivable and Accounts Payable. Make sure all invoicing and bills are posted (especially if you’re on an accrual basis — income/expenses are recognized when they occur rather than when received/paid). Be sure all payments have been applied to open invoices.  
  3. Reconcile all credit card accounts and statements. Expenses charged to a credit card should be dated when charged NOT when the statement is paid. For example, if you charged expenses in December but the statement doesn’t come until January, you can still capture those expenses in the current year.
  4. Get ALL cash receipts to post. If there were payments paid from the owner that related to business, they would be applied to their “Owner Contribution” account. That would reduce their personal cash payments and increase expenses.
  5. If you have loans on your balance sheet, request a year-end report with the balance from the bank or lending institution to make sure they match. If they don’t balance each other, it is typically due to interest expenses. You can create a journal entry, posting the interest to your expense account, thus adjusting the amount of your loan amount to the actual balance on the bank records
  6. Prepare and file 1099s. Hopefully throughout the year you have collected the W9 information on all of the contractors. If you have not, they need to be finalized and postmarked to the contractor no later than January 31st.
  7. Prepare and file W2s. This may be done by your payroll service provider, but if you prepare your own payroll reports the W2s need to be finalized and postmarked to the employee by January 31st.
  8. Print out a YTD General Ledger. Go through each account and review everything in it. Make sure that each cash and loan account (checking, receivables, payables, notes, inventory and fixed assets) has backup documentation to prove that their balances are correct. Review your income and expense accounts and verify that all of the transactions are posted to the correct accounts. 

Common information we will require from you to prepare your tax return:

Generally, we will make the final year-end adjustments to the balance sheet to zero out the owners’ distributions/draws for the upcoming year as well as to record depreciation. Occasionally, we have additional tax adjustments that may also affect your books.

 

We know that closing out your books for the year can be a daunting task. But taking the time to prepare now will likely save you both time and money later. “Clean” books make the tax preparation process that much easier and efficient. If you have questions regarding any of the suggestions listed here, please let us know. 

 

 

As the end of 2016 approaches, it's time for employers to think about filing Forms W-2 and 1099. Forms W-2 are issued to employees to report compensation, withholding tax, and other items related to compensation. Forms 1099 are most commonly issued by businesses for payments in excess of $600 to vendors for services, rent, and other miscellaneous types of income. Forms 1099 do not need to be issued for purchases of inventory or other products.  
 

Filing Deadlines

 
For calendar year 2016, the due date for sending Forms W-2 and 1099 to employees and vendors remains January 31, 2017.  
 
In previous years, the due date for sending copies of these forms to the Social Security Administration (SSA) and to Internal Revenue Service (IRS) was the end of February. But for calendar year 2016, the due date for sending copies of the forms to SSA and IRS has been moved up to January 31, 2017.  
 
The IRS indicates that receiving the forms earlier will make it easier to verify income and withholding reported on individual income tax returns and to hopefully identify potentially fraudulent requests for refunds.   
 

Penalties

 
The IRS continues to impose strict penalties for late or non-filers as well as for those with incomplete or erroneous information. And it is important to note that separate penalties may apply: one for the filing and one for the payee statement. For example, if you fail to file a correct Form 1099-MISC with the IRS and  don't provide a correct Form 1099-MISC statement to the payee, you may be subject to two separate penalties.   
 
As in prior years, business owners are required to attest to having filed these forms on their business income tax returns.

Additional Notes on Forms 1099

In order to complete Form 1099, the business needs to obtain the name, address, tax entity type, and tax ID number for the vendor. If the vendor is an LLC, the business needs to know if the LLC is taxed as a single-member LLC, a partnership, or an S-corporation. Forms 1099 do not need to be issued to S-corporations or C-corporations unless the corporation is an attorney’s office.   
 
Form W-9, Request for Taxpayer Identification Number and Certification, can be used to gather this information. Ideally, the form should be completed prior to payment to the vendor. We recommend businesses have a policy that vendors must complete and return Form W-9 before the business issues payment to avoid the scenario of scrambling at year end to get information that may be difficult to gather.
 
If the vendor uses a “DBA” (doing business as), that should be indicated on the W-9 and this name also needs to be shown on the Form 1099. Forms 1099 must be filed with the name registered with the IRS tax return and EIN. You may not use a Social Security number along with a business name.
 
Once forms are received, the IRS matches the names and tax identification numbers with income tax returns. The business will receive a notice if the identification number reported on the 1099 doesn’t match IRS records. If incorrect information isn’t corrected, IRS will notify the business to withhold 25% from future payments and remit this to the IRS. This is referred to as “backup withholding” and can be a cumbersome process. 
 
Instructions and forms can be found on the IRS website at www.irs.gov.  We are happy to answer questions and can complete these forms for you or train you how prepare the forms using QuickBooks.   
 

Changes to Deadlines & Penalties at a Glance

Form Deadline
2016 Forms W-2, W-3,  and certain Forms 1096 and 1099-MISC  January 31, 2017
2016 Forms 1099-MISC, if reporting nonemployee compensation payments in box 7 January 31, 2017
Late Filing of Forms W-2, W-2G, 1098 and 1099 Penalty
2016 information returns filed less than 30 days late $50 per return with a maximum fine up to $186,000
2016 information returns filed over 30 days late, but filed before August 1, 2017 $60 per return with a maximum penalty of $532,000
2016 information returns filed after August 1 or not at all $260 per return with a maximum penalty of $500,000. 
2016 information returns not filed due to intentional disregard of the rules $530 per return with an unlimited maximum penalty!

 

The U.S. Department of Labor (DOL) has released a final rule that makes significant changes to the determination of which executive, administrative and professional employees — otherwise known as “white-collar workers” — are entitled to overtime pay under the Fair Labor Standards Act (FLSA). The rule will make it more difficult for employers to classify employees as exempt from overtime requirements. In fact, the DOL estimates that 4.1 million salaried workers will become eligible for overtime when they work more than 40 hours in a week.
 
The changes will have a tax impact as well: Employers’ payroll tax liability will increase as they pay overtime to more employees who work in excess of 40 hours a week or pay higher salaries to maintain overtime exemptions. 

Current requirements for white-collar exemptions

To qualify for a white-collar exemption from the overtime requirements under current federal law, an employee generally must satisfy three tests:
  1. Salary basis test. The employee is salaried, meaning he or she is paid a predetermined and fixed salary that’s not subject to reduction because of variations in the quality or quantity of work performed.
  2. Salary level test. The employee is paid at least $455 per week or $23,660 annually.
  3. Duties test. The employee primarily performs executive, administrative or professional duties.
Neither job title nor salary alone can justify an exemption — the employee’s specific job duties and earnings must also meet applicable requirements.
 
Certain employees (for example, generally doctors, teachers and lawyers) aren’t subject to either the salary basis or salary level tests. The current regulations also provide a relaxed duties test for certain highly compensated employees (HCEs) who are paid total annual compensation of at least $100,000 and at least $455 per week.

Significant changes under the final rule

The DOL issued a proposed rule in July 2015, revising the 2004 regulations, and received more than 270,000 comments in response.
 
The revisions in the final rule, which take effect December 1, 2016, mainly relate to the salary level test. The rule increases the salary threshold for exempt employees to the 40th percentile of weekly earnings for full-time salaried workers in the lowest-wage Census region (currently the South) — $913 per week or $47,476 per year. 
 
In response to what the DOL described as “robust comments” from the business community, the final rule allows up to 10% of the salary threshold for non-HCE employees to be met by nondiscretionary bonuses, incentive pay and commissions, as long as these payments are made on at least a quarterly basis. Thus, an employee’s production or performance bonuses could push him or her over the threshold and into exempt status (assuming the other tests are satisfied).
 
The rule also updates the HCE threshold above which the relaxed duties test applies. It raises the level to the 90th percentile of full-time salaried workers nationally, or $134,004 per year. 
 
The final rule continues the requirement that HCEs receive at least the full standard salary amount — or $913 — per week on a salary or fee basis without regard to the payment of nondiscretionary bonuses and incentive payments. Such payments will, however, count toward the total annual compensation requirement.
 
The standard salary and HCE annual compensation levels will automatically update every three years to maintain the levels at the prescribed percentiles, beginning January 1, 2020. The DOL will post new salary levels 150 days before their effective date.

The duties test

The final rule makes no changes to the duties test. In the proposed rule, the DOL had sought comments regarding the effectiveness of the test at screening out workers who aren’t bona fide white-collar workers. 
 
But it determined that the new standard salary level and automatic updating will work with the duties test to distinguish between overtime-eligible workers and those who may be exempt. Moreover, as a result of the revised salary level, employers won’t need to consider the duties test as often — if a worker’s pay doesn’t satisfy the salary level test for exemption, the employer needn’t bother assessing the worker’s duties.

Compliance options

According to the DOL, employers have a range of options when it comes to complying with the changes to the salary level (although it doesn’t require or recommend any method). Options include:
 
Review and do nothing. After completing an internal review, you might choose to do nothing if your white-collar workers fall short of the new salary level but don’t ever work more than 40 hours per workweek.
 
Raising salaries. You may want to raise the salaries of employees who meet the duties test, have salary near the new salary level and regularly work overtime. Paying them at or above the salary threshold will maintain their exempt status.
 
Paying overtime above a salary. You could continue to pay employees a salary covering a fixed number of hours, which could include hours above 40. For example, you might:
And, of course, you might reorganize workload distributions or adjust employee schedules to redistribute work hours in excess of 40 across current staff. You could also hire additional employees to reduce or eliminate overtime hours worked by your current staff.

The big picture

As noted, the cost of the new overtime rules is more than just the increased compensation; it also includes additional payroll tax liability on that compensation, as well as administrative costs to comply. This is a complex and complicated issue; and we recommend you consult your employment advisor with questions or concerns.

In the Accounting Services Department at Stockman Kast Ryan + Co, we take a balance sheet approach when closing a set of books. This means each account on the balance sheet (assets/liabilities and equity) is reconciled to source documents (bank statements, amortization schedules, payroll and sales tax returns, etc.) before closing the net income for the year. We view all the transactions during the year to capture any reclassifications that may need to be reallocated to a different account as well as reconciling expenses such as payroll. 

There are many things to take into consideration when finalizing a Year End Closing.

Here is a guide to getting your books ready for us:
 

Common information we will require from you to prepare your tax return:

Generally, we will make the final year-end adjustments to the balance sheet to zero out the owners’ distributions/draws for the upcoming year as well as to record depreciation. Occasionally, we have additional tax adjustments that may also affect your books.

 

We know that closing out your books for the year can be a daunting task. But taking the time to prepare now will likely save you both time and money later. “Clean” books make the tax preparation process that much easier and efficient. If you have questions regarding any of the suggestions listed here, please let us know. 

 

 

As we approach year-end, one of the earliest business tax reporting tasks that must be completed is preparation of information returns known as Forms 1099. The purpose of Forms 1099 is for businesses to report to the IRS various items of income and deduction for a recipient. The IRS will match the information received on these forms to recipients’ tax returns, and if there is a discrepancy, the IRS will contact the taxpayer regarding the discrepancy.

Types of Income Required to be Reported on Form 1099-MISC

Form 1099-MISC is the most common 1099 prepared by businesses. This Form reports payments made in the course of a trade or business to individuals and unincorporated businesses that do not constitute wages. The most common types of payments reported are royalty payments or payments to independent contractors for services or work. Below is a list of payments made by businesses that must be reported to recipients on Form 1099-MISC:

NOTE:  The exemption from issuing Form 1099-MISC to a corporation does not apply to payments for legal services provided by corporations or for payments for medical or health care services provided by corporations.

Link to example Form 1099-MISC: www.irs.gov/pub/irs-pdf/f1099msc.pdf

Link to IRS instructions for preparation of Form 1099-MISC: www.irs.gov/pub/irs-pdf/i1099msc.pdf

Gathering Information to Complete Forms 1099-MISC

Preparation of the actual Forms 1099-MISC is not difficult. But the determination of which vendors, service providers or other payees must receive a 1099-MISC, as well as gathering and summarizing all of the information that must be reported,can be time consuming.  

In order to prepare Forms 1099-MISC, businesses must gather or summarize the following information for each 1099 recipient each year: 

We recommend that businesses obtain the first two items of information each year on Form W-9 (http://www.irs.gov/pub/irs-pdf/fw9.pdf) for each recipient before the first payment of the year is issued to the recipient. The payment information can be automatically summarized in accounting software programs or can be summarized from detailed reports by payee.

Due Dates for Furnishing Forms 1099-MISC to Recipients

Generally a copy of Form 1099-MISC must be furnished to a recipient by January 31st of the year following the reporting year. Accordingly, for 2015 reporting, Forms 1099-MISC should be mailed to recipients by February 1, 2016 because the due date falls on a Sunday. If, however, amounts are reported to 1099-MISC recipients in box 8 (Substitute payments in lieu of dividends or interest) or box 14 (Gross proceeds paid to an attorney), copies must be mailed to recipients by February 16, 2016.

Filing Forms 1099

Businesses that submit less than 250 of any one type of information returns can file paper Forms 1099. If a business files paper forms, specially prescribed forms must be used so that the paper forms submitted can be read by IRS optical character recognition (OCR) equipment. Most office supply stores sell the specially prescribed Forms 1099. (Do not attempt to download and print Form 1099 from the IRS website!) Failure to use the specially prescribed forms could subject the filer to a penalty of up to $100 per form. 

Forms 1099 submitted on paper must be mailed to the IRS on or before February 29th of the year following the reporting year. Forms 1099 filers should submit copy A of Forms 1099 along with Form 1096 (Annual Summary and Transmittal of U.S. Information Returns) to the IRS at the address listed on Form 1096, based on the principal business location of the filer. Form 1096 is also a specially prescribed form and can also be purchased at office supply stores.

Businesses that must submit more than 250 of any type of information returns must file electronically using a system called FIRE (Filing Information Returns Electronically). The FIRE system is accessed via the Internet at https://fire.irs.gov/firev1r/default.aspx. Users must have software that can produce a file in the proper format according to IRS Publication 1220. Businesses required to submit Forms 1099 electronically generally must obtain IRS approval to do so by submitting Form 4419 – Application of Filing Information Returns Electronically at least 45 days before the due date of the returns. The due date for filing 2015 electronic Forms 1099 is March 31, 2016.

Penalties Related to Forms 1099

The Internal Revenue Code includes penalties that may apply to businesses required to file Forms 1099. The penalties are applied, unless due to reasonable cause, for:

Generally, the penalties imposed are from $30 per return to $250 per return, depending on the type of failure and how soon the errors are corrected. There is a de minimis exception for returns that failed to include required information or include incorrect information if there was timely filing of information returns and if all errors are corrected by August 1st of the year following the reporting year.

Cautions and Recommendations for 1099-MISC Reporting

 

Stockman Kast Ryan + CO is here to help you with this year-end task. We can prepare Forms 1099-MISC for you or we can train you and/or your staff to not only prepare the 2015 Forms 1099-MISC but also assist with a jump start on the 2016 1099-MISC preparation process. We can assist with 1099 QuickBooks mapping and with implementation of procedures to gather and summarize all of the information required to file accurate 1099s as tax year 2016 progresses. 

As we approach year-end, one of the earliest business tax reporting tasks that must be completed is preparation of information returns known as Forms 1099. For 2014 reporting, Forms 1099-MISC should be mailed to recipients by January 31, 2015.
 
The purpose of Forms 1099 is for businesses to report to the IRS various items of income and deduction for a recipient. The IRS will match the information received on these forms to recipients’ tax returns, and if there is a discrepancy, the IRS will contact the taxpayer regarding the discrepancy.
 

Types of Income Required to be Reported on Form 1099-MISC

Form_1099Form 1099-MISC is generally the most common 1099 prepared by businesses. This form reports payments made in the course of a trade or business to individuals and unincorporated businesses that do not constitute wages. The most common types of payments reported are royalty payments or payments to independent contractors for services or work. Below is a list of payments made by businesses that must be reported to recipients on Form 1099-MISC:
NOTE:  The exemption from issuing Form 1099-MISC to a corporation does not apply to payments for legal services provided by corporations or for payments for medical or health care services provided by corporations.
 
Link to example Form 1099-MISC:
http://www.irs.gov/pub/irs-pdf/f1099msc_14.pdf
 
Link to IRS instructions for preparation of Form 1099-MISC:
http://www.irs.gov/pub/irs-pdf/i1099msc_14.pdf
 

Gathering Information to Complete Forms 1099-MISC

 
Preparation of the actual Forms 1099-MISC is not difficult. But the determination of which vendors, service providers or other payees must receive a1099-MISC, as well as gathering and summarizing all of the information that must be reported, can be both challengingt and time consuming. 
 
In order to prepare Forms 1099-MISC, businesses must gather or summarize the following information for each 1099 recipient each year: 
 
We recommend that businesses obtain the first two items of information each year on Form W-9 (http://www.irs.gov/pub/irs-pdf/fw9.pdf) for each recipient before the first payment of the year is issued to the recipient. The payment information can be automatically summarized in accounting software programs or can be summarized from detailed reports by payee.
 

Due Dates for Furnishing Forms 1099-MISC to Recipients

 
Generally a copy of Form 1099-MISC must be furnished to a recipient by January 31st of the year following the reporting year. Accordingly, for 2014 reporting, Forms 1099-MISC should be mailed to recipients by January 31, 2015. If, however, amounts are reported to 1099-MISC recipients in box 8 (substitute payments in lieu of dividends or tax-exempt interest) or box 14 (gross proceeds paid to an attorney), copies must be mailed to recipients by February 15, 2015.
 

Filing Forms 1099 MISC

 
This article is specific to Forms 1099 MISC, but the rules for filing apply to all types of Forms 1099. Businesses that submit less than 250 of any one type of information return can file paper Forms 1099. If a business files paper forms, specially prescribed forms must be used so that the paper forms submitted can be read by IRS optical character recognition (OCR) equipment. Most office supply stores sell the specially prescribed Forms 1099. (Do not attempt to download and print Form 1099 from the IRS web-site!) Failure to use the specially prescribed forms could subject the filer to a penalty of up to $100 per form. 
 
Forms 1099 submitted on paper must be mailed to the IRS on or before February 28th of the year following the reporting year. Forms 1099 filers should submit copy A of Forms 1099 along with Form 1096 (Annual Summary and Transmittal of U.S. Information Returns) to the IRS at the address listed on Form 1096, based on the principal business location of the filer. Form 1096 is also a specially prescribed form and can also be purchased at office supply stores.
 
Businesses that must submit more than 250 of any type of information returns must file electronically using a system called FIRE (Filing Information Returns Electronically). The FIRE system is accessed via the Internet at https://fire.irs.gov/firev1r/default.aspx. Users must have software that can produce a file in the proper format according to IRS Publication 1220. Businesses required to submit Forms 1099 electronically generally must obtain IRS approval to do so by submitting Form 4419 – Application of Filing Information Returns Electronically – at least 45 days before the due date of the returns. The due date for filing 2014 electronic Forms 1099 is March 31, 2015.
 

Penalties Related to Forms 1099

 
The Internal Revenue Code includes penalties that may apply to businesses required to file Forms 1099. The penalties are applied, unless due to reasonable cause, for:
 
Generally, the penalties imposed are from $30 per return to $250 per return, depending on the type of failure and how soon the errors are corrected. There is a de minimis exception for returns that failed to include required information or include incorrect information if there was timely filing of information returns and if all errors are corrected by August 1st of the year following the reporting year.
 

Cautions and Recommendations for 1099-MISC Reporting

  • Payers must be careful to report payments to recipients in the correct boxes because the IRS uses 1099 information to match with recipients’ tax returns.
  • Each type of 1099 must be submitted separately with a separate Form 1096.
  • If after Forms 1099 are filed, the payer discovers that additional forms are required to be filed, the additional forms should be filed with a new Form 1096.
  • Send Forms 1099-MISC to recipients as early as possible so that any required changes can be made before the Forms 1099 are submitted to the IRS. This avoids filing corrected Forms 1099 with the IRS.
  • Paper Forms 1099 should not be folded but be submitted to the IRS in a flat envelope.
  • Mail paper Forms 1099 by certified mail and retain the certified mail receipt to document timely filing of Forms 1099.
  • Be sure to retain all Forms W-9 and other summarized information used to determine the correct amounts to report on Forms 1099-MISC in case you receive questions from recipients or from the IRS.
     
Stockman Kast Ryan and Company is here to help you with this year-end task. We can prepare Forms 1099-MISC for you or we can train you and/or your staff to not only prepare the 2014 Forms 1099-MISC but also assist with a jump start on the 2015 1099-MISC preparation process. We can assist with 1099 QuickBooks mapping and with implementation of procedures to gather and summarize all of the information required to file accurate 1099s as tax year 2015 progresses. Please call us at (719) 630-1186 or through our Secure Email if we can be of assistance.

 

Linda Greene

If you are a business owner who collects and pays Sales Tax or you are a consumer or business owner paying Use Tax to the state on your purchases that did not include Colorado sales tax, we want you to be aware that the service fee is changing.

The service fee (also known as the Vendor’s Fee or discount fee) has been restored to a rate of 3.33% for returns filed timely on or after July 1, 2014.

The service fee will be effective for:

•    State Sales Tax
•    State Retailer’s Use Tax
•    Aviation Sales Tax
•    RTD/CD (Denver metro area)special district taxes

The service fee rates for state-collected local jurisdictions are not part of this change, however they may change periodically.

If you have received pre-printed sales tax forms from the State, the rate of .0222 (2.22%) should be changed to the new rate of .0333 (3.33%) for timely filed returns.  The new forms for the July 2014 to December 2014 period will have the new service fee rate printed on the return.

Please contact us with any questions at (719) 630-1186.