Employee Retention Credit: Over but Not Done

The federal government’s Employee Retention Credit (ERC) proved to be a lifeline for many businesses and their employees affected by the COVID pandemic. The eligibility rules were complex and changed over time, as noted in an extensive IRS chart. Not all business owners may have been able to figure out whether they were eligible; however, the…

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Home Office Deductions: More Complex Than They Seem

It can be challenging to determine allowable deductions for a home office. Following is a summary of key IRS provisions. Internal Revenue Code Section 280A IRC Section 280A includes the rules for home office deductions. A freelancer who works from home, for instance, must pass three tests in order to claim home office deductions: The…

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Depositing and Reporting Employment Taxes

As an employer, you are required to uphold the responsibility of payroll taxes. As such, you must also ensure that you understand what the rules are, especially due to how complex they are. First and foremost, start  by ensuring you are aware of these three types of taxes, which you will need to send to…

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All About Quarterly Tax Returns

IRS Form 941 is a tax form that businesses file quarterly. It is how businesses report employee income taxes, Social Security, and Medicare taxes that the business withheld from employee paychecks over the previous quarter, and the matching employer taxes. Filing deadlines are the last day of January, April, July, and October of any given…

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Small Business Owners May Qualify to Deduct Their Home Office Expenses

If you own a small business and “exclusively and regularly” use part of your home as your primary place of doing business, you may be able to deduct some of the expenses of operating your home office on your federal income tax return. Unfortunately, employees are not eligible to claim the home office deduction to the…

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Taxable and Nontaxable Employee Benefits

As the unemployment rate falls from its 2020 high, employees are switching jobs in record numbers. The new stability in the economy means workers have more leeway to shop around for jobs that fit their lifestyles, needs, and values. Now, the onus is on employers to provide an environment that makes their star team members…

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IRS Announces Mileage Rates for 2022

The IRS has issued the 2022 optional standard mileage rates used to calculate the deductible costs of operating an automobile for business, charitable, medical or moving purposes. Beginning on Jan. 1, 2022, the standard mileage rates for the use of a car (also vans, pickups, or panel trucks) will be: 58.5 cents per mile driven…

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IRS Offers Guidance on ERC

The IRS has issued guidance for employers regarding the retroactive termination of the Employee Retention Credit. The Employee Retention Credit now applies only to wages paid before October 1, 2021, unless the employer is a recovery startup business. This guidance can be found in Notice 2021-65. It applies to employers that paid wages after September 30,…

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Payroll Tax Rates and Contribution Limits for 2022

Below are federal payroll tax rates and benefits contribution limits for 2022. Social Security tax In 2022, the Social Security tax rate is 6.2 percent for employers and employees, unchanged from 2021. The Social Security wage base is $147,000 for employers and employees, increasing from $142,800 in 2021. In 2022 self-employed people must pay 12.4…

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