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Updates!

To ensure uninterupted updates and news delivery, please add russhoskins@hcpaonline.com to your address book.                                                                           Update #2- January 20, 2017

Inside Straight

Inside information. Straight answers.

Hoskins Quiros Osborne & LaBeaume, CPA, LLC

"Life can be taxing. We can help."

 

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JANUARY IS A BIG MONTH!

 

Steep Penalties If Your 1099’s Are Late!

With sharply increased information reporting penalties in their second year (as high as $260 per late Form 1099), timely issuance of Form 1099s has become imperative for many businesses. The urgency for timely reporting is compounded by the continued presence of questions on Forms 1065, 1120, 1120S, and 1040, whether the taxpayer made any payments in 2016 that would require the taxpayer to file Form(s) 1099. Starting this year, taxpayers also face earlier deadlines for reporting W-2 and 1099 information to the Social Security Administration and the IRS.


 

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Penalties If 1099 Incorrect:

  • You MUST file a informationally correct  return by January 31st.
  • You MUST file electronically if you are required to file electronically. You will be penalized if you file on paper when  you were required to file electronically.
  • You must report a taxpayer identification number (TIN). AND IT MUST BE ACCURATE.
  • If you are required to file paper forms, they MUST BE legible and machine readable .
  • You MUST also provide a correct Payee Statement by January 31st!
  • The Payee Statement MUST contain all required information on the statement!
  • You can be penalized if you provide incorrect information on the Payee Statement

 


 

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Do You Need To File 1099-MISC?

The Form 1099-MISC is probably the most filed Form 1099 of the series. You must file Form 1099-MISC, Miscellaneous Income, for each person (subject to the exceptions listed below) to whom you paid during the year:

  1. At least $10 in royalties or broker payments in lieu of dividends or tax-exempt interest;
  2. At least $600 in rents, services (including parts and materials), prizes and awards, other income payments, medical and health care payments, crop insurance proceeds, cash payments for fish (or other aquatic life) purchased from anyone engaged in the trade or business of catching fish, or, generally, the cash paid from a notional principal contract to an individual, partnership, or estate;
  3. Any fishing boat proceeds; or
  4. Gross proceeds of $600 or more paid to an  attorney .

 



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The Cost of Inaccurate 1099's Varies

The penalty rates for failure to file correct information returns and/or to furnish correct payee statements depend on how late the correct Form 1099 is filed and can range anywhere from $50 per return to $260 per return. The per-failure penalty is $530 for a taxpayer who intentionally disregards the filing requirements for information returns and payee statements.



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Your business is appreciated and your referrals are welcome. The general information in this update should not be acted upon without first determining its application to your specific situation. For further details on any  article, please contact us.

Inside Straight Newsletter © Copyright 2017 Hoskins Quiros Osborne & LaBeaume CPA LLC. All Rights Reserved.

 

Taxpayer Advocate Service Feed

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Wed, May 15, 2019

Subscribe to the NTA’s Blog and receive updates on the latest blog posts from National Taxpayer Advocate Nina E. Olson. Additional blogs from the National Taxpayer Advocate can be found at www.taxpayeradvocate.irs.gov/blog In my recently released Annual Report to Congress, I discussed the need to evaluate the impact of IRS audits on voluntary compliance. Last week’s blog discussed...

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Every year, the Taxpayer Advocate Service (TAS) helps thousands of people with tax problems. This story is only one of many examples of how TAS helps resolve taxpayer’s tax issues. All personal details are removed to protect the taxpayer’s privacy. One of the main reasons TAS exists is to help taxpayers with tax problems who are also suffering financial hardships. When taxpayers owe...

NTA Blog: There is Still Time to Register for the International Taxpayer Rights Conference

Thu, May 09, 2019

Subscribe to the NTA’s Blog and receive updates on the latest blog posts from National Taxpayer Advocate Nina E. Olson. Additional blogs from the National Taxpayer Advocate can be found at www.taxpayeradvocate.irs.gov/blog We are just weeks away from the 4th International Taxpayer Rights Conference. This year’s conference takes place May 23-24, 2019 at the University of Minnesota ...

NTA Blog: IRS Examinations - The IRS Should Promote Voluntary Compliance and Minimize Taxpayer Burden in the Selection and Conduct of Audits

Wed, May 08, 2019

Subscribe to the NTA’s Blog and receive updates on the latest blog posts from National Taxpayer Advocate Nina E. Olson. Additional blogs from the National Taxpayer Advocate can be found at www.taxpayeradvocate.irs.gov/blog In February of 2019, I released the 2018 Annual Report To Congress in which, among other things, I discuss the influence of tax audits on taxpayers’ attitudes a...

NTA Blog: Although the IRS Has Made Some Improvements, Math Error Notices Continue to Be Unclear and Confusing, Thereby Undermining Taxpayer Rights and Increasing Taxpayer Burden

Thu, May 02, 2019

Subscribe to the NTA’s Blog and receive updates on the latest blog posts from National Taxpayer Advocate Nina E. Olson. Additional blogs from the National Taxpayer Advocate can be found at www.taxpayeradvocate.irs.gov/blog With the filing season in full operation, many taxpayers are receiving correspondence from the IRS that convey significant taxpayer rights and require taxpayers to ta...

2019 Tax Forums will feature TAS seminars and the Case Resolution Program

Fri, Apr 26, 2019

Each year the IRS sponsors the Nationwide Tax Forums, a three-day series of tax education and networking conferences for tax professionals in cities around the country. These events feature the latest information from the IRS, news about tax law changes, the chance to meet with software vendors and the opportunity to attend nearly 50 seminars presented by IRS employees and members of professio...

NTA Blog: The Second Circuit in Borenstein Helped to Close the Gap in the Tax Court's Refund Jurisdiction, but Only for Taxpayers in that Circuit

Wed, Apr 24, 2019

Subscribe to the NTA’s Blog and receive updates on the latest blog posts from National Taxpayer Advocate Nina E. Olson. Additional blogs from the National Taxpayer Advocate can be found at www.taxpayeradvocate.irs.gov/blog In 2017, the U.S. Tax Court decided the case of Borenstein v. Commissioner by applying a technical reading of a statutory rule that produced a gap in its refund juris...

TAS Tax Tip: Updates to Estimated Tax Penalty Waiver

Tue, Apr 23, 2019

The April 15th tax deadline has passed, however the IRS announced on March 22, 2019 that it is expanding the waiver of the Estimated Tax Penalty to include relief for taxpayers whose total withholding and estimated tax payments equal or exceed 80 percent of the tax shown on the return for the 2018 taxable year. This threshold was reduced from the 85 percent threshold in Notice 2019-11, Relief f...

Tax Notes podcast features an interview with the National Taxpayer Advocate

Fri, Apr 19, 2019

On April 11, National Taxpayer Advocate (NTA) Nina Olson sat down with a senior reporter from Tax Notes, an online publication for tax professionals, to record an interview about the filing season and other tax issues. In part one of this two-part podcast, the NTA brings her unique perspective to bear on the status of the filing season and how the government shutdown affected not only the proce...

NTA Blog: The Adoption of a Withholding Code and the Improvement of Free File Fillable Forms Would Streamline Tax Withholding and Reporting

Thu, Apr 18, 2019

Subscribe to the NTA’s Blog and receive updates on the latest blog posts from National Taxpayer Advocate Nina E. Olson. Additional blogs from the National Taxpayer Advocate can be found at www.taxpayeradvocate.irs.gov/blog In last week’s blog, I discussed the potential benefits arising from an expansion of the pay-as-you-earn (PAYE) tax system to incorporate additional income item...