IRS Released Draft 2020 Form W-4

The Internal Revenue Service issued a draft of the 2020 Form W-4, Employee’s Withholding Allowance Certificate (PDF), that will make accurate withholding easier for employees starting next year. The revised form implements changes made following the 2017 Tax Cuts and Jobs Act, which made major revisions affecting taxpayer withholding. The redesigned Form W-4 no longer uses…

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Employee or Independent Contractor

Which do you have? For federal tax purposes, this is an important distinction. Worker classification affects who pays the federal income tax, social security and Medicare taxes, and how tax return is filed. Classification affects the eligibility for social security and Medicare benefits, employer provided benefits and your tax responsibilities. If you are not sure…

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2019 Form W-2 Reporting of Moving Expense Reimbursements (IRC §132)

The IRS has clarified reporting moving expense reimbursements on Form W-2. The only amounts to be reported under ‘Code P’ for 2019 are excludible moving expense reimbursements paid directly to a member of the U.S. Armed Forces who moves per a military order and incident to a permanent change of station. Employers should not report…

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Penalty Relief Due to Reasonable Cause

Once you have filed information returns with the IRS at yearend, you may ultimately receive a Notice from the IRS that proposes to assess penalties with respect to the returns that you filed. The IRS may issue Notice 972CG which proposes an IRC 6721 penalty for the information returns that were filed late, filed on…

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