Charities and Non-Profits!!!
If you are a small non-profit organization and missed filing 3 years in a row you now have an opportunity to file a 990N (e-post card). This must be done before 10/15/10 or the non-profit may lose its non-profit status. Goto
Also listed at the above link is a list of at risk organizations.
HIRE Act
I am discovering that some who have payrolls are still not familiar with the HIRE Act. This has been one of the easiest of incentives for businesses. This allows you to keep your portion of the Social Security Taxes you have been required to match. This only lasts until December 31, 2010.
To qualify you must have:
A “qualified employee” is an employee
who:
• begins employment with you after
February 3, 2010, and before January 1,
2011;
• certifies by signed affidavit, or similar
statement under penalties of perjury, that
he or she has not been employed for
more than 40 hours during the 60-day
period ending on the date the employee
begins employment with you;
• is not employed by you to replace
another employee unless the other
employee separated from employment
voluntarily or for cause (including
downsizing); and
• is not related to you. An employee is
related to you if he or she is your child or
a descendent of your child, your sibling
or stepsibling, your parent or an
ancestor of your parent, your stepparent,
your niece or nephew, your aunt or
uncle, or your in-law. An employee also
is related to you if he or she is related to
anyone who owns more than 50% of
your outstanding stock or capital and
profits interest or is your dependent or a
dependent of anyone who owns more
than 50% of your outstanding stock or
capital and profits interest. (taken from the W11 instructions)
The W11 form is to be retained with your records. Correct you don’t even have to send it in. You don’t have to wait for approval. You don’t have to fill out endless number of forms to get your incentive. Your portion of Social Security that you have needed to match is now yours to keep. This does not include Medicare – ONLY Social Security.
If you have qualifying employees that started before you were aware of the incentive you may make adjustments on the current quarter’s 941 form.
As always if you have any questions regarding this great incentive please email or call me, Jeanne Noel Chalfont, Chalfont Business Solutions.
See Federal Links for the W11 with the instructions.
IRS 2010 Mileage Rates
IRS announced today the new mileage rates that will be in effect starting January 1, 2010. The standard mileage rate for the use of a car (also vans, pickups or panel trucks) will be:
• 50 cents per mile for business miles driven,
• 16.5 cents per mile driven for medical or moving purposes, and
• 14 cents per mile driven in service of charitable organizations.
The standard mileage rate cannot be used when the taxpayer has more than four vehicles in use simultaneously or for vehicles used for hire.
A reminder for taxpayers that have used any depreciation method under the Modified Accelerated Cost Recovery System (MACRS) or claiming a Section 179 deduction on a vehicle. You may not use the business standard mileage rate on that same vehicle. You do have the choice to use actual costs for the vehicle once it is fully depreciated.
IRS First Time Home Buyer Tax Credit Reminder
First time home buyers must complete the purchase on or by November 30, 2009 to claim up to a maximum of $8,000.00. There need not be a tax liability to receive this credit.
For those considering a home purchase this fall, here are some other details about the first-time home buyer credit:
- The credit is 10 percent of the purchase price of the home, with a maximum available credit of $8,000 for either a single taxpayer or a married couple filing jointly. The limit is $4,000 for a married person filing a separate return. In most cases, the full credit will be available for homes costing $80,000 or more.
- The credit reduces the taxpayer’s tax bill or increases his or her refund, dollar for dollar. Unlike most tax credits, the first-time homebuyer credit is fully refundable. This means that the credit will be paid to eligible taxpayers, even if they owe no tax or the credit is more than the tax owed.
- Only the purchase of a main home located in the United States qualifies. Vacation homes and rental properties are not eligible.
- A home constructed by the taxpayer only qualifies for the credit if the taxpayer occupies it before Dec. 1, 2009.
- The credit is reduced or eliminated for higher-income taxpayers. The credit is phased out based on the taxpayer’s modified adjusted gross income (MAGI). MAGI is adjusted gross income plus various amounts excluded from income—for example, certain foreign income. For a married couple filing a joint return, the phase-out range is $150,000 to $170,000. For other taxpayers, the range is $75,000 to $95,000. This means the full credit is available for married couples filing a joint return whose MAGI is $150,000 or less and for other taxpayers whose MAGI is $75,000 or less.
- The credit must be repaid if, within three years of purchase, the home ceases to be the taxpayer’s main home. For example, a taxpayer who claims the credit based on a qualifying purchase on Sept. 1, 2009, must repay the full credit if he or she sells the home or converts it to business or rental use at any time before Sept. 1, 2012.
Taxpayers cannot take the credit even if they buy a main home before Dec. 1 if:
- The taxpayer’s income is too large. This means joint filers with MAGI of $170,000 and above and other taxpayers with MAGI of $95,000 and above.
- The taxpayer buys a home from a close relative. This includes a home purchased from the taxpayer’s spouse, parent, grandparent, child or grandchild.
- The taxpayer owned another main home at any time during the three years prior to the date of purchase. For a married couple filing a joint return, this requirement applies to both spouses. For example, if the taxpayer bought a home on Sept. 1, 2009, the taxpayer cannot take the credit for that home if he or she owned, or had an ownership interest in, another main home at any time from Sept. 2, 2006, through Sept. 1, 2009.
- The taxpayer is a nonresident alien.
For details on claiming the credit, see Form 5405, First-Time Homebuyer Credit.
Information provided by IR-2009-83, Sept. 17, 2009
Jeanne Noël
A Business Plan – A Living Document
In the last week I have had two situations where a Business Plan, for me, was the theme.
The first setting is an individual forming a corporation. This corporation would then partner with and a sole proprietor under a LLC. The second is someone developing a business he acquired.
I was asked, by the latter, what would a business plan look like? I thought this might be a good time to briefly review business plans because they are: often overlooked, fit a specific need and shelved, or are not understood.
The answer to the above interrogative is who is it for? To guide the entrepreneur, for bank loans, for investors, for clients, etc.
The important part of the plan is in the development of it. Valuable questions are asked of ourselves in becoming or continuing on as an entrepreneur. Do we have what it takes to develop and run a business? What are we offering as a business, what are the products/services, what are the benefits of what we offer, who are our customers/clients, how do we market it, how does it operate, where does it operate, who are we working with, what are the risks and the favorite – putting several financial reports together.
Once developed it is a guiding force in good times and the inevitable bad times. It is most importantly a living document that if used will evolve and continue giving insight into you and your business.
Jeanne Noël
Under Construction
Please take a look around but watch out for nails and such – I’ve had the ol’ hammer n nails out trying to get finished up. Please visit often for new fix’ns and additions – like some blogging.