Business Filers – 2011 End of Year Reporting

Attention Business Clients:

 RE:  2011 Year End Reporting Requirements

We understand that you work hard and value your time. At MJW EA, we strive to match your efforts with resources and information that simplifies the understanding of Tax laws, Rulings and Regulations that could affect your finances.

Following are helpful hints regarding end of year reporting requirements and closing the year for BUSINESS FILERS (regardless of your tax status – Corp; Partnership; LLC; Sole-Proprietor):

• You are required to file 1099’s for all individuals (including partnerships and LLC’s) that you paid more than $600.00 to during the course of the year for services performed.  This includes repairmen, maintenance people, interior designers, accountants, and lawyers – to name a few.  We can assist you with the 1099 filing to the state and IRS if you are not prepared to do these in house. These are due to the individuals by January 31, 2012. Transmittals to the state and IRS are due by February 28, 2012.
• You are required to distribute all W-2’s to your employees by January 31, 2012.
• Quarterly payroll reports are due by January 31, 2012.
• Annual payroll reports are due by February 27, 2012.
• Verify all employees’ personal information.  The SSA is charging a $50.00 penalty for all W-2’s that are issued with incorrect name (as registered with the SSA), address, and social security number.
• You are required to file your annual or quarterly sales tax report by January 31, 2012.
• Verify that the sales reflected in your sales tax reports for the year tie out to the sales you have recorded for your income tax return.
• Calculate any “Use Tax” due for taxable items purchased out of state to be included and paid with your sales tax report.
• If you carry an inventory perform a year end physical inventory and cost it out.
• If you are a cash basis taxpayer: Pay all 2011 expenses prior to December 31, 2011 to benefit from the expense this year.
• This is a good time to reconcile all of your fixed assets with what is reported on your Personal Property Declaration and your Fixed Asset Schedule for tax purposes.  If you have disposed of any of the equipment or furniture that you have previously depreciated there may be some income tax implications. Review that information and make available for your tax preparation.
• Business Mileage Clarification:  If you do not take an office-in-home deduction because you do not use the space exclusively and regularly for business you are still eligible for  business miles when you leave your home IF your home office qualifies as your principal place of business. The IRS is stressing compliance on mileage logs – substantiation is extremely important with the IRS moving towards a higher audit rate.

If we can be of any assistance during these processes –or if you have other year-end questions, don’t hesitate to contact us.

Here’s to a successful new year!