August - Industry Newsletter

IRS NEWS FOR BUSINESS

August 2017

►UPCOMING WEBINARS

Join Great Lakes and Midwest Stakeholder Liaison Summer Series – Part III Web Conference to Help Small Businesses Owners Understand Their Tax Responsibilities

Part III - Review Methods to Pay Your Tax Liability:  This presentation will focus on various methods that would be best for your business when paying your tax liability.

• Date: Wednesday, August 16, 2017
• Time: 10:00 am – 10:45 am Eastern Time

Click on the following link to register: https://www.webcaster4.com/Webcast/Page/1154/21251

August 17: Understanding S Corporations Part I - Overview and Election

• This free web conference will provide an overview of S Corporations. Part I of this presentation will focus on the following:
  • Defining an S Corporation
  • Discussing how and when to elect to be taxed as an S Corporation
  • Discussing late election relief procedures
  • Explaining concept of reasonable compensation for S-Corp shareholder/employees
  • Discussing the rules for fringe benefits to 2% shareholders
• Session 1: Register HERE
• Session 2 (closed captioning): Register HERE

September 7: Understanding S Corporations Part II - Shareholder Stock Basis and Debt Basis

• This free web conference will provide an overview of S Corporations. Part II of this presentation will focus on the following:
  • Describing the three loss limitations for S Corporation shareholders
  • Discussing the shareholder’s responsibility for tracking stock and debt basis
  • Reviewing the stock basis ordering rules
  • Defining when a shareholder has debt basis
  • Identifying case law factors used to establish when debt is bona fide.

Session 1: Register HERE
Session 2 (closed captioning): Register HERE

See Webinars for Small Businesses for upcoming National and Local Webinars

Click HERE for videos recently posted to the IRS Video Portal.

►NEWS

IRS Website Provides Tools to Help Small Businesses Understand Employment Taxes

• The IRS offers small businesses many free products to help them understand and comply with the law. Products ranging from online calculators, printable calendars, step-by-step guides and a series of educational webinars are all available on IRS.gov.

Tips on How to Handle an IRS Letter or Notice

• The IRS mails millions of letters every year to taxpayers for a variety of reasons. Keep the following suggestions in mind on how to best handle a letter or notice from the IRS:
  • Do not panic. Simply responding will take care of most IRS letters and notices.
  • Do not ignore the letter.
  • Respond timely
• See the article above for more tips.

Taxpayers Should Review Their Withholding; Avoid Having Too Much or Too Little Federal Income Tax Withheld

• The IRS encourages taxpayers to consider checking their tax withholding, keeping in mind several factors that could affect potential refunds or taxes they may owe in 2018.
• Reviewing the amount of taxes withheld can help taxpayers avoid having too much or too little federal income tax taken from their paychecks. Having the correct amount taken out helps to move taxpayers closer to a zero balance at the end of the year when they file their tax return, which means no taxes owed or refund due.
• The IRS offers several online resources to help taxpayers bring taxes paid closer to what they owe. They are available anytime on IRS.gov. They include:
  • IRS Withholding Calculator – Online tool helps determine the correct amount of tax to withhold.
  • IRS Publication 505 – Tax Withholding and Estimated Tax.
  • Tax Withholding – Complete information on withholding, estimated taxes, FAQs, and more.
• Self-employed taxpayers, including those involved in the sharing economy, can use the Form 1040-ES worksheet to correctly figure their estimated tax payments. If they also work for an employer, they can often forgo making these quarterly payments by instead having more tax taken out of their pay.

Private Debt Collection

• The IRS began a new private collection program of certain overdue federal tax debts selecting four contractors to implement it.
• These private collection agencies will work on accounts where taxpayers owe money, but the IRS is no longer actively working them.
• The IRS will give taxpayers and their representative written notice that the accounts are being transferred to the private collection agencies. The agencies will send a second, separate letter to the taxpayer and their representative confirming this transfer.
• Private collection agencies will not ask for payment on a prepaid debit, iTunes or gift card. Taxpayers will be informed about electronic payment options for taxpayers on IRS.gov/Pay Your Tax Bill. Payment by check should be payable to the U.S. Treasury and sent directly to IRS, not the private collection agency.

NEW!  View Your Account Information

►TAXES. SECURITY. TOGETHER. (Identity Theft)

Tax Scams - How to Report Them

• Participating in an illegal scheme to avoid paying taxes can result in imprisonment and fines, as well as the repayment of taxes owed with penalties and interest. If you become aware of any abusive tax scams, please report them to the appropriate contact below.
• How Do You Report Suspected Tax Fraud Activity? This quick reference chart outlines how to report suspected tax fraud activity in different situations.
• Tax Scams / Consumer Alerts. This page looks at the different scams affecting individuals, businesses, and tax professionals and what do if you spot a tax scam.

►Employers

IRS Warns of New Phone Scam Involving Bogus Certified Letters; Reminds People to Remain Vigilant Against Scams, Schemes this Summer

• The IRS is warning people to beware of a new scam linked to the Electronic Federal Tax Payment System (EFTPS), where fraudsters call to demand an immediate tax payment through a prepaid debit card. This scam is being reported across the country, so taxpayers should be alert to the details.
• In the latest twist, the scammer claims to be from the IRS and tells the victim about two certified letters purportedly sent to the taxpayer in the mail but returned as undeliverable. The scam artist then threatens arrest if a payment is not made through a prepaid debit card. The scammer also tells the victim that the card is linked to the EFTPS system when, in fact, it is entirely controlled by the scammer. The victim is also warned not to contact their tax preparer, an attorney or their local IRS office until after the tax payment is made.

Now Available: Public List of Certified Professional Employer Organizations

• The IRS has published a list of organizations certified as professional employer organizations (CPEO) on a new IRS.gov CPEO Public Listings Page.
• Voluntary Certification Program for Professional Employer Organizations has more information on CPEOs.

HSA Amounts for 2018 are listed in Rev. Proc. 2017–37, found in Internal Revenue Bulletin 2017-21.