New Due Date for Forms 1099-MISC & W-2

Beginning with 2016 forms, employers will now have one filing due date of January 31st, 2017 (earlier than prior years).  So keep in mind that, Federal W-2‘s are due to both employees and agencies no later than January 31st.  And to your independent contractors, Form 1099-MISC (reporting Box 7 Nonemployee Compensation) are also due on January 31st.  Most states have adopted this earlier due date, but you can call DSA at 1 (800) 879-6605 for more information or to request blank forms.

IRS NOTIFICATIONS

Have you received a letter from the IRS? Or, maybe a state notice that you don’t understand? Just send it to your Representative!  Fax it to (914) 696-7505 or scan and e-mail it directly to your Rep and we will help you determine the best course of action.

ANNUAL TAX RETURNS / EXTENSIONS

Always make sure your account is up-to-date! Please contact your Tax Representative if you have any questions or need to get caught up on your paperwork. You can e-mail them directly through the link on the right or call DSA at 1 (800) 879-6605, we are available Monday through Friday, 9 am to 5 pm EST.

Business Tax Return(s) [ex. Form 1120S]
Please keep in mind that the due date for Corporate Returns is March 15th.

The IRS can charge $195 PER MONTH PER SHAREHOLDER for late filings

Personal Tax Return(s) [Form 1040]
Personal returns are always due April 15th (unless this date falls on a weekend or holiday, in which the date then becomes the next business day.) 

Please keep in mind that if an extension has been filed on your behalf, you will owe interest and a late penalty will be applied on any tax not paid by the regular due date of April 15th.

THE EXTENSION MISCONCEPTION

FALSE: “Filing an extension will postpone my tax due date and my tax payment.”

TRUE: “If you owe any taxes you will be subject to late fees and penalties even if you filed an extension!”

QUARTERLY PAYROLL & ESTIMATED TAX PAYMENTS

Please make sure to submit your Monthly Report every month. This will allow DSA to calculate your Quarterly Payroll payments and Estimated Tax Payments as accurately as possible. Call your Account Representative if you are confused at all about these payments and remember, payroll tax payments are mandatory and estimated tax payments are highly recommended!  Please note the difference between the due dates for each:

… FOR ALL CLIENTS
ESTIMATED TAX PAYMENTS
  YOUR 1040-ES for IS DUE ON
  First Quarter April 15
  Second Quarter June 15
  Third Quarter September 15
  Fourth Quarter January 15 (following year)
… IF YOU ARE INCORPORATED
PAYROLL TAXES
  YOUR 941 for IS DUE ON
  First Quarter April 30
  Second Quarter July 31
  Third Quarter October 30
  Fourth Quarter January 31 (following year)

 

IF YOU PAY A PART TIME HELPER

In most cases, if you use a helper or relief person who does not work under your direct control and supervision you should be able to treat that person as an independent contractor, rather than a payroll employee, this will save you a lot of paperwork and some cost. However, it is extremely important to have a written agreement signed by both you and the person you hire. Having a signed Merchandiser Agreement and/or Service Contract on record, can make all the difference in defending your position to the IRS if ever a question.

It is important to pay that person (or corporation) by check to maintain a paper trail and to keep record of how much you have paid them during the year. In addition, it is imperative that you have the appropriate contract(s) on file to support that this person is not a payroll employee, but is indeed an independent contractor.

You and your merchandiser/contractor must agree to and sign the contract. As with any signed contract, we recommend having your attorney review the agreement to be sure it suits your circumstances. Keep a copy for your records and provide a copy to your contractor. Lastly, be sure to obtain their Social Security Number or EIN and address so you can issue them the correct tax form (1099-MISC) at year-end.

RECORDKEEPING

The IRS requires that records and copies of your returns be kept for a certain amount of years depending on the situation. It is probably a good idea to keep your records for at least 7 years as a minimum, or indefinitely if you have the space. You should also factor in if the records are related to assets, and do these records help in figuring Amortization, Depreciation and Gains/Losses when the asset is disposed of. It is never a good idea to dispose of records, thinking that your Accountant should have copies. It is your responsibility and duty to keep these records.

PAYMENTS TO PRODUCT SUPPLIERS

Any payments made to purchase product that you resell, either from your principal supplier or others should be listed on your Monthly Report.  Only record these payments on your Monthly Report when payments are made by check, not if these payments occur through Weekly Settlement.

IRS: FILE – PAY – CALL

Here is a tax tip when you have a payment due or expect to owe money to the IRS, that you may or may not be able to afford at the moment.  This will usually apply to all types of returns; personal, business and payroll. Just remember this guide: File – Pay – Call…

File your tax returns by the due date (your 1040 will always be due by April 15th, unless it falls on the weekend or a holiday). The IRS will assess penalties on late filed returns. To prevent this make sure your filings are always up-to-date, and if need be make sure that an extension is filed on your behalf to avoid these penalty fees.

Pay what you can up front.  Your payment will always be due on the original due date, even if an extension was filed.  The IRS will extend the time it takes you to prepare and collect your paperwork, but not the payment due date.  So pay what you can now by the original due date.  Penalties and interest will accrue on the balance due, so if you pay down the amount you owe, you will accrue less interest.

Call the IRS to set up an installment plan at 1 (800) 829-1040.  In most cases the IRS will be willing to work with you to make sure that your balance gets paid in a reasonable time period.  Just try to pay it off sooner rather than later to avoid the interest!