John Sheeley

This is a great piece from JibJab.  It is reminiscent of the “School House Rock” segments during Saturday morning cartoons in the 1970’s.

No two taxpayers have identical needs when establishing a new business entity in the U.S. Clients oftern have a strategy in mind that comes from a combination of internet sources and friends who “do this all the time”. Often the strategy isn’t as effective as it could be.

Its official: Sole proprietors, single member LLCs and partners in partnerships will be subject to the new MTA tax on their net income, to the extent the income is allocable to the 12-County MTA Service area.

There’s a small blurb on the New York State Department of Taxation and Finance Website.

Last night the NY State legislature passed a bailout package of sorts for the MTA. Included in this package is a new payroll tax to be paid by all for-profit employers in the 12 County MTA service area.

Although this has been brewing for a few months, the tax rate and scope of coverage area came as a surprise.

Affected employers will pay 34 cents per hundred dollars of payroll.  So, if your payroll is $100,000, your total burden is $340.  The tax is slated to be completely paid by the employer, with no employee contribution, similar to unemployment insurance contributions.

A few things aren’t clear (at least to me) yet:

-will there be a cap, for example on the first $x of payroll per employee per year

-the effective date of the tax

-the payment frequency (monthly, quarterly, annual)

-the method of payment, by that I mean a new form to file with the MTA?  Or will the tax be added to the NYS 45 payroll tax form (that’s my guess)

-for those of you with employees within and without of the 12 County MTA area, how will we segregate this information?

-what are the effects on household employers?

-will the net earnings of the self-employed, including single-member limited liability companies, be subject to this new tax?

This is just a heads-up as I think about this issue. As I learn more, I will keep you posted.

Any United States person who has a financial interest in or signature authority, or other authority over any financial account in a foreign country, if the aggregate value of these accounts exceeds $10,000 at any time (even for one day) during the calendar year must disclose these accounts each year to the U.S. Treasury. This reporting is accomplished using Form TDF 90-22.1, which must be filed whether or not the foreign account generates any income during the year. There is a $10,000 penalty per undisclosed account. The Internal Revenue Code prohibits this penalty from being abated under any circumstances once assessed.

For purposes of this form, a “United States person” includes a citizen or resident of the United States, or a person in and doing business in the United States. The term “person” includes individuals and all forms of business entities, trusts, and estates.

The IRS announced that taxpayers in Delaware, Illinois, New York, and Rhode Island who file paper income tax returns will send them to different processing centers this year.

Taxpayers in Delaware, New York, and Rhode Island will now send their tax returns to the IRS Kansas City Service Center in Kansas City, MO. Taxpayers in Illinois will now send their tax returns to the IRS Fresno Service Center, in Fresno, CA.

The IRS continuously monitors work flow at its centers and makes appropriate adjustments by altering the volume of returns to be sent to each. Taxpayers who use the envelope provided with the income tax instructions do not have to be concerned with the address change, their returns automatically will go to the correct center. Taxpayers who e-file will not be affected by the address changes.

Due to the state’s persistent cash and budget problems, the State Controller announced on Friday, January 16, 2009 that he will have to delay refunds for 30 days starting February 1, 2009 for Personal Income Tax and Business Entity taxpayers.

FTB is still processing returns as normal. However, it is likely this delay will affect state refunds for most early filers. Returns that have not completed processing before February 1, 2009 will have their refunds held for 30 days.

This applies to all refund types. Delayed Direct Deposit Refunds (DDR) will be electronically transmitted when funds are available.

FTB will update this website with FAQs as further information becomes available

A very web-savvy client introduced me to Drop Box, referring to it as his “tool of the year”.

I won’t waste bandwidth raving about the product. It has changed the way we work here, both internally and with clients. If you need to share large files, either within your office or with clients, check out Drop Box.

Yesterday, a relative informed me that today only, December 22, Intuit and Staples were offering Quick Books Pro 2009 for PC for no cost after rebates.

The offer for a free-after-rebates copy of Quick Books Pro 2009 did not appear in Sunday’s advertising circular.  The staples.com website does not mention the offer.  In fact, when I went to the website just after midnight this morning, Quick Books Pro 2009 single user version for PC does not appear in the product listing.

I walked into Staples this morning and located the product on the shelf.  List price: $199.  No point-of-purchase advertising about the rebates.  I spoke to the cashier and the manager, both of whom had no information on the rebates.  I thought to myself, “another Internet hoax?”

Sure enough, on a price check, Quickbooks Pro 2009 comes with a $40 instant rebate, and a $159.99 manufacturer’s reabte.  I laid out $ 172.99 today, of which $159.99 will return to me in the form of a rebate check.  Net cost: $13.00 in New York State and local sales tax.

Get to Staples today, even if you have a working version of Quick Books.  This is a great deal.  Your accountant will love you.

President Bush signed the “Unemployment Compensation Extension Act of 2008″ (H.R. 6867) into public law today. It gives seven more weeks of unemployment payments to workers who have exhausted their current jobless benefits. For those in states with the highest unemployment rates, an additional 20 weeks will be allowed