October, 2013

ADA—Insurance Notice for Employees

There is NOT currently a penalty if you don’t provide these notices, but they say we’re supposed to provide the notices by October 1, 2013, or whenever you hire a new employee.

The link to the notice if you DO NOT provide health insurance to your employees is here: https://www.dol.gov/sites/default/files/ebsa/laws-and-regulations/laws/affordable-care-act/for-employers-and-advisers/model-notice-for-employers-who-do-not-offer-a-health-plan.pdf

The line to the notice if you DO provide health insurance to your employees is here: https://www.dol.gov/sites/default/files/ebsa/laws-and-regulations/laws/affordable-care-act/for-employers-and-advisers/model-notice-for-employers-who-offer-a-health-plan-to-some-or-all-employees.pdf

There is some information you’ll need to fill out on these forms—perhaps download, fill in the info, and copy?

Due Dates

October 15 – Personal Tax Returns on Extension due.

I will be out of the office Friday October 4th through Sunday October 6th.

Payroll for Apartment Managers

In California, if you have an apartment building with more than 15 units, you are required to have a “responsible person” residing on the premises. If you have an apartment manager who is receiving reduced rent as “compensation” for keeping track of your building, can they file for unemployment or disability?

As we say in our payroll classes, anyone can FILE for unemployment or disability, but not everyone is eligible.

The IRS and California’s EDD say if “lodging” is furnished on the employer’s premises, for the employer’s convenience, and as a condition of employment, it is not subject to income tax nor income tax withholding, not Medicare nor Social Security (IRS Publication 15A, page 15)—which is ALMOST all the taxes. The three that are missing are CA Unemployment Insurance, CA Employment Training Tax and CA State Disability Insurance (DE-44, page 32, and DE-231TP). The value of lodging is not “income wages” but it is “subject wages.”—a fine distinction.The 2013 rate for SDI in California is 1%, but the SDI is normally withheld from the paycheck—and the employer is making this payment in addition to the value of the lodging— SO, to figure out the “wage base” to calculate the SDI tax, we have to add the tax paid to the value of the lodging. Mathematically, we take the lodging value/0.99 to get the wage base for SDI, UI and ETT (calculation found at DE-231Q). UI and ETT are taxes with rates that change per employer, and these two are limited to the first $7,000 of wages for each employee in 2013. SDI tax is limited to the first $100,880 paid to each employee for 2013.

How do you figure out the value of the rent reduction? Ideally the cash value of the rent reduction would be stated in an employment contract. You may have an idea based on the other 15 units in the building. The CA EDD also provides a minimum of $39.90 per week, or a maximum of $1,224 per month as an alternate method of determining value, or 2/3 of ordinary rental value (DE-44, page 11).

There are also minimum wage laws in California, but I’m just not going to get into that here! You might want to have them keep track of their hours and submit a timecard, and you should keep a copy.

The upshot of this complicated system is that it would appear apartment mangers ARE potentially eligible for Unemployment or State Disability, and as the apartment owner, you are responsible to report your employees and pay California employment tax for them, even though they have no “wages.”

Classes – IRS Education Provider, Basic Payroll, Schedule C

Here’s a link to the seminars page on my website: www.taxbuddha.com/seminars.html

I’m an official Education Provider. You can find my name (Tax Buddha) listed at the IRS website: https://ssl.kinsail.com/partners/irs/publicListing.asp where you’ll see I’m qualified to provide federal tax update and federal tax classes for EA’s and RTRP’s. (I just knew I should have used the name AAAAA Tax Buddha!)

Basic Payroll
In conjunction with the IRS and EDD, I’m going to be doing some Basic Payroll seminars coming up in the near future.

Basic Payroll Seminar runs 9 am ­ 3 pm with an hour for lunch

The next seminar will be:

San Francisco at the SBA office 455 Market Street, 6th floor (I take BART to Embarcadero or Montgomery Street)
Wednesday, November 13, 9:00 am – 3:00 pm
Tuesday, December 3, 9:00 am – 3:00 pm

Register by going to http://www.edd.ca.gov/Payroll_Tax_Seminars/ and find your favorite location.

These seminars have proven to be very popular for business owners and bookkeepers, plus they’re free.

How to Prepare your Own Schedule C
Get ready for next year and filing your own Schedule C for last year. Review what the IRS wants to know from you and how to report it for your business. This is a class for business owners who need a basic understanding of their 1040 Schedule C tax forms. We’ll also talk about what to do with the numbers once you have them. We can’t guarantee you won’t get audited, but this class will make it less likely.

I will be at the US SBA office in San Francisco at 455 Market Street, 6th Floor.
Tuesday, October 8, 6:00 pm – 8:30 pm

The Eightfold Path to Pay Less Tax and Avoid an Audit

Eight basic things business owners want to know printed in a booklet in “executive summary” form. This is ten years of working with the IRS Tax Code distilled down so it doesn’t take YOU ten years.

Just another way we’re trying to simplify your life. And the purchase is tax deductible!

You can order from Amazon.com. Here’s the link to Amazon: http://www.amazon.com/Eightfold-Path-Less-Avoid-Audit/dp/0615233422/ref=sr_1_22?ie=UTF8&s=books&qid=1226611038&sr=1-22 

The booklet also contains sections on how returns are selected for audit, when to seek professional help, and how long to keep your tax records.

Little Box of Inc: Incorporations Made Easy published on Kindle

The book with tips about how the S Corporation works is now published to Amazon’s Kindle, updated with additional information about S Corporations, and can be found by searching for Andrew S Rogers as author, and click on “Kindle.” Here’s the blurb:

Considering incorporating as an S Corporation? This booklet will help you understand how the S Corporation works, what you need to do to become incorporated and what you need to do once you have a corporation to stay out of trouble. The structure and the requirements are reviewed, as well as helpful tips to use your corporation to reduce your tax liability and retain your status as an S Corporation. I’ve worked with S Corporations for many years, and as a tax preparer, I can choose the kind of entity I have for my business: I choose the S Corporation myself, and I’ve convinced many of my fellow tax preparers to incorporate as well. I’ve divided the information into clear, easy-to-understand topics, and cross-referenced sections when it might be helpful.

After you’ve read this material, you can view on-line videos via YouTube.com for free to access more advanced information about S Corporations. You may also be interested in my “Choice of Entity” class – see below.


Tax Buddha Messenger Bags

Want to be the first person in your tax bracket to sport the fabulous Tax Buddha Messenger Bag? I’ve now got a “shop” on Café Press at www.cafepress.com/TaxBuddha in case you’d like to order your own Tax Buddha logo items. The messenger bag came out particularly well, not quite “saffron,” but easy to find in an airport.

Phone and Fax Numbers

Our northern California occasional in Alameda:
1516 Oak Street, Suite 109
Alameda CA 94501
Phone numbers are:
Phone (510) 332-0401
Fax (925) 478-2726

“You too can be enlightened about tax” — Tax Buddha