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Click on the links below to jump to each section in this article: Backup Withholding: What Businesses Should Know Can You Deduct Elder Care Costs? IRS Eases Partnership Sale Reporting Rules   Backup Withholding: What Businesses Should Know In most cases, you aren’t required to withhold taxes from payments to independent contractors. However, there are situations in which the “backup withholding” rules apply. Backup withholding is most commonly required when a contractor fails to provide a correct Social Security number or Employer Identification Number, or doesn’t properly complete Form W-9, “Request for Taxpayer Identification Number and Certification.” When required, you must withhold 24% from payments to the contractor and remit those funds to the IRS using Form 945, “Annual...

Click on the links below to jump to each section in this article: Get Ahead With a Midyear Tax Review IRS Penalties During the Pandemic Could Be Refundable Employers Face New Limits on Meal Expense Deductions   Get Ahead With a Midyear Tax Review Life changes can affect your tax picture more than you might expect. Taking time now to review key areas can reduce the risk of certain penalties and uncover tax savings opportunities. Start by reviewing your withholding and estimated tax payments. If your income has changed, you may need to update your Form W-4 so that your withholding accurately reflects your current circumstances. If you’re self-employed or have significant income not subject to withholding (such as dividends or capital gains), you may need to make quarterly estimated...

Click on the links below to jump to each section in this article: How Hiring Your Child This Summer Can Reduce Taxes Review Your Withholding After Filing More Entities Gain Access to IRS Business Tax Account   How Hiring Your Child This Summer Can Reduce Taxes The wages you pay your child are generally deductible as a business expense. For your child’s income tax purposes, wages received will be at least partially protected from federal income tax by his or her standard deduction. Any wages in excess of the standard deduction generally will be taxed at your child’s marginal rate, likely only 10%. So this strategy can reduce your family’s overall income tax liability. Additional savings may be available on payroll taxes. If a business is a sole proprietorship or a partnership where...