McKonomics

New Tax Law Did NOT Repeal 1099 Reporting Requirements

 Despite efforts by some members of Congress, the burdensome 1099 reporting requirements for businesses and rental property owners were not repealed as part of the new law passed on December 17, 2010. And Congress has adjourned for the year so a repeal of the requirements will now have to wait for the new Congress to take up the issue in 2011. 

The new requirements were part of two laws passed in 2010: 

IRS Gives Employers Guidance on 2011 Withholding

 Employers must quickly get their payroll systems in line to account for the two percent cut in the Social Security tax for 2011. Congress passed the new law with just two weeks for employers to make changes. 

Shortly after the new law passed, the IRS issued instructions and new withholding tables. Employers should start using the new tables no later than January 31, 2011, according to the IRS.  "For any Social Security tax over withheld during January, employers should make an offsetting adjustment in workers' pay as soon as possible but not later than March 31, 2011," the IRS added. 

For more information and to see the tables, go to this link on the IRS website.

Tax Relief Act of 2010, A Decision in Time for the Holidays?

 The tree is decorated, the stockings are hung, and the holiday festivities are planned. However, there is still one thing left to do as 2010 is drawing closer to an end. Congress needs to make a final decision on the Bush-era tax cuts along with various other tax breaks that have been proposed.

Late on December 9, H.R. 4853, the Tax Relief, Unemployment Insurance Reauthorization, and Job Creation Act of 2010 (the Tax Relief Act) was introduced into the senate. The following paragraphs contain only a summary of some of the most relevant provisions included in the bill which benefit individuals and businesses.

Currently, the provisions of the Economic Growth and Tax Relief Reconciliation Act of 2001 are set to expire, which means that individual tax rates will go back to the rates (15%, 28%, 31%, 36%, and 39.6%) that were in effect prior to the enactment of this act.

In addition, a number of other individual provisions are set to expire. The Tax Relief Act, if passed, will extend the current tax rates through 2012. Here are some of the highlights that will impact individuals:

- Income tax rates for individuals will stay at 10%, 15%, 25%, 28%, 33%, and 35%. 

- Itemized deductions for higher-income taxpayers are not reduced. 

- The personal exemptions of a higher-income taxpayer are not phased out when AGI exceeds an inflation-adjusted threshold.

Tax-Saving Moves for Individuals at Year End

 Even though New Year's Eve is just around the corner, there's still a little time left for year-end tax planning. If you move fast enough, a few eleventh-hour tax moves can cut your tax bill or increase a refund for the 2010 tax year.

Keep in mind that the "Bush tax cuts" are scheduled to expire December 31, 2010, thereby raising tax rates for some individuals in 2011. But a late reprieve from Congress could preserve lower rates for another year or longer. Until the uncertainty is removed, focus on what you can do now to reduce your 2010 liability.

Here are ten tax strategies to consider:

Practical IT Security - 10 Tips for Success

 The world of information technology has a great many facets. There are a variety of considerations relative to security, software, applications, operating systems, and other areas. However, regardless of the technology you're using, there are foundational areas that must be considered for any computing environment. These are the basics of security; these are the 10 tips for success.

1. Passwords

Passwords are vital to securing any access. A password is like a key or combination lock, the more complex the combination, the better a lock will be. Each password should be unique to the device, website, or asset you want to protect. What could happen if someone knew your password?  What-if scenarios will help you to decide how strong you want to make your password.

2. Antivirus and Malware

You do not want to have to have these on your computer. Period. What could go wrong if your computer was infected? How much time would you lose? When it comes to malware, prevention is far better than dealing with the problem after the fact. Install trusted antivirus software, run periodic scans, and train employees on web surfing and e-mail habits so you can help to prevent this problem from happening.