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Category Archives: Small business Tax

How Long Do You Need To Keep Records?

In general, you must keep records that support items shown on your individual tax return until the statute of limitations runs out -- generally three years from the due date of the return, or the date you filed, whichever is later. In most cases, the IRS can audit your return for three years. You can also file an amended return on Form 1040X during this time period if you missed a deduction, overlooked a credit or misreported income.

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IRS Ruling on Payroll Taxes and Retirees

The IRS says that a retiree who had been provided medical benefits by his prior employer owes FICA taxes on any cash payments received in lieu of continuing medical benefits. The payment is considered to be salary – and thus subject to payroll taxes because it relates to a benefit from a prior employment relationship.

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2008 Standard Mileage Rates

The new rate for business miles is up 2 cents from 2007 however, medical and moving miles are down 1 cent from last year. The rate for miles driven in the service of a charitable organization has remained the same.

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Forms W-2, 1099, W-3, and 1096

Some people think they are getting ahead of the game by mailing forms to the Government and at the same time providing the appropriate forms to their employee/independent contractor. The reality is, by doing so, they are potentially creating a difficult situation for themselves.

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