Did you take advantage of the HIRE Act in 2010?

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Oct 192011
 

If you took advantage of the HIRE Act tax credit last year, you may be eligible for the HIRE Retention credit on your 2011 business tax return.

The HIRE retention credit is a general business credit to encourage retention of new hires and will be claimed on the employers income tax return. The amount of the credit is the lesser of $1000 or 6.2 percent of wages (as defined for income tax withholding purposes) paid by the employer to the retained qualified employee during the 52 consecutive week period. The qualified employees wages for such employment during the last 26 weeks must equal at least 80% of wages for the first 26 weeks.  Click here for the FAQs http://www.irs.gov/businesses/small/article/0,,id=220747,00.html.

If you qualify for this tax credit, tell your CPA or tax preparer when you have your business tax return done.

 Posted by at 10:07

What to do with uncollected paychecks?

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Oct 042011
 

What do employers do with uncollected paychecks which either were not picked up by the employee or were returned to the employer as “address unknown?

We recommend employers to consider the following:

  • Aside from sending certified-mails to the former employee, call the person (i.e. cell / home phone) to notify him or her that paycheck(s) have been unclaimed and document when the paycheck(s) was mailed and when the employer called.
  • Forward the check to the State Bureau of Unclaimed Property. Remember, the check is NOT the property of the employer.
  • The state holds the items for the owner or heirs until a claim is filed to collect the property. (Note: If an un-cashed payroll check is voided, the money is then available in the company’s payroll checking account. If later the funds are not available to pay the employee or to submit to the state, the employer and officers could find themselves under a breach of fiduciary responsibility.)
  • The company must report these wages on the W-2 form and pay all taxes that are due as if the un-cashed unclaimed payroll checks had been cashed on a timely basis. State unemployment reports and taxes will also need to be filed and paid as if the payroll check was cashed.
  • Consider having a company unclaimed/un-cashed paycheck policy in place.
 Posted by at 09:03