Large cash payments, Idalia, Hawaii, credits and deductions, helping employees with student loans
Tax Resources for Small Business
Inside This Issue
Beginning Jan. 1, 2024, businesses must e-file all Forms 8300 (and other certain types of information returns required to be filed in a given calendar year) if they’re required to file at least 10 information returns other than Form 8300.
Many businesses are finding the free and secure e-filing system to be a more convenient and cost-effective way to meet the reporting deadline of 15 days after a transaction – and they get an email acknowledgment of receipt. Businesses can also batch e-file their reports, which is especially helpful to those required to file many forms.
2. IRS announces sweeping effort to restore fairness to tax system with Inflation Reduction Act funding; new compliance efforts
Capitalizing on Inflation Reduction Act funding and following a top-to-bottom review of enforcement efforts, the IRS announced the start of a sweeping, historic effort to restore fairness in tax compliance by shifting more attention onto high-income earners, partnerships, large corporations and promoters abusing the nation’s tax laws.
The effort, building off work following last August’s IRA funding, will center on adding more attention on wealthy, partnerships and other high earners that have seen sharp drops in audit rates for these taxpayer segments during the past decade.
The changes will be driven with the help of improved technology as well as Artificial Intelligence that will help IRS compliance teams better detect tax cheating, identify emerging compliance threats and improve case selection tools to avoid burdening taxpayers with needless “no-change” audits.
A reminder to taxpayers who make estimated tax payments – the deadline to submit third quarter payments is Sept. 15, 2023.
Gig workers, sole proprietors, retirees, partners and S corporation shareholders generally must make estimated tax payments if they expect to have a tax liability of $1,000 or more when they file their return. The IRS Tax Withholding Estimator, Interactive Tax Assistant and the worksheet in Form 1040-ES, Estimated Tax for Individuals all offer clear step-by-step instructions to see if they’re required to make estimated tax payments. And the payments page on IRS.gov explains the many easy ways to pay.
The IRS announced tax relief for individuals and businesses affected by Idalia in Florida and for Hawaii wildfire victims in Maui and Hawaii counties. These taxpayers now have until Feb. 15, 2024, to file various federal individual and business tax returns and make payments.
The IRS is providing additional guidance and certainty to states and their residents regarding the federal income tax consequences of state payments made to them. This is in addition to previous IRS guidance on state payments made in 2022 as explained in IRS News Release IR-2023-23.
Most taxpayers that receive state tax refunds do not have to include them as income for federal tax purposes. The guidance also covers payments that spill over from 2022 into 2023 and payments from state general welfare programs.
7. IRS webinar educates workers about employer educational assistance programs to help pay student loans
Fall college semester is quickly approaching and the IRS reminds employers and employees that under federal law, employers who have educational assistance programs can use them to help pay student loan obligations for their employees. The IRS will hold a free webinar about Qualified Educational Assistance Programs on Sept. 14, 2023.
“The IRS wants to remind both employers and employees about this special feature that can help with student loans,” IRS Commissioner Danny Werfel said. “There is a limited window of time for this educational assistance program, and the IRS wants to make sure employers don’t overlook this option that can help businesses attract and retain workers.”
The following information may be of interest to individuals and groups in or related to small businesses:
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