The IRS recently issued guidance on the difference between a tip and a service charge. The distinction is important because service charges are considered revenue of the establishment. To the extent that the service charges are, in turn, paid to the employees, that amount is compensation, subject to all payroll taxes and withholdings. The employer’s […]
A new act extends the work opportunity tax credit for one year but only for qualified veterans who begin work before Jan. 1, 2013. The act also makes a number of changes for hiring qualified veterans. The Three Percent Withholding Repeal and Job Creation Act was signed by President Obama on Nov. 21, 2011. Effective […]
In the closing days of 2011, Congress passed tax legislation that temporarily extended a payroll tax cut, but did not extend two important depreciation incentives – a lack of action that will be important as taxpayers plan their income and deductions for 2012. For 2011, Congress reduced by 2 percent the employee share of the […]