Business Tax Tips

NOTE: DELINQUENT TAXPAYERS---Please go to my individual tax tip page to read about how the IRS can use private creditors to come after you if you owe the IRS money--better get your taxes filed and paid!!

A few items to discuss for 2023:

• Mileage rates for autos are 65.5 cents per mile.  These rates apply to electric, hybrid, diesel, or gas-powered automobiles.

• 1099's ... I’ll take a minute to discuss 1099’s.  Okay, you don’t have to send one to corporations, and people that rent from you don’t have to send you one.  That’s great.  However, do realize that the penalty for you not doing one to folks that work for you and make over $600 during the year is now $250 per form and some auditors are even disallowing the deduction!

• The IRS can also make you pay more if they believe the omission is intentional. 

  • Be smart.  Get all of the info from your worker before you give him/her the first check.  

  • Make copies of his/her social security and driver license cards. (Of course, this person must be a legitimate contract laborer, not an employee in disguise.)  

  • Then, at year end, give them a 1099 NEC.  Please be aware that folks like me, lawyers, your landlord (business) and anyone else in the business field that is not incorporated have to get one too, if you paid them over $600 in annual fees!  You can buy 1099 NEC's from any office supply store, just fill them out, be sure to send the top pink copy to IRS by Feb 28.  The recipient has to have their copies by Jan 31.  The 1099 is easy to fill out, you just need the amount, name, address, and social security number of the recipient, along with your own business name, etc.  I usually have some extras if you need a few.

You definitely need to read my individual tax tips for 2023.