Employee vs. Independent Contractor – My 20 point check list

Independent_contractors_1_.556ccbfd149a6Mistakenly classifying an employee as an independent contractor can result in significant fines and penalties. There are 20 factors used by the IRS to determine whether you have enough control over a worker to be an employer. Though these rules are intended only as a guide-the IRS says the importance of each factor depends on the individual circumstances-they should be helpful in determining whether you wield enough control to show an employer-employee relationship. If you answer “Yes” to all of the first four questions, you’re probably dealing with an independent contractor; “Yes” to any of questions 5 through 20 means your worker is probably an employee.

1. Profit or loss. Can the worker make a profit or suffer a loss as a result of the work, aside from the money earned from the project? (This should involve real economic risk-not just the risk of not getting paid.)

2. Investment. Does the worker have an investment in the equipment and facilities used to do the work? (The greater the investment, the more likely independent contractor status.)

3. Works for more than one firm. Does the person work for more than one company at a time? (This tends to indicate independent contractor status, but isn’t conclusive since employees can also work for more than one employer.)

4. Services offered to the general public. Does the worker offer services to the general public?

5. Instructions. Do you have the right to give the worker instructions about when, where, and how to work? (This shows control over the worker.)

6. Training. Do you train the worker to do the job Continue reading

Is it a Gift or Entertainment?

12798954_1688315601437295_3809076672797603996_nEach year I’ll have several clients roll up with some pretty hefty receipts for what they will call “client gifts”. They are usually shocked to hear that there is a $25.00 limit on such gifts. Meals and entertainment will usually yield you a greater deduction, if you can swing it that way. Here it is in a nut shell.

Packaged Food: If you give packaged food or drink to a business associate, where the item is intended to be consumed at a later time, it is a gift. Continue reading

Bees are buzzing on rooftops at 7 San Francisco hotels

beeSan Francisco (AP) – At the Clift Hotel in San Francisco, there are more than 370 rooms inside and 100,000 bees buzzing above in rooftop hives outside.

Yes, honeybees.

Aware of the well-publicized environmental threats to honey bees that have reduced numbers worldwide, 7 San Francisco hotels have built hives on the rooftops. The sustainability efforts also benefits the hotels as the bees produce honey for cocktails, food and spa treatments. It’s the latest in a series of environmental programs at hotels that includes low-flow toilets and aggressive recycling programs.

“This is not about making money, it’s really about raising awareness about sustainability”, said Melissa Farrar, spokesman at the Fairmont in San Francisco. “There’s not one solution so we wanted to do our part to help. It’s part of the bigger effort for helping the planet.” Farrar said the four hives on the rooftop garden support about 250,000 bees and produce about 1,000 pounds of honey each year.

Kristin J. Bender

The Importance of Having a Will


Most recently, Prince joins a list of celebrities who died without a will. Tupac Shakur, Bob Marley, and so many other legendary musicians have passed without securing their estates.

It begs the question:  Why?

It seems like such a basic concept; everyone needs a will.  Otherwise the laws of the state you live in determine who receives your assets and controls your legacy after you die.  Without a will, you have no say in what happens, and the chances of a family fight increase dramatically.

Even though a will is relatively simple to create, studies consistently show that Continue reading

The Tax Benefits for Hiring Your Own Child

20150619000453-star-warsHow would you like to help your children develop a sense of responsibility and strong work ethic, while simultaneously letting them earn some money and save for college, all tax-free?

It’s possible. Kids fill our lives with joy, but they also fill our lives with tax benefits. Every child you claim as a dependent can lower your taxable income by $3,950. And the Child Tax Credit may save you another $1,000 per qualifying child if your income is less than Continue reading

Setting priorities in an election year

taxesimageElection-year politics will dominate legislative action in 2016 as both parties seek to lay out policy agendas for 2017 and beyond, which would seem to dim prospects for legislation in 2016. However, despite divided government during 2015, Congress enacted several key pieces of legislation. Will the legislative successes of 2015, including the signing of a major December ‘tax extender’ bill, and Paul Ryan’s elevation to Speaker of the House create momentum that can be carried over into enactment of additional meaningful legislation during 2016? Will the House or the Senate introduce further tax reform legislation setting the stage for 2017?

Newport Beach Tax and Financial will address these topics and more, including tax reform, global tax controversy, IRS challenges, new regulatory projects, and other tax policy matters of importance to today’s business leaders.

How to track your tax refund’s whereabouts

where's-my-refund-graphic200x200Filing your tax return electronically shouldn’t have to feel like sending something into outer space. There’s no need to be in the dark about whether the IRS has accepted your tax return and when you can expect to receive your refund.

For example, tax-filing early birds who got their returns in electronically by Jan. 14, and elected to get their refund via direct deposit, should have received their money on Jan. 29. That’s the first direct deposit date set by the IRS.

Assuming you weren’t among those early filers, you can use the Where’s My Refund tool on the IRS website to track your tax return and refund. It lets you check on the status of an electronic return within 24 hours of the IRS receiving it. But you’ll have to wait four weeks after you mailed a paper return to check its status with the tool. Another great reason to e-file if you can.

Where’s My Refund lets you follow your ret Continue reading

IRS to hire up to 700 enforcement workers

BN-NK579_0405ta_M_20160405191302The Internal Revenue Service is hiring up to 700 employees for tax enforcement in what Commissioner John Koskinen calls the agency’s “first significant enforcement hiring in more than five years.”

In a memo to employees Tuesday, Mr. Koskinen said the IRS found money for the hiring—despite budget constraints—because of retirements, other departures and unspecified “efficiencies.” The first wave of hiring will begin in a few weeks and will be concentrated in the IRS department that monitors small businesses and the self-employed.

“While adding 600 to 700 new enforcement hires will not replace those who have left, it will help fill key gaps in our enforcement workforce created by Continue reading

The National Taxpayer Advocate Wants to Hear from You!

We-want-to-hear-from-YOU-FINAL-300x197Olson to Hold Public Forum on Taxpayer Service Needs in Baltimore on May 13

WASHINGTON — National Taxpayer Advocate Nina E. Olson and Sen. Ben Cardin, a member of the Senate Committee on Finance, will hold a public forum to discuss what taxpayers want and need from the IRS to comply with their tax obligations. Sen. Cardin is also the ranking member of the Senate Committee on Foreign Relations.

The public forum will be held on Friday, May 13, at 10:30 a.m. at the University of Maryland Francis King Carey School Of Law in Baltimore.

Members of the public and the media are invited to attend.