The Internal Revenue Service has expanded its Voluntary Classification Settlement Program (VCSP) paving the way for more taxpayers to take advantage of this low-cost option for achieving certainty under the law by reclassifying their workers as employees for future tax periods.The IRS is modifying several eligibility requirements thus making it possible for many more interested employers, especially larger ones, to apply for this program. Thus far, nearly 1,000 employers have applied for the VCSP which provides partial relief from federal payroll taxes for eligible employers who are treating their workers or a class or group of workers as independent contractors or other nonemployees and now want to treat them as employees. Businesses, tax-exempt organizations and government entities may qualify.Under the revamped program, employers under IRS audit, other than an employment tax audit, can qualify for the VCSP. Furthermore, employers accepted into the program will no longer be subject to a special six-year statute of limitations, rather than the usual three years that normally applies to payroll taxes. Normally, employers are barred from the VCSP if they failed to file required Forms 1099 with respect to workers they are seeking to reclassify for the past three years. However, for the next few months, until June 30, 2013, the IRS is waiving this eligibility requirement. Details on this temporary change are in Announcement 2012-46.To be eligible for the VCSP, an employer must currently be treating the workers as nonemployees; consistently have treated the workers in the past as nonemployees, including having filed any required Forms 1099; and not currently be under audit on payroll tax issues by the IRS. In addition, the employer cannot currently be under audit by the Department of Labor or a state agency concerning the classification of these workers or contesting the classification of the workers in court.Interested employers can apply for the program by filing Form 8952, Application for Voluntary Classification Settlement Program, at least 60 days before they want to begin treating the workers as employees.Employers accepted into the program will generally pay an amount effectively equaling just over one percent of the wages paid to the reclassified workers for the past year. No interest or penalties will be due, and the employers will not be audited on payroll taxes related to these workers for prior years. Employers applying for the temporary relief program available for those who failed to file Forms 1099 will pay a slightly higher amount, plus some penalties, and will need to file any unfiled Forms 1099 for the workers they are seeking to reclassify.
Speed of state foreclosure process may influence housing market
As Long Island families facing foreclosure battle endlessly with mortgage lenders, they may feel like characters in a frustrating financial drama. In such situations, homeowners are easily overwhelmed due to limited knowledge of the legal process and the timeline for finalizing a foreclosure. Requirements to complete the process vary from state to state, so people who want to stop home foreclosures should become familiar with local laws to avoid rapid property loss.
Bankruptcy Code Dollar Figures Raised 6.3% for Inflation
As reported by the Bankruptcy Law Network, the numbers are out for the April 1 inflation adjustment in dollar amounts in the bankruptcy code. The numbers increase 6.3%. Every three years, the bankruptcy numbers are automatically adjusted for the change in the Consumer Price Index for All Urban Consumers, published by the Department of Labor. The Judicial Conference publishes the new numbers and they take effect for bankruptcy cases filed on or after April 1, 2013. The chart of changes in bankruptcy code dollar figures were published today and can be found in the Federal Register, Vol. 78, No. 35, Thursday, February 21, 2013, Notices, on page 12090. The changes will make it a little easier for debtors to get a fresh start in bankruptcy. More property can be retained and exempted by debtors using the federal exemptions. The safe harbor before the mansion loophole is closed enlargens. More people will qualify for chapter 13 bankruptcy reorganization as the debt limits go up. Higher limits make it more difficult for trustees or the U.S. Trustee to challenge bankruptcy cases. The means test thresholds ease making more people eligible for chapter 7 bankruptcy or less payment to unsecured creditors in chapter 13 bankruptcy. Larger amounts of payments to creditors within 90 days of bankruptcy filing will be sheltered from recovery by trustees. Credit card charges for cash advances and luxury goods must be higher to be presumed fraudulent under the new dollar figures.
Struggling restaurant files for bankruptcy
Realizing a business venture is on the brink of possible failure can be a sobering event. Business owners in this situation often need to make difficult decisions about the future of their companies. Chapter 11 bankruptcy may be an unfortunate, but necessary, option to save a failing business.
MF Global clients may recover investments
A commercial bankruptcy has different financial implications than a personal bankruptcy, although a business owner may support business debts with personal assets. Business owners often declare a business bankruptcy with a Chapter 11 filing. Readers in Long Island may want to learn about one brokerage firm that may be able to return investments to its clients after filing in this way. This could also help area customers who have been waiting to get their money back and may have to consider filing for personal bankruptcy as a result.
Ousted CEO files for bankruptcy protection
Filing for bankruptcy is a step that people from any socio-economic background can consider if their liabilities are greater than their assets. Whether the individual involved is a millionaire, is struggling from one paycheck to the next or has suffered from a job loss, bankruptcy protection can assist with debt relief and provide some financial breathing room. In the case of one former executive, such a filing was the continuation of an ongoing professional and personal saga.
IRS Extends Tax Relief to Some New Jersey and New York Victims of Hurricane Sandy; Return Filing and Tax Payment Deadline Extended to April 1, 2013
In the aftermath of Hurricane Sandy, the Internal Revenue Service announced additional tax relief to affected individuals and businesses. The IRS today is further extending tax deadlines of that relief until April 1 for the following localities:
