The IRS encourages all businesses and business owners to know the rules when it comes to classifying a worker as an employee or an independent contractor. An employer must withhold income taxes and pay Social Security, Medicare taxes and unemployment tax on wages paid to an employee. Employers normally do not have to withhold or pay any taxes on payments to independent contractors. Here are two key points for small business owners to keep in mind when it comes to classifying workers: 1. Control. The relationship between a worker and a business is important. If the business controls what work is accomplished and directs how it is done, it exerts behavioral control. If the business … [Read more...]
Archives for May 2017
Why It’s Important to Partner With Your Child’s Teacher
I am a big believer in collaboration and forming a true team of advocates for your child. As the spouse, friend, and relative of lifelong educators, I believe firmly that such a partnership begins and ends with your child's teacher. One of the best article I have read on the subject was written by Amanda Morin[1]. Mrs. Morin wrote, and I concur that: "Partnering with your child’s teacher can have a powerful impact. When you and your child’s teacher have a good relationship and communicate regularly about his learning and attention issues, it’s easier to work together to help him succeed in school. It makes it easier for both of you to share concerns and celebrate successes." As Ms. … [Read more...]
Hobby or Business? IRS Offers Tips to Decide
Millions of people enjoy hobbies that are also a source of income. From catering to cupcake baking, crafting homemade jewelry to glass blowing -- no matter what a person’s passion, the Internal Revenue Service offers some tips on hobbies. Taxpayers must report on their tax return the income earned from hobbies. The rules for how to report the income and expenses depend on whether the activity is a hobby or a business. There are special rules and limits for deductions taxpayers can claim for hobbies. Here are five tax tips to consider: Is it a Business or a Hobby? A key feature of a business is that people do it to make a profit. People engage in a hobby for sport or recreation, not … [Read more...]