January 2011 Client Newsletter

2011 predictions you ask? $5.00 a gallon gas by years end,  an uptick in your business’ sales, continued state government woes with even more delays in paying its bills, it is all doom and gloom in the Public Sector (look no further than the way New York City handled the recent sanitation snow removal worker’s slow down and President Obama’s re-election team has just started a wave of staff lay-offs), while the Internet becomes more important in just about everything we do including the marketing your business, a Chicago Cubs World Series, and according to the the Aztec Calendar the end of the world is just a year away. On second thought maybe I will leave the predictions to the experts.

More doom and gloom.  As you probably heard, IRS will delay refunds for many taxpayers.  Approximately 50 million refunds will be delayed by a month. Congress’ late passage of the tax bills means the IRS will need additional time to re-program their computers.  By the way the due date for your tax return is April 18, 2011 because of Emancipation Day, a holiday observed in Washington D.C on April 16th.

And speaking of new tax laws, The Tax Relief, Unemployment Insurance Re-authorization, and Job Creation Act of 2010 provides a two percentage point payroll tax cut for employees, reducing their Social Security tax withholding rate from 6.2 percent to 4.2 percent of wages paid. This reduced Social Security withholding will have no effect on the employee’s future Social Security benefits. Employer’s matching contribution of 6.2 percent does not change.  This change is effective for your first payroll check written in 2011. Do you need 2011 W-4 forms for your employees?  Email or call us and we will mail you new forms.  In a hurry?  We have added a link to our Blog so you can down load them.

We have already started processing your quarterly forms this month.  Some clients will be paying their federal tax liability electronically, while others will not. It is based on liability.  As usual 1099 forms will be processed last.  Don’t expect any 1099 forms mailed to you until very late in January.

Later this month we will be sending you a newsletter designed to help you gather your 2010 personal income tax information for filing this year.  We will not automatically send you a personalized tax organizer as we have done so previously.  Criticism from some clients about sending  certain personal information via bulk mail, and the fact that some clients love them, and use them, while others don’t made us re-think the policy.  We decided to go green. Need a personalized organizer? Email or call us and we will send one to you right away.