IRS Rules Discounts Offered to Employees Are Taxable Income

In the recently released Chief Counsel Advice (CCA) 200923029, the Internal Revenue Service ruled that discounts provided to an employer’s employees who purchase or lease property from a company that formerly owned the employer are taxable as fringe benefits based on...

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Question of the Week: Why Did My Payroll Cost Increase?

This week’s question comes from Rachel, a business owner. I have been running payroll with almost the exact same hours every week for the last few months. In the last few weeks, the payroll cost was several thousand dollars more each week than a month ago. Why did my...

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2008 Form W-2 Tips, Part 8, Box 7 Social Security Tips

This is one in a continuing series on the 2008 Form W-2, Wage and Tax Statement, which employers must generally furnish to employees no later than February 2, 2009. Forms mailed on the due date are considered furnished if properly addressed. Employers unable to meet...

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2008 Form W-2 Tips, Part 4, Box 3 Social Security Wages

This is one in a continuing series on the 2008 Form W-2, Wage and Tax Statement, which employers must generally furnish to employees no later than February 2, 2009. Forms mailed on the due date are considered furnished if properly addressed. Employers unable to meet...

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Question of the Week: Why Did My FICA Tax Deduction Stop?

This week’s question comes from Matt, a sales rep: Every week there’s a deduction for FICA on my paycheck. Two weeks ago, the deduction was lower than usual and last week there was no deduction at all. Why did my FICA tax deduction stop? Answer: The FICA (Federal...

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IRS Issues Guidance on Payments to Deceased Employees

The IRS recently issued guidance for reporting wages paid in 2008 (including accrued wages and vacation pay) on behalf of deceased employees. Although state law generally controls who receives the unpaid wages, the reporting follows the same rules even if the check is...

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