No Changes to Information Returns for 2025 Despite OBBB Changes
Form W-2, Forms 1099, and Form 941 and other payroll return forms won’t change for tax year 2025. Further, federal income tax withholding tables will not be updated for OBBB provisions during tax year 2025. The IRS has instructed employers and payroll providers to continue using current procedures for reporting and withholding.
IRS Renews Warnings on Aggressive Employee Retention Credit Claims
Last week, the IRS issued a renewed warning urging business owners to carefully review the Employee Retention Credit (ERC) guidelines before filing claims.
The FICA Tip Credit
The FICA Tip Credit provides relief to businesses paying employment taxes on tip income. Calculation of the credit is somewhat complex, requiring employers to determine an amount known as “creditable tips.” The creditable tips figure removes the tip income that covers the difference between the employee’s hourly wage and the minimum wage.
PA Department of Revenue Transitioning Business Taxpayers to myPATH
The Pennsylvania Department of Revenue is in the final phase of its modernization project. This includes the transition of all business taxes – including employer withholding tax, sales tax, and corporation taxes – into the Pennsylvania Tax Hub (PATH) system.
New Safe Harbor for ERC Gross Receipts Calculation
This month, the IRS announced a new safe harbor provision that allows employers to exclude certain amounts received from other pandemic relief programs in determining whether it qualifies for the Employee Retention Credit (ERC) based on a decline in gross receipts.