Lightening the small-business owner's tax burden.
Small businesses recently got a break from the IRS that aims to save their owners time and money. The IRS has raised the threshold for employment tax deposits from $500 to $1,000. The SBA estimates that 500,000 business owners won't be required to make employment tax deposits because of the move, though they must continue to file their income tax forms either on a quarterly or an annual basis.
The new ruling affects accumulated employment taxes such as Social Security, Medicare and withheld income taxes, reported and filed quarterly on Form 941 or annually on Form 943. Entrepreneurs who file quarterly are eligible to start using the higher threshold for the return period that began July 1, 1998; those who file annual returns are eligible for the period beginning January 1, 1999.
For more information about the change, contact the IRS office in your area.