BN Daily E-Journal

Starting with the first quarter of 2011, employers will begin filing new:

• Quarterly Contribution Return and Report of Wages (DE 9)
• Quarterly Contribution Return and Report of Wages (Continuation) (DE 9C).

Employers will report their Unemployment Insurance, Employment Training Tax, and State Disability Insurance contributions, along with the Personal Income Tax withholdings, quarterly on the DE 9 instead of annually on the Annual Reconciliation Statement (DE 7). Detailed wage items for each worker will be reported on the DE 9C instead of the Quarterly Wage and Withholding Report (DE 6). Employers will still use the DE 6 and DE 7 for years prior to 2011.

The change to quarterly reporting will allow EDD and employers to identify overpayments more quickly, which will result in faster refunds. In addition, EDD will be able to promptly notify employers of any amounts due.

Registered employers will receive the new forms automatically by mail starting in 2011. The new forms will also be available online and at local EDD offices in December 2010.

Employers will continue to make deposits using the Payroll Tax Deposit (DE 88ALL) form. The quarterly reporting change will not affect deposit and return due dates. Please refer to the California Employer’s Guide (DE 44) for deposit and reporting requirements.

NOTE: This quarterly reporting change does not affect Annual Household employers, Disability Insurance Voluntary Plan filers, or Disability Insurance Elective Coverage filers.

Expanded e-Services for Business

Beginning in the spring of 2011, EDD will significantly expand its e-Services for Business. Employers will be able to conduct more business online with EDD including:

• Viewing account information
• Filing reports
• Paying tax deposits and liabilities

This article was provided by CAEDD, and is available to view at: http://www.edd.ca.gov/Payroll_Taxes/Important_Payroll_Tax_Changes_in_2011.htm

If your business manufactures products or purchases them for resale, you generally must value inventory at the beginning and end of each tax year to determine your cost of goods sold. Some of your expenses may be included in figuring the cost of goods sold. Cost of goods sold is deducted from your gross receipts to figure your gross profit for the year. If you include an expense in the cost of goods sold, you cannot deduct it again as a business expense.

The following are types of expenses that go into figuring the cost of goods sold.

• The cost of products or raw materials, including freight
• Storage
• Direct labor costs (including contributions to pensions or annuity plans) for workers who produce the products
• Factory overhead

Under the uniform capitalization rules, you must capitalize the direct costs and part of the indirect costs for certain production or resale activities. Indirect costs include rent, interest, taxes, storage, purchasing, processing, repackaging, handling, and administrative costs.

This rule does not apply to personal property you acquire for resale if your average annual gross receipts (or those of your predecessor) for the preceding 3 tax years are not more than $10 million.

For additional information, refer to the chapter on Cost of Goods Sold, Publication 334, Tax Guide for Small Businesses and the chapter on Inventories.   – reprinted from IRS

Get your pen and pad of paper ready, 1099 paper that is. As part of the newly enacted Patient Protection and Affordable Care Act signed into law March 23, 2010, by President Obama, businesses will be required to report payments over $600 per year of goods or services made to anyone, including corporations, except entities exempt under 501 (a) charitys and non-profits. Read more here.
This will also effect you if you receive payments through credit card terminal. The credit card processing companies will be sending a new 1099 called 1099-k which will report your income received. Read more about this proposed law here.
You should start getting 1099 information as soon as possible to help aleviate being over paperworked by emailing or sending the form W-9 to all of your vendors. You can get form W-9 here.

This recession affects everyone, especially small businesses. If you haven’t already done so, now is the time to check your extra expenses and cut back on frivolous spending. Make sure you are getting the best prices on monthly charges such as phone, internet, and long distance. What you don’t want to cut down or slack on is payroll taxes, workers comp insurance, or liability/auto insurances. Times may be hard, but not paying the government will get you into trouble, and they are having a hard time as well so they have beefed up their efforts on collections. Being under insured can keep you from getting a job and could potentially lead to a disastrous situation.

Many small businesses operate without a budget, however it is never to late to get one going. If you are lost with budgeting, the best place to start is with your monthly expenses. Secondly, you want to create and stick with a budget for each new project that you start. It is not as hard as it sounds, and will save you a headache in the long run and now is the perfect time to learn and implement something new.

We have a unique opportunity to slow down, look at our expenses and make valid and smart decisions. The past 10 years were filled with rush, courage, power and money. The next few years are a cycle of thought, saving, reflection, and careful planning. It is also a good time to fix what is broken with your company and look to the future with new found skills and planning.

Lastly, it is a good time to learn about new ideas that can manifest global change one project at a time. How can your skills be matched with renewable energy? By opening the door to change, learning new ideas, saving, planning and budgeting, we are moving forward together into a better and brighter future.

If you are planning to file a lien against your project for non-payment in California, then the first step would be to put all your paperwork in order, then consider the following:

1.) Do you have a complete address?
2.) Do you have the Accessors Parcel Number?
2.) Do you have the owners full name as recorded on the grant deed?
3.) If you did not work directly for the owner, did you file a 20 Day Preliminary Notice?
4.) Should you have a professional file your lien and obtain the above information? If so, you can call 1-877-776-5436 (BN Lien Services).
5.) Lastly, did you try to talk this over with the owner of the property?

All of the items above should be addressed before filing a Mechanics Lien. Builders Notebook supports members by providing a full document preparation service. We can also prepare a “Collection Letter” to see if the owner truely disagrees with payment. We find that 85% of the time there is a miscommunication in paperwork leading the owner to confussion with the project. Construction may seem simple to you (the professional) however the layman may have difficulty understanding Change Orders, Additional Work, and complex changes in the scope of work leading to additional charges.

If you need assistance with your lien, please contact us at 1-877-776-5436 so we can discuss the route you should take to best protect your investment.