The usual employer tax deadlines continue through the month for paying over tax payments to the IRS. If you have been paying quarterly remember to check each quarter that you are still eligible to do so. The test only goes back one quarter.
As an employer now is the time to start preparing for the year end tax filings that will take place in January and February. Order your W2s and make sure that all your employee information such as addresses is up to to date. If you will need to issue 1099s to independent contractors make sure that you have their tax ID numbers and addresses on file.
Other tax deadlines this month include:
December 10 – Employees must report to their employer all tips for November if they total more than $20.
December 17 – Corporations must deposit the fourth installment of any estimated tax due.
December 31 – If you want to set up a qualified pension plan such as a 401(k) plan, it needs to be set up by the end of the tax year. Note that some other plans can be set up later and deductions still apply to the earlier year so consider all the options with your financial advisor and tax advsior.
December 31 – If you have an IRA or pension plan such as a 401(k) make sure that you have taken your Required Minimum Distribution (RMD) by this date if you are aged over 70 1/2. In the year you turn 70 1/2 you have until April 1 of the following year to take the RMD. If you do not take the RMD by the end of the year you will be charged a penalty of 50% on the RMD you do not take.
If you haven’t already started on your year end tax planning now is the time to do so.
Congress has still not resolved the “fiscal cliff” so that is clouding year end tax planning this year. However it is important to go through all the options so that you can act quickly if Congress does resolve their differences before the end of the year.
Disclaimer – This article does not constitute personal tax advice to the reader and is only offering general information. You should seek professional advice for your own situation as the most appropriate tax planning depends on your personal and unique circumstances.