What’s the Real Value of a Benefit Plan Audit?
That depends on who you ask. If you ask an employer that takes their fiduciary obligations seriously, or one that has had problems with their plan in the past, then the audit is very valuable. However, if you ask an employer that is not so in-tune with their fiduciary obligations and views the audit as a commodity that goes to the lowest bidder, then the audit is a hassle and of little or no value.
For many, a benefit plan audit is not an option:
Once a retirement plan falls into the large plan category, an audited financial statement is Continue reading »
Employee or Independent Contractor? That’s the Question in California and Everywhere Else
A business owner’s hiring of a worker as an employee has real costs beyond the wages paid to the employee. Such costs range from hard costs (e.g., payroll taxes, unemployment, health and disability insurance, etc.) to costs such as compliance with the regulatory requirements of having an employee, along with the added administrative burdens of payroll and a human resource department. In a perceived cost savings measure, some business owners have been tempted to hire workers and treat them as independent contractors. Nonetheless, the decision to designate a worker an “independent contractor” as opposed to an “employee” is not one without consequences that demand careful Continue reading »
What are your chances of being selected for an IRS tax audit?
The 2011 IRS Data Book, a compilation of statistical data and IRS activities, is out. You can read the whole book here: http://www.irs.gov/pub/irs-soi/11databk.pdf or just skip to page 22 of the publication for the important stuff.
In summary, the average audit rate for individual tax returns is 1.1%. But what’s in your return can push you above the average. At the high end, those making more than $1 million have an audit instance of 12.5%. At the other end, returns for those making under $200,000 and without any business or rental activities have Continue reading »
