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HomeBlogLEM Business Solutions Latest NewsMaking Year-End Tax Prep Easy

Making Year-End Tax Prep Easy

Business Woman looking frustrated sitting at a desk and doing taxes with her hand on her face.

Closing out the year can be a daunting task for any small business, especially when it involves essential elements like filing 1099s and W-2s on time. LEM Business Solutions offers a simplified process, ensuring minimal effort on the part of your business making year-end tax prep easy!

 

 

Minimizing your workload

At LEM Solutions, we understand that year-end closing can overwhelm any small business. We take the stress out of the equation by offering a wide range of services: 

        1. Working with CPAs to enable them to file taxes & collect year-end documentation 
        2. Taking the worry out of tax preparation by balancing & reconciling all balance sheets, reviewing all profit & loss activity, and posting year-end basic adjustments. It is vitally important to review your business financials, click here to learn more. 
        3. Posting all year-end adjusting entries & closing the year after tax returns are filed. 
        4. Filing 1099 forms with Federal & State authorities, and ensuring W-2 processing. 

Consequences of 1099 non-compliance

Filing 1099s late or incorrectly can result in substantial penalties from the IRS. Whether it is a 1099-NEC or a 1099-MISC, there are different types of penalties based on whether you filed late, didn’t file at all, or filed incorrectly.

Penalties for Filing Late

Assuming the correct payee statement was filed, you will incur different amounts of penalties based on the date it was filed, the number of 1099s that were late, and the size of your business. These are the following penalties, according to the IRS 2023 regulations.

      1. Filing less than 30 Days late: $50 per 1099. 
      2. Filing 31+ Days Late but prior to August 1st: $110 per 1099.
      3. Filing after August 1st: $290 per 1099.

Penalties for Not Filing at all 

1099s that are not filed at all will incur additional penalties. If the IRS determines that it is due to “intentional disregard” they will penalize you $580 per return, with no cap on the final amount you will receive. 

Penalties for Incorrect Filing

The penalties will vary for incorrect filing depending on the type of error and whether it was intentional. A business will typically pay $100 per incident, and a separate $100 fee after the IRS sends a statement to all taxpayers who received incorrect forms. Check the IRS website for steps to take if you have filed incorrectly. 

Staying current with LEM Business Solutions:

Staying up-to-date with year-end closing and 1099 compliance is vital for any business. LEM Business Solutions can provide a simple process, ensuring compliance, and minimizing your workload. Stay current, stay compliant, and thrive with LEM’s custom services. Contact us today to learn how we can support your year-end financial success.