Daniel Cullinane CPA

2500 Plaza 5 25th fl  Jersey City NJ 07311                                                          phone 732-516-1648  fax 732-516-9778

                 MBA TAXATION                                                                                                         

Cash awards to employees for participating in wellness programs are taxable. A firm provides benefits under a wellness program at no cost to employees. Participants are able to earn cash awards or gym memberships from the employer. These perks are taxable wages and subject to payroll taxes  Also taxable: Reimbursement of employees' salary reduction amounts. Here,  workers make pretax contributions to help pay for the wellness program, and the employer later reimburses them all of a portion of the amounts paid as a reward for participating in the program. The repayments are additional wages.


IRS continues to see problems with 403(b) plans of schools and colleges. Many plans wrongfully exclude part time workers and substitute  teachers who. The Revenue Service recently finished a compliance project of these retirement plans to find out whether they have made available to all workers who are eligible to participate. It found that 40% of plans questioned failed to ensure that universal availability rues were being followed. In many cases, partimers who worked 1,000 or more hours during a yer were wrongfully excluded from participating the the school plan Plan sponsors should find it easier to correct universal availability errors. Last year the IRS explanded its voluntary correction program to include safe harbors for fixing such mistakes in 403(b) plans without seeking a private letter ruling Sponsors must contribute any required payin plus earnings that should have accrued. They must notify affected participants about the error and corrective actions taken

Small groups will be paying less to file Form 1023-ez. Beginniing July 1, the filing fee will drop to $275 form $400 now. Charities with annual gross receipts of $50,000 or less and total assets of $250,000 or less can submit the 1023-ez to apply for a tax exemption. Churches, hospitals, schools, credit counseling groups, nonprofits organized as LLCs and others can not use the EZ form

JULY NEWSLETTER

Daniel Cullinane CPA

25 Plaza 5 25th fl Jersey City NJ                                          phone 732-516-1648 fax 732-516-9778

MBA Taxation

Copyright ©​ Daniel Cullinane CPA.

​INVESTING 

Under consideration by Securities and Exchange Commission, the approval of a new stock exchange that foils high frequency trading. Investors Exchange (IEX) , an alternative trading platform, is applying to the SEC to become full fledged public stock exchange catering primarily to mutual funds. and other long term investments.  To thwart high frequency trading, IEX is reliant on a "speeed bump" of 350 microseconds. That gives it enough time to make sure that orders are near real prices and not stale prices that allow high speed traders to profit by racing ahead of slower investors. In a sign that the SEC is paving the way to approve IEX's application, it appears to have determined that a speed bump of less than 1,000 micro seconds is OK under existing stock exchange trading rules.

EXEMPT GROUPS

TAXABLE EMPLOYEE BENEFITS