IRS Issues Several Reminders for National Small Business Week 2022News, Offshore Account Update
Posted in on May 20, 2022
National Small Business Week was May 1- 7, 2022, as recognized by the Internal Revenue Service (IRS). During the week the IRS published several notices, reminders and Tax Tips intended specifically for small businesses—all focused on the IRS’ theme of “Building a Better America Through Entrepreneurship.” In this article, Maryland tax attorney Kevin E. Thorn, Managing Partner of Thorn Law Group, recaps some of the highlights:
Small Businesses Should Start Planning Now to Take Advantage of Tax Benefits for 2022
Small businesses can reduce their federal income tax liability by claiming various credits and deductions. The IRS is encouraging small businesses to start planning now to ensure that they maximize these tax benefits for the 2022 tax year. Some examples of these benefits include:
- The 100% meal deduction for food and beverages purchased at restaurants in 2022
- The home office deduction for business owners who “use a room or other identifiable portion of the home exclusively for business on a regular basis”
- Federal tax deductions for start-up expenses, qualified business income and health insurance
Small Businesses Should Start Planning Now to Make their Quarterly Estimated Tax Payments
Small businesses and self-employed individuals must make quarterly estimated tax payments to the IRS (and the Comptroller of Maryland). As the IRS explains, “Individuals, including sole proprietors . . . generally must make estimated tax payments if they expect to owe tax of $1,000 or more when their return is filed. Corporations generally must make estimated tax payments if they expect to owe tax of $500 or more when their return is filed.”
Taxpayers that fail to make quarterly estimated tax payments can face liability for interest and penalties. Underestimating (and underpaying) quarterly tax obligations can lead to interest and penalties as well.
Small Businesses May Qualify for the Work Opportunity Tax Credit As a Result of the Pandemic
The Work Opportunity Tax Credit (WOTC) is available to small businesses that employ workers who are “in any of ten targeted groups facing barriers to employment.” The WOTC is an important program, and we encourage small business owners to learn more about all of the categories of workers who qualify.
For National Small Business Week 2022, the IRS is highlighting the WOTC’s application to long-term unemployment recipients. “With millions of Americans out of work at one time or another since the pandemic began, the IRS notes that one of these targeted groups is long-term unemployment recipients who have been unemployed for at least 27 consecutive weeks and received state or federal unemployment benefits during part or all of that time.” Small businesses that hire eligible workers can claim a one-time tax credit for 2022 after certifying with the Maryland Workforce Exchange.
Contact Maryland Tax Attorney Kevin E. Thorn, Managing Partner of Thorn Law Group
If you have questions or concerns about your federal income tax obligations as a small business owner in Maryland, we invite you to schedule a consultation at Thorn Law Group. To speak with Managing Partner and Maryland tax attorney Kevin E. Thorn in confidence, please call 240-235-5096, email firstname.lastname@example.org or get in touch online today.Share This Post