Reporting Change of Address or Responsible Party with the IRS
Beginning with 2014, it is mandatory that businesses report changes in responsible parties to the IRS. For non-publicly traded entities, a responsible party is the person who has a level of control over, or entitlement to, the funds or assets in the entity that as a practical matter enables the individual, directly or indirectly, to control, manage, or direct the entity and the disposition of its funds or assets. For most small businesses, this is the primary owner of the entity.
Within 60 days of a change in responsible parties, the entity must file form 8822-B, Change of Address or Responsible Party-Business with the IRS to report the change. Although there are no direct penalties for failing to file the form, a failure to receive a notice of deficiency or demand for tax, the penalties and interest will continue to accrue, even though the responsible party fails to receive the notices.
All businesses with EINs should review their SS-4, Application for Employer Identification Number, and file Form 8822-B with the IRS to update any changes in business addresses and responsible parties, as soon as possible. Here is the link to IRS form 8822-B http://www.irs.gov/pub/irs-pdf/f8822b.pdf.
If you have any questions, please contact Ken McLaughlin at 630-230-8434.
Written By: Bob Kovanic, MBA, CPA, Padgett Business Services
NOTE: This publication should not be regarded as legal advice or legal opinion. The content is intended for general informational purposes only. If you have any concerns regarding anything in this publication you may contact your own attorney, CPA or our law office at 630-230-8434, website www.ma-lawpc.com.
How to Limit Your Liability to Subcontractor Employees for Workplace Injuries
In a recent decision, Carney v. Union Pacific Railroad Company, 2016 IL 118984 (Oct. 20, 2016), the Illinois Supreme Court provided some guidance to owners and general contractors on limiting their liability to subcontractor employees in construction injury cases. Under the common law, anyone who employs an independent contractor is generally not liable for that contractor’s acts or omissions, but the hiring entity may still be liable for its own negligence.
In this case, Union Pacific Railroad Company entered into a written agreement with a general contractor, Happ’s, Inc., to remove three abandoned bridges on property owned by the railroad. Under this agreement, Happ’s purchased the bridges from the railroad and agreed to provide the labor, tools, and material necessary for the work. The contractor hired a subcontractor to assist with the removal. An employee of the subcontractor was severely injured during demolition of one of the bridges, when a falling bridge girder severed his legs, and he filed a negligence claim against the railroad. The court considered owner liability under three potential claims: owner control, negligent hiring, and dangerous condition on the land.
A WOMAN’S RIGHT TO BIRTH CONTROL VS. RELIGIOUS RIGHTS
On June 30th, the U.S. Supreme Court ruled in favor of three family-owned businesses, with the majority of the court saying that businesses can refuse to pay for certain forms of contraception they find “morally repugnant.” At issue are four contraceptives known as abortifacients which are contraceptives that prevent ovum implantation or cause a miscarriage shortly after becoming pregnant.
In writing the majority opinion, Justice Samuel Alito noted that the Obama White House already provided an opt-out for nonprofit religious corporations by allowing an outside insurance company to pay for birth control and felt this should also apply to for-profit employers. It was suggested by the court that the Government could assume the cost of providing the four contraceptives at issue to women who are unable to obtain them under their health-insurance policies due to their employers’ religious objections.
Relief for Late S-Election Under Rev. Proc. 2013-30
In August 2013, the IRS issued Rev. Proc. 2013-30 that consolidates and simplifies rules provided previously. Taxpayers now have 3 years and 75 days from the date the S-election was originally intended to be effective to file a late S-election. No use user fee will apply. The election will be effective as of that intended date. To qualify for relief, the corporation must meet the following:
- The S-election would have been effective had the Form 2553 been submitted timely.
- The failure to qualify as an S-corporation was solely because the election was not submitted timely.
- The corporation has reasonable cause for its failure to file timely and acted diligently to correct the error.