Blog - Witcher & Stewart

IRS Is Way Behind in Processing

Have you filed a return with the IRS and still waiting for them to process it? Well, the good news is that the IRS is trying to clear out the backlog of unprocessed returns. The bad news is that as of December 9th, 2022 the IRS still has 2.5 million unprocessed returns from 2021 and earlier. This is a substantial improvement over the 7.6 and 6.7 million, respective individual and business returns that were not processed as of August.

You may be waiting just a little longer for that refund or any closure with these outstanding issues. Please contact your tax professional for more information regarding your specific situation.

Retirement Savings

Great news for 2023! The SECURE 2.0 Act has made a number of beneficial changes for employer sponsored plans. If you are 50 years or older you can make an additional catch-up contribution. The new maximum contributions are:

401(k), 403(b) – 22,500, catch-up contribution 7,500
IRA – $6,500, catch-up contribution of $1,000
SIMPLE – 15,500

In 2023, taxpayers must begin taking their first required minimum distribution (RMD) by April 1^st of the year following the year they turn 73. This is up from 72 in 2022. For those of us under 63, that age increases to 75 in 2033.
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Is my business required to file a form 1099-NEC?

The answer is most likely yes. If you paid any person or business more than $600 for services or attorney fees during the year, then YES you are required to file a Form 1099-NEC. You are also required to file a 1099-NEC for any person that you withheld federal income taxes for because they were subject to backup withholding regardless of the amount you paid them.

You do not have to provide a 1099-NEC to a corporation or an LLC, that has elected to be taxed as a corporation. The only way to know this, however, is to have a current W-9 on file for each vendor BEFORE you pay them. This will save you from the stress of trying to hunt down vendors when it is time to file the 1099s. Read More…