Medlin Software, Dennis

What a message to send to their clients. Wonder how they will "spin" this one. Totally agree about having all eggs on one basket leads to cracked eggs...

As distasteful as wide net casting collection is, like many things, there are two sides. Low collection rate or not, it makes some business sense to farm out collections for whatever fee they get for assignment, rather than taking a zero. The IRS is a business too... as are all tax agencies. (such as how many are looking at forced taxes, such as retirement deductions, as a profit generator with several companies offering turn key "solutions"). If not liable, and the letter is not backed by a court order, it could be a valid action to ignore it. In some ways, no different than the number of email and mail "junk/fake/fraud invoices" most receive on a regular basis. I try to remember to fall back on not volunteering anything to anyone. I just listened to a VM stating it was a courtesy call before receiving a registered collection letter tomorrow... I bet there is no letter arriving tomorrow.

I was deposed by IRS investigators in a criminal case. The investigators found a copy of my software on a seized computer and asked what my relationship was with the (now in the care of the government via incarceration). Once I explained the connection, I was thanked and left alone. The person was convicted of fraudulent return as they were filing for their clients (recent immigrants) and capturing their refunds, which has been improperly inflated via EITC. The convicted sent me threatening messages, even though I had no information for or against their case, but which the prosecutor likely found "helpful". The OP is a good reminder to research electronic record keeping regulations, and to try to ensure your actions do not give blanket search and seizure rights to the IRS. Not only for your client's protection, but simply to protect your ability to do daily business. As I have likely posted many times, not being able to provide PRINTED records, or simply acting in a way to show your record keeping is electronic, may (definitely in the past, and possibly with current regs unless they have been revised) give the tax agencies any time warrant-less search rights, and requires proactive notification to the IRS if there is any chance required data is unavailable.

Probably just fishing with a wide net. If anything like payroll processing, anyone with the appearance of access to or control of funds will be looked at, and will likely have to defend.

"Fee waiver – If you facilitate the MarylandSaves program for your employees or offer another qualified plan, your annual report filing fee ($300 for most businesses), is waived each year you participate." MD realizes there is a cost to employers, and/or they want to encourage more employers to use the state sponsored plan... I saw a blurb that OR, being the first to implement a similar plan in 2017, has an average employee balance of $750 after 4+ years.

Looks like MD selected a different management group (which likely means a different reporting and deposit method, increasing payroll costs). Each state seems to have a “board” who manages the management firm… With the management firm taking their cut, and the state folks likely getting something, logically, there may be more fees taken, reducing income for the participant. Unless the profit for the managers comes from “volume”.

At present, there are three states using the same back end provider. It is likely the company managing the process lays out the ease of use for the politicians, and the bites to out in their campaign process. I expect more states will follow this turn key setup. If the company ever goes public, it may be a good investment as these things are likely not to go broke. As you can infer, I am not fond of forcing these things on employers. Employees can already do the same on their own if they wish so this seems like a money grab for those selling the service and managing the funds.

The cost for the employer is compliance, reporting, and the inevitable employee wanting you to explain it to them.

The flaw with paper was having to wait for the Covid based credits. The touted form 7200, for the supposed quick advance, failed in my experience. in regular use, mail is fine.

I doubt they would include a payroll form with general tax forms. Likely separate divisions within the walls of IRS. IIRC the 94x efile data structure is xml. Not the best choice unless they planned on a web based input and read, and even then, it wastes bandwidth with the trade off of having field names, start and stop included. XML is a lose for small uses as no one is going to manually create an xml file, where most can create a csv/txt file if they are inclined to.

I have no idea. Some old timers say the incentive is for complication because some of the decision makers are looking to cash in once they get to private practice. Could be no one has incentive to rewrite what surely is outdated code in a dead language. We have no idea of the actual reason, but the optics sure are bad when a simple text style file works so well for SSA and most states.

Not new. A few years back, I had a significant % (far too many to be a coincidence) of customers asking how to reprint 941 forms... most shared the same IRS 941 mailing addresses. Most were not compliant (in keeping paper copies for the required time frame), but reprinting was not an issue since they were from the prior year. Some had used a third party to efile... Abby Normal: "This is all a prelude to forced efiling of all forms. And really, it's about time. Computers have been part of everyday life since the 80s, or almost 40 years. It's long past time to modernize the entire system." Mailing with proof of mailing AND printing and retaining a paper copy, is not an unreasonable process. I don't know of any truly free efiling method for 94x at present. Vendors (such as those who offer to read payroll data from software) who offer to process such filings have a cost of about $5 per form. The IRS is or at least is not at present, setup (willing?) to adapt to an employer, or even programmer, friendly efile system. They would need, IMO, an easy online method for the very small employer, and an easy CSV, TXT, or MMREF type file structure for the rest (instead of what they offer now. The other issue is those who efile in bulk, like a software vendor, have to go through an "approval" process as the IRS wants to put the efiler, even if a software vendor, in the liability chain. There is a way out, but it still takes time. It has been a few years since I dug deep, but I have not seen any update to the electronic record retention regs. They were onerous enough that non one who read them would ever stray from paper. The flaws were essentially, by not keeping paper records, you are giving the IRS free search and seizure ability because you have to positively prove you can recall any required records, which the IRS can test at will, including access to or seizure of your hardware. Also, you have to positively report any possible data loss, so a computer change would likely have to be reported, power outage, etc (unless you re-verified all data each time). Absolutely, no one likely follows said rules, but those in the business, holding records for many clients, would not likely want to expose all client data to warrant-less search. I remain open to new regulations, as I stopped researching this issue as no one was interested in what I found!

Support wise, likely easier to maintain a web based app, once mature. Of course, data entry is slower and there are outages (both ends) to deal with. Plus, not having direct control over data (which also means the user cannot make it disappear). Many prefer desktop for control and speed reasons. Some still don’t have more than bad DSL connections (just setup Starlink here a few minutes ago). Web based does make the user hardware moot, which has advantages. I get many requests from those who do not want web based apps.

FAQ is about all anyone had/has for things like PPP and ERC.

Anything tied to dealing with government compliance can be lifetime employment. ~30 years for me with programming, 45 dealing with payroll (processed my first payroll when I was 15). I plan to work as long as I am able.

So good to hear. It is sometimes hard not to fall into the trap of not focusing on the good.

Good in principle, maybe bad in real life. If you are not earning enough to complete the task well, timely, and without too much physical harm, then it may be a disservice to your customers. I have clients who do work for others who tell me they cannot afford to keep their computer current, and get upset at a sub $100 annual license fee for software which enables their income stream, say they cannot afford a good backup solution, do not have a spare computer at the ready, etc. Could be just moaning, but if the truth, they are giving away their time. "I actually had a lady crying on the phone because nobody would take her" Could be a reason, maybe they are a PITA, and have washed through many other providers. As someone long ago said here (not me), new customers at the last moment get the top of the line fee, and if an easy client, maybe a discount to the normal rate over time.

There are cases where there is not enough pay, sans tips, to cover all withholding. SS could have been what the employer elected to “short”.

In many cases, or most, an employer paid disability coverage is taxable. If it was employee paid, then not taxable. It is something to consider if there is a choice, remembering the employer paid bene will be considered income.

Daily, I get a complaint that a new employee has no FWH. The employer usually even says they claim no allowances. I have to try to revisit the W4 change, there is no provision for allowances, and those who used to claim 0 or 1 allowance need to add additional withholding. Usually still my “fault” even when I go over Pub15T with them. Daily I am also getting complaints that my calculations are wrong because an employee is griping they had to pay for the first time ever. I too look forward to the filing deadline, and while bothersome for tax preparers, still firmly believe tax preparers should be charging for and helping with W4 forms rather that giving unusable advice such as withhold 10%, or no advice at all such as “submit a new W4”. Of course, clients don’t want to pay for services, so I get the push back, but having an amount withheld above the penalty level and right about the amount owed would benefit the client who is wise, versus clients who rate preparers on the size of their refund (tell them to use the higher withholding option and add several hundred additional <smile>). Grand toddler always puts things in perspective for me. Limiting all support to written form has changed my attitude the most. Prevents misunderstanding (or at least shows the proper information was given) and not as many go on written tirades.

Employer has no obligation to handle domicile, only nexus. Maybe the NY liability is more than NJ, and if a credit towards NJ is allowed, then there is no NJ liability. It could be if the 125 is salary reduction, it may need to be included in NJ taxable.

There is a way to exclude 125 in NJ. If the employer sets it up a certain way.

The expectation seems to be the person they are seeking help from is a mind reader, with full access to their thoughts and boas'. They also seem to believe we know all, and have been monitoring their bank accounts, charge cards, computers, and can print, access, or remember all of their activity. Ties into the shift away from self-responsibility of any sort.

The W2 was due out by the end of January. It should not be something manipulated. Also points out the person is an employee (receives a W2) and should be receiving proper timely paychecks, not something manipulated after EOY. OTOH, I hear it far too often - "we have always done it that way", such as issue one "paycheck" per year, and manipulating after the fact... Same with not bothering to handle >2% S Corp owner insurance until the year is done, or only on the last paycheck.

No experience with this. The information in the image may help you get started, if just to narrow your search.