To Avoid Penalties for Inaccurate Information

3 Quick Tips…To avoid the new penalties for inaccurate information on returns:

1. Check your company/client’s EIN. Sole proprietor cannot use the owner’s SSN. Check the company name and address on the 941, 940, W-3 and W-2.
2. If the owner’s children were hired, they must have W-2s—even if no FIT or FICA was withheld—or business deductions for their wages may be lost plus penalties. 
3. If you hire domestic help, have a 9-digit EIN formatted on paper forms as xx-xxxxxxx. SSNs are formatted as xxx-xx-xxxx. Failure to use the exact EIN and company name on file with the IRS can result in failure-to-file penalties and problems with 941/W-2 reconciliations. 

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