Pub. 2 2020 Issue 6

Year-End Reporting And Other Important Compliance Items [The following information was compiled for members by NHADA Gold Partners & tax advisors O’Connor & Drew, P.C. This information will apply generally to all dealerships, but you are advised to seek advice from your own counsel for your dealership’s particular circumstances.] COMPLIANCE CHECKLIST FOR W-2s, 1099s, AND CASH REPORTING: 1. Have you included the following items in each employ- ee’s final payroll, which will be included on the Form W-2? • Year-end Bonuses • Use of Demonstrators (see below) • Cost of Group-Term Life Insurance Coverage in Excess of $50,000 • Cost of Shareholder’s Health Insurance Premiums and Other Fringe Benefits • Aggregate Cost of Employer-Sponsored Health Insurance Coverage to be included on W-2 (box 12, code DD) if file 250 or more W-2s . . . However, Amount is Not Taxable • Separate employer reporting requirements for “applicable large employers” (Forms 1094-C and 1095-C) under the Affordable Care Act are required for the 2020 tax year. Self-insured employers will need to file additional Forms 1094-B and 1095-B to report information about covered individuals. 2. Issue all appropriate 1099s and W2’s to recipients and the Internal Revenue Service by February 1, 2021. • Report on Form 1099 - NEC – Nonemployee Com- pensation Paid to Unincorporated Service Providers • Report on Form 1099 - MISC – Rents Paid to Un-incorporated Lessors ■ NOTE: Reporting is not required for services under $600 ■ Report for attorneys – All Payments, whether or not incorporated. Payment for legal services, but not for the attorney’s services, report on Form 1099 - MISC; payment for attorney’s fees, report on Form 1099-NEC. • Report on Form 1099-INT – Imputed Interest on Shareholder Loans • Use Form 1099-B for Settlement Payments (all payments) 3. All customers for whom you filed a Form 8300 (“Report of Cash Payments over $10,000”) during 2020 must receive a notification on your letterhead by January 31, 2021. 4. Employer’s obligation under .9% additional Medicare tax • Applies to wages and compensation (including tax- able fringe benefit) in excess of the threshold amount paid in a calendar year. LAUREN CARNES NHADA GOLD PARTNER O’CONNOR & DREW, P.C D R I V E 18