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Written by Marc R Barnes EA
September 28, 2010 |
Do you qualify for this money-saving vehicle? Payroll taxes are a big cost of doing business, and any way you can save money is always worth looking into. One way to save on payroll taxes is to use an accountable plan. Under this plan, you save money on payments you make to employees for reimbursements of expenses or advances made in anticipation of such expenses. The great advantage of an accountable plan is that it saves the employer money because reimbursements made to the employee do not have to be counted as wages to that employee. For this reason, the employer does not have to pay any of the related payroll taxes on those amounts, nor is the employee’s reimbursement reduced by FICA taxes. It’s a win-win situation. In order to have an accountable plan, you must have a written document that meets the following three requirements:
It’s never too late to set up an accountable plan and begin enjoying the tax savings right away. Share:
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