Wow! 2019 is already upon us.
As 2018 soon recedes into memory, it’s time to look ahead to 2019. For small businesses, it’s crucial to consider how such items like new legislation and tax deadlines can impact your day-to-day operations and monthly schedules.
Below is a list of 2019 items we think should be on a small business owner’s radar.
Keep Up with 2019 Mileage Reimbursement Rates
At the time of writing this article, the IRS has not released the 2019 standard mileage rate. We encourage you to check the IRS Standard Mileage Rates webpage for updates.
Salespeople and anyone who has a mobile-oriented job should be aware of a Tax Cut and Jobs Act (TCJA) impact to claiming mileage as a tax deduction.
As of January 1, 2018, employees can no longer deduct mileage as unreimbursed business expense deductions. This might come as a shock to people who drive a lot for their jobs as they prepare their 2018 taxes.
However, the self-employed can still claim mileage as a business expense.
If you’re a business owner with mobile employees, you might want to consider adopting a mileage reimbursement model that can help compensate for the miles they drive.
Plan Now to Use Health Flexible Spending Arrangements
Being able to set aside pretax income to cover health care costs not paid by insurance can be a significant financial benefit for employees.
In 2019, employees (not self-employed) can contribute $2,700 through payroll deductions to health flexible spending accounts (FSAs). Deadline for 2019 enrollment was November 30, 2018.
FSAs tend to be a use it or lose it account. Money not spent by the end of the plan year can be forfeited. However, some employers may offer FSA plans to carry over $500 of unspent funds into the next year. Additionally, some FSA plans allow a two and a half month grace period to spend 2018 funds in 2019.
Meeting the January 31, 2019 Deadline for W-2s & 1099s
Yes, we’ll be facing that W-2 and 1099 deadline before you know it. In order to correct potential errors, we recommend that employers prepare and distribute these well before the January 31, 2019 deadline.
Be Aware of Social Security 2019 Maximum Changes
In 2019, the maximum amount of income subject to the 6.2 percent social security taxable ceiling increased to $132,000 from $128,400.
Take Advantage of Higher Retirement Contribution Maximums in 2019
After six years stuck at $5,500, employees can now contribute up to $6,000 in your IRA in 2019. If you’re age 50 or over you can contribute a Catch-up, limit up to $1,000.
Contributions to 401(k) increased from $18,500 to $19,000. If you’re age 50 or over, you can contribute a Catch-up, limit up to $6,000. The total contribution limit for both employee and employer increased from $55,000 to $56,000 ($62,000 for age 50 or older).
If you’re self-employed, you might want to take full advantage of contributing 20% of your self-employment earnings through a SEP-IRA. Didn’t set up a SEP-IRA in 2018? Well, it’s not too late. For those that extend their 2018 tax return date, the deadline to set up a SEP-IRA and make an initial contribution for the 2018 tax year is October 15, 2019.
Too Busy? Delegate Your Tasks
Managing a business is time-consuming. Especially when you have to keep up with all of the changes from regulations to taxes. Make time by delegating tasks to a virtual assistant firm like Business Solutions Unlimited? Call us today at (904) 429-4588 and let us start keeping up with all the small details so you want have to.