Archive for May, 2011

On May 13, 2011, the Texas Senate joined the House by passing H2403, which provides that online subsidiaries or affiliates of retailers with stores or other facilities in Texas have nexus with the state. The bill, which has not yet been sent to the governor, would be effective January 1, 2012 and would affect tax liability that accrues on or after that date.

The U.S. Court of Appeals for the Eighth Circuit recently upheld a lower court’s ruling denying summary judgment to a restaurant that claimed a tip credit against all of the wages earned by its servers and bartenders, even though the employees spent considerable time performing tasks for which they did not receive tips [Fast v. Applebee's International, Inc., CA8, Dkt. No. 10-1725/10-1726, 4/21/11].

Servers and bartenders at Applebee’s restaurants filed a lawsuit claiming that they regularly spent more than 20% of their time on general preparation and maintenance, activities that didn’t generate tips. Applebee’s took a tip credit for all work performed by its servers and bartenders, including the general preparation and maintenance work, even when it amounted to more than 20% of the employee’s work. The servers contended that this was a violation of the Fair Labor Standards Act (FLSA) and that Applebee’s owed them additional compensation.

The Texas Comptroller’s Office has transitioned from its original WebFile Sales Tax System to the new MyCPA WebFile system for sales tax.  The “CPA” in MyCPA stands for Comptroller of Public Accounts, not Certified Public Accountant.  It is for use by all taxpayers, not just Certified Public Accountants.

MyCPA is a secure login portal that allows an individual or authorized representative to set up one user account with access to multiple taxpayer IDs and their related taxes and business accounts.

Confused about when these expenses are considered to be legitimate, when a meal is classified as “travel” and when it is classified as “meals and entertainment,” whether meal and entertainment expenses are reimbursable to your employees?  Here are some guidelines in order to substantiate the expenses and make sure that reimbursements are nontaxable to employees—excluded from gross income and exempt from FIT, FICA and FUTA:

The Texas Comptroller’s Office has new information for 2011 franchise tax filing, including the Franchise Tax Web Service, passive entity reporting, apportionment, temporary credit election, extensions and mandatory electronic funds transfer (EFT), and combined group extensions. (Texas Tax Policy News 4, 04/01/2011.)  WebFile is still a free service.