If you employ people in the State of South Carolina, make sure you are aware of the E-Verify requirements that went into effect on January 1, 2012. Below is a copy of the notice from the South Carolina Department of Labor, Licensing and Regulation.

NOTICE TO ALL SOUTH CAROLINA EMPLOYERS:

You Must Verify All New Hires through E-Verify Effective January 1, 2012

Amendments to the “South Carolina Illegal Immigration and Reform Act” were signed into law by Governor Nikki Haley on June 27, 2011. The amended law requires all employers to enroll in the U.S. Department of Homeland Security’s E-Verify system beginning January 1, 2012 and to verify the legal status of all new employees through E-Verify within three business days. Failure to enroll in and use E-Verify to verify new hires will result in probation for the employer or suspension/revocation of the employer’s business licenses.

Verification Requirements

In addition to completing and maintaining the federal employment eligibility verification form, more commonly known as the Form I-9, all South Carolina employers must within three business days after employing a new employee:

1. Verify the employee’s work authorization through the E-Verify federal work authorization program administered by the U.S. Department of Homeland Security.

2. Employers may no longer confirm a new employee’s employment authorization with a driver’s license or state identification card.

E-Verify

E-Verify is a free Internet-based system maintained by the U.S. Department of Homeland Security. E-Verify compares the information an employee provides on Form I-9, Employment Eligibility Verification, against millions of government records maintained by the Department of Homeland Security and the Social Security Administration. The database generally provides results in three to five seconds. If the information matches, the employee is eligible to work in the United States. If there’s a mismatch, E-Verify will alert the employer and the employee will be allowed to work while he or she resolves the problem. To enroll in E-Verify, go to www.dhs.gov/e-verify.

License

Under the law, all private employers in South Carolina are imputed a South Carolina employment license which permits a private employer to employ a person in the state. A private employer may not employ a person unless the private employer’s South Carolina employment license and any other applicable licenses as defined in Section 41-8-10 are in effect and are not suspended or revoked. Under Section 41-8-10, a “license” means an agency permit, certificate, approval, registration, charter, or similar form of authorization that is required by law and that is issued by any agency political subdivision of the state for the purpose of operating a business in the state. Professional licenses are excluded, but “license” includes employment licenses, articles of organization, articles of incorporation, a certificate of partnership, a partnership registration, a certificate to transact business, or similar forms of authorization issued by the South Carolina Secretary of State, and any transaction privilege tax license.

Employment of Unauthorized Alien Prohibited

Section 41-8-30 provides that a private employer who knowingly or intentionally employs an unauthorized alien violates the private employer’s licenses.

Enforcement

The South Carolina Department of Labor, Licensing and Regulation (LLR) is charged with investigating complaints and conducting random audits of private employers to assure compliance. The agency must: (1) notify the United States Immigration and Customs Enforcement (ICE) of suspected unauthorized aliens employed by a private employer; and (2) notify state and local law enforcement agencies responsible for enforcing state immigration laws.

Failure to Comply

For a first occurrence by a private employer, prior to July 1, 2012, of failure to verify a new hire through the E-Verify federal work authorization program within three business days, an employer must swear or affirm in writing to the South Carolina Department of Labor, Licensing and Regulation that the employer has complied with the provisions of the federal law covering employment of unauthorized aliens (8 U.S.C. Section 1324a) from January 1, 2012 until notification by LLR of a violation, and comply with the state law on verification of new hires within three business days.

For a first occurrence by a private employer, after July 1, 2012, of failure to verify a new hire through the E-Verify federal work authorization program within three business days, the Department of LLR must place the employer on probation for a period of one year, during which time the private employer must submit quarterly reports to the agency demonstrating compliance with the law. A subsequent violation within three years of the law’s verification requirements must result in the suspension of the private employer’s licenses for at least 10 days but not more than 30 days.

A private employer who knowingly or intentionally employs an unauthorized alien must have his licenses suspended by the Department of LLR on a first occurrence for at least 10 days but not more than 30 days. During the period of suspension, the private employer may not engage in business, open to the public, employ an employee, or otherwise operate. The private employer’s licenses are reinstated when the employer demonstrates that the unauthorized alien has been terminated, and pays a reinstatement fee equal to the cost of investigating and enforcing the matter, not to exceed $1,000. For a second occurrence, the employer’s licenses must be suspended for at least 30 days but not more than 60 days. Following a third occurrence, the private employer’s licenses are revoked.

Have you seen all of the sales! The holidays are here, and millions of Americans kicked off the season with “Black Friday” shopping. Braving the crowds and the cold, facing scorn from family they’ve left behind, they line up at obscenely early hours (or duck out of Thanksgiving dinner before the pumpkin pie is even served) to save $20 on the last video gaming system or $80 on a flat-screen television.

It’s sad, but true, that most Americans spend more time planning their “Black Friday” shopping than they spend planning their taxes. But that can be an expensive mistake!

What if the IRS had a sale? What if the IRS let you discount your taxes by thousands of dollars, this year and every year to come? And what if they let you do it from the comfort of your home or your office, without lining up in the pre-dawn hours of a chilly November morning? Would you give thanks for a sale like that?

You’re probably not holding your breath for the scrooges at the IRS to hold a “sale.” The good news is, you don’t have to wait for that to happen. You just need a plan. Tax planning is the key to paying the legal minimum. And a good tax plan can pay for a holiday season full of gifts and fun. There are legal ideas for tax reduction that you won’t read about in the paper. You need a CPAs like us who are continually trained to help you reduce your taxes.

Call us now at (704) 752-9845 for your free Tax Analysis. We’ll find the mistakes and missed opportunities that may be costing you thousands today, and show you how “Black Friday” tax planning can save thousands more tomorrow. We guarantee you’ll give thanks for the savings, or we’ll donate $50 to your local charity. So call now to schedule your Analysis.

The Tax Foundation released a state by state breakdown of the percents of tax filers that owe no Federal Income Tax.  You can read their report here.  In North Carolina, 38% of all income tax filers owed no Federal Income Tax.  In South Carolina, 40% of all income tax filers owed no Federal Income Tax.

You may recall that the estimate from the Tax Policy Center of American households that owe no Federal Income Tax is at 47%.  This can not really be compared to the 36% of American tax filers that owe no Federal Income tax that included in this report.  The big different is the millions of American households that are not required to file tax returns. 

Nationally, the totals ranged from 21% of Alaskan households to 45% of Mississippi households who owed no Federal income tax.

(Hat Tip:  to Peter Pappas of the Tax Lawyer’s Blog)

Many who have never filed an extension are cautious if they have to file one.  They are afraid that “bad things” may happen.  Tax extensions are nothing to be afraid of and may in fact be a good move.  First, extensions for tax returns are needed when there is not enough time or information to file an accurate return by the first due date of the return (for individuals this is April 15, but for corporations, this is March 15).  If there is money due, the due date cannot be changed.  Late payment penalties and interest still begin on the original due date, even though the IRS may not know what the calculation is until the final returns are filed.  You should mail in the estimated balance due with the extension to minimize or eliminate this penalty.

In many cases, it may be necessary to file an extension if you receive K-1′s for partnership or other business interests because that information is not available yet.  If there are questions about the accuracy of information, don’t be afraid of extensions.  It is better to wait and file with real information than to “guesstimate” the information.

There is also one other reason you may want to consider routinely filing an extension each year.  There have been several studies that indicate that you could be reducing audit risk by filing your returns later.  Amir D. Aczel, PhD, a professor of statistics, was once audited and it took him two years to get a no change conclusion.  He was not thrilled with the time this took and the IRS process so he decided to dig in and write a book about the process.  He surveyed several accountants on timing and research about audit risk.  He showed statistically in his book, “How to Beat the IRS at its Own Game,” that filing later reduces audit risk and the changes of being selected.

When asked about how to avoid an audit at a seminar of 500 CPAs, a former District Director of the IRS when asked about how to avoid an audit he said “pay your tax on time and file late. If you file late the service is just glad to get the return and get it processed…”

Is this fool proof?  I don’t know, but can it hurt you?  No, there is no reason that you cannot fully comply with your responsibilities as a tax payer and file by October 15 as required by law.  Do your part, but be smart.