In IR-2026-125 (October 21, 2026), the IRS said it will not challenge missing Form 720 filings, reports or records that are solely due to IRC §4041(a) tax on taxable dyed-diesel uses from October 1 through December 31, 2026, building on the IR-2026-122 penalty relief. Other excise taxes, fuel tax credit records and state rules such as North Carolina's S.L. 2026-62 and Form GAS-1259 still apply.
On October 14, 2026, SSA announced a 3.6% Social Security COLA starting with January 2027 benefits and raised the 2027 Social Security wage base from $184,500 to $192,300, lifting the maximum employee OASDI tax to $11,922.60. Employers, S Corp owners, self-employed workers and working retirees should update payroll settings, salaries, estimated taxes and earnings-test plans before January 1, 2027.
Executive Order 14435, signed October 5, 2026, directs Treasury to defer certain 24.4¢-per-gallon federal diesel taxes incurred October 5–December 31, 2026 and to waive dyed-diesel highway penalties, if the law allows. It is a deferral, not forgiveness—here is what truckers, farmers and fuel retailers in every state should track while IRS guidance is pending.
On Wednesday, October 7, 2026, North Carolina lawmakers passed the Relief at the Pump Act to suspend the state’s 41-cent motor fuel excise tax through November 30, 2026, once the governor signs. Here is what Cary/RTP fleet owners, farmers using dyed diesel, and fuel retailers should track—returns still due, pass-through rules, and the day-after-enactment start date.
IRS Notice 2026-60 sets the per diem rates for travel from October 1, 2026: $329 per day for high-cost localities and $230 elsewhere under the high-low method, while GSA's fiscal 2027 rate for Raleigh is $142 lodging plus $74 M&IE. Here is what Cary/RTP employers and S Corp owners should update—including the 10% owner limit and the October–December transition rule.
Small business recordkeeping and audit readiness: IRS retention periods, digitizing receipts, 1099-K and POS reconciliation, common audit risk areas, and YCL representation with Form 2848.
NC business personal property listing: list equipment with your county January 4–February 1, 2027; Wake extensions and online listing, the 10% late penalty—subject to current IRS/NCDOR/county tax office guidance.
NC sales tax for restaurants, retail, and salons: NCDOR registration, filing frequency, county rates (Mecklenburg 8.25% from July 1, 2026), prepared food, gift cards, and the Wake/Mecklenburg 1% meals tax.
A full-year small business tax calendar: 941, 940, NC-5, W-2/1099, estimated tax, 1120-S/1065, Schedule C, NC sales tax, and county listing, with 2027 dates—subject to current IRS/NCDOR/county tax office guidance.
WOTC in 2026: authorized only for hires through Dec. 31, 2025; target groups, the 28-day Form 8850 deadline, NC Commerce certification, and Form 5884—subject to current IRS/NCDOR guidance.
Hiring your spouse or children compliantly: real work and reasonable pay, FICA/FUTA exceptions by entity type, NC withholding, and records—subject to current IRS/NCDOR guidance.
Health insurance taxes for owners and staff: the self-employed deduction (Form 7206), S corp 2% shareholder W-2 rules, 2026 QSEHRA limits, and ICHRA—subject to current IRS/NCDOR guidance.
SEP vs. Solo 401(k) vs. SIMPLE IRA for small business owners: 2026 contribution limits, employee coverage, the October 1 SIMPLE deadline, and the startup credit—subject to current IRS/NCDOR guidance.
Restaurant and salon build-out and equipment depreciation: QIP, 2026 Section 179 limits, 100% bonus depreciation, tenant improvements, and NC 85% add-backs—subject to current IRS/NCDOR guidance.
Home office and vehicle deductions for NC small business owners: simplified vs. actual method, the split 2026 mileage rate, mileage logs, and S corp accountable plans—subject to current IRS/NCDOR guidance.
Schedule C deductions for sole proprietors: rent and booth rent, supplies, advertising, software, insurance, training, plus recordkeeping—limits subject to current IRS/NCDOR guidance.
When should an NC LLC elect S corp status on Form 2553? Reasonable salary plus distributions, SE tax comparison, NC franchise tax and annual report costs—subject to current IRS/NCDOR guidance.
Commingling business and personal funds risks limited liability, disallowed deductions, and messy S corp distributions and shareholder loans—cleanup steps for NC owners, subject to current IRS/NCDOR guidance.
Month-end close for NC small businesses: P&L, balance sheet, cash flow statement, and a QuickBooks/Xero checklist tied to sales tax, payroll, and estimates—subject to current IRS/NCDOR guidance.
Cash-heavy NC restaurant or salon? POS Z reports, cash deposit reconciliation, cash tip reports, Form 8300, and sales tax tie-outs—thresholds subject to current IRS/NCDOR guidance.
The 1099-NEC threshold rises from $600 to $2,000 for 2026 payments (per IRS instructions): W-9 first, 24% backup withholding, Jan 31 deadline, IRIS e-file, and NC 4% ITIN withholding.
Booth rental done right: fixed rent and control limits, owner rent income, renter Schedule C and 15.3% SE tax, quarterly estimates, and 2026 $2,000 1099 thresholds—subject to current IRS/NCDOR guidance.
Are commission nail and spa technicians really 1099 contractors? IRS control factors, §3509 back taxes, Section 530, Form SS-8, VCSP reclassification, and NC DES and misclassification rules.
Monthly employee tip reports, Form 8027 for large food or beverage establishments, 8% allocated tips, service charges vs. tips, new W-2 boxes, and the 45B credit—subject to current IRS guidance.
Hiring your first NC employee? EIN, NCDOR withholding, DES unemployment insurance, W-4/NC-4/I-9, pay frequency and payroll software, step by step—rates subject to current IRS/NCDOR guidance.
Reconcile the four quarterly Forms 941 to Forms W-2 and W-3 before year-end filing. Compare wages, tips, and federal withholding, then document corrections with the right form.
§70105 keeps §199A for 2026+, widens phase-in to $75k/$150k, and adds a conditional $400 minimum—thresholds per RP 2025-32. YCL compliance map (to be verified items flagged).
Form 7004 can automatically extend calendar-year Forms 1065 and 1120-S from mid-March to mid-September—but it does not extend the time to pay. File a separate 7004 for each return, usually by the original due date.
IRIS is the IRS’s free Taxpayer Portal for e-filing Forms 1099 and related information returns—after you obtain an IRIS TCC. Upload CSV or enter manually (up to 100 forms per batch), and remember the 10-return electronic filing mandate.
Calendar-year S corps and partnerships e-file Forms 1120-S/1065 through MeF, with K-1s due to owners by the return due date including extensions. A rejected timely e-file may get a short perfection window—owners’ 1040 clocks do not automatically move.
S corp shareholder-employees need reasonable W-2 wages before distributions. No IRS fixed percentage; zero wages with large distributions is an employment-tax red flag. Cary/RTP compliance notes.
S corp and partner K-1 income rarely has full withholding. Use reasonable W-2 withholding plus 1040-ES to meet the 90% / 100%–110% safe harbor and avoid §6654 penalties. Cary/RTP owner compliance notes.
FinCEN’s March 2025 interim final rule generally limits “reporting companies” to foreign entities registered to do business in the U.S.; U.S.-created companies are typically exempt from BOI filings. Foreign companies may still have to file and generally need not report U.S. beneficial owners. Recheck FinCEN FAQs before forming entities.
OBBBA raised the per-issuer QSBS exclusion to $15 million for stock acquired after July 4, 2025, added 50%/75%/100% tiers at 3/4/5 years, and lifted the issuer gross-assets limit to $75 million. Cary/RTP founders and angels should plan eligibility before financing rounds.
OBBBA expanded §45B to barbering, nail care, esthetics, and body/spa treatments. W-2 employers claim on Form 8846; booth renters generally do not qualify. Beauty uses a different minimum-wage floor than restaurants.
OBBBA raised the §179 limit to $2.5 million, with phaseout beginning at $4 million of placements. North Carolina does not match federal limits—expect add-backs. Plan federal and NC books before buying equipment.
Even with a ~$40,000 federal SALT cap, North Carolina’s Taxed PTE election (S corps / partnerships) and California’s 9.3% PTE tax can still ease individual SALT pressure via entity-level state tax and federal entity deduction. Elect on a timely return—once filed, the NC election cannot be changed. Cary/RTP owners: model before you file.
OBBBA (P.L. 119-21) permanently restores 100% bonus depreciation under §168(k) for qualified property acquired after January 19, 2025. Cary/RTP small businesses should confirm contract and placed-in-service dates before year-end CapEx—and note temporary §168(n) qualified production property.
