A Week in Perspective
EXPLAINING THE “METHODS” OF MY “MADNESS” – A look into the world of my blogging friend. (RDF- Looking forward to meeting up with you in St. Louis on August 15 – 18, 2011)
November’s Important IRS Dates – A new month is upon us, along with a new set of IRS Deadlines. We’re entering the IRS’s fourth and final quarter. Here’s the important IRS dates you need to know:
IRS Makes Few Changes to Retirement Rules – For the second year in a row, the Internal Revenue Service has announced that there will be no change to the maximum allowable contributions to pension plans or to individual retirement accounts in 2011. Here are the limits that will remain the same in 2011:
Expensing of Business Assets – New Treasury Report – Economic stimulus provisions of the past few years have included bonus depreciation and higher expensing amounts under IRC Section 179.
What Non-profits should know about Tax Form 990 – Form 990 or Return of Organization Exempt from Income Tax form is due to be submitted to the IRS by non-profits. Ever since 2008, this Form has been substantially revised to include several reporting requirements by the IRS. There are a few pertinent changes to the form and its requirements that non-profit organizations should know.
My favorite post this week.
A must read.
Being an Entrepreneur / Your Business – The topic of working on your own, or, even if you don’t the importance of the entrepreneur “in you” wherever you do work. Do you consult, do you have your own clients or are you striving to? There are some principals I think are necessary to make it “on your own” or excel where you are working. While I am a younger CPA and take a lot of pride in what I have accomplished so far, I keep working hard knowing that I have hardly touched the tip of the iceberg of what I can accomplish in my life.
Like my bloging mentor said about The Missouri Taxguy, Do I really need to keep reminding you to check out BlogRoll Beans from Joe Arsenault over at CafeTax? Thanks Joe.
Suggested first Republican budget cut: Congressional salaries – Watch out for the pigs as they pass over Kay.
What if you are donating it to an arson awareness organization?
Another must read –
Commercials, Kids, and Materialism – If you’ve been reading The Simple Dollar for long, you’ll know that this ad takes a swing directly at a lot of different ideas I’ve shared over the years about parenting, money, materialism, and other things. I thought I’d run through them again in light of this ad.
Tax moves to make in November – we have to get through the lame-duck session. In the next few weeks, Congress has vowed to deal with the expiring expiring Bush tax cuts, stimulus tax breaks that are only good for a couple more months, the already ended extenders and even the estate tax that’s scheduled to come back to life on Jan 1. 2011.
Tax Carnival #76: Election Day 2010
Pension Plan Limits for 2011 – The IRS has announced the 2011 cost of living adjustments affecting dollar limitations for pension plans and other retirement-related items.
3 Tips for Launching a New Business – Starting a business may not be one of the easiest things to do, but it could be one of the most rewarding, as well as one of the most financially freeing decisions you could make for yourself. Seeing that most, if not all of us, need some hand-holding whenever we’re starting a new venture, here is some advice on three routine yet absolutely crucial areas of a business.
How to Fund a Startup – Deciding to start a business is exciting. You are in charge of making decisions large and small, and you have the opportunity to change your life, and possibly other lives as well. But starting a business also brings challenges. Almost all businesses will require some form of capital to start. If you don’t have cash reserves in a savings account or other liquid investment available to use, you’ll have to find other ways to fund your startup. Here are some common methods for getting the money you need to start your business:
Did Obama Really Cut Small-Business Taxes 16 Times? – The assertion that the Obama administration has cut taxes for small business 16 times might surprise some entrepreneurs —But the White House backed the claim with a fact sheet. Here, for the record, are the taxes the administration says it has cut, in its words:
Bill Gates Loses on Election Night
Could Tax Law Professors Be More “Tax Return Hands-On” Than Tax Practitioners? – Mike Foster, who practices with Venable LLP, said, “I don’t even do my tax returns anymore. I don’t know any tax lawyer who does their own tax returns. The forms are Greek even to us.” Hopefully someone does a survey to determine how many tax lawyers do their own returns.
Please Ask Me Before… – …you make decisions that might affect your taxes. . . .
In short, please see me (or your tax professional) before you do something that will affect your taxes. If you’re not sure if there will be an effect, please call and ask.
5 ways to save on heating costs – We are always on the lookout for ways to save a few extra dollars and heating costs are a good place to start, especially in the fall and winter.
FAIR Tax isn’t just a bad tactic; it’s a bad idea. – The Wall Street Journal and the Cato Institute’s Daniel Mitchell have branded the “FAIR Tax” sales tax proposal a loser issue for political candidates. In a more-in-sorrow-than-anger tone, the Journal notes the difficulties of candidates who embrace this national sales tax:
5 Do-It-Yourself Services You Should Leave to the Professionals – Many people are tightening their belts in these uncertain economic times.One of the first places we often look to save money is finding projects around the home that we can do ourselves rather than calling the professionals. All do-it yourself projects are not created equal, though, and there are times when you are better off calling in the professionals rather than potentially causing more problems by doing it on your own.
What is QE2, and What Does it Mean for You? – The big news on the economic front is that the Federal Reserve has decided to launch a second round of “quantitative easing” – dubbed QE2. If you’re not familiar with the concept of quantitative easing
Don’t pay the seller’s income tax – The Foreign Investment in Real Property Tax Act of 1980 requires buyers to withhold 10 percent federal income tax when buying real estate from those diabolical foreign sellers. The IRS can force a buyer who fails to withhold the 10 percent from the purchase payment to come up with the 10 percent withholding out of his own assets.
Saving Money at Christmas – Christmas spending over the last 2 or 3 years has been relatively low in comparison with other years, but that’s all set to change this Christmas. According to the National Retail Federation (NRF), shoppers are ready to part with their cash this holiday season for the first time since the recession hit. The NRF has forecast total retail sales growth of 2.3% for November and December this year, which means that consumers plan to spend an average of $688.87 on holiday shopping this year, an incredible figure. So if that’s the sort of money the average person on the street is willing to spend this Christmas, how many of you are actually trying to save?
Jason Blumer CPA, He’s a Funny Guy
Carnival of Wealth #10 – Halloween Edition
Website 101: How to Build a Site and Get It Online – Building and putting a website online doesn’t have to be difficult or complicated, though. If you are willing to do a little mental gymnastics and learn a few tricks, you can build a simple website on your own and publish it to your server yourself. Here are a few simple tips for do-it-yourselfers.
How Much Will You Spend in Retirement? – When people share their retirement plans with me, they often assume that they’ll be able to reduce their spending once they retire. At first glance, this seems reasonable. After all (they tell themselves) they won’t have to support the kids anymore and the house will be paid for. And the media encourages people to think this way too. They make the argument that once folks retire, they usually spend 80% of what they spend while they are working. This kind of thinking is wrong and dangerous… Unless you are very mindful and really understand how much money you will need to retire.
Five Ways to Save Money on Food – The number one way to save money is by learning how to cook. You might have a hectic schedule and be exhausted at the end of the day but push yourself to prepare a nice meal. You’ll get to enjoy it, expand your knowledge about cooking, and eat better than ordering it from some fast food place. You won’t be good at it in the beginning but over time your skills will improve and you’ll enjoy it even more.
A Week in Perspective
Recently, I read a tweet asking why we don’t comment on blogs any more. My thought. No need to. Everyone is in too big of a hurry. In response to this, here is what I ask of you: Most bloggers including myself have some sort of way for you to share the post. The post is full of great information. You liked it to the end, and you may have found it informational and or useful. So why not share it. Use the buttons, share it on your Facebook page or your twitter or Digg this or whatever you happen to be on. We are all out here providing information not for fame but to help you the American taxpayer find out what could save you money. Send it on to your friends and followers.
IRS Taxing Your Pumpkin Stands? Good Grief!
An Investor Nightmare Waiting to Happen – In order to claw our way out of a scary recession, we’ve dropped interest rates to artificially low levels to stimulate the economy. What happens to our financial institutions and our pocketbooks when interest rates go back up?
How the battle over credit card swipe fees hits consumers – The feud over the so-called swipe fees merchants pay banks when customers use plastic is reaching a crescendo and will likely hit registers in coming months. Both sides — merchants and card issuers — insist they’re fighting for the best interests of the consumer. At stake are billions of dollars in swipe fees, otherwise known as interchange fees.
IRS paid more than $111 million in erroneous stimulus-related tax benefits
If you missed it yesterday. Please go back and read this week’s rendition of WHAT’S THE BUZZ? TELL ME WHAT’S A HAPPENNIN’
I just finished up some work for the auto company (shame it didn’t last long) and find it in the news more than I seemed to think it was before. Michigan Gets Ford Tough on Tax Credits – The Michigan Economic Growth Authority (MEGA) is seeking tax cuts for the auto giant, as well as its counterparts, GM and Chrysler. Michigan Governor Jennifer Granholm announced the tax cuts, noting the intent of the cuts was to create and retain jobs in the state.
My favorite post this week – Recognize and Eliminate Distractions – One of the things that’s critical when it comes to achieving goals is just plain sticking to the goal until it is complete. It can be super-easy to become sidetracked without even realizing it.
A great book review – Generation Earn: The Young Professional’s Guide to Spending, Investing, and Giving Back – Personal finance is a broad topic and can be difficult to understand when you don’t know where to start. That’s where the book, Generation Earn, by Kimberly Palmer comes into play. Generation Earn is geared toward young professionals, (it is subtitled The Young Professional’s Guide to Spending, Investing, and Giving Back), but I also think it is a great book for anyone starting off on their own, including high school and college students, recent college grads, someone separating from the military or making another similar career change, or anyone else dealing with a major life change that affects their financial situation.
You Can Request an IRS Appeal- Here’s How: - Don’t like the IRS’s rulings? Don’t think you owe? Believe it or not, if you have a conflict with a notice sent to you by the IRS, you have the right to appeal.
IRS Patrol: IRS Announces Pension Plan Limitations for 2011
Off the rails – The federal government has decided to spend $218 million that it doesn’t have on railroad track repairs between Chicago and Iowa City. The State of Iowa will throw in $20 million it doesn’t have, all to enable Amtrak to start losing money forever at $42 per ticket to run trains that will take five hours to make the trip, on the occasional day that Amtrak is on time.
NZ Approves Tax Break for The Hobbit
Is the Mortgage Interest Deduction on the Table? – The Wall Street Journal reported Monday that President Obama’s deficit commission is mulling the idea of reforming the mortgage interest deduction as a way to help solve the nation’s budget problem. You can expect the typical reaction from those in the housing industry (Realtors® and homebuilders) who will claim this is the end of the world as we know it, as well as the anti-tax caucus who won’t accept any tax increase ever.
Still waiting for my confirmation, my friend posted I GOT IT! Cash Basis Balance Sheet balance for A/R or A/P – What can you do if you do have an Accounts Receivable balance on your Cash Basis Balance Sheet?
Five Steps to Starting a Business – Starting a business can be a rewarding experience, but it can also be very time consuming and difficult. Many resources are available to assist you, but information overload can cause you from moving forward.
5 IRA Moves to Make Before the New Year – it’s time to start thinking about holiday shopping—and some year-end money moves. When it comes to your IRA, there are five moves you ought to consider before the ball drops in Times Square.
4 Ways to Blast Away Your Debt – Debt can be as blinding as a blizzard in Buffalo during February. If you are in debt, chances are you have never taken the time to add up the exact amount you owe. Figuring out your net worth is simple and must be done if you ever expect to get out of debt.
This is a number one must read for the small business crowd – New Sec. 179 Rules Have Pleasant Surprise - Many small businesses placing assets in service in 2010 will get a big additional break if they are above the normal $250k.
Understanding Financial Statements Fundamentals
Reading the Story of a Financial Statement
Tracking Stats For Your Business
A LOAD OF CRAP! – My fellow tax bloggers and I are constantly reporting on emails allegedly from the IRS that are in reality “phishing” scams, and reminding you that the IRS will NEVER initiate contact with a taxpayer via email. But those are not the only emails you need to worry about. I am often forwarded tax-related emails that clients have themselves been forwarded, often from friends or family, with the question, “Is this true?”.
Tax Day Gets 2011 Change – Procrastinators rejoice! Next year you will be able to wait three days longer to queue up at your local post office and send in your taxes.
13 Things Your Auditor Will Need For An Initial Audit – We often are engaged to do initial audits of companies preparing to go public. Many have limited operating histories and have never been through an audit. Your auditors are going to need a lot of information to complete the audit and I can tell you we appreciate it when our clients have everything together. What should you have ready? Here is the list we give to our new clients:
How the HIRE Act Incentives Work
2011 IRA contribution limits: 3 ways to maximize your retirement tax advantages – . . . find it useful to think of saving money like distance running. If you obsess over the total distance, then each step seems hopelessly insignificant in covering the necessary ground. If instead you just start making those steps, and concentrate on finding a comfortable and consistent pace, you’ll find that before you know it, the distance will take care of itself.
Music Video – Los Bank Auditors- I’m on an Audit – Fantastic
BusinessWeek Publishes Misleading Article on Federal Withholding Changes in 2011 – All taxpayers should be concerned about the impending expiration of tax cuts (from both the Bush and Obama years) but no one should have a heart attack reading BusinessWeek’s latest estimates of how much higher the taxes will be. They’re way too high.
Even tax lawyers need tax filing help
Best, worst state tax climates for business – Most folks are obsessing over how the expiring Bush tax cuts might affect individual taxpayers, but when it comes to businesses, a lot of other factors come into play. So the Tax Foundation analyzes each year the tax climates of the 50 states to determine which states, from a tax standpoint, are the most business-friendly and which tend to cause companies to flee their borders.
7 Costs to Eliminate Before You Retire – You will be able to get by in retirement with a smaller nest egg if you eliminate as many expenses as possible before you leave the workforce, such as mortgage and credit card debt. While you’re still working, you can also take care of many other expenses that are likely to crop up in retirement, including home repairs, and even taxes in some cases. Here are some expenses you should try to tackle before you retire.
Small Business Payroll Tax Management – When it comes to payroll tax filing, perfection is essential. For small business owners who lack the luxury of having an accounting staff at their disposal, staying on top of filing deadlines and keeping abreast of changing regulatory requirements can be a time-consuming ordeal.
In addition to freeing you up to focus on revenue-producing tasks, full-service payroll companies offer a range of additional benefits:
Renting Vs. Buying A Home: Which Is The Best Choice?
Tax plan now for year end – With just a little over 2 months left until the end of 2010, it is looking more like we will not get an extension of the Bush era tax cuts. The impact of not extending the current tax cuts will be a tax increase for just about everyone, but especially hard hit will be families with over $250,000 of income.
Sadly several of the links do not take you anywhere. Also I noticed that several of the listed blogs actually haven’t contributed to their sites for a very long time.64 Tax Blogs for Geeks and Wonks – Although taxguy not listed you need this list – There’s something for everybody in this list — one of the best we’ve seen — of blogs for tax geeks and wonks. This list includes four kinds of tax blogs: Tax Policy Blogs by American Professors, “Think Tank” Tax Policy Blogs, State and Local Tax Policy Blogs, Helping American Taxpayers Make Sense Of Policy.
Colbert: Tax Shelter Skelter – Comedy Central’s Stephen Colbert explains why we need to keep George W. Bush’s tax cuts alive.
A few weeks ago I received several letters (can you call them letters if they come to you via e-mail?) asking if I had room in my practice for newly accredited CPA’s. I responded equally to them all asking for résumé like information stating classes or experience above and beyond the call of what is taught to get by.
To get to the CPA exam in Missouri one must have 150 Semester Hours and a Minimum Degree (Baccalaureate) is required. Unfortunately to get there, tax education is very minimal in my opinion. Then, the CPA exam covers/test not so-much in the way of tax.
Other MO requirements:
- minimum of 33 semester hours in accounting (at least 1 course in Auditing and at least 18 semester hours of the accounting courses must be upper division accounting)
- 27 semester hours in general business
Of those that sent out the request, only one responded and he was/is very honest. The short version, he knew he didn’t have adequate experience and only during the CPA testing did he realize what he wanted to do. He contacted me looking to join me in an effort to learn. If I can swing it, he’ll be working for me in the upcoming season.
One of the others (just past the CPA exam), tweeted that she had $40.00 and a few days later it was gone and she had no clue where she had spent any of it. I am glad she didn’t respond to my inquiry, as after that, she’d been looking elsewhere.
My point with all of this? Tax season is fast approaching. Make sure you find a tax pro to help you with your preparation. Know and visit with the person handling and preparing your information.
Choosing a Payroll Provider —
There comes a time in every small business owner’s life when they start thinking about moving payroll from their living room computer into the hands of a hired professional.
View L & R Tax Preparation Payroll Video
Shopping for a payroll professional, as well as anything else, requires a little research.
Having just moved my company largely online with on line everything (including payroll) I thought I should put some information out for everyone. So, here are some key questions everyone should ask themselves before choosing a payroll provider.
Before you commit to a payroll provider, ask these questions.
1. What type of payroll provider service will address my needs best?
With traditional payroll services, you phone in, e-mail or fax your payroll information every pay period. These methods require you to establish a set time every pay period for you to submit your payroll. Traditional services also calculate taxes and other deductions and offer various payment methods for employees.
Online payroll has been available for nearly a decade. This service usually allows you to enter payroll hours from one Web site and will make all payroll tax calculations and deductions. Paycheck stubs and W-2s are available for employers and employees on a secure Web site, and direct deposit is usually included. Some, can and will file and pay payroll taxes on your behalf. (L & R Tax preparation now offers this service)
Payroll software, like online payroll, allows you to enter payroll information at your convenience and will perform necessary calculations. However, you are responsible for debiting your bank account, printing checks or arranging for direct deposit and handling IRS penalties and notices.
2. What are the biggest concerns about outsourcing payroll?
Most people agree that payroll would be an easy if it weren’t for payroll taxes, withholdings and other calculations such as 401k, or accrued leave time. If you don’t want to stay on top of strict IRS rules and regulations, choose a payroll service that will do the work for you.
Additionally, if you’re considering software or a phone/email/fax solution to process payroll, make sure they offer direct deposit. You’ll save your employees time, and you won’t have to be in on payday to hand out checks.
Although you probably won’t think of it immediately, online access for pay stubs and payroll records can save hours of tedious work. If an employee has ever asked you to provide the last six months worth of pay stubs for mortgage purposes, you know the advantages of offering employees self-service payroll accounts.
3. What if something goes wrong?
If it’s important for you to be able to speak with someone on the phone when you have a question about payroll, ask if they offer live, U.S.-based customer support. And if you’re one to work on Saturdays, you’ll want to make sure someone will be available to assist you then.
Phone support can be a lifesaver if you receive IRS penalties and notices. It’s not uncommon for businesses to receive these penalties or notices in error. If you don’t want to be on the phone directly with the IRS resolving the issue, make sure your payroll service has tax experts who will work with the IRS on your behalf.
Fitting in time for a call about a small payroll question is not on most small business owners’ lists of top priorities. Make sure your payroll service offers a comprehensive, easy-to-use online help database.
4. How does outsourcing my payroll help me stay in compliance?
Many services calculate payroll and provide direct deposits but don’t handle payroll tax deposits or filings. They may say they assist with those tasks, but if you want the most inconvenient and riskiest part of payroll off your plate, make sure your provider will deposit and file federal, state and local payroll taxes on your behalf.
If payroll taxes are the riskiest part of payroll, new hire reporting is the second. In a recent poll, 95 percent of business owners were not aware that federal and state law mandates that all new hires be reported to the state in an appropriate amount of time. To alleviate worries about compliance, select a payroll provider that reports new hires automatically.
Some payroll services offer more than payroll compliance. For example, your business must post the appropriate labor law posters. If you don’t want to worry about costly fines, ask a potential provider about labor law posters and poster updates.
5. Is it worth it?
Regardless of the method you choose — phoning-in, e-mailing, faxing, or entering payroll online or into software —outsourcing payroll is always faster and more reliable than doing it by hand. Homemade spreadsheets are useful, but a transposed number or erroneous formula can translate into a payroll nightmare as you try to rectify an employee’s pay and amend taxes.
If there’s one thing you can always count on changing, it’s tax laws. And they don’t always change at the beginning of the year. Outsourced payroll, even payroll software, spares you the burden of keeping up-to-date with ever-changing tax tables.
Some closing thoughts.
Outsourced payroll is the same as other outsourced services: You can’t put a price on more time to grow your business and service for your clients. That’s not to say the most expensive payroll service will provide you with the most free time. For example, traditional payroll services are usually the most expensive, yet they require you to set aside time during normal business hours to fax or phone in payroll. Likewise, the cheapest provider may save you money but will likely leave you scratching your head trying to decode payroll tax and compliance laws.
Look for the provider that meets your specific needs. Don’t pay for a service that charges for extras you won’t use. Likewise, don’t try to save money by selecting a service that meets just most of your needs. You want a service that handles all your needs. When you find the right payroll service, the benefits will justify the cost
Prepare your taxes on-line With L & R Tax Preparation
L & R Tax Preparation
Tax Preparation, Payroll, and Accounting,
Including online services.
E=MC2 or use QuickBooks
