Dugan & Lopatka summer issue of NFP newsletter now available!
The summer issue of Dugan & Lopatka's Solutions for Nonprofits newsletter is here!
6 tax tips for startups
Taxes are rarely the first thing that entrepreneurs think about. With that in mind, the IRS put together a short-list of tax related considerations for start-up businesses.
1. Pick a business structure. One of the first things you will need to decide is how to structure your business – as a sole proprietorship, a partnership, an S or C corporation, and so on. Each comes with different tax rules and different filing requirements, so the advice of an expert is invaluable.
2. Pick a tax year. How and when a business files its taxes is determined by its tax year, which can either match the calendar year, or be a fiscal year of any 12 consecutive months. In most cases, the business owner can choose whichever works best for them. But, calendar years are required for businesses with no books or records, no annual accounting period, or in certain circumstances laid out in the Internal Revenue Code or the income tax regs.
What's New in Finances: Don′t forget to review your insurance
When was the last time you reviewed your insurance coverage? An annual insurance review makes good financial sense. Here are points to consider as you review your various insurance policies.
Health care. If you have an individual policy, investigate whether your employer, union, or professional association offers a less expensive group policy.
Long-term care. Long-term care insurance may be advisable if you're between the ages of 55 and 72 and you don't have enough assets to fund long-term care.
Properly classifying workers remains a major problem
From an August 2, 2017, online Accounting Today post
Worker misclassification is a perennial issue for the Internal Revenue Service and state taxing authorities due to the perception that many employers are not properly classifying their workers.
By avoiding labeling their workers as employees, employers also avoid paying minimum wages, overtime, payroll taxes, worker’s compensation, unemployment, Social Security contributions, health benefits, paid leave, 401(k) benefits and unpaid leave under the Federal Family and Medical Leave Act. And workers have some benefits to being considered independent contractors, such as the ability to deduct certain business expenses that are not available to employees, the ability to set up their own retirement plans, and the fact that they are not subject to withholding. Of course, many workers want to be considered employees so they can get the benefits due employees, such as vacation pay, overtime pay and health insurance.
Cybersecurity threats proliferating for midsize and smaller businesses
Smaller organizations are targets for hacking and phishing attacks to get information that can harm them or bigger companies they do business with. This July 2017 Journal of Accountancy publication addresses these increasing threats.
Why would cyberthieves target a company other than the very largest - big enterprises with big payoffs? It's a question that many small and medium-size businesses (SMBs) ponder, arriving at the wrong answer.
Hackers have SMBs in their crosshairs as much - if not more so - than the world's biggest enterprises. Here's one reason: Small companies in the business-to-business space that serve large organizations often connect to the latter's networks and systems. In effect, the SMB is a potential conduit to the larger company's data assets.
A handy guide to expensing roofing costs
Roof work can be a major project if you own commercial or residential property. Many people incorrectly assume that a substantial roof project should always be capitalized and depreciated. Often times, roofing costs can be 100% deducted in the year the work is completed. This article from a June 22 post in The Tax Advisor nicely lays out factors to evaluate in determining whether your roof work needs to be capitalized or if it can be expensed.
Each year, tax professionals who deal with real estate must evaluate the most recent building expenditures and determine which items should be written off as a repair expense or capitalized. The most common, and often significant, item that is evaluated is roofing-related work. In many cases, only a portion of the roofing system is replaced, and depending on the facts, those costs may be deducted as repairs. When compared to the alternative option of depreciating the cost over a 27.5-year life for residential rental real estate or a 39-year life for commercial real estate under the modified accelerated cost recovery system, an incorrect conclusion may lead to a significant overpayment of tax liability.