Posted by Doug Snyder on Tue, May 22, 2012 @ 07:52 AM
Three years after the economic crisis led many Americans to re-evaluate their financial picture, economic uncertainty is still the norm. While there's little you can do about the shaky economy, you can help stabilize your small business finances over the long term by evaluating what you're doing right ... and wrong. There's no guarantee, but avoiding these four money mistakes may help your business survive and ultimately thrive in any turbulent economy.
Mistake 1: Jumping on the bandwagon
Are you letting economic news--good or bad--control your financial decisions? For example, are you selling gold because you've heard that prices are at record highs or buying real estate because you've heard that prices are at record lows? Have you decided to pull most of your small business investments out of the stock market because you've seen headlines warning of a possible financial crisis?
Unless you're basing your decisions on your own needs and circumstances rather than on the opinions or actions of others, you can't be sure you're doing what's right for you. Instead of jumping on the bandwagon, take a proactive, rather than reactive, approach to your finances, no matter what economic news you're hearing or what other investors are doing. Revisit your tolerance for risk and your own financial goals, and try to prepare yourself for a variety of scenarios. Avoid basing money decisions on emotion, or you may find yourself facing unanticipated consequences down the road.
Mistake 2: Only saving what's left over
Do you continue to worry that you're not saving enough? Do you routinely rely on credit rather than cash to pay for the things you want or need? Rather than blame your financial inertia on your income, look a bit deeper, because the real culprit may be the lack of financial priorities. If you don't know exactly how you're spending your money and you haven't set financial goals, it's unlikely that you'll see much financial progress.
Go back to basics by preparing (or reviewing) your budget. If you tend to save only what you have left over every month, you can put yourself on a more disciplined course by having a fixed amount taken out of your paycheck automatically for retirement. Or, you can set up automatic transfers from your checking account to a savings or investment account.
Mistake 3: Not having an emergency fund
One lesson that you may have learned over the past few years is that the economic market isn't stable. That's a major reason why one of your business priorities should be an emergency fund. While it isn't glamorous, this underappreciated workhorse really pulls its weight during hard times. Having cash on hand that you can use for an unexpected expense, or to pay bills when revenues are not flowing in, is vital because it can help you avoid disaster. If you don't have emergency savings to fall back on, a minor money shortfall can quickly turn into a major cash crisis.
Mistake 4: Not asking for help
Even if your finances are in good shape right now, you may be overdue for a checkup. Reviewing your business finances is especially important during periods of volatility because it can help reveal potential strengths and weaknesses, and identify changes you might need to make to adjust to the current economic climate. And if you're business is already in financial trouble, don't let fear or shame prevent you from asking for help. Facing financial problems early may help you make a full recovery. Many creditors are willing to work with you, but this may be much easier while your credit is still good, and while you still have time to turn things around.
South Carolina's Small Business and Nonprofit CPA
Posted by Doug Snyder on Tue, May 01, 2012 @ 02:13 PM
Warning - Tax filing deadline draws near for nonprofit organizations having a calendar year-end. Internal Revenue Service Form 990 - Return of Organization Exempt from Income Tax is due May 15th. Most individuals, small business owners, and media outlets treat April 15th as the only major tax deadline day. However, people involved with nonprofit organizations are aware of another significant tax filing deadline.
Some think nonprofits are not required to file tax returns. Reality is almost all nonprofits
(with some exemptions) are required to file annual tax returns or potentially lose their nonprofit status. If you need a quick overview see IRS Nonprofit Tip
The major purpose for nonprofit tax return involves compliance rather than computing tax. In many cases, nonprofit tax return filing requirements are more extensive than the information needed to complete small business tax returns. Three focus areas for nonprofits completing Form 990 are the federal, state, and governance requirements.
Federal Requirements - The reporting requirements for nonprofit organizations has changed over the past several years. Small nonprofts (less than $15,000 annual receipts) have an option to file Form 990N -EPostcard. A majority of nonprofits (annual receipts greater $200,000 or assets greater than $500,000) fall into the category that requires filing the "long-form". A requirement of the long-for asks if the board of directors reviewed Form 990 before it was submitted to the IRS. It is helpfull to board members to have an Form 990 Board Member Checklist
State Requirements - Most states have requirements for tax exempt organizations to file tax returns, but it differs by state as to which state agecny is to receive the Form 990. For example, South Carolina nonprofits report to the Secretary of State who requires a charitable organization either submit the Secretary of States Annual Report Form or the IRS Form 990, 990-EZ or 990-PF on an annual basis. Most states allow the IRS Form 990 to be submitted, you just need to make sure it goes to the proper agency.
Governance Requirements - The major difference between small business tax returns and tax exempt organization tax returns is that nonprofits have to complete extensive policies, procedures and governance questions not required on for-profit tax returns. According to the current IRS Commissioner, "the IRS believes there is a direct relationship between exempt organizations adopting and following good governance practices and their compliance with the tax code."
Completing Form 990 is an extensive process for most nonprofit organizations. The sooner you begin the tax preparation process before the deadline, the more likely you will be able to complete in time all requirements of the tax return. You may file an extension, but make it a goal to make the filing deadline. - Good luck!
If you need further information or assistance with filing your nonprofit tax return contact South Carolina's Small Business and Nonprofit Accountant
South Carolina's Small Business and Nonprofit CPA
Posted by Doug Snyder on Sun, Apr 15, 2012 @ 10:44 PM
The 2011 personal tax return deadline is upon us. Uncle Sam wants to hear from you soon. It is strange the tax return deadline date is April 17, instead of April 15th. Even so, the tax deadline is here. You should choose 1 of the following 3 options:
1. File Tax Return - Payments made (possibly a refund due) or you can pay amount due. IRS has several options for tax payments. See Everything You Need To Know About Making Federal Tax Payments
2. File Tax Return - Can't pay the total amount due with the return. The IRS has severa flexible payment options for those who cannot come up with the total amount due with the tax return. See Tips For Those Who Cannot Pay Their Tax On Time
3. Extend Tax Return - If you do not have all the information to complete an accurate tax return, there is a provision you can extend your return filing deadline until October 15, 2012. See Need Extra Time to File Your Tax Return, File an Extension You may need more time to determine a few more tax savings actions.
The most important point is this: FILE YOUR TAX RETURN OR A TAX RETRUN EXTENSION by April 17th! Please do not consider not filing anything with the IRS. By missing the deadline, you will incur tax penalties and cause increase your time and effort dealing with the IRS than if you at least file the minimal amount of information.
If we can help you comunicate with Uncle Sam before the clock strikes midnight on April 17th, do not hesitate to contact South Carolina's small business and nonprofit accountant
South Carolina's Small Business and Nonprofit CPA
Posted by Doug Snyder on Wed, Dec 21, 2011 @ 11:01 AM
The year is quickly coming to an end. If you are a small business owners it is time for you to focus on tax saving steps to make before year-end. For many tax savings measures to be allowed by the IRS for 2011, the activity has to occur by the last day of the year. You should take time to consider the following actions.
Determine Current Tax Position- With only a few weeks remaining to year-end, you should have a reasonable estimate of your 2011 bottom line. If it looks like you are going to have a taxable profit, then it will be well worth you taking more time to determine what steps can be made to lower the tax burden on your estimated profit.
Steps Before Year-End - Typically you want to make payments for expenses before year-end and delay receiving any income you can until the following year. For example, a tax bill due in January can be deducted on this year's return if paid by the end of December. Small business owners who bill for their services may find it beneficial to wait and send invoices at the beginning of the new year.
Prepare For Future Taxes - Whether you anticipate taxable income or loss for 2011, you still should consider what awaits small business owners in the not-to-distant future. Economic and political uncertainty leads many financial advisors to suggest taking actions to position your small business activities for the anticipated 2012 small business tax trends
South Carolina's Small Business and Nonprofit CPA
Posted by Doug Snyder on Thu, Jul 28, 2011 @ 05:38 AM
Seems like the only headline in the news recently is the gridlock in Washington DC over the debt ceiling limit. Over all the noise, can small business owners hear how the national debt ceiling will impact thier lives? From South Carolina to California there are already enormous financial crisis issues being faced. Aren't these local crisis more important than the current fight in Washington?
Unfortunately, the national debt ceiling issues will bring some negative impacts to small businesses and nonprofits accross the country. You can watch a Short Debt Ceiling Impact Video to gain a general understanding of some major issues to consider regarding the debt ceiling impact.
"Any agreement to raise the federal debt ceiling will likely come with a mandate for a tax overhaul, and some fear that changes made to produce more revenue could reduce incentives for retirement savings and investment" says Mark Shoeffer, Jr an Investment News journalist. He suggest the Debt Ceiling Deal Could Be Monumentally Bad in his current article.
Stay tuned. Something must happen soon to break the grid-lock. The impact will soon follow.
As you move forward you will want to Get The Most Out of Your Business to deal with the national debt ceiling impact and other tough economic issues you are currently facing. Hang in there!
South Carolina's Small Business and Nonprofit CPA
Posted by Doug Snyder on Fri, Jul 22, 2011 @ 06:11 AM
Mid-year is an excellent time for financial planning particularly challenging economic times. As a result of December 2010 legislation, 2011 tax planning takes place in an environment characterized by something that was missing last year – a relative degree of certainty. That said, you need to keep certain things in mind as you consider your current tax situation. Consider the following tax planning actions:
Review Tax Withholding – As the IRS suggests, “If you have too little federal tax withheld from your pay, you could end up owing a lot of money when you file your taxes. If you withhold too much, you will get a large refund next year, but that means you gave up the use of your money for several months during the year.” You can compute your withholding at the Federal Tax Withholding Calculator
Consider Five Strategies – “The post-recessionary world demands a new game-plan for companies to operate quickly, flexibly and strategically within a more volatile environment. Fostering and protecting key relationships, particularly vendor and supplier relationships, and executing best-practice operations is paramount to achieving success” says Craig Doud. See his recommended five strategies at Five strategies for business performance
Attend Free Webinar – Take an hour to focus on the critical issues to consider in planning for your financial situation now to help you get on track for a secure future tomorrow. The American Institute of CPAs is offering a free webinar through their 360 Degrees of Financial Literacy Program. Register today at Rejuvenate Your Financial Plan
There is always a lot to think about when it comes to tax-savings and financial planning. Mid-year is a good time to analyze your situation so you have adequate time to take action before the year-end rush begins.
Want to know more about your 2011 Tax Landscape? Check out Landscape at the middle of 2011
South Carolina's Small Business and Nonprofit CPA
Posted by Doug Snyder on Thu, May 19, 2011 @ 05:41 AM
American highlights Small Business this week. It is a good time for South Carolina business owners to take a quick review of 3 areas to keep them on the road to success.
Compliant with the IRS – Like it or not, business owners must make sure the company remains compliant with the mountain of federal tax laws. Fortunately, the IRS is becoming more user friendly. The IRS website has a dedicated section Small Business Tax Center that provides a wealth of information related to small business federal tax requirements.
Utilize Tax Incentives – While tax compliance is paramount to maintaining small business success, best practices of thriving small businesses includes utilizing tax breaks. Many tax incentives change each year. Near the end of 2010 laws were enacted to help stimulate small business actvities. Check to see if the Tax Incentives From Small Business Legislation affect you in 2011.
Local Small Business Issues - In addition to staying current on the federal tax issues, business owners must understand the current landscape in the state they operate. It is important to stay atuned to the issues in South Carolina. A helpful resource is the South Carolina Small Business Chamber that helps advocate for small business in South Carolina.
These are challenging economic times. Many civic and business leaders agree that a critical step for economic recovery is to keep small businesses successful.
Keep up the good work small businesses. We salute you this week and every week as you work to fuel America's economic recovery.
South Carolina's Small Business and Nonprofit CPA
Posted by Doug Snyder on Tue, May 10, 2011 @ 08:28 AM
Attention Nonprofit Organizations - Tax Deadline Approaches.
For nonprofit organizations with a calendar year accounting period, the tax return filing deadline is May 15th. Since the deadline falls during a weekend in 2011, the deadline is Monday, May 16th. Completing the correct IRS Form 990 - Return of Organization Exempt From Income Tax can be a challenge. Questions to consider:
What is correct form? There are several different forms of exempt organization tax returns. The correct tax return form depends on the total amount of annual revenue and total assets. You can determine the correct form for your entity by reviewing Thresholds for Filing 2010 Form 990.
Must Board of Directors review? Form 990 has expanded the issues a nonprofit entity must report. One section of the long-form 990 is dedicated to governance, policies, and procedures. A nonprofit entity must answer if the board of directors will see the tax return before it is filed with the IRS. In order to answer yes on the return, the board of directors must see the Form 990 before being filed.
Can extension be filed? A request for an extension can be filed that will have the due date of August 15, 2011. The extension must be requested by May 16, 2011. You can obtain the form to request an extension by going to Application for Extension.
Would you like a helpful Form 990 Preparation Checklist? Ask for Form 990 Checklist.
South Carolina's Small Business and Nonprofit CPA
Posted by Doug Snyder on Tue, Dec 21, 2010 @ 09:04 AM
The Tax Relief, Unemployment Insurance Reauthorization, and Job Creation Act of 2010, HR 4853, which postpones the sunset of the 2001 and 2003 tax cuts, reduces the estate tax, extends a large number of expired provisions, and extends unemployment benefits was signed last Friday.
The Act has numerous components of interest and concern to South Carolina small businesses and nonprofits (note-partial information below received from South Carolina Nonprofit Organizations newsletter):
Tax Rates Maintained: All of the individual tax rates put in effect in 2001 and 2003 are maintained through 2012, including those for upper-income tax brackets. Most immediately, this means employers will not have to adjust employee withholdings for income taxes.
Individual Payroll Taxes Reduced: Employees receive a two percent reduction in the Social Security tax they pay. For 2011, nonprofit and other employers will need to reduce the individual's share of payroll withholding from 6.2 percent to 4.2 percent. To illustrate what this change means, an individual earning $50,000 will see $1,000 in tax savings.
Charitable Giving Incentives: The IRA rollover and other expired charitable giving incentives (promoting donations of food, land, computers, and books) are restored for the remainder of 2010 and through the end of 2011, which should help promote giving.
Video for Small Business Tax Savings 2010
South Carolina's Small Business and Nonprofit CPA
Posted by Doug Snyder on Fri, Dec 10, 2010 @ 05:38 AM
Benjamin Banks, the AICPA's spokesperson for personal finance says:
Some SC Busness owners may "have put off managing their finances at some time or another–a bill here, a phone call there–but overindulging in the desire to dawdle can lead to a debt disaster. The good news is that you don't have to tackle all of your finances at once. Take it one step at a time and you will be able pull yourself out of financial procrastination.
- Shout it out. As with any goal, it can be beneficial to tell someone about your new objective. Whether you tweet it, post it or simply tell your neighbor, when there's someone there to help keep you accountable, you're more likely to make progress improving your finances.
- Take everything task by task. If you make taking care of your finances about time, such as "I'll take one hour to balance my checkbook," you're more likely to sit there watching the clock. Instead, make a list of all your financial tasks, and take care of them one by one, regardless of how long they take.
- Make finances fun. Make finances fun. OK, so you may not be able to train yourself to look forward to paying the bills, but if you reward yourself after every task–say with a relaxing bath or an evening with that book you've wanted to read–you'll have more incentive to get the job done. Positive reinforcement is key to changing your behavior.
Remember, as with breaking any bad habit, you may have a procrastination slip up every here and there, but the important thing is to not let yourself slip back into your old ways. So put yourself in tomorrow's shoes and take care of yesterday's" business today!
Need more information contact South Carolina's Small Business and Nonprofit Accountant
South Carolina's Small Business and Nonprofit CPA