Writing Off Your Summer Vacation – My Money (usnews.com)

Posted on July 6, 2013 | Leave a comment

If you’re lucky enough to get away this season, consider making vacation plans that will enable you to deduct some of your travel expenses. The only way to do this is to include certain activities in your trip.

Combine business with pleasure. Take a meeting for business in a distant location and all of your airfare is a deductible business expense even though you spend some time on your personal activities. As long as the primary purpose of the trip is business within the United States, transportation and lodging costs and 50 percent of meal expenses on business days can be written off. If you drive instead of fly, you can deduct 56.5 cents per mile, plus parking and tolls.

However, there’s no red line for determining whether the primary reason for your trip is for business or pleasure. Clearly, if you spend more days on business than personal activities, it demonstrates a business need for the travel.

The key to nailing down a deduction for business travel is good record keeping. Be sure to carefully follow the rules outlined on IRS.gov so that if your return is questioned, you can back up your claims. Consider using an app like Expensify to keep track of your business-related travel expenses.

read more…via Writing Off Your Summer Vacation – My Money (usnews.com).

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Do I Need an Accountant?

Posted on July 3, 2013 | Leave a comment

If you are bootstrapping, or starting a small business on a limited budget, you have probably spent some time trying to figure out where you can cut business costs and do more on your own in order to stretch the funds you have available.

One area you may consider doing it yourself instead of hiring it out is accounting. If you have an accounting background and a solid understanding of business finances, then this may be a good place to cut costs. However, if you lack experience in managing the books of a business and expect to learn as you go, you should think twice. Managing your own accounting system incorrectly can hurt your business not only now, but also in the long-term.

Here is a rundown of the things an accountant can do for a small business owner. Review the list carefully, especially if you’re still unsure why an accountant may be a good resource to add to your small business team.

During the Start-Up Process

When you start a business, there are a number of actions you need to take and systems you need to set up in order to create the foundation of a successful business. Here are some ways an accountant can help:

via Do I Need an Accountant?.

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Posted in Budgeting, Information, Saving money, Tax Time Prep

Special VA Electronic Filing Mandate Reminder

Posted on June 25, 2013 | Leave a comment

All Withholding Tax filers are required to file returns and make payments electronically for tax periods beginning on or after July 1, 2013. The due date for the first returns and payments required by the mandate differs by filing frequency. The mandate is effective for:

 

  • Monthly filers      beginning with the July 2013 return, due on August 25, 2013.
  • Quarterly filers      beginning with the July – September 2013 return, due on October      31, 2013.
  • Seasonal      filers      beginning with the July 2013 return, due on August 25, 2013 or      the first subsequent month the business has an employee.

If you have questions on setting this up, call us today. We may be able to walk you through it over the phone. 540-309-5165

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Rules for 2013 Summer Hiring

Posted on June 24, 2013 | Leave a comment

Obtain W-4s from all summer employees, even the owners’ children, students working part-time and foreign students.

 Withhold FITW from all employees, including the owner’s spouse/children, unless a W-4 claims exempt.

Withhold FICA from all employees, even high-school students and those who receive SS benefits. Exception: Employees under 18 working for sole-owner parents.

Pay overtime for hours actually worked over 40 hours in the workweek. You are not required to include as hours worked paid time off (holidays, vacation days). Do not substitute paid nonwork hours for work hours to make all hours straight time, thus avoiding overtime pay.

Example: Eric works 12 hours a day, 4 days of the workweek. He is off the 5th day, a holiday, but is paid for 8 hours. He is correctly paid 40 hours’ straight time + 8 hours’ overtime + 8 holiday (nonwork) hours. Eric’s employer is not allowed to substitute the 8 hours’ holiday pay for Eric’s 8 hours of overtime to avoid paying the overtime rate.

Paid holidays and vacations

Under federal law, paid holidays for part-time and summer help are always optional, but check state laws.

No paid vacation is required—but if you provide paid vacation, some federal and state laws apply.

Benefits

For temps and part-timers, benefits are optional; if offered, they should be explained in a written benefits plan.

–The American Institute of Professional Bookkeepers (AIPB)

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Posted in Information, Saving money, Tax Time Prep, The IRS

Three Things I’ve Learned From Warren Buffett by Bill Gates| LinkedIn

Posted on June 18, 2013 | Leave a comment

Know how valuable your time is.

No matter how much money you have, you can’t buy more time. There are only 24 hours in everyone’s day. Warren (Buffett) has a keen sense of this. He doesn’t let his calendar get filled up with useless meetings. On the other hand, he’s very generous with his time for the people he trusts. He gives his close advisers at Berkshire his phone number, and they can just call him up and he’ll answer the phone.

(Good advice for all business owners…spend time doing what you do best, and leave the other details to those who know those details best. Contact us today (moorebookkeeping@msn.com) if you’d like to stop dealing in the bookkeeping details!)

via Three Things I’ve Learned From Warren Buffett | LinkedIn.

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Outsourced Bookkeeping Provides Safe Keeping For Your Business’s Financial Data

Posted on June 10, 2013 | Leave a comment

The Tornado recently in Moore, OK reminds us of the devastating effects a natural disaster can have on a community. Just as families are working to rebuild their lives, so too are the small businesses that were impacted by the storm.

Kai Ryssdal of American Public Media’s Marketplace interviewed a business owner in Moore, Oklahoma whose business was completely destroyed by the tornado. In the interview, Kai asked the business owner about her business forms and client records. She responded by saying:

“Luckily I did find my [client] records, and I have a CPA offsite … that was the saving grace because I didn’t get the computer backup.”

Regardless of scale, natural disasters have proven that even traditional backups can fail. For instance, say your office experiences a fire, flooding, or even an earthquake, and everything is damaged. Your paper records are gone and your computer equipment is unsalvageable. You can’t rely on keeping your most important business information backed up on an external hard drive. Storing your information with an offsite financial professional can help by protecting your mission critical data so that when it is time to reopen your business, you have all the information you need at hand.

Outsourced Bookkeeping Gives You Peace of Min

via Outsourced Bookkeeping Provides Safe Keeping For Your Business’s Financial Data.

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Three Words That Will Transform Your Career | LinkedIn

Posted on June 3, 2013 | Leave a comment

Every time you encounter another person, think: help this person. It’s not altruistic. Nothing else can so quickly supercharge your career and improve the quality of your life.

When you walk into Starbucks for a coffee, think help this person about the barista who serves you. Instead of being frustrated that he isn’t moving fast enough, see if you can make him smile. Better yet, tell him to keep the change.

When the phone rings on a busy day, don’t get frustrated by the interruption. Think help this person while you answer the phone. Doing so will change your demeanor, your thought process, and the entire interaction.

If you have a subordinate who isn’t pulling her weight, instead of criticizing her, every time you see her think help this person. This doesn’t mean let her slide, or ignore her shortcomings. It means help her either improve her skills or find a position better suited to her strengths. But don’t just brush her aside; really help her.

 

But wait a minute – I know what some of you are thinking. What about the people who take credit for other people’s work? What about the rich and powerful who have gotten that way by crushing others? Doesn’t their success prove me wrong?

Not at all. Sure, there are some people who take the exact opposite strategy. But it takes real skill and focus to succeed by being evil, and most of us just don’t have the fortitude to pull it off. For those of us with a soul and a heart, the only real choice is to succeed by helping others.

By first thinking help this person, you will change the ways that others perceive you. There is no faster or more effective way to change your interactions and relationships. You will be viewed as a positive, constructive, helpful and dependable person. People will think you are more perceptive, attentive and understanding.

That’s why this way of thinking is not altruistic; it is selfish, in the best sense of the word. The single best way to help yourself is to always be looking for ways to help other people. Sure, you’ll be making the world a better place, and in the course of your life you will help many thousands of people. But don’t do it because you ought to, or because it’s the “right” thing to do.

Think help this person because you’re selfish, and proud of it.

Thanks for reading this.

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Money Mistakes You Might Be Making – 360 Degrees of Financial Literacy

Posted on May 31, 2013 | Leave a comment

Mistake 1: 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 2: Not having an emergency fund

One lesson that you may have learned over the past few years is that the job market isn’t stable. That’s a major reason why one of your savings 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 if you lose your job, is vital because it can help you avoid having to rely on credit or tap your retirement savings. If you don’t have emergency savings to fall back on, a minor money shortfall can quickly turn into a major cash crisis.

Mistake 3: Not asking for help

Even if your finances are in good shape right now, you may be overdue for a checkup. Reviewing your 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 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.

via Four Money Mistakes You Might Be Making – 360 Degrees of Financial Literacy.

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Internet Sensation Charles Ramsey Gets Free Food From McDonald’s: Do You Want Taxes To Go With That? – Forbes

Posted on May 28, 2013 | Leave a comment

On May 6, 2013, Charles Ramsey made national news – all while eating a hamburger. His 9-1-1 call was instrumental in the rescue of kidnapping victim Amanda Berry and two other women, Michelle Knight and Gina DeJesus. Berry had been missing since 2003; Knight and DeJesus disappeared in 2002 and 2004, respectively.

Ramsey had just returned from McDonald’s when he heard a scream and noticed Berry trying to escape from the house next door. He ran from his living room and together with a neighbor, Angel Cordero, he broke down the door and let her out. Berry explained who she was and Ramsey called 9-1-1. He was remarkably calm while offering her description to the dispatcher and confirming that she needed an ambulance. Ramsey couldn’t answer whether the captor was still in the house, saying “I don’t have a fuckin’ clue, bro. I’m just standing here with my McDonald’s.” That line went viral as news of the remarkable discovery of the girls spread like wildfire on the internet.

Please read the rest at Internet Sensation Charles Ramsey Gets Free Food From McDonald’s: Do You Want Taxes To Go With That? – Forbes. Wonderful story.

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Keep Track of Your Receipts!

Posted on May 24, 2013 | Leave a comment

auditKeep track of your receipts!

Businessman claimed he ran a proprietorship and filed a Schedule C showing a substantial loss for the year. The IRS denied most of the deductions on the return because the taxpayer lacked sufficient records to support them. The taxpayer appealed to the Tax Court.

Held: Mostly for the IRS. Under §162, Trade or business expenses, a taxpayer must prove that the expense was ordinary and necessary for carrying on a trade or business; and the expense was paid.

For many of the expenses, the taxpayer proved one of the elements but not the other, providing bank statements showing checks written to office supply stores and the USPS — but no  detailed record of items purchased  and how they related to the business. For other expenses, the taxpayer had invoices showing the amount due and how these items related to the business —but no proof the invoices actually were paid.

Acceptable proof could include receipts, cancelled checks or credit card statements. The court ruled the evidence provided by the taxpayer was so scant that the court could not even estimate deductions under the Cohan rule.* The court denied most of the deductions because the taxpayer did not prove both key elements for each deduction.

* The Cohan rule lets the IRS and courts use other sources to estimate expenses and amounts, if the evidence is both credible and sufficiently detailed to verify the deduction and to make a reasonable estimate of the amount.

More requirements: Some expenses, such as travel, meals, entertainment and auto expenses, require more proof under §274, Disallowance of certain entertainment, etc., expenses. The IRS and courts have no flexibility on these items and deny deductions unless all of the substantiation required by the regulations is provided. [Fleming v. Commissioner, T.C. Memo. 2010-60]

–American Institute of Professional Bookkeepers

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