Category Archives: Budgeting

348 Days Until Obamacare is Fully Enacted — Do You Know What To Expect? – Forbes

As the full enactment of Obamacare approaches, there are many factors that business owners know to look out for. Do I need to provide health insurance to my employees? Should I go to an exchange? How will the mandate impact my business and profitability? How much are my health insurance premiums going to go up?

These are all questions that many business owners are starting to look. Below are some points that you may not have thought of that should go into your business planning.

We all know that health insurance premiums are expected to go up, but do you know how much?

Small groups 2-99 employees can expect to see price increases between 20% and 50% upon the full enactment of reform.

When factoring in medical trend, taxes and fees, carrier and product changes and the introduction of community rating, your premiums will jump significantly.

As a small business owner, asking your existing broker for a quote is not going to solve this problem as it will require a new method behind providing employees with health insurance. The objective of a health insurance plan should not be to carry you over to the next year with as little pain as possible, but to address your company’s healthcare expenses for the long term. You need a road map that will allow you to offer affordable coverage to employees while keeping costs in line.

Some employers are looking to drop plans in order to remain profitable. Unfortunately, this is not the answer and can cause more pain than gain. With the Supreme Court upholding the individual mandate, all Americans will be required to obtain health insurance or pay a penalty. The cost of obtaining coverage for individuals is expected to jump 100% – 200% with an average increase of 116%. This is going to push many employees who either have individual plans or would ordinarily look at obtaining individual plans to go to their employer to obtain coverage. By not obtaining small group coverage, you risk losing your talent to other companies who are willing to absorb the cost. This can result in the loss of business and inevitably impact the bottom line more then not offering coverage at all.

via 348 Days Until Obamacare is Fully Enacted — Do You Know What To Expect? – Forbes.

Americans Rip Up Retirement Plans –

The labor force has been getting older for decades for reasons that range from longer life spans and better health to companies’ replacement of defined-benefit pensions with higher-risk 401(k) plans.

But the stark increase in workers expecting to stay on the job—now 62%—was a surprise, Mr. Levanon said. After all, the stock market has largely earned back its losses, home prices are rising, and the unemployment rate is creeping down, all of which suggests workers should be feeling more secure.

Many middle-aged Americans, though, drew down their savings during those lean years and now find that leaving the work force on their original timeline is no longer viable, he said.

They are also facing low interest rates, an uncertain future for Social Security, and a lower likelihood of receiving employer health insurance after retirement.

The uptick may be good news for some industries—notably utilities and power companies—that face disruptive skills shortages when older workers retire.

However, senior employees can be expensive for companies, both in salary and health-care costs.

via Americans Rip Up Retirement Plans –

CPAs: Fixing deficit should be government’s top economic priority

CPAs have serious concerns about the U.S. federal budget deficit.

Fifty-four percent of the more than 1,700 AICPA members surveyed Dec. 4 through Dec. 24 said deficit reduction should be the top economic priority for the U.S. government.

Lagging far behind fixing the deficit were other priorities: Creating jobs (23%), tax reform (18%), and ensuring the long-term stability of Social Security and Medicare (5%).

“CPAs in communities large and small and from coast to coast are increasingly troubled by the government’s inability to come to grips with this economic calamity-in-the-making,” AICPA President and CEO Barry Melancon, CPA, CGMA, said in a news release.

Last week, the government passed legislation that helped the U.S. avoid the “fiscal cliff.”

Congress and President Barack Obama now are preparing for what’s expected to be an intense debate over the debt ceiling and spending cuts that would be designed to reduce the deficit.

Melancon said 76% of AICPA survey respondents are sending a clear message to federal policymakers to deal with the debt crisis without delay.

“Fiscal responsibility is essential to our country’s economic sustainability,” Melancon said.

Hiring freezes (55%), reduced capital spending (53%), reduced benefits (52%), and layoffs (52%) were identified by CPAs as the most likely consequences for their clients or company if the government fails to reduce the federal budget deficit.

The gravest effects of failure to fix the budget deficit would be felt by individuals, CPAs said. Almost three-fourths of respondents (73%) said individuals and families would be affected most severely if policymakers cannot reduce the deficit.

Solving the federal deficit problem has been an area of significant focus for the AICPA. In November, the AICPA board of directors passed a resolution describing the need to put the United States on a better economic path and supporting the nonpartisan Campaign to Fix the Debt and Comeback America Initiative.

Earlier last year, the AICPA developed a video, “What’s at Stake,” to inform the public of the danger the federal deficit poses to the financial sustainability of the United States.

“We call on everyone to join together in a public dialogue to make this a national priority,” 2011–12 AICPA Chairman Greg Anton said in the video.

The focus on that effort continues as political leaders gear up for talks about spending cuts.

via CPAs: Fixing deficit should be government’s top economic priority.

Check Your Credit Report Annually

Everyone should check their credit report at least annually. Go to this free, secure site to check it.

To assure that your credit file is disclosed only to you, the nationwide consumer
credit reporting companies will authenticate your identity utilizing the
personal identification information you provide on this site, including, but not
limited to, your Social Security number, and then require that you answer
certain questions. For your protection, if your identity cannot be authenticated
for online delivery of your credit report, you will receive further instructions
on how to request your report for delivery by the U.S. Postal Service. Failure
to authenticate for online delivery of your annual credit report is not an
indicator of fraudulent activity or identity theft.

Stock Pickers Game the Fiscal Cliff – Wall Street Journal

Companies pay out special dividends ahead of “fiscal cliff”: Major U.S. companies are rushing to authorize special dividends before Dec. 31st before the “fiscal cliff” takes effect and the tax on dividends jumps from 15% to 43.4%. Over the past two weeks, at least four Standard & Poor’s 500 corporations have announced special payouts.

Stock Pickers Game the Fiscal Cliff –

Business Income and Expenses Tracking | Virtual Bookkeeping Company – Your Administrative Solutions

The actual process of keeping books is easy to understand when broken down into steps:

1. Keep receipts and or other acceptable records of every payment and expenditure from your business.

2. Summarize your income and expenditure records on a periodic basis (generally daily, weekly, or monthly).

3. Use summaries to create financial reports that will provide specific information about the business. For example, how much monthly profit is the business making or how much the business is worth?

Bookkeeping and accounting functions of a business share two basic goals:

1. To keep track of income and expenses improving chances of making a profit.

2. To collect the necessary financial information about the business to file various tax returns.

Remind yourself of these goals whenever feeling overwhelmed by the details of keeping financial records.

Be reassured that there is no requirement that records are kept in any particular way. In other words, there is no official “right” way to organize the books. As long as the records accurately reflect business income and expenses the IRS will find them acceptable. Whether you do your accounting by hand, on ledger sheets or use accounting software, these principles are exactly the same.

Keeping records:

Summaries of business income and expenses are the heart of the accounting process. Remember that each business sale and purchase must be backed by some type of record containing the amount, the date, and other relevant information about the sale or purchase.

From a legal point of view, the method of keeping receipts can range from slips kept in a box to a sophisticated cash register hooked into a computer system. You will, of course, want to choose a system that fits your business needs.

For more information on how to get set up and ready to roll, call us today at 540.309.5165. We offer an hour free consultation!

via Business Income and Expenses Tracking | Virtual Bookkeeping Company – Your Administrative Solutions.

Hiring a Bookkeeper or an Accountant |

Most people in business for themselves, especially those starting out, believe they can keep their own books. After all, they find plenty of good accounting software on the market, programs that practically fill the spreadsheets out by themselves. They believe they can save money and at the same time keep a closer eye on expenses when they write every check themselves and balance every account.

Those arguments have a lot of appeal. But I’ve found that in the long run, a bookkeeper or accountant is not just someone who keeps track of the pennies and receipts, but a key member of your management team. I ask my accountant whether I should lease or buy a car, extend a business trip into a vacation, and how much I should put aside for retirement. In short, specialists are worth their salt because they know how to save you time and money.

via business – Hiring a Bookkeeper or an Accountant |

Payroll Tax Cut Unlikely to Survive Into Next Year –

Regardless of who wins the presidential election in November or what compromises Congress strikes in the lame-duck session to keep the economy from automatic tax increases and spending cuts, 160 million American wage earners will probably see their tax bills jump after Jan. 1.

That is when the temporary payroll tax holiday ends. Its expiration means less income in families’ pocketbooks — the tax increase would be about $95 billion in 2013 alone — at a time when the economy is little better than it was when the White House reached a deal on the tax break last year.

Independent analysts say that the expiration of the tax cut could shave as much as a percentage point off economic output in 2013, and cost the economy as many as one million jobs. That is because the typical American family had $1,000 in additional income from the lower tax.

via Payroll Tax Cut Unlikely to Survive Into Next Year –

via Payroll Tax Cut Unlikely to Survive Into Next Year –

Cellphones Are Eating the Family Budget –

More than half of all U.S. cellphone owners carry a device like the iPhone, a shift that has unsettled household budgets across the country. Government data show people have spent more on phone bills over the past four years, even as they have dialed back on dining out, clothes and entertainment—cutbacks that have been keenly felt in the restaurant, apparel and film industries.

via Cellphones Are Eating the Family Budget –

CFPB finds discrepancies in credit scores provided by credit bureaus – The Washington Post

Credit bureaus sometimes provide Americans with credit scores that are different from those that lenders use in deciding whether to offer a loan and at what interest rate, the government’s consumer watchdog found in a study released Tuesday.

Researchers at the Consumer Financial Protection Bureau found that the discrepancy happens for as many as one in four people.

via CFPB finds discrepancies in credit scores provided by credit bureaus – The Washington Post.