Offer plan loans? Be sure to set a reasonable interest rate
Can your company’s retirement plan participants take out loans from their accounts? If so, you must set a “reasonable” interest rate. Neither the IRS nor the DOL provides a set percentage for plan sponsors. The IRS looks to similar local interest rates and what local banks charge for similarly structured loans. Meanwhile, DOL regulations generally define a reasonable rate as equal to commercial lending interest rates under similar circumstances. Need help? We can assist you in reviewing your plan document and loan policy statement to calculate a reasonable rate. READ MORE +
Nonprofits and their staffers can save tax with an accountable plan
When your nonprofit’s employees submit expenses for reimbursement, you generally must report the payments on W-2 forms, withhold applicable taxes and pay the employer portion of employment taxes. But with an accountable plan in place, you can avoid these steps and save both staffers and your organization taxes. Expenses covered in an accountable plan must have a business connection, be “reasonable” and be properly documented. Additional rules apply, and your plan should be put in writing in case the IRS ever challenges it. We can help you do this. READ MORE +
Who can — and who should — take the American Opportunity credit?
Who can take the American Opportunity credit? If you have a child in college, you may be eligible to claim the credit (up to $2,500) on your 2016 income tax return. If your income is too high, you won’t qualify. But your child might. There’s a potential downside: You’ll have to forgo your dependency exemption for him or her. And the child can’t take the exemption. But the exemption is also subject to a phaseout, so you might lose its benefit anyway. We can help run the numbers and provide more information about qualifying for the American Opportunity credit. READ MORE +
Make sure the IRS won’t consider your business to be a “hobby”
If you run a business “on the side” and derive most of your income from another source, you may face a risk: Your enterprise might be a hobby in the eyes of the IRS. If so, it will be subject to the hobby loss rules, which means you can’t use a loss from the activity to offset other income. In evaluating whether an activity is a hobby, the IRS looks at various factors. For example, poor record keeping, ongoing lack of profit and minimal effort to make a profit might indicate a hobby. Concerned about the hobby loss rules? We can help evaluate your situation. READ MORE +
Getting your money’s worth out of a company retreat
Company retreats can be expensive. But when planned properly, they can produce fresh strategic ideas and raise employee morale. To ensure the event’s success, several months ahead of time identify your key retreat objectives. Pick only two or three so you have a better chance of fulfilling these goals. Also, create a detailed, reasonable budget. Set limits for such variable costs as location, accommodations, food, transportation, speakers and entertainment. It’s not easy, but a retreat can be both enjoyable and cost-effective. Please let us know how we can help. READ MORE +
Divorce necessitates an estate plan review
Going through a divorce? Update your estate plan as soon as possible to avoid unintended outcomes. Unless you wish to provide your former spouse with an inheritance, immediately amend your will and trusts to eliminate him or her as a beneficiary. Also, unless you’re comfortable with your former spouse controlling your wealth, designate someone else as executor or trustee. This is a good idea even if you live in a state where divorce automatically nullifies bequests to an ex-spouse and automatically revokes an appointment of a former spouse as executor or trustee. READ MORE +
Why nonprofits need continuity plans
All organizations, not-for-profit and for-profit alike, need a continuity plan for when disaster strikes. But these plans are particularly critical for organizations that provide essential human and emergency services. Start by assessing threats to your people, processes and technology. Then consider best and worst outcomes regarding personal injury, property damage and financial losses and how you can mitigate any damage. Although everyone should provide feedback, assign one person to take the lead and create the plan document. For additional tips, contact us. READ MORE +
2016 IRA contributions — it’s not too late!
There’s still time to make 2016 IRA contributions: The deadline is April 18. If the contribution is deductible, it will lower your 2016 tax bill. But even if it isn’t, a 2016 contribution is likely a good idea. Your money can grow tax-deferred (tax-free in Roth accounts). But annual contributions are limited by law, and any unused limit can’t be carried forward; once the deadline has passed, the savings opportunity is lost forever. The 2016 limit is $5,500 (plus $1,000 for those age 50 or older on Dec. 31, 2016). Want to learn more? Contact us. READ MORE +
The Section 1031 exchange: Why it’s such a great tax planning tool
Like many business owners, you might also own highly appreciated business real estate. Under a Sec. 1031 “like-kind” exchange, you can defer gains on real property used in a business if, instead of selling it, you exchange it solely for property of a “like kind.” Virtually any type of real estate will qualify as long as it’s business or investment property. It’s rare for two owners to simply swap properties. You’ll likely have to execute a “deferred” exchange, in which you engage a qualified intermediary. The rules are complex, so contact us for details. READ MORE +
Keep family matters out of the public eye by avoiding probate
Probate is a legal procedure in which a court establishes your will’s validity, determines your estate’s value, resolves creditors’ claims, provides for the payment of taxes and transfers assets to your heirs. Downsides to probate are that it’s time consuming, expensive and public. You can avoid or minimize probate by designating beneficiaries where possible and titling assets in a way that allows them to be transferred directly to your beneficiaries outside your will. Contact us to learn more ways to minimize probate based on your assets. READ MORE +
Listen and trust: The power of collaborative management
Do you collaborate with your managers or simply issue orders? As your company grows, you’ll likely be better off sharing responsibility for major decisions. To promote collaboration, clearly communicate your strategic objectives. Also, listen to your managers’ ideas and act on the viable ones. Conduct regular performance reviews as well, emphasizing accomplishments and exploring growth opportunities. Provide constructive, ongoing professional and leadership training, too. Let our firm assist you in assessing the profitability impact of your management team. READ MORE +
Does your nonprofit need to register in multiple states?
If your not-for-profit solicits funds online, or uses other fundraising methods that cross state boundaries, it may need to register in multiple jurisdictions. The critical activity is soliciting, not accepting, funds. So an unsolicited donation from an out-of-state supporter doesn’t necessarily require you to register in that state. However, widely used communications such as email and text blasts and social media appeals are likely to be considered multistate solicitations. Unfortunately, rules vary widely by state and can be confusing. Contact us for help. READ MORE +
When an elderly parent might qualify as your dependent
Are you supporting an elderly parent? You might qualify for the adult-dependent exemption, which allows a deduction of up to $4,050 per adult dependent claimed on your 2016 tax return. For you to qualify, in most cases your parent must have less gross income for the tax year than the exemption amount. Generally Social Security is excluded, but payments from dividends, interest and retirement plans are included. And you must have contributed more than 50% of your parent’s financial support. Contact us for more information on qualifying for this break or others. READ MORE +
Filing deadline rapidly approaching for flow-through entities
The March 15 federal income tax filing deadline for calendar-year partnerships, S corporations and LLCs treated as partnerships or S corporations for tax purposes is nearly upon us. This deadline is nothing new for S corporation returns, but it’s about a month earlier than previous years for partnership returns. The extension deadline remains at Sept. 15 for both partnership and S corporation returns, but you must file for the extension by March 15. Contact us if you have questions about the filing deadlines that apply to you or avoiding interest and penalties. READ MORE +
Cooking the books
What’s the most costly type of white collar crime? Falsified or manipulated financial statements generate a median cost of $975,000 — more than any other type of occupational fraud, according to the Association of Certified Fraud Examiners. Examples include concealed liabilities, fictitious revenues, inflated asset valuations, misleading disclosures and timing differences. Losses from financial statement fraud can quickly snowball out of control. We can help identify red flags, ferret out ongoing schemes and deter would-be fraudsters from cooking your books. READ MORE +
Make health care decisions while you’re healthy
Estate planning isn’t just about what happens to your assets after you die. It’s also about protecting yourself and your loved ones. This includes having a plan for making critical medical decisions in the event you’re unable to make them yourself. And, as with other aspects of your estate plan, the time to act is now, while you’re healthy. If an illness or injury renders you unconscious or otherwise incapacitated, it will be too late. READ MORE +
Don’t make hunches — crunch the numbers
It’s a simple question. If my company buys a given asset, will the asset’s benefits be greater than its cost? Some basic ways of finding an answer ignore the time value of money. That’s why it’s better to look to discounted cash flow metrics. For example, net present value measures how much value a capital investment adds to the business. And internal rate of return estimates a single rate of return that summarizes the investment opportunity. We can help you use these and other metrics to make better business decisions. READ MORE +
Should your nonprofit outsource HR management?
Does your not-for-profit have too much work and not enough staff to go around? Consider outsourcing your human resources function. It could give your employees more time to spend on other core duties, mission-driven programs and strategic plans and help reduce costs. Even if after performing a cost-benefit analysis you find that it costs more to outsource, you may want to move forward because most HR providers will have better tools and more time to spend on employee issues than your organization does. But there are downsides, too. READ MORE +
When it comes to charitable deductions, all donations aren’t created equal
As you file your 2016 income tax return and plan your charitable giving for 2017, it’s important to keep in mind the available deduction. It can vary significantly depending on a variety of factors. Other than the actual amount you donate, one of the biggest factors that can affect your deduction is what you give. READ MORE +
Deduct all of the mileage you’re entitled to — but not more
Rather than keeping track of the actual cost of operating a vehicle, employees and self-employed taxpayers can use a standard mileage rate to compute their deduction related to using a vehicle for business. But you might also be able to deduct miles driven for other purposes, including medical, moving and charitable purposes. READ MORE +
Can the WOTC save tax for your business?
Employers that hire individuals who are members of a “target group” may be eligible for the Work Opportunity tax credit (WOTC). If you made qualifying hires in 2016 and obtained proper certification, you can claim the WOTC on your 2016 tax return. Whether or not you’re eligible for 2016, keep the WOTC in mind in your 2017 hiring, because the credit is also available for 2017. READ MORE +
Use an ILIT as a wealth preserver
If you’re concerned about your family’s financial well-being after you’re gone, life insurance can provide peace of mind. Going a step further and setting up an irrevocable life insurance trust (ILIT) to hold the policy offers additional estate planning benefits.Nevertheless, you can design the trust to adapt to changing circumstances and provide that children or grandchildren born after you establish the trust be automatically added as beneficiaries. READ MORE +
What can a valuation expert do for your succession plan?
Most business owners spend a lifetime building their business. And when it comes to succession, they face the difficult decision of whether to sell, dissolve or transfer the business to family members (or a nonfamily successor). Many complicated issues are involved, including how to divvy up business interests, allocate value and tackle complex tax issues. READ MORE +
Make sure your nonprofit’s bylaws are on point
Bylaws are the rules and principles that define your not-for-profit’s governing structure. Your board and staff need to be familiar with exactly what the bylaws contain — and what they don’t. If they’re incomplete or don’t reflect the organization’s current mission, revising them is critical. READ MORE +
IFRS vs. GAAP: Some public companies want a choice
U.S. public companies are required to report their financial results using U.S. Generally Accepted Accounting Principles (GAAP). But, since 2007, hundreds of foreign companies listed on U.S. stock markets have been able to report financial results using International Financial Reporting Standards (IFRS) instead of GAAP. The Securities and Exchange Commission (SEC) is currently considering a proposal that, if approved, would allow domestic companies to supplement their GAAP results with IFRS results. READ MORE +
Transfer Pricing and Micro-Multinationals
There is a growing phenomenon in business called “micro-multinationals” and a vexing international tax issue around “transfer pricing” that goes with them. The Marks Paneth global network is a multi-lingual and multi-disciplinary team of experienced professionals who can work with you to get started by designing an efficient transfer pricing model and pricing methodology that aligns with your business. READ MORE +
What your nonprofit can learn from for-profit businesses
If your not-for-profit is “stuck” and unsure how to move forward, consider adopting some for-profit business practices. The essential missions of businesses and nonprofits may be different, but ways to achieve them often are the same. For example, the strategic plan lies at the core of most for-profit businesses and should be at the core of nonprofits, too. Your plan should set objectives for one, five and 10 years out, paying particular attention to each goal’s return on investment. To learn more about business practices that benefit nonprofits, contact us. READ MORE +
Envision your advisory board before you form it
Many companies reach a point where they could benefit from an advisory board. If you’re about there, you may wonder what your ideal advisory board should look like. First, participants need to have expertise and experience that complement your company’s staff. Second, they should support your long-term strategic goals. Look to assemble a diverse mix of backgrounds, personalities and skills. As your business evolves, you may need to replace some members or change the board’s size. Please contact our firm to discuss the concept of advisory boards further. READ MORE +
Give your board members a break — and your nonprofit a boost
A board retreat can give board members a break and your nonprofit a boost. Board members lead busy lives and may not get to every board meeting, so a retreat that brings everyone together in a relaxed setting can be invaluable. Retreats enable participants to get past the mundane topics of regular meetings and delve into specific issues. To get the most out of your retreat, choose the time and place carefully, create a detailed agenda and make a postretreat plan for following up on decisions made during the retreat. Contact us for help with nonprofit governance. READ MORE +
Put Email List Segmentation to Work for Your Nonprofit
If you send all of your not-for-profit’s communications (donation requests, newsletters, meeting announcements) to everyone on your email list, don’t be surprised if stakeholders tune out or even unsubscribe. By getting the right messages to the right people, email segmentation can help increase engagement and response rates. Consider segmenting your list by donation amount, event participation, membership renewal, volunteer hours and even demographics, if you have that data. Contact us for more tips on improving your nonprofit’s efficiency and effectiveness. READ MORE +
Is your business committed to its cost-control regimen?
Is your business truly committed to its cost-control regimen? Like keeping up an exercise routine, controlling expenses takes not just good intentions but also an ongoing effort. Begin by identifying expenses in every business area. Prime candidates include technology contracts, lease agreements, and utilities and office supplies. Managing such costs shouldn’t be a one-time thing. It must be a strategic decision that starts with ownership and is clearly communicated down the organizational chart. Contact our firm for help with your long-term cost-control plan. READ MORE +
PTO banks: A smart HR solution for many companies
Many businesses are taking a new approach to paid time off (PTO). Under the “PTO bank” concept, employers merge the traditional components of excused absences (vacation time, sick time, etc.) into one employee-managed account. Many of today’s employees and job candidates view PTO banks as easier and empowering. More efficient administration can reduce the associated costs for employers as well. But, despite the many potential benefits, creating PTO banks may not be the best move for every company. Please contact our firm for help assessing the idea. READ MORE +
Are you ready for the new revenue recognition rules?
While the FASB has postponed the effective date for the new principles-based, revenue guidance by one year, companies that report comparative results can’t delay any longer. Learn how to start the implementation process now. READ MORE +
Using independent contractors? Protect your business with these tips
Many businesses use independent contractors to keep payroll taxes and fringe benefit costs down. But using outside workers may result in other problems. The IRS often questions businesses about whether workers should be classified as employees or independent contractors for federal employment tax purposes. READ MORE +
Time for a nonprofit internal controls check-up
Your nonprofit’s internal controls are strong only if they’re current. So perform a risk assessment every time you experience major organizational changes, such as significant expansion, or when factors such as the loss of a large grant put new stresses on your not-for-profit. Two functions deserve particular scrutiny. READ MORE +
An effective succession plan calls for decisive action
The prospect of leaving your company in the hands of someone else likely brings mixed emotions. You’ve no doubt spent a substantial amount of time and a great degree of effort in getting your enterprise to where it is today. But when it comes to creating and executing a succession plan, decisive action is critical. You’ve got to respect the importance of timeliness — not only for you and your family, but also for your successor and employees. So here are two key questions to answer. READ MORE +
Entrepreneurs Coming to the US. What you don’t know about taxes can really hurt you!
Business opportunities in the US marketplace have never been better for non-US based entrepreneurs and start-ups. The US economy continues to show strong growth and economic resilience, even in the face of volatile capital markets in early 2016. But both foreign individuals and start-ups need to be wary of the complex US tax landscape, as poor planning and even inadvertent behavior or actions can result in huge tax liabilities. READ MORE +
The Benefits of 401(k) Plans for Startups.
While many small business owners may consider offering a 401(k) plan, many decide against it based on uncertainty over costs, a cumbersome set-up process and the administrative burden that is required to run it. READ MORE +
The Often Complicated Tax Implications of Stock Options
Employee Stock Options are fast becoming a standard component of compensation for many emerging growth sector companies. Stock option plans are a very popular way of attracting and retaining high performing employees for startups, who often lack the cash to offer big salaries and bonuses. These plans give founders the ability to offer stock options to employees, officers, directors, consultants and advisors – in short all the people often needed to get a business up and running. It allows people to buy stock in the company when they exercise the options, and in some cases make loads of money in the process. READ MORE +
Avoiding the US Sales Tax Trap
UK and European companies that do business in the US or set up US operations are frequently puzzled by US sales and use taxes. Sales and use taxes are transactions taxes that are imposed on ultimate customers at a state and local level. The amounts and rules vary from state to state and locality to locality. Sales and use taxes are not like European value added tax (VAT). VAT is a tax imposed on each level of a transactional chain but then recoverable in many circumstances except by the ultimate retail customer. READ MORE +
NJ Angel Investor Tax Credit Program
The New Jersey Economic Development Authority (NJEDA) is offering all investors who invest in a qualifying NJ emerging technology business a tax credit through the Angel Investor Tax Credit program. NJEDAThis program was enacted in January of 2013 to help attract investments, and spur job creation / economic growth in New Jersey’s current and next generation of high-skilled, high- paying emerging technology sector. READ MORE +
Can Your Company Cash in on the Modified R&D Tax Credit?
The IRS section 41 tax credit for research and development (R&D) is now permanent. With this change there are big potential benefits to start-ups and small business who could not previously take advantage of this credit. If you are a start-up company with annual gross receipts of less than $5 million, you can apply up to $250,000 of your R&D credit against your payroll tax liability. The modification of the R&D tax credit was part of the 2015 PATH (Protecting Americans from Tax Hikes) act and allows companies to free up cash flow to invest in their businesses. READ MORE +
Tax Considerations for Start-Ups (Part 2)
In the excitement of raising money from investors then launching, a new start-up business ,many founders and stakeholders are focused on refining the product / service offering, acquiring customers, making sales and making the business profitable. But founders should be both mindful and vigilant about meeting all their tax liabilities. Not doing so could result in extremely unpleasant consequences, including stiff fines from federal, state and local tax authorities. Here’s an overview of the business owner’s role / responsibility, and a list of tax-related issues that should be considered by savvy founders, ideally with the help of a qualified CPA. READ MORE +
Making UK Equity Plans Work for US Employees.
When UK emerging companies venture outside the UK, they quickly need to address whether – and how – to extend equity-based compensation to non-UK employees. However, few jurisdictions offer a regime as favourable as the UK’s Enterprise Management Incentives (EMI) scheme for providing equity compensation to emerging company employees. READ MORE +
Are You Thinking of Doing Business in the US?
For many individuals, entrepreneurs and companies it’s about achieving and living the ‘American dream’. Being successful in the US is well on the way to being successful globally. To what extent is this true, and how easy is it to ‘crack’ America? READ MORE +
Bet Early. Win Big. Tax Plan Accordingly.
There is an abundance of digital media coverage, and discussions at leading venture funding events about the huge opportunities for investors and founders alike to win big financially – by creating and scaling innovative start-ups. READ MORE +
Transfer Pricing is Good.
You are a non-US based firm and you’ve taken the plunge by deciding to set up your business in the US. Now you are designing your business model and your budget for the next few years. High on your “to do” list is estimating sales revenue, marketing, wages and office space and other expenses so that you can determine the potential profitability or loss of your business globally. The difficult task is then to determine how much of this profit or loss is taxed in each country where you are operating. READ MORE +
Businesses Coming to the US. What you don’t know can cost your company plenty!
Start-ups coming to the US from abroad, even if just to “test the waters” of doing business in the US, need to be wary of the complex US tax landscape – on a Federal and State level. Poor planning or lack of understanding of the laws, may cause an unsuspecting Start-up to cross the line and actually “start to do business” in the US. Then, failure to take simple actions like filing tax returns (even without profits) or collecting sales tax can result in huge tax liabilities! READ MORE +
Corporate Structuring is Good
US venture capitalists historically insisted that they would only invest in an early-stage UK or other non-US company if the company “flipped” its corporate structure and installed a US (typically Delaware) holding company above the startup’s existing top company. For a variety of reasons this historical view is changing. Many US investors increasingly are open to the idea of investing in UK (and often Irish) holding companies without the “Delaware flip.” READ MORE +
Year End Tax Planning Tips for Emerging Growth Companies
During the holidays you often hear the saying “It is better to give than to receive” but we don’t think this should apply to having your company make unnecessary tax payments to the IRS, state or local tax authorities. Many emerging growth companies don’t have revenue in their first year or two of operations as they create a viable product, solicit customers and work to raise money from angels and venture capital firms. READ MORE +
Take Advantage of Tax Incentives to Enhance Your ROI.
Small businesses have been the growth engine of the US economy since the last recession. Congress has helped fuel that engine with provisions in the IRS tax code that can reward people who start and invest in certain types of small businesses. The exemption for Qualified Small Business Stock (QSBS) is an often overlooked, but potentially big tax break for both founders and those investing in small businesses. READ MORE +
Can Founders Really Scale…or Not?
Back in May of 2014 Forbes’ Entrepreneurs Blog addressed an interesting question: “Founders Can’t Scale: Fact or Fiction?” Forbes opened this article with the statement “There is a belief in the business world that founders can’t scale. Put another way, a company’s growth curve will eventually outstrip the capabilities of its founder’s ability to remain CEO.” READ MORE +
Play Smart Offense to take full advantage of tax benefits and increase current or future cash inflow
Smart tax planning is not always about safeguarding against risks and avoiding penalties. If done the right way, you will hear “the crack of the bat” in terms of improving your cash inflows now, and into the future. READ MORE +
How to Employ a Sound Defense Against Tax Liability Risks
Getting an emerging growth company up and running is one of the most exciting and stressful times any entrepreneur can face. It can involve testing the viability of the business model, acquiring paying customers, hiring and managing a new staff, testing the viability of new products or services, finding space for the business and of course starting to raise money. READ MORE +
Raising Funds? Be Sure to Scrub Down the Term Sheet
According to Bruce Gibney (formerly with famed VC firm, Founders Fund) “Venture financing turns on three things: Money, power and ignorance.” He went on to note “These variables converge most violently in the term sheet, which proposes the basic relationship between the venture capitalist and the company. Term sheets have a set of short, formalized components, which in combination quickly become exceedingly tangled and opaque.” READ MORE +
Find Out More About How We Can Help You
Save the Date! The Business Council of Westchester presents Westchester Business Expo.
View All Events
Save the Date! The Business Council of Westchester presents Westchester Business Expo.
Thu. April 27, 2017
View All Events