New law helps businesses make their employees’ retirement secure
The Setting Every Community Up for Retirement Enhancement Act (SECURE Act) was recently signed into law as part of a larger spending bill. There are several provisions of interest to small businesses that have a retirement plan for employees or are thinking of adding one. For example, unrelated employers will be able to join together to create a retirement plan. Beginning in 2021, new rules will make it easier to create and maintain a multiple employer plan. In addition, there’s an increased tax credit for small employer retirement plan startup costs. And there’s a new small employer automatic plan enrollment credit. These are only some of the provisions in the law. Contact us to learn more.
The SECURE Act: What you should know now
As expected, President Donald Trump is preparing to sign in to law the Setting Every Community Up for Retirement Enhancement or SECURE Act in the next few days. The Act was part of a major spending package approved by the Senate on Thursday and will usher in major changes to the way most Americans plan […]
Congress gives a holiday gift in the form of favorable tax provisions
As part of a year-end budget bill, Congress just passed a package of tax provisions that will provide savings for some taxpayers. It contains a variety of tax breaks. For example, the age limit for IRA contributions is being raised from age 70½ to 72. The age to take required minimum distributions (RMDs) is also going up from 70½ to 72. Most of the tax “extenders” have been reinstated through 2020. In addition, there is a package of retirement-related provisions, including new rules that allow some part-time employees to participate in 401(k) plans. These are only some of the provisions in the new law. Contact us with any questions.
Wayfair revisited — It’s time to review your sales tax obligations
In a 2018 decision, the U.S. Supreme Court expanded the power of states to collect sales tax from remote sellers. Today, nearly every state with a sales tax has enacted a similar law. So if your company does business across state lines, it’s a good idea to reexamine your sales tax obligations. If you make online, telephone or mail-order sales in states where you lack a physical presence, it’s critical to find out whether those states have economic nexus laws and determine whether your activities are enough to trigger them. If you have nexus with a state, you must register and collect state and applicable local taxes on your taxable sales there. If you need assistance, contact us.
5 ways to strengthen your business for the new year
The end of one year and the beginning of the next is a great opportunity for reflection and planning. Now’s a good time to think about ways to strengthen your business for the new year. Here are five ideas: 1) Compare your 2019 financial performance to budget and determine what went right or wrong. 2) Create a multiyear capital budget to anticipate expensive purchases. 3) Assess the competition to identify major players and how you should respond. 4) Review your insurance coverage to ensure you’re adequately protected. 5) Analyze market trends to evaluate where things stand and where they’re headed. Contact us for help implementing savvy moves to make 2020 a strong year for your company.
Stretch your marketing dollars further with smart strategies
If your marketing budget is limited, there may be ways to stretch that money further. For example, you could engage in some competitive intelligence and research the marketing campaigns of larger companies. Sometimes their big-budget approaches can be distilled down to lower-cost alternatives. You might also get hyperlocal and engage more actively with your community, such as displaying signage on vehicles or contributing to a locally-focused social media page. Last, look carefully into guerilla marketing: putting your company’s brand in the public eye in an unconventional way. Examples include (legal) graffiti art and viral videos. Contact us for help assessing costs and feasibility.
Small Businesses: It may not be not too late to cut your 2019 taxes
Don’t let the holiday rush keep you from taking some important steps to reduce your 2019 tax liability. You still have time to execute a few strategies. For example, are you thinking about purchasing new or used heavy vehicles, heavy equipment, machinery or office equipment in the new year? Buy them and place them in service by December 31, and you can deduct 100% of the cost as bonus depreciation. Or you can put recurring expenses normally paid early in the year on your credit card before Jan. 1. That way, you can claim the deduction for 2019 even though you don’t pay the bill until 2020. Finally, before year-end, contribute to a SEP or 401(k) if you haven’t reached the contribution limit.
Do you have a side gig? Make sure you understand your tax obligations
The number of people engaged in the “gig” or sharing economy has grown in recent years. And there are tax consequences for the people who perform these jobs, such as providing car rides, renting spare rooms, delivering food and walking dogs. Generally, if you receive income from these gigs, it’s taxable. That’s true even if the income comes from a side job and if you don’t receive a 1099-MISC or 1099-K form reporting the money you made. You may need to make quarterly estimated tax payments because your income isn’t subject to withholding. Some or all of your business expenses may be deductible on your tax return, subject to the normal tax limitations and rules. Contact us to learn more.
Adopting a child? Bring home tax savings with your bundle of joy
If you’re adopting a child, or you adopted one this year, there may be significant tax benefits available to offset the expenses. For 2019, adoptive parents may be able to claim a nonrefundable credit against their federal tax for up to $14,080 of “qualified adoption expenses” for each adopted child. (This amount is increasing to $14,300 for 2020.) The credit allowable for 2019 is phased out for taxpayers with adjusted gross income (AGI) of $211,160 ($214,520 for 2020). It is eliminated when AGI reaches $251,160 for 2019 ($254,520 for 2020). We can help ensure that you meet all the requirements to get the full benefit of the tax savings available to adoptive parents.
3 last-minute tips that may help trim your tax bill
You may still have time to reduce your federal tax liability by taking certain steps. For example, contribute the maximum to your retirement plans by year end, including traditional IRAs and SEP plans. Another idea: If you make your Jan. 2020 payment this month, you can deduct the interest portion on your 2019 tax return (assuming you itemize deductions on your tax return). You can also “harvest” any investment losses by Dec. 31. If you have more losses than gains, you generally can apply up to $3,000 of the excess to reduce your ordinary income. Any remaining losses are carried forward to future tax years. Contact us if you want to discuss ways to minimize your 2019 tax liability.