The 1-2-3 of B2B marketing
It’s critical to recognize the differences between marketing to the public (or certain segments thereof) and business-to-business (B2B) marketing. Whereas wide-scale marketing campaigns need to be simple, concise and catchy, effective B2B campaigns are typically more detailed, complex and substantive. Tell and show customers and prospects how you’ll solve their problems in areas such as productivity, quality, time and costs. Provide plenty of specifics on how you’ll do so, speaking their language. Last, get to know the real people who make the buying decisions at your targeted accounts. Contact us for help
Summer: A good time to review your investments
It’s a good time to review your portfolio for tax-saving strategies. The long-term capital gains tax rate is still historically low on appreciated securities that have been held for more than 12 months. The federal income tax rate on long-term capital gains recognized in 2019 is 15% for most taxpayers. However, the top rate of 20% plus the 3.8% net investment income tax (NIIT) can apply at higher income levels. For 2019, the 20% rate applies to single taxpayers with taxable income exceeding $425,800 ($479,000 for joint filers and $452,400 for heads of households). Contact us to learn how to grow your investments by minimizing the amount of tax you must pay on profits.
It’s a good time to buy business equipment and other depreciable property
The Section 179 deduction has long provided a tax windfall to businesses, enabling them to claim immediate deductions for qualified assets, instead of depreciating them over time. For 2019, the maximum deduction is $1.02 million, subject to a phaseout rule if more than $2.55 million of eligible property is placed in service during the tax year. Even better, the Sec. 179 deduction isn’t the only avenue for immediate tax write-offs for assets such as machinery and equipment. Under the 100% bonus depreciation tax break, the entire cost of eligible assets placed in service in 2019 can be written off this year. Contact us to learn how your business can maximize the deductions.
Volunteering for charity: Do you get a tax break?
Are you a volunteer who works for charity? You may be entitled to some tax breaks if you itemize deductions on your tax return. Unfortunately, they may not amount to as much as you think your generosity is worth. Because donations to charity of cash or property generally are tax deductible for itemizers, it may seem like donations of something more valuable for many people — their time — would also be deductible. However, no tax deduction is allowed for the value of time you spend volunteering or the services you perform for a charitable organization. However, you potentially can deduct out-of-pocket costs associated with your volunteer work. Many rules apply, so contact us with questions.
Is your accounting software living up to the hype?
Accounting software sells itself as being much more than a simple spreadsheet or ledger. Is your system living up to the hype? If not, make sure you’re taking advantage of its full functionality. An on-staff champion may be able to share his or her knowledge, or you could engage a consultant to retrain employees. Also, encourage staffers to point out labor-intensive steps that could be better automated or inconsequential processes that might be eliminated. Last, periodically review critical documents yourself for errors or anomalies that could be traced back to misuse of your software. Contact us for help.
M&A transactions: Avoid surprises from the IRS
If you’re in the process of a merger or acquisition, it’s important that both parties report the transaction to the IRS in the same way. Otherwise, you could increase your chances of being audited. If a sale involves business assets (as opposed to stock or ownership interests), the buyer and the seller must generally report the purchase price allocations that both use for specific assets. This is done by attaching IRS Form 8594 to each of their federal income tax returns. Both parties use the same allocations. Consider requiring this in your asset purchase agreement at the time of the sale. To lock in the best postacquisition results, consult with us before finalizing any transaction.
Odd word, cool concept: Gamification for businesses
“Gamification” is perhaps an odd word, but it’s a cool concept. The term generally refers to integrating characteristics of game-playing into business-related tasks to increase engagement. Some companies use it with customers. For example, a retailer might award points for purchases to collect and use toward discounts. But many businesses use it internally for training, to improve morale and to better measure progress toward goals. Naturally, gamification has its risks. You don’t want to “force fun” or frustrate employees with unreasonably difficult games. For more information, contact us.
You may have to pay tax on Social Security benefits
If you’re getting close to retirement age, you may be wondering if your Social Security benefits are going to be taxed. The answer depends on your other income. If you’re taxed, up to 85% of your payments will be hit with federal income tax. (There could also be state tax.) If you file a joint tax return and your “provisional income,” plus half your Social Security benefits, isn’t above $32,000 ($25,000 if unmarried), none of your benefits are taxed. If your provisional income is above those amounts, you must report a certain percentage of your benefits as income. Contact us for help with the exact calculations. We can also help you plan to keep taxes as low as possible during retirement.
Bartering: A taxable transaction even if your business exchanges no cash
Small businesses may find it beneficial to barter for goods and services instead of paying cash for them. If your business engages in bartering, be aware that the fair market value of goods that you receive in bartering is taxable income. And if you exchange services with another business, the transaction results in taxable income for both parties. Many business owners join barter clubs that facilitate barter exchanges. If you join a barter club, you’ll be asked to provide your Social Security number or employer identification number. You may receive a form reporting barter transactions and you may have to file forms with barter partners and the IRS. Contact us for more information.
Grading the performance of your company’s retirement plan
Imagine giving your retirement plan a report card. Is it a straight-A student or could it use some help after school? Many plan sponsors track common metrics such as benchmarked fees, participation rates and average deferral rates. But don’t stop there. A sometimes-overlooked measure is average account balance size. Knowing your plan’s asset growth rate is also helpful. Ultimately, though, good plan performance isn’t measured by any one element but by aggregating multiple data points to derive an “on track to retire” score. We can help you accomplish this.