Typical Situation: Our client is growing and are unsure if they are legally complaint with employees. They feel they have been "winging it" in the area of HR, for too long and want to formalize processes. Or simply, they have many questions about employee issues and need answers we cannot provide (Legally and we just don’t know)
 
When you hear a business owner say:

• “I need to fire this person, but I don’t want to get sued”
• “How do I deal with:
  • Affirmative Action, or Employee Assessments, or Job Descriptions, or Compensation; Design and Bench Marking
  • Recruiting. What I can and cannot ask in an interview?
  • Anything having to do with an employee

 
HR Management Association Provides

• The HR Hotline: Unlimited access to certified HR professionals, compensation analysts and benefits experts. Hotline access to experienced employment law attorneys — without the hourly fees.
• Website:  Instantly access the full resources of the HR Source right from your desktop. Thousands of pages of searchable data, information, sample documents, commonly used forms and more.
• Weekly e-newsletter delivers HR compliance information and best practices in a clear, concise format that provides you with practical options and sensible advice.

 
How they Work The HR Management Association is a not-for-profit employers' association serving more than 1,100 companies and organizations. They provide human resources, compensation, legal, training and employee benefits services.
 
Matching Ideas with Resources:

Business owners may be able to benefit from the home office deduction
Taxpayers who use their home for business may be eligible to claim a home office deduction. It allows qualifying taxpayers to deduct certain home expenses on their tax return. This can reduce the amount of the taxpayer’s taxable income.
Here are some things to help taxpayers understand the home office deduction and whether they can claim it:

• The home office deduction is available to both homeowners and renters.
• There are certain expenses taxpayers can deduct. They include mortgage interest, insurance, utilities, repairs, maintenance, depreciation and rent.
• Taxpayers must meet specific requirements to claim home expenses as a deduction. Even then, the deductible amount of these types of expenses may be limited.
• The term "home" for purposes of this deduction:
  • Includes a house, apartment, condominium, mobile home, boat or similar property.
  • Also includes structures on the property. These are places like an unattached garage, studio, barn or greenhouse.
  • Doesn’t include any part of the taxpayer’s property used exclusively as a hotel, motel, inn or similar business.
• There are two basic requirements for the taxpayer’s home to qualify as a deduction:
  • There must be exclusive use of a portion of the home for conducting business on a regularly basis. For example, a taxpayer who uses an extra room to run their business can take a home office deduction only for that extra room so long as it is used both regularly and exclusively in the business.
  • The home must be the taxpayer’s principal place of business. A taxpayer can also meet this requirement if administrative or management activities are conducted at the home and there is no other location to perform these duties. Therefore, someone who conducts business outside of their home, but also uses their home to conduct business may still qualify for a home office deduction.
• Expenses that relate to a separate structure not attached to the home will qualify for a home office deduction. It will qualify only if the structure is used exclusively and regularly for business.
• Taxpayers who qualify may choose one of two methods to calculate their home office expense deduction: 
  • The simplified option has a rate of $5 a square foot for business use of the home. The maximum size for this option is 300 square feet. The maximum deduction under this method is $1,500.
  • When using the regular method, deductions for a home office are based on the percentage of the home devoted to business use. Taxpayers who use a whole room or part of a room for conducting their business need to figure out the percentage of the home used for business activities to deduct indirect expenses.  Direct expenses are deducted in full.

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IRS launches new Tax Withholding Estimator; Redesigned online tool makes it easier to do a paycheck checkup

WASHINGTON — The Internal Revenue Service today launched the new Tax Withholding Estimator, an expanded, mobile-friendly online tool designed to make it easier for everyone to have the right amount of tax withheld during the year.

The Tax Withholding Estimator replaces the Withholding Calculator, which offered workers a convenient online method for checking their withholding. The new Tax Withholding Estimator offers workers, as well as retirees, self-employed individuals and other taxpayers, a more user-friendly step-by-step tool for effectively tailoring the amount of income tax they have withheld from wages and pension payments.
“The new estimator takes a new approach and makes it easier for taxpayers to review their withholding,” said IRS Commissioner Chuck Rettig. “This is part of an ongoing effort by the IRS to improve quality services as we continue to pursue modernization and enhancements of our taxpayer relationships.”
The IRS took the feedback and concerns of taxpayers and tax professionals to develop the Tax Withholding Estimator, which offers a variety of new user-friendly features including:

• Plain language throughout the tool to improve comprehension.
• The ability to more effectively target at the time of filing either a tax due amount close to zero or a refund amount.
• A new progress tracker to help users see how much more information they need to input.
• The ability to move back and forth through the steps, correct previous entries and skip questions that don’t apply.
• Enhanced tips and links to help the user quickly determine if they qualify for various tax credits and deductions.
• Self-employment tax for a user who has self-employment income in addition to wages or pensions.
• Automatic calculation of the taxable portion of any Social Security benefits.
• A mobile-friendly design.

In addition, the new Tax Withholding Estimator makes it easier to enter wages and withholding for each job held by the taxpayer and their spouse, as well as separately entering pensions and other sources of income. At the end of the process, the tool makes specific withholding recommendations for each job and each spouse and clearly explains what the taxpayer should do next.

The new Tax Withholding Estimator will help anyone doing tax planning for the last few months of 2019. Like last year, the IRS urges everyone to do a Paycheck Checkup and review their withholding for 2019. This is especially important for anyone who faced an unexpected tax bill or a penalty when they filed this year. It’s also an important step for those who made withholding adjustments in 2018 or had a major life change.

Those most at risk of having too little tax withheld include those who itemized in the past but now take the increased standard deduction, as well as two-wage-earner households, employees with nonwage sources of income and those with complex tax situations.

To get started, check out the Tax Withholding Estimator on IRS.gov.
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Typical Situation: Our client’s Card processing fees have increase over the years. The may have outstanding invoices that would be paid quicker if they took credit cards.
 
When you hear a business owner say:
·         “I don’t understand the charges from my current credit card processing company.”
·         “It is taking too long for me to receive payment on my invoices.”
·         “I have been receiving chargebacks because I am not EMV compliant and my equipment does not take chip cards.”
·         “I want to upgrade my credit card processing equipment but I’m not sure what is the best fit.”
·         “I am opening a new business and I need to accept credit card payments.”
 
Merchant Services assist businesses with taking secure electronic payments (credit cards, checks, online payments). They find ways to streamline operations, reduce cost, improve cash flow, and provide excellent reporting. There are a variety of solutions including online payments, payment terminals, invoicing software, and POS systems.
 
How they Work They will ask questions about how a business operates currently and struggles they may be having with expenses, cash flow, reporting, marketing, customer loyalty, etc. They then take these findings to customize a tailored recommendation for the business. All new accounts are checked for accuracy, assisted with installation and training, and receive 24/7 support.

Matching Ideas with Resources:​

Step 1) Begin- Give us your accounting documents.

• Bank Statements, Receivables, Payables, Inventory, etc.

Step 2) Accounting–  We process your information, reconcile and file.

Step 3) Statements– We prepare the Financial Statements.

• Balance Sheets, Income Statements, Ledgers

Step 4) investigation– Accountant Review of Financials.

• Tax Planning- Proactive planning can potentially minimize your tax burden.

Step 5) Consulting-  Business Strategist Review.

• Analysis of Goals, Operations, Marketing, Trends,

Step 1) Begin Again- Meet With You and Discuss Findings.

• Regular Accountability through Timely, Accurate Financial Reporting

 

Congratulations, Now that you sold your business, there are reports you need to fill out for the IRS. 

Form 8594 is used to report the sale and purchase of a group of assets that constitute a business. Both the purchaser and seller must file Form 8594 with their own individual income tax return.
On Form 8594, the total selling price of the business is allocated to asset classes using the residual method.
Form 8594 provides the IRS with the following information:

• The purchaser's depreciable basis in the assets transferred, and
• How the seller determined gain or loss.

Assets Classes on Form 8594
Form 8594 lists seven classes of assets. For asset acquisitions occurring after March 15, 2001, make the allocation among the following assets in proportion to (but not more than) their fair market value on the purchase date in the following order:

Class I assets:

• Cash and general deposit accounts (including savings and checking accounts).
• Does not include certificates of deposits held in banks, savings and loan associations, or other depository institutions.

Class II assets:

• Certificates of deposit
• U.S. government securities
• Foreign currency
• Publicly traded personal property, including stocks and securities.

Class III assets:

• Accounts receivable
• Other debt instruments
• Assets that you mark to market at least annually for federal income tax purposes.

Class IV assets:

• Property of a kind that would properly be included in inventory if on hand at the end of the tax year or
• Property held by the taxpayer primarily for sale to customers in the ordinary course of business.

 
Class V assets:

• All other assets other than Class I, II, III, IV, VI, and VII assets.
• Example of assets included in this class:
• Furniture and fixtures, equipment, buildings, land, and vehicles.

Class VI assets:

• Section 197 intangibles (other than goodwill and going concern value).
• Examples include, workforce in place, customer lists, clients lists, patient lists, trademarks, trade names.
• See the list of section 197 intangibles.

Class VII:
Goodwill:

• Goodwill generally represents the excess of the price paid for a business over its net asset value (also called book value). It may have the following characteristics:
• It may be associated with a company's good reputation in terms of the products it sells, the services it performs, and it's standing in the community. Other characteristics of goodwill include:
• It may be tied to the ability of a business to continue doing business with its existing customers and to attract future customers.
• It is an intangible asset that may only be acquired as part of the acquisition of a business.
• It is a section 197 intangible whose value is amortized over 15 years by the purchaser of a business.
  

Going concern value:

• Going-concern value is the value attributed to a business entity as an on-going enterprise.
• Going-concern value focuses mainly on the ability of the company's assets to generate a return on investment not simply goodwill.

If an asset described in (I) through (VI) is included in more than one category, include it in the lower number category. For example, if an asset is described in both (4) and (6), include it in (4).

Thursday, July 18, 2019    10am- Noon

​If you're brand new to QuickBooks or a novice, then it is a perfect class for you. If you've been using QuickBooks for less than 2 years, you'll most certainly learn lots of interesting tips, tricks, and workarounds to help you be more effective. This class is perfectly suited for business owners, spouses of business owners, office receptionists, secretaries, office managers, sales and administrative professionals, bookkeepers and anyone who uses QuickBooks as part of their business.

You don't need any prior experience in QuickBooks or accounting. This is designed for people who are trying to decide if QuickBooks are for them and their business, people new to QuickBooks or have been using it for a short period of time. You don't need a computer as this class is not hands on. We've learned that people are able to learn so much more when they're focused on listening to the instructor.
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The workshop will be held in the conference room in the Lower Level of our building:

300 N. Martingale Rd.,
Lower Level Room 80
Schaumburg, IL 60173
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If you don't own a copy or subscription, no problem. Learn if it is right for your business and if it is, you can buy at half price though GLM.

As a follow up to a blog post here a couple of weeks ago (Click here):

Illinois Secure Choice will be sending notifications to employers, who have more than 25 employees eligible for unemployment for any 30 day period, in batches between now and the end of August/beginning of September.  All Illinois employers must either have their own retirement plan or the must register for Illinois Secure Choice by 11/1/19 if they have more than 25 employees.  If an employer has their own retirement plan they would need to prove that to Illinois Secure Choice to be exempted from the program.  If they start Illinois Secure Choice and later decide they’d rather have their own retirement plan, they would need to prove that the plan is in place to be allowed to withdraw from the program.
The notification letters to employers will include an access code to register online.  Once that registration is complete the clock starts on the program for that employer.  Employers have until November 1st to begin the program, so if they don’t want to start early they should delay registering until October. 
Any employee who is over 18 and is employed 30 days or more must be registered by their employer.  When employees are registered they are automatically opted in for a 5% contribution to the retirement plan and they have 30 days to change that before it goes into effect.  Employees will be sent information packets that include instructions on creating their online account as soon as they are registered.  Employers won’t get a copy so they can’t help employees other than to direct them to Illinois Secure Choice’s employee line 855-650-6914.
Employers will transmit payroll and contribution data with each payroll and the state will withdraw it from their bank account.  They will also need to regularly update the employee list with Illinois Secure Choice.