​Direct from the IRS, the best way to set up your charitable donations. If you or your business has specific questions or situations, please contact us here at GLM.

Tool on IRS.gov helps taxpayers research charities before making donations
When people are done giving thanks at the dinner table, many start another kind of giving. The annual Giving Tuesday happens the week after Thanksgiving to kick off the season of charitable giving. This year, Giving Tuesday falls on Tuesday, November 30.

Taxpayers may be able to deduct donations to tax-exempt organizations on their tax return. As people are deciding where to make their donations, the IRS has a tool that may help. Tax Exempt Organization Search on IRS.gov is a tool that allows users to search for charities. It provides information about an organization’s federal tax status and filings.

Here are four facts about the Tax Exempt Organization Search tool:

• Donors can use it to confirm an organization is tax exempt and eligible to receive tax-deductible charitable contributions.
• Users can find out if an organization had its tax-exempt status revoked. A common reason for revocation is when an organization does not file its Form 990-series return for three consecutive years.
• EO Select Check does not list certain organizations that may be eligible to receive tax-deductible donations, including churches, organizations in a group ruling, and governmental entities.
• Organizations are listed under the legal name or a “doing business as” name on file with the IRS. No separate listing of common or popular names is searchable.

Taxpayers can also use the Interactive Tax Assistant, Can I Deduct my Charitable Contributions? to help determine if a charitable contribution is deductible.

Taxpayers may also want to decide now if they’ll itemize their deductions when they file next year. Last year’s tax reform legislation made changes to the standard deductions and itemized deductions. Many individuals who formerly itemized may now find it more beneficial to take the standard deduction. So, taxpayers should check their 2017 itemized deductions to make sure they understand what these changes mean to their tax situation for 2018. More information about these changes is on IRS.gov/taxreform.

More Information:
Tips for Tax Exempt Organization Search
Tax Exempt Organization Search: Frequently Asked Questions
Tax Reform Basics for Individuals and Families

IRS YouTube Videos:
Tax Exempt Organization Search English | ASL

​The above is directly quoted from the IRS newsletter: Tool on IRS.gov helps taxpayers research charities before making donations. It is direct information from the IRS as the best way to set up your charitable donations. Again, if you or your business has specific questions or situations, please contact us here at GLM.

​Thursday is Thanksgiving, a time of the year to give thanks for what you have. Take time to reflect on the year so far and look at all you have accomplished.

In upcoming blogs and GLM's newsletter we will look at tax ramifications of giving to charities and non-profits. We will also give you some you may be able to give to. Until then:

Happy Thanksgiving from your friends at GLM Financial.

There are more buyers out there for your company than you might think. Ranking potential buyers from most to least logical requires an assessment of how each of the following characteristics applies to a particular buyer:

·         Potential synergistic benefits of your business if they currently own a related business
·         Capital / financing available to close the transaction
·         Experience in completing acquisitions
·         Previous knowledge of, or involvement with, the company / industry
·         Geographical proximity

It is at this point that it is time to make the first critical decision. How broadly should you market your company? A wide offering distribution increases the probability of achieving the best price, but also increases the likelihood of damaging your company by releasing sensitive business information to a wide range of people.

Your competitors may be the ‘best’ buyers, but they are also the ones who could inflict the most harm on your business if they are privy to confidential information.

From the perspective of the owner, prospective buyers, the IRS, lenders and divorce & bankruptcy courts, the value of a business for purposes of a sale, estate planning, orderly or forced liquidation, gifting, divorce, etc. can be vastly different.

Intrinsically tied to the various purposes of valuation are numerous definitions of “value.” Here are a few examples: 

• Investment Value – The value an acquirer places on a business based on a future return on investment determined by assessing past and current performance, future prospects, and other opportunities and risk factors involving the business.
• Liquidation Value – The value derived from the sale of the assets of a business that is closed or expected to be closed following the sale.
• Book Value – Book value is the difference between the total assets and total liabilities as accounted for on the company’s balance sheet.
• Going Concern Value – Used to define the intangible value which may exist as a result of a business having such attributes as an established, trained and knowledgeable workforce, a loyal customer base, in-place operating systems, etc.
• Fair Market Value – For the purpose of this article, the focus will be on transaction related valuations. Fair Market Value (“FMV”) is the most relevant definition of “value” and is of the most interest to business owners. The more knowledge business owners and prospective buyers have about the valuation process, the more likely they will come to an agreement on a purchase price.​

Direct from the IRS, the best way to realize Advertising and Marketing Expenses . If you or your business has specific questions or situations, please contact us here at GLM.

The tax law allows businesses to deduct expenses that help them bring in new customers and keep existing ones. These costs may include expenses for advertising and marketing. Here are some details about this valuable tax deduction that can help small businesses save money on their taxes.

Advertising and marketing costs must be ordinary and necessary to be tax deductible.

• An ordinary expense is one that is common and accepted in the industry.
• A necessary expense is one that is helpful and appropriate for the trade or business. An expense does not have to be indispensable to be considered necessary.

Here are a few advertising expenses that are usually deductible:

• Reasonable advertising expenses that are directly related to the business activities.
• An expense for the cost of institutional or goodwill advertising to keep the business name before the public if it relates to a reasonable expectation to gain business in the future. For example, the cost of advertising that encourages people to contribute to the Red Cross or to participate in similar causes is usually deductible.
• The cost of providing meals, entertainment, or recreational facilities to the public as a means of advertising or promoting goodwill in the community.

Generally, small businesses can’t deduct amounts they pay to influence legislation, which includes advertising in a convention program of a political party, or in any other publication if any of the proceeds from the publication are for, or intended for, the use of a political party or candidate.

More information (Directly from the IRS):
Small Business and Self-Employed Tax Center
About Publication 535, Business Expenses

​The above is directly quoted from the IRS newsletter sent Wednesday October 27, 2021 Issue Number: Tax Tip 2021-159. It is direct information from the IRS. Again, if you or your business has specific questions or situations, please contact us here at GLM.

​The end of the calendar year is an important time for businesses of all sizes. It's when businesses need to start organizing the year's financial information for tax season. Though the April 15 filing deadline may be months away, your company should be thinking about ways to make that period as easy as possible.
What should small business owners be doing right now to prepare for tax season.

Automate your tax prep
In today's world, there are countless programs, apps and services available to help make tax time less of a burden. Using QuickBooks in your business to track your sales, expenses and other financial information helps to make the tax preparation process more streamlined. The way taxes should be dealt with is to automate the process. The earlier you proceed towards automation, the less time needed to work in tax season, which means more time remaining to focus on your business.

​Review your business expenses
As every business owner knows, tax season means taking stock of the company's income, expenses and deductions. To get ahead of this task, business owners should do this throughout the year, thus ensuring a smooth ride when it comes time to file taxes.
The biggest part of preparing for taxes is what should already have been done which is keeping track of all business expenses throughout the year. If everything has been entered into your accounting system in a timely fashion, then the hardest part is done. If not, you need to set aside some time to gather and enter everything correctly."
Implementing a good filing system, is key to making sure you can easily locate and organize all your business expenses. Again, accounting software like QuickBooks Online is affordable option for small businesses looking to sync and track bank account activity, expenses and invoices.

Learn which tax law changes will affect you
Tax laws are constantly changing, and it's wise to stay alert and up-to-date on changes that could affect your business. Business owners need to recognize that new reporting requirements for the Affordable Care Act have begun to take effect, and if your company offers health insurance, you'll need to make sure you're meeting those requirements.
If you're unsure of what any tax law updates could mean for your business, be sure to consult your accountant.

Best practices for tax time
Understand your deductions and requirements. Consult with a tax preparer before the end of the year will help them clean things up, take better advantage of available deductions, and hopefully costs. For example, many owners may not be aware that the tax code only allows a 50 percent deduction for meals and entertainment. However, there is an allowed deduction of 100 percent for specific meals, like holiday parties, or when an employer provides a meal for employees at work, for the employer's convenience. Knowing how to track these items during the year will ensure the best possible deduction.

Think about how future plans will affect next year's numbers. Are you going to be selling your business next year? Speak with your accountant about the reporting method you use — cash basis or accrual basis. The method will impact your P&L [profits and losses]. When a buyer is looking at your business, less profit can influence whether they will buy.

Save up for tax-day liability costs. With no cash to cover the tax liability, the consequence is usually additional fines and penalties that would not have been accrued with proper planning and focus. Our recommendation is to create a separate bank account. As money comes in, set it aside into that account ... and when Tax Day comes, you have the cash on hand to cover your liability.

​Know when to outsource. Many small businesses are successful due to their do-it-yourself approach to solving problems. Taxes are sometimes best left to the professionals. By hiring a professional, you ensure that they're done correctly, and free yourself up to continuing managing your primary business needs.

Due to technical Problems, the Blog/ Podcast had to be skipped this week. 

Section 1031 of the Internal Revenue Code allows the deferral of gain on the sale and subsequent purchase of real property used for business use or investment. An exchange is much like a typical sale followed by an acquisition within 180 days but with a few rules attached.

BENEFITS OF AN EXCHANGE
This often overlooked tax strategy can help you accomplish many short and long-term real estate objectives:

• Immediate tax deferral
• Ability to acquire real estate with pre-tax dollars
• Long-term appreciation on tax deferral
• Estate preservation as deferred gain may be forgiven upon death
• Less management responsibility
• Consolidation of properties
• Greater selling and buying power
• Increased income potential
• Relocation or expansion of business facilities
• Diversification of assets or geographic locations
• Conversion to personal use property after a period of qualified use
• Exit strategy for business owners

Learn More:
COMPLIMENTS OF:
​Connie Custer, Business Development
1031 CORP.
100 Springhouse Drive, Suite 203
Collegeville, PA 19426

Office: 610.792.4880 ext. 230
Cell: 610.724.5195
Email: connie@1031CORP.com
Website: www.1031CORP.com

Taken from the Daily Herald on September 25th 2021. By KELSEY SHEEHY of NerdWallet

The pandemic isn't crushing the entrepreneurial spirit. It's fueling it.

People normally tied to a desk or working double shifts used lockdown to launch side hustles, often out of necessity. And some have turned those side gigs into full-fledged businesses.

These basic but essential steps can help you take things to the next level and give your new venture a shot at staying power.

1. CHOOSE A BUSINESS STRUCTURE
2. OPEN A BUSINESS BANK ACCOUNT
3. UPGRADE YOUR BOOKKEEPING
4. SPELL OUT YOUR BUSINESS PLAN
5. INVEST IN PROFESSIONAL HELP

Read the Whole Article here: 
​www.dailyherald.com/business/20210925/millennial-money-5-steps-to-level-up-your-side-hustle

Employers in Illinois with at least 5 employees must soon comply with the Illinois Secure Choice Savings Program Act (Secure Choice) or offer employees an employer-sponsored retirement plan.

​Background
Secure Choice requires employers to automatically withhold five percent of an employee’s compensation (up to the annual maximum allowed for IRA contributions each year as provided by the IRS), unless the employee elects a different amount or opts out of the program, and to remit those contributions to the Secure Choice program.
Under the original program, employers that satisfy these criteria are subject to the Secure Choice program:

1. Have at least 25 employees as reported to the Illinois Department of Employment Security (IDES) for unemployment insurance payments;
2. Have been operating in Illinois for at least two years; and
3. Do not offer a qualified retirement plan to any Illinois employees. (A qualified retirement plan under sections 401(a), 401(k), 403(a), 403(b), 408(k), 408(p), or 457(b).)

New Requirements
The newly enacted law makes several notable changes to Secure Choice, including:

• The 25-employee threshold is reduced to 5 employees. Now, the program will apply to employers with at least 5 employees in the state during every quarter of the previous calendar year. The employer determines the total employee count using the annual average from the employer-reported quarterly data.
• Secure Choice now includes annual, automatic increases to the contribution rates up to a maximum of 10% of an enrollee’s wages. The Illinois Department of Revenue will establish a schedule for the automatic increase.
• The changes clarify that the second year of non-compliance need not be consecutive for applying the $500 noncompliance penalty.
• Employers now have 120 days (rather than 90 days) after issuance of a notice of proposed penalty assessment for noncompliance to file a protest with the department or come into full compliance.
• The changes allow providing notices electronically rather than only by first class mail.

When Effective
The program will notify employers before their scheduled start time to allow them time to register. The schedule is:

Wave 1: The enrollment deadline for employers with fewer than 25 employees and more than 15 employees will be no sooner than September 1, 2022

Wave 2: The enrollment deadline for employers with at least 5 employees but not more than 15 employees will be no sooner than September 1, 2023.

The Illinois Secure Choice website provides additional information, including FAQs.
https://www.ilsecurechoice.com/home/faq.html

These tax tips can help new business owners find success
Starting a business can be very rewarding. It can also be a little overwhelming. From business plans to market strategies, and even tax responsibilities…there are many things to consider. Here’s what new business owners can do to help get off to a good start.

• Choose a business structure. The form of business determines which income tax return a business taxpayer needs to file. The most common business structures are:
  • Sole proprietorship: An unincorporated business owned by an individual. There’s no distinction between the taxpayer and their business.
  • Partnership: An unincorporated business with ownership shared between two or more people.
  • Corporation: Also known as a C corporation. It’s a separate entity owned by shareholders.
  • S Corporation: A corporation that elects to pass corporate income, losses, deductions, and credits through to the shareholders.
  • Limited Liability Company: A business structure allowed by state statute.
• Choose a tax year. A tax year is an annual accounting period for keeping records and reporting income and expenses. A new business owner must choose either:
  • Calendar year: 12 consecutive months beginning January 1 and ending December 31.
  • Fiscal year: 12 consecutive months ending on the last day of any month except December.
• Apply for an employer identification number. An EIN is also called a federal tax identification number. It’s used to identify a business. Most businesses need an EIN.
• Have all employees complete these forms:
  • Form I-9, Employment Eligibility Verification
  • Form W-4, Employee’s Withholding Allowance Certificate
• Pay business taxes. The form of business determines what taxes must be paid and how to pay them.

Taxpayers interested in starting a business can find information for some industries on the Industries/Professions Tax Centers webpage. Each state has additional requirements for starting and operating a business. Prospective business owners should visit their state's website for info about state requirements.

More information:

• Small Business Admiration’s 10 steps to start your business.