In recent years, the gig economy has changed how people do business and provide services. Taxpayers must report their gig economy earnings on a tax return – whether they earned that money through a part-time, temporary or side gig. The IRS’ Gig Economy Tax Center provides information and resources to help this group of entrepreneurs and workers understand and meet their federal tax obligations.
Here are key things for individuals involved in the gig economy to remember as they get ready to file in 2023.

Gig economy income is taxable

• Taxpayers must report all income on their tax return unless excluded by law, whether they receive an information return such as a 1099 or not.
• Individuals involved in the gig economy may also be required to make quarterly estimated tax payments to pay income tax and self-employment tax, which includes Social Security and Medicare taxes. The last estimated tax payment for 2022 is due Jan. 17, 2023.

Workers report income according to their worker classification
Gig economy workers who perform services, such as driving a car for booked rides, running errands and other on demand work, must be correctly classified. Classification helps the taxpayer determine how to properly report their income.

• If they are employees, they report their wages from the Form W-2, Wage and Tax Statement.
• If they are an independent contractor, they report their income on a Schedule C, Form 1040, Profit or Loss from Business - Sole Proprietorship.

The business or the platform determines whether the individual providing the services is an employee or independent contractor. The business owners can use the worker classification page on IRS.gov for guidance on properly classifying employees and independent contractors.

Expenses related to gig economy income may be deductible
Individuals involved in the gig economy may be able to deduct expenses related to their gig income, depending on tax limits and rules.

• Taxpayers may be able to lower the amount of tax they owe by deducting certain expenses.
• It is important for taxpayers to keep records of their business expenses.

Pay the right amount of taxes throughout the year
An employer typically withholds income taxes from their employees' pay to help cover taxes their employees owe.
Individuals involved in the gig economy have two ways to cover their taxes due:

• If they have another job where they are considered an employee, they can submit a new Form W-4, Employee's Withholding Certificate to their employer to have more taxes withheld from their paycheck to cover the tax owed from their gig economy activity.
• They can make quarterly estimated tax payments throughout the year.

More information:
Publication 525 Taxable and Nontaxable Income
Publication 1779, Independent Contractor or Employee

​Share this tip on social media -- #IRSTaxTip: Tax tips for gig economy entrepreneurs and workers. http://ow.ly/TZ4T50MnUmE
​

Nearly 200 New Laws for Illinois in 2023
I want to thank LaVelle Law for a very comprehensive email about this! They are a business Law firm in Schaumburg. www.lavellelaw.com/

They’ve prepared a summary of some of the new Illinois laws that may impact your life.

See a complete list here:
 https://www.illinoissenatedemocrats.com/images/PDFS/2022/bills-taking-effect-2023.pdf​

STUDENT CONFIDENTIAL REPORTING ACT (SB 03936/PA 102-752) Legislation requiring state agencies, such as schools and the Illinois State Police, to establish a hotline for receiving reports and other information regarding the potential harm or self-harm of students or school employees.
 
CROWN ACT (SB 03616/PA 93-1078) Legislation amends the definition of “race” under the Illinois Human Rights Act to include traits historically associated with race, including, but not limited to, hair texture and protective hairstyles. The goal of this law is to prevent hair discrimination in the workplace.
 
LIFTING UP ILLINOIS WORKING FAMILIES ACT (SB 0001/PA 101-0001) Legislation amends the Illinois Minimum Wage Law to raise the minimum wage in the State of Illinois to $15 by 2025. In 2023, the minimum wage in Illinois will increase from $12 to $13 an hour.
 
FAMILY BEREAVEMENT LEAVE ACT (SB 03120/PA 102-1050) Legislation amends the Illinois Family Bereavement Leave Act to provide up to two weeks, or 10 working days, of unpaid leave for women who have a miscarriage or other diagnosis or event that impacts pregnancy or fertility, including failed adoptions or surrogacy agreements and unsuccessful reproductive procedures. The amendment also expands the definition of “family member” under the Act to include spouses, domestic partners, siblings, grandparents, and stepparents.
 
ILLINOIS VEHICLE CODE
(SB 03216) Amends the Illinois Vehicle Code to include licensed physical therapists on the list of persons who can “verify that a person is a person with disabilities.”
 
(SB 03609) Lowers vehicle registration fees for cars and small trucks if they were manufactured in Illinois.
 
SCHOOL CODE EXPANSION
(HB 05193/PA 86-1475) Legislation amends the Illinois School Code to require “safe gun storage” to be included on the list of required topics in the state’s safety education curriculum for all grades.
 
(HB 05488/PA 102-0981) Legislation amends the Illinois School Code to allow every student enrolled in a public middle or high school at least one excused school day absence per year to engage in a “civic event.” A “civic event” is an event “sponsored by a non-profit…or government entity that is open to the public.”
 
ILLINOIS STATE EMPLOYEES GROUP INSURANCE ACT
(HB 04271/PA 102-0731) Requires state-regulated private insurance to cover medically necessary breast reduction surgery.
 
(HB 05254/PA 102-0804) Requires health insurance plans to cover medically necessary hormone therapy treatments for women who have induced menopause by undergoing a hysterectomy.
 
(HB 05318/PA 102-1073) Requires health insurance to cover annual prostate cancer screenings upon a physician’s recommendation.
 
(HB 05334/PA 102-0979) Requires health insurance to cover costs for genetic testing for the BRCA1 and BRCA2 genes to detect risks for breast and ovarian cancer upon a physician’s recommendation.
 
JOB TRAINING ASSISTANCE AND SUPPORT SERVICES PILOT PROGRAM ACT (HB 05225/PA 102-0803) Legislation created a five-year pilot program that offers assistance and support services, such as childcare or transportation subsidies, to eligible individuals to allow them to complete an apprenticeship or internship.
 
THE COMPREHENSIVE HEALTH EDUCATION PROGRAM (SB 04028) Legislation requires Illinois schools to provide information on where and how students can access mental health care services.
 
ILLINOIS CAREER/TECH PATHWAY (HB 03296) Legislation requires school boards to establish a career and technical education pathway program for grades 6 through 12.
 
ILLINOIS DUAL CREDIT COURSES (HB 05506) Legislation allows partnership agreements between Community College districts and High School districts to allow high school students to take a dual credit course for high school credit and collect demographic data.
 
RED LIGHT CAMERA/SPEED CAMERA CHANGES FOR STOLEN VEHICLES (HB 03772) Modifies existing vehicle laws by providing that people whose cars have been stolen will no longer be liable for violations, fees, fines, or penalties when caught on red light and speed cameras.
 
ILLINOIS HEALTH AND WELLNESS OF STATE RESIDENTS (SB 02535) Legislation requires that before a pharmacist dispenses an opioid, they must inform the patient that opioids are addictive and offer to give them an opioid antagonist.
 
WORKER’S RIGHTS AMENDMENT TO THE ILLINOIS BILL OF RIGHTS (SJRCA0011) Amendment to the Bill of Rights of the Illinois Constitution that makes the “right to organize and to bargain collectively through representatives of their own choosing for the purposes of negotiating wages, hours and working conditions” a fundamental right for Illinois workers.
 
LATEX GLOVE BAN ACT (HB 0209/PA 102-1095) Legislation bans latex gloves in the handling and preparation of food. The Act will also ban the use of latex gloves by medical personnel starting Jan. 1, 2024.
 
ILLINOIS POWER OF ATTORNEY ACT (HB 05047/PA 102-0794) Legislation amends the Illinois Power of Attorney Act to permit agents in a health care setting to present electronic copies of documents that delegate power of attorney and requires the health care provider to accept the digital document.
 
MOTOR FUEL TAX (PA 101-0032) Effective January 1, 2023, the State Motor Fuel Tax will increase to $0.423 per gallon of gasoline. Additionally, the tax will resume its annual increase on July 1, 2023.
 
GROCERY TAX (PA 102-700) Effective January 1, 2023, the 1% tax on groceries will be reinstated after it was suspended from July 1, 2022, through June 30, 2023.
 
BANKING DEVELOPMENT DISTRICT ACT (HB 05194/PA 102-802) Establishes an incentive program to induce banks and credit unions to open branches in areas with underbanked populations.
 
HUMAN RIGHTS ACT (HB 02775/PA 102-896) Legislation amends the Illinois Human Rights Act by making it a civil rights violation for anyone in real estate transactions to discriminate based on source of income. Financial institutions are exempt if they are considering source of income in transactions in compliance with state or federal law.
 
CONDOMINIUM PROPERTY ACT (HB 05246/PA 102-976) Legislation amends the Condominium Property Act by narrowing the timeframe for section 22.1 disclosures for prospective purchasers from 30 days to 10 days. The amendment also limits the fee for gathering such information to $375, with an additional $100 charge permitted for rush service completed within 72 hours.
 
REAL ESTATE VALUATION TASK FORCE ACT (HB 04410/PA 102-934) Legislation creates the Real Estate Valuation Task Force to identify and resolve the causes of racial disparities in appraisals.
 
PROPERTY TAX CODE (SB 03069/PA 102-1000) Legislation amends the Property Tax Code to provide that a homeowner or condominium association may file an appeal or intervene in an appeal on behalf of its members to the Property Tax Appeal Board. 

​​Here is an outline of a business plan you can use. If you have some trouble, you can ask Tom Gosche, Business Strategist from GLM! tomg@goglm.com and/or 630-675-8971

1. Executive Summary

2. Current Situation

3. Vision

• Mission Statement
• Goals (long range)
• Objectives (short/medium range)

4. Management

5. Product / Service Description

6. Market Analysis

• Customers
• Competition
• Opportunities
• Risks

7. Marketing Strategy

• Personnel
• Facilities / Equipment
• Pricing & Profitability
• Advertising & Promotion
• Public Relations
• Selling Tactics
• Distribution Channels
• Business Relationships

8. Production / Manufacturing Strategy

• Personnel
• Facilities / Equipment
• Intellectual Property
• Regulation / Compliance
• Supply Chain
• Business Relationships

9. Administrative Strategy

• Personnel
• Facilities / Equipment
• Management Information
• Worker Administration & Benefits
• Regulation / Compliance
• Business/Professional Relationships

​10. Financial Information 

• Pro Forma Balance Sheets (for 5 years into the future)
• Pro Forma Income Statement (for 5 years into the future)
• Detailed Budget (for next 12 to 24 months into the future)
• Cash Flow Projection (for next 12 to 24 months into the future)
• Break Even Analysis (show growth steps, if applicable)
• Summary of Existing Resources (people and money)
• Potential Sources of Funding

She loves working with business owners on securing their assets with a plan so they can survive disruptions and thrive in the aftermath. The business will develop a business continuity plan via learning how to do tailored risk assessment and business impact analysis. Erika and her company, EaaS will then work that plan through trainings and exercise creation and facilitation to determine the plan's viability. EaaS leaves businesses better able to resume operations quickly when risk management fails.

Recordkeeping is an important part of running a small business. In fact, keeping good records helps business owners make sure their business stays successful.
Here are some things small business owners should remember about recordkeeping:

• Good records will help business owners:
  • Monitor the progress of their business
  • Prepare financial statements
  • Identify income sources
  • Keep track of expenses
  • Prepare tax returns and support items reported on tax returns
• Small business owners may choose any recordkeeping system that fits their business. They should choose one that clearly shows income and expenses. Except in a few cases, the law does not require special kinds of records.
• How long an owner should keep a document depends on several factors. These factors include the action, expense and event recorded in the document. The IRS generally suggests taxpayers keep records for three years.
• A good recordkeeping system includes a summary of all business transactions. Businesses usually record these transactions in books called journals and ledgers, which business owners can buy at an office supply store, or keep them electronically. All requirements that apply to hard copy books and records also apply to electronic business records.
• The responsibility to validate information on tax returns is known as the burden of proof. Small business owners must be able to prove expenses to deduct them.
• Business owners should keep all records of employment taxes for at least four years.
• Businesses that keep paper records should keep them in a secure location, preferably under lock and key, such as a desk drawer or a safe. 
• Businesses that keep records electronically on a computer should always have an electronic back-up, in case the hard drive crashes.

The Daily Herald had an article in Sunday’s Newspaper about the importance of an Accountant or CPA in advising your business. You can imagine that we at GLM agree with this this. Having an outside look at your business and finances is very important to the growth and stability of your business.

About the Author:
Denice Gierach is an attorney, CPA, Northwestern University business master's graduate, and has owned several businesses including in real estate and manufacturing. She is the lead attorney at Gierach Law Firm in the Chicago area. With more than 30 years of experience, she has been a respected and sought-after resource for businesses looking to grow, sell, solve problems, and succeed long term.
Her insights across business areas gives a fuller lens to business issues and solutions, and helps businesses grow and succeed with less time spent on legal issues and other time-consuming problems
 
Here is a link to the Article:
​ https://www.dailyherald.com/business/20221204/the-importance-of-involving-your-cpa-in-your-business
​

The Tuesday after Thanksgiving marks Giving Tuesday when many people choose to make charitable donations. People making charitable donations for Giving Tuesday, or at any time during the year, should review whether their gift is tax-deductible.

Donations to charities may be deductible
Most contributions of cash or property made to a charitable organization are deductible as an itemized deduction on Schedule A, Form 1040, Itemized Deductions. Cash contributions include those made by check, credit card or debit card, as well as unreimbursed out-of-pocket expenses in connection with volunteer services to a qualifying charitable organization. Donations of property other than cash are generally deductible at their fair market value.

There are some contributions that aren’t tax deductible, including donations:

• Made to a supporting organization
• Intended to help establish or maintain a donor advised fund
• Carried forward from prior years
• Made to most private foundations
• Made to charitable remainder trusts
• Of time spent volunteering

Some things to do when a taxpayer is considering making charitable gifts include:

• Use the Interactive Tax Assistant to help determine if a charitable contribution is deductible.
• Get a written acknowledgement for any charitable contributions of $250 or more.
• Research charities they are considering donating to carefully.

Tax Exempt Organization Search tool
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. TEOS provides information about an organization's federal tax status and filings.

Things to know about the TEOS 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.
• TEOS does not list certain organizations that may be eligible to receive tax-deductible donations, including churches, organizations in a group ruling and governmental entities.
• TEOS lists organizations 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.

​Qualified charitable distributions
Taxpayers age 70 ½ or older can make a qualified charitable distribution directly from their IRA, other than a SEP or SIMPLE IRA, to a qualified charitable organization. The maximum annual amount a taxpayer may exclude from income for a QCD is $100,000. A QCD may also count toward the taxpayer’s required minimum distribution for the year. Taxpayers should review Publication 590-B, Distributions from Individual Retirement Arrangements, for more information.

We recently met with Wendy Schulz, Preferred Funding Group based in West Dundee. They help to secure the funding you need to start or grow your business with help from their trusted team of Experts! Whether you’re looking to start a new business or looking to grow your business, a personal or business loan from PFG can make your plans into a reality.

Qualify for up to $500,000 today

FUNDING PROGRAMS

• 5 or 7 year Term Loans
• Business Credit Card Program
• Personal Credit Card Program

​TERM LOAN PROGRAM

• Rates range from 5.49%-14.99%
• No minimum length of time in business
• Fixed monthly payment
• No upfront fees
• Full liquidity Immediately
• Funding in 7-15 business days
• (Dependent on strength of personal credit)

REQUIREMENTS

• 680+ Personal Credit scores in all 3 bureaus
• 2 years personal tax returns showing $50,000 or more of taxable income

​BUSINESS CREDIT CARD PROGRAM

• 0% Interest for 6-12 months
• No minimum length of time in business
• Stated income
• No upfront fees
• Reports only to the business

REQUIREMENTS

• 700+ Personal Credit Scores on all 3 bureaus
• Established Business Entity

Apply today: ​https://preferredfundinggroup.wufoo.com/forms/q1b99q130o9718l/