Monday, July 17, 2017

Get to Know These Tax-Saving Terms


As you begin to think about scheduling your midyear tax planning appointment, refresh your memory on the meanings of terms that can save you money. Here are three.
  • Exclusion. Exclusions are items that would generally be included on your return, but are specifically excluded by a tax law provision. For example, gifts and inheritances you receive are excluded from your income – you simply don’t report them on your federal tax return.
  • Deduction. By definition, a deduction means an amount is subtracted from your income. Tax deductions fit into four general categories.
Above the line deductions, such as alimony paid, can be claimed even if you don’t itemize.
Itemized deductions are a specific group of expenses, including amounts you pay for certain taxes, medical costs, charitable donations, mortgage interest, and disaster losses.
The standard deduction is a simplified substitute for itemized deductions. It’s a flat amount you can use to reduce your gross income instead of itemizing each allowable expense.
Business deductions are the ordinary and necessary expenses required for carrying on your trade or business.
  • Credit. Income tax credits are subtracted from the tax you owe. Note the difference from the definition of deductions, which reduce your income and indirectly reduce your final tax bill.
Tax credits can be refundable, meaning you’ll get money back if the credit exceeds the amount of tax you owe. Nonrefundable credits can only reduce your tax to zero.
These terms can be confusing. Call if you have questions about these tax-savers and how including them in your midyear planning can benefit you.

See more at : http://www.bas-pc.com/

Wednesday, July 5, 2017

Five Reasons to Incorporate Your Business



Most new businesses start with no thought about legal structure. In the eyes of the IRS, the default structure is a “sole proprietor,” in which your business profits are taxed on your personal tax return. This can serve you well to start, but there are several reasons you may want to consider incorporating as your business grows.


  • To protect your personal assets from creditors. When you operate your business within a corporation, creditors are often limited to corporate assets to satisfy a debt. Your home, savings, and retirement accounts are no longer fair game.
  • To provide a personal liability firewall. The corporate form can help protect you against claims made by others for injuries or losses arising from actions of your business.
  • To issue shares of stock. You can help build your business by issuing shares to new investors, or by offering stock options to key employees as a form of compensation.
  • To gain tax flexibility. A corporation can provide you with more tax flexibility. Deliberate planning can help optimize the taxable division between corporate income, dividends, and your personal wages.
  • To enhance your business presence. Being incorporated sends a signal that your business is a serious enterprise, and it could open doors to opportunities not offered to sole proprietors. Consumers, vendors, and other businesses often prefer to do business with incorporated companies.

If you are still going over the pros and cons of incorporating your business, give our office a call. Together, we can complete a thorough tax review that will help shed light on the impact such a move will have on your business situation.

See more at : http://www.bas-pc.com/

Wednesday, June 28, 2017

Don’t Underestimate the Power of Curb Appeal




Curb appeal is often talked about when selling a residential home, however, it applies just as frequently to the commercial building or space. If you want to improve the market value, curb appeal matters. Locations with great curb appeal usually command higher prices and spend less time on the market.

Luckily there are simple, inexpensive ways to help your building impress buyers.

1) Make it sparkle. Walk around the outside and take note of what looks dirty: windows, downspouts, gutters, siding, and doors. These can usually be tackled with soapy water and a scrub brush. For a bigger job, consider using a pressure washer.

2) Coat of paint. Updating the color of your door, trim, or shutters may help your building look newer and more modern.

3) Replace hardware. Don’t overlook your building address numbers, entry door locksets, doorbells, mailboxes, or light fixtures. These elements add visual interest, but can detract from the appeal if they show years of wear. Replace, clean, or paint pieces that have become dingy or out of date.

4) Update landscaping. Planting a tree is a great way to add long-lasting dimension and appeal. Consider flanking the front entry with trees or shrubs. Add a pop of color by placing flower planters or adding window boxes to front-facing windows. Or simply make sure the lawns are being mowed before showings.

5) Incorporate outdoor art. For an outside the box idea, bring some art into the space leading up to your entry door. It could be as simple as a birdbath, bird feeder, or hanging windchimes; or as unique as a one-of-a-kind sculpture from a local artist.

See more at : http://www.bas-pc.com/

How to Build Your Business Credit



Whether your firm has been operating for years, or you decided over last night’s coffee to start a new venture, you’re sure to face the need for business credit. Entrepreneurs often ask friends and family to invest in their start-up businesses, and many draw on personal funds to launch new firms. But to address ongoing business needs – such as requirements for inventory, equipment, and real estate – most firms seek additional help from credit card companies and banks.

Unfortunately, today financial institutions are more wary than they used to be about extending credit to small companies. And with many business revenues faltering because of market pressures, even well-established companies have found it difficult to obtain loans.

As a result, establishing good business credit has become more important than ever. To convince a lender that your company represents a good risk, you should first prepare a well-written business plan. It need not be as long as a Tolstoy novel, but should lay out in some detail your products, pricing, estimates, competition, and basis for cash flow projections. A clearly defined business plan will convince potential lenders that you’ve addressed the greatest obstacles to your firm’s success. Before approaching lenders, consider your business structure as well. For example, a limited liability company or corporation may be seen as less risky than a sole proprietorship. The goal is to present a professional image to convince the lender that your company will prosper in good times and bad.

To establish good business credit, you’ll also want to make sure all required licenses are current and your firm is registered with the major business credit reporting bureaus such as Experian and Equifax. Work with vendors who report to these bureaus so that your on-time payments are tracked.

Of course, the key to building good business credit is making all your payments on time. As with personal credit, your business credit score will climb as managers prove their skill at monitoring the firm’s cash flow and their commitment to honoring the firm’s obligations.

Also consider having our office review your financial statements before you send them to the bank. If you need assistance with this or other business concerns, give us a call.

See more at : http://www.bas-pc.com/

Tuesday, June 20, 2017

Disability Insurance – What You Need to Know


Say “insurance” to most people and auto, health, home, and life are the variants that spring to mind. But what if an illness or accident were to deprive you of your income? Even a temporary setback could create havoc with your financial affairs. Statistics show your chances of being disabled for three months or longer between ages 35 and 65 are almost twice those of dying during the same period.
Yet people with financial savvy often overlook disability insurance. Perhaps they feel adequately covered through their job benefits. However, such coverage can be woefully inadequate. The fact is, most individuals should consider disability insurance in their financial planning. When considering disability insurance, think in terms of long term and short term. Many employers provide long-term disability coverage for all employees. Find out if your employer does. If you have long-term disability insurance, you need to consider short-term coverage to supplement during the period of disability before your long-term coverage begins. To get the right coverage for you, take the following steps:
Scrutinize key policy terms. First, ask how “disability” is defined. Some policies use “any occupation” to determine if you are fit for work following an illness or accident. A better definition is “own occupation,” whereby you receive benefits when you cannot perform the job you held at the time you became disabled.
Check the benefit period. Ideally, your policy should cover disabilities until you’ll be eligible for Medicare and Social Security.
Determine how much coverage you need. Tally the after-tax income you would have from all sources during a period of disability and subtract this sum from your minimum needs.
Decide what you can afford. Disability insurance is not inexpensive. Plan to forgo riders and options that boost premiums significantly. If your budget won’t support the ideal benefit payment, consider lengthening the elimination period (but be sure that accumulated sick leave, savings, etc., will carry you until the benefits kick in).
See mpre at : http://www.bas-pc.com/

Tuesday, June 6, 2017

How to Build Your Business Credit


Whether your firm has been operating for years, or you decided over last night’s coffee to start a new venture, you’re sure to face the need for business credit. Entrepreneurs often ask friends and family to invest in their start-up businesses, and many draw on personal funds to launch new firms. But to address ongoing business needs – such as requirements for inventory, equipment, and real estate – most firms seek additional help from credit card companies and banks.
Unfortunately, today financial institutions are more wary than they used to be about extending credit to small companies. And with many business revenues faltering because of market pressures, even well-established companies have found it difficult to obtain loans.
As a result, establishing good business credit has become more important than ever. To convince a lender that your company represents a good risk, you should first prepare a well-written business plan. It need not be as long as a Tolstoy novel, but should lay out in some detail your products, pricing, estimates, competition, and basis for cash flow projections. A clearly defined business plan will convince potential lenders that you’ve addressed the greatest obstacles to your firm’s success. Before approaching lenders, consider your business structure as well. For example, a limited liability company or corporation may be seen as less risky than a sole proprietorship. The goal is to present a professional image to convince the lender that your company will prosper in good times and bad.
To establish good business credit, you’ll also want to make sure all required licenses are current and your firm is registered with the major business credit reporting bureaus such as Experian and Equifax. Work with vendors who report to these bureaus so that your on-time payments are tracked.
Of course, the key to building good business credit is making all your payments on time. As with personal credit, your business credit score will climb as managers prove their skill at monitoring the firm’s cash flow and their commitment to honoring the firm’s obligations.
Also consider having our office review your financial statements before you send them to the bank. If you need assistance with this or other business concerns, give us a call.

Wednesday, April 26, 2017

Could the Coverdell ESA be the right fund for you?


As we approach graduation season, we have education costs on the brain!

You’re probably familiar with 529 college savings plans. Named for Section 529 of the Internal Revenue Code, they’re also known as qualified tuition programs, and they offer tax benefits when you save for college expenses.

But are you aware of a lesser-known cousin, established under Section 530 of the code? It’s called a Coverdell Education Savings Account and it’s been available since 1998.

The general idea of Coverdell accounts is similar to 529 plans – to provide tax incentives to encourage you to set money aside for education. However, one big difference between the two is this: Amounts you contribute to a Coverdell can be used to pay for educational costs from kindergarten through college.
Generally, you can establish a Coverdell for a child under the age of 18 – yours or someone else’s. Once the Coverdell is set up, you can make contributions of as much as $2,000 each year. That contribution limit begins to phase out when your income reaches $190,000 for joint filers and $95,000 for single filers.
Anyone, including trusts and corporations, can contribute to the account until the child turns 18. There are no age restrictions when the Coverdell is established for someone with special needs.

While your contribution is not tax-deductible, earnings within the account are tax-free as long as you use them for educational expenses or qualify for an exception. In addition, you can make a tax-free transfer of the account balance to another eligible beneficiary.

Qualified distributions from a Coverdell are tax-free when you use the money to pay for costs such as tuition, room and board, books, and computers.

Please call for information about other rules that apply to Coverdell accounts. We’ll be happy to help you decide whether establishing one makes sense for you.

And best of luck to you and your loved ones who are knee-deep in education costs, whether it’s kindergarten, college or anything in between.

Happy [Future] Graduation!

More Info : Business Accounting Systems, PC