LA County Sales Tax Increase July 2017

LA County Sales Tax Increase July 2017

As you may be aware, there is an increase in the LA County sales tax rates taking effect July 1, 2017. In November 2016, voters approved Measure M which applies to Los Angeles County including all cities and unincorporated areas. It is imperative that you know which tax rate applies if you sell to those outside of your business location. At this time, the BOE is not increasing the sales tax for the passage of Measure H (Sales tax for Homeless Services and Prevention) which was approved in March 2017. Increases usually don’t take effect less than 6 months after the vote is approved, so it could potentially be implemented as early as the 4th quarter of 2017. We’ll have to watch for information to know when this increase will take effect. Unless a city has passed addition legislation for a higher tax rate, the new percentage will be 9.25%, up from 8.75%. The following cities will have a higher rate:   Avalon 9.75% City of Commerce 9.75% Compton 10.25% Culver City 9.75% Downey 9.75% El Monte 9.75% Inglewood 9.75% La Mirada 10.25% Long Beach 10.25% Lynwood 10.25% Pico Rivera 10.25% San Fernando 9.75% Santa Monica 10.25% South El Monte 9.75% South Gate 10.25% As a retailer, if you charge the incorrect tax rate, you are responsible for paying the difference. The proper rate will be calculated on the sales tax return when the information is filed. The tax rate is determined where the customer receives the merchandise, not where your business is located. A sale is considered to have occurred when the client receives the merchandise unless the contract...
Tax Breaks for Grandparents Raising Their Grandchildren

Tax Breaks for Grandparents Raising Their Grandchildren

Are you a grandparent caring for grandchild(ren) or think you may be soon? I read a blog written by Robert Trinz that shares deductions you may be able to take on your tax return. Read more to see what may apply to your situation. Tax breaks you may be able to use include: Head of household filing status -This is often more favorable than single (of course if married, you would most likely select married filing jointly). Exemption for the child – A taxpayer is entitled to a deduction equal to the exemption amount for each person who qualifies as his or her dependent. Earned income credit – To qualify on account of grandchildren, the AGI must be less than certain specific amounts that depend on the number of qualifying children the grandparent has. Child tax credit – Individuals may claim a maximum $1,000 for each qualifying child the taxpayer can claim as a dependent. Credit for child and dependent care expenses – The maximum amount of employment-related expenses that may be used to compute the credit is $3,000 for one qualifying individual, or $6,000 for two or more qualifying individuals. Credits or deductions for qualified education expenses – There are a number of tax breaks that may be available to a grandparent who pays his or her grandchild’s education costs. Deductions for medical and dental expenses – An individual who itemizes can deduct the amount by which certain unreimbursed medical and dental expenses paid during the year for himself or herself, his or her spouse, and his or her dependents exceed 10 percent of his AGI. Adoption expenses – In addition to adoption fees, qualified expenses...
Should Your Online Business Have an EIN?

Should Your Online Business Have an EIN?

If you run an online business and are wondering if it would be necessary for your company to have an Employer Identification Number (EIN), then this article will help clarify things for you. Whether it’s a legal requirement or not, the author Deborah Sweeney informs us on why you should have an EIN along with the benefits that come with it. EINs are typically needed if your company plans to hire, or is in the process of hiring, employees. ECommerce businesses that don’t plan on hiring anyone may dismiss an EIN without realizing all of the other benefits it can provide their business — many of which your company really needs. From protecting your social security number to opening up a business bank account, here’s why it’s handy to have an EIN. Protect Your Social Security Number In order to identify your business, you are legally required to use your Social Security Number or an EIN. While sole proprietors often use their SSN on official documents, many are now opting to file for and use an EIN instead. Why is that? An EIN is much less sensitive than your SSN which could easily be stolen in a case of identity theft, wreaking havoc on your personal matters. Don’t worry that you’ll need to safeguard your EIN either since these are only used as a federal identifier. If you know that you’ll be using your SSN frequently on forms related to your eCommerce business (Editor’s not: like a sales tax registration!), then it’s a smart move to file for and use an EIN as a precaution. Federal Tax ID Numbers...
Will Trump’s New Healthcare Bill Impact Your Taxes?

Will Trump’s New Healthcare Bill Impact Your Taxes?

If you’ve heard about the new healthcare bill President Trump wants to pass, there are some things you need to know on how it might affect you and your taxes. In a brief blog post, written by Kent Livingston, he discusses the new proposal and how it could bring about noteworthy changes of which you should be informed. Since President Trump and his administration took office in January there has been much hubbub about the Affordable Care Act, otherwise known as Obamacare. Of course, this was a hot topic throughout the campaign and it has remained on the forefront of the new administration’s agenda since they took control of the White House. After a previous attempt to repeal the ACA failed in March, early May the Trump administration introduced another plan that passed the House in its first attempt: the American Health Care Act, or AHCA. However, that doesn’t mean the fight is over. In fact, the bill still has to clear the Senate and at this point the outcome is anything but certain, with many senators already opposing the bill. Significant Changes In any case, the new proposal would lead to several significant changes, including changes to your taxes, if it does become law, and therefore you should be aware of how it would affect you should it pass. No Penalty for Not Having Insurance – For starters, one of the biggest complaints about Obamacare was the individual mandate to have insurance and the penalty for not complying. The new bill would eliminate this penalty and thus save taxpayers who choose to go uninsured hundreds of dollars a...
Commission Based Salespersons: A Cautionary Tale

Commission Based Salespersons: A Cautionary Tale

Do you pay employees on a commission basis? if so, I’d like to share information with you from a recent newsletter by DeAnn Chase of the Chase Law Group. A recent case issued by the California appellate court will have a significant impact on the structure of commission-based compensation for inside salespersons.  The case of Vaquero v. Stoneledge Furniture involved employees engaged in retail furniture sales activities for Ashley Furniture Stores, (“Ashley”).  Ashley argued that its compensation program ensured that employees were paid at least minimum wage, and that this compensation plan adequately accounted for the employees’ meal and rest periods.  However, Ashley’s compensation plan was structured such that the employees were paid via a “draw” against advanced commissions that equated to an hourly wage that exceeded the minimum hourly wage, but allowed Ashley to “claw back” future commissions for pay periods in which the employees’ commissions did not exceed the hourly minimum payments.  The court therefore determined that this program did not adequately account for non-sales activities, such as time spent in meetings or trainings.  Accordingly, the court determined that Ashley’s compensation plan did not adequately account for the employees’ mandatory rest periods, and that the employees should have been separately compensated for these rest periods.  Notably, the court found that an alternative compensation program instituted by Ashley prior to the court’s final determination was adequate.  This compensation program provided that the employees would be paid a fixed hourly wage that complied with the local, state and federal minimum wage, and then provided the employees with incentive-based commissions based on sales.  If you run a business that hires...
Tax Changes In 2017 You Need To Know About

Tax Changes In 2017 You Need To Know About

With the IRS guidelines changing from year to year, there is a lot of stress on taxpayers trying to stay up-to-date with current information. Mairye Bates, from H&R Block’s Block Talk, keeps you stress-free and knowledgeable on the tax changes occurring this year. Maybe you worry about the correct way to track and report your income and expenses, or perhaps you wonder about the rules for deducting retirement savings accounts. Or maybe you’re wondering about healthcare insurance topics. Here are some tax changes in 2017 that will help you stay on top of things this upcoming tax season. For 2017, the IRS has instituted some changes that you should know about. These changes apply broadly to all American taxpayers: Standard Tax Rates 2017 2016 Personal Exemption $4,050* $4,050* Standard deduction – Single, or Married Filing Separate $6,350 $6,300 Standard deduction – Head of Household $9,350 $9,300 Standard deduction – Married Filing Joint $12,700 $12,600 Earned Income Credit – Maximum Amount $6,318 $6,269 *Subject to phase out for Adjusted Gross Income starting at $261,500 ($314,000 for Married Filing Jointly) Personal Taxes Health Insurance For 2017, the amount used to calculate the penalty for not maintaining minimum essential health coverage is $695 or 2.5% of household income, whichever is higher. There are no changes to Marketplace Insurance. Remember, if you are a small business owner, you may be able to deduct your health insurance and long-term care premiums as an “above the line” deduction on your personal return, if you meet some conditions. This means that you are not limited by the 10% of AGI threshold for medical expenses. If you...
Pre-Shift vs. Before-Shift: What’s the Difference?

Pre-Shift vs. Before-Shift: What’s the Difference?

After reviewing some information that was sent to us from HR Pilot, we thought it would be useful to other companies that have questions regarding on whether an employee should be compensated or not. Employers are using pre-shift meetings as an effective tool to increase communication in the workplace, but it is important to know the difference between “Pre-shift” and “Before-shift” duties when considering work-time. Any time the employee is “suffered or permitted” to work is considered time that must be compensated by the employer, even if it is a “quick” meeting, and even if the employee is not clocked in. Examples of other duties that can be done “Pre-shift” and must be compensated include: Reading, giving, or getting instructions to perform a duty; Logging into a software system; Attending “roll-call” or reviewing daily duties with a manager; Donning protective gear; Completing pre-shift inspections; and Gathering necessary supplies for work. Examples of the employee’s duties that might be permissible “before-shift” (this includes any activity that is not considered a benefit to the employer), such as:* Parking a car; Resting in the break room or using the bathroom before a shift; Putting a meal in the refrigerator or hanging up a coat; and Making a call to plan how to get home from work. * Always consult with your EPLI HR Professionals if there are any questions as to Pre-shift duties. Contact them at 800-980-2988 or hrdirectors@eplaceinc.com. If you have questions regarding this or any other policy, contact your HR representative today. If you don’t currently work with a company, feel free to reach out to us for referrals to...
Which IRS Violations Are Evasion Or Willful Depends On The Facts

Which IRS Violations Are Evasion Or Willful Depends On The Facts

Taxes are usually such a difficult subject, but with the helpful guidance of Robert W. Wood, dealing with the IRS can be more easily understood. In his article written on Forbes.com, Robert discusses how penalties could affect you whether or not your violation was intentional and how much it could cost you. The tax law distinguishes between non-willful and willful conduct. Willfulness involves a voluntary, intentional violation of a known legal duty. In taxes, it applies to both civil and criminal violations. Big penalties and even prosecution can hang in the balance. Innocent mistakes can be forgiven, but conduct that appears to be intentional can be a different story. Many people think that even civil penalties cannot be imposed if you were not actually trying to cheat anyone. However, intent can sometimes be inferred from conduct. The definition of willfulness causes many people to think that their conduct is not likely to be examined, and that their own knowledge is entirely subjective. If you didn’t know you had a legal duty to report income or a foreign bank account, you might reason, how can you be treated as willful? Unfortunately, it is not that simple. Take the recent case of Arthur Bedrosian v. U.S. Reported here. In the early 1970s, he opened two Swiss bank accounts. An accountant prepared his tax returns, and Bedrosian did not inform the accountant about the Swiss accounts. In the 1990s, he finally mentioned them to the accountant, who said that he had been breaking the law for years by failing to report. Even so, the accountant said that he should do nothing. He...
Now’s the Time to Take a Long, Hard Look at Busy Season

Now’s the Time to Take a Long, Hard Look at Busy Season

Do you have busy season cycles in your industry? As you are probably aware, we have come out of the busiest time of year and found a great article on what we can assess after making it through a busy season. If you want to analyze your business after a busy season, read the information below by Marsha Leest of Goingconcern.com. Although it sounds like she is writing to employees of organizations, we as business owners can look at her questions and see how well our company did in these areas. Busy Season Assessment Training. Were you given adequate training, if it was needed so that you could work as effectively and efficiently as possible? If you were struggling, were you able to ask questions? IT Support. Were issues resolved quickly? If not, did you have to take matters into your own hands? How did that work? Exposure to Clients. Did you have the opportunity to meet with clients, or were you mostly in the background? If it was your first busy season, keep in mind that you can learn from even the most mundane tasks. Data Mining. Were you able to learn from clients’ data? Are there opportunities for initiative? How does that change how you look at your assignments? Overall “Firm Feel.” What was the atmosphere like at the firm? Were you able to take the time you needed to handle personal or family business during busy season? Did the firm do things to make your life easier, like bringing in lunch or dinner or sponsoring fun events? Firm Leadership. Were firm leaders visible or absent? Supportive...
3 Reasons Small Businesses Must Innovate or Perish

3 Reasons Small Businesses Must Innovate or Perish

Brainstorming and thinking of new ideas to help your small business to grow are incredibly important, because without growth, your company’s success may start to decline. In an article written by Isaac O’bannon, he quotes Mayur Ramgir who gives some useful advice for why you should keep innovating. It’s often said that all it takes to change a person’s life – or the life of a business – is one big idea. While it’s true that many individuals and businesses have gone a long way on the strength of a lone idea, plenty of others prospered even further because they are constantly innovating – coming up with one good idea after another. “Businesses usually start out with an innovative idea,” says Mayur Ramgir (www.mayurramgir.com), president and CEO of Zonopact, Inc. “But they soon lose that innovative edge as they just try to survive with their day-to-day operations.” Ramgir has seen the problem often while working with the clients of Zonopact, which provides companies with software products that help them streamline their processes, carving out more time for innovation. “It’s easy to lose sight of your vision, and the kind of innovative thinking that got you to where you are, when you become bogged down in solving each day’s problems,” he says. So why it is important that companies keep innovating? 1. Other companies can claim your market share. Apple has become a perfect example of what a gap in innovation can leave. There hasn’t been much game-changing innovation from Apple since it released the iPad in 2010, thus giving its competition time to make up the ground that separated...

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