by Candy | Sep 21, 2018 | Bookkeeping, Sales Tax
Business owners often have a lot to think about. From weighing bright ideas and establishing systems for growth, to juggling clients, regulations, and inventory, it can be both an exciting and stressful time for small business owners. With all the many responsibilities each vying for an owner’s time and attention, it can be easy for sales tax obligations to slip through the cracks. And yet, failing to comply to nexus standards can be a serious liability for a business, with a chance of high penalties and problems in the wake of an audit. It’s no secret that sales tax can be complicated, so to help your business stay on the up-and-up, here are three common mistakes small businesses make and how to avoid them. 1. Neglecting Sales Tax Completely If you’re not sure if your business or the product you sell requires sales tax, don’t just ignore it altogether. Research nexus and how your business applies to the various state sales tax laws in which you operate. Are you a brick and mortar business? Check your state to see what obligations apply. An online seller? While this Supreme Court case might be changing the rules soon, for now most online retailers use economic nexus to determine whether or not sales tax is required. Remember, not collecting sales tax can bring some serious penalties to your business, so don’t risk it! 2. Getting the Numbers Wrong With sales tax regulations as numerous as the states and jurisdictions who require it, keeping track of the percentages and amounts can be tricky for small businesses – not to mention...
by Candy | Sep 18, 2018 | Business
It’s no secret that freelancing can be a rewarding career. From being your own boss while controlling your rate and schedule, to doing what you love with the clients you choose, becoming a freelancer can seem a dream for many, and for the most part, it is. However, just like with every job, there are a few downsides to working as a freelancer – some unexpected. 1) Being Your Own Boss Can Be Hard While it’s nice to choose how and when you work, freelancing can be difficult unless you have the self-control and personal introspection to schedule your time accordingly. With no boss or set working hours keeping you on track, fighting against procrastination can be a daily struggle for some. For others, as a freelancer only gets a return on the amount of work they put in, while the opportunities for business and client expansion are endless, working too much can become a problem – easily losing track of the days behind their laptops, or feeling guilty over time spent relaxing. Bottom line: unless a freelancer is especially careful, “freedom of schedule” can end up hurting them and their business in the end. 2) Finding That Balance Between Work and Life isn’t Always Easy It’s true that freelancing helps lend flexibility to your week, but that flexibility comes with a few cons. For one, as many freelancers work from home, they lack that “off switch” your brain gets when clocking out of a typical J-O-B to go enjoy evening plans. For a freelancer, weekends become synonymous with weekdays, while they’re constantly jumping in and out of work...
by Candy | Sep 14, 2018 | Taxes
It was a sad day for many when the aptly named “Queen of Soul”, Aretha Franklin, passed away at the age of 76 to pancreatic cancer on August 16th. And though her body has been laid to rest with a funeral service to remember, the singer’s family is in for a long, hard road ahead of them as Franklin’s estate – totaling an estimated $80 million – was reportedly left without a will. While Franklin’s lack of an estate plan is by no means an anomaly amongst similar celebrities – prominent figures like Prince and James Brown also failing to have their affairs in order before their death – for the singer’s heirs, this could mean long, and very public disputes over who gets what, as well as costly estate taxes that could have potentially been avoided, or at least reduced. “I was after her for a number of years to do a trust,” Franklin’s attorney, Don Wilson, told the Detroit Free Press. “It would have expedited things and kept them out of probate, and kept things private.” But as the Queen of Soul never did, Franklin’s four sons have all filed as interested parties in receiving shares of her estate, while her niece has also requested to be listed as the estate’s executor. How will Franklin’s assets be divided with no will or estate plan? “She’s a Michigan resident, so Michigan laws of heirship would dictate where everything would flow, meaning who would inherit her assets,” answers Stuart Kohn, Levenfeld Pearlstein’s trusts and estates attorney. “Because she had no spouse, her children would inherit her assets, and because...
by Candy | Sep 11, 2018 | Payroll
Decent humanity had a win when California’s Governor Jerry Brown signed two new employment bills into state law on July 9th. The two bills, scheduled to take effect January 1st of next year, are simple but effective in nature – one addressing workplace sexual harassment, and the other Paid Family Leave regulations – while both were unanimously voted through by bipartisan Legislature. Curious about the changes? Read on… Bill to Alter Paid Family Leave Regulations After the previously required seven-day waiting period before receiving Paid Family Leave (PFL) benefits was removed from state law altogether at the start of this year, one of the bills signed by Governor Brown, AB 2587, was more of a clarifying update to existing legislation. Back when there was a seven-day waiting period, if employers demanded their employees use up their vacation time before receiving PFL benefits, that waiting period could simultaneously count towards their earned time off, making it so that an employee would only have to wait two weeks instead of three to receive their benefits. Now that the waiting period no longer exists, AB 2587 merely removes the law’s reference of it counting towards an employee’s vacation time – the vacation law itself remaining unchanged. Sexual Harassment Protection Bill for Victims and Employers Coded as AB 2770, this bill is a major milestone towards protecting victims of sexual harassment, while helping to prevent it from happening again to others in the future. An old problem when it came to sexual harassment in the workplace, if a victim ever did have the courage to speak up about it, a common response from...
by Candy | Sep 7, 2018 | Payroll
While every employer has to deal with the accidental trip, cut, or injury happening to one of their employees at some point throughout the lifespan of their business, no one should have to put up with fraud in the process. According to a study done by the National Insurance Crime Bureau, workers’ compensation insurance fraud is a casually-committed crime that annually costs businesses over $30 billion nationwide. Perhaps one of the more common forms of this is “claim-related fraud”, which happens when an employee either falsely reports an injury or overexaggerates the extent of an existing one in the effort to receive better workers’ compensation benefits. Want to avoid being scammed out of a higher insurance premium? If you’ve just received a workers’ comp. claim from your employee – while there’s no one-size-fits-all guideline to know a fraud when you see it – a simple factcheck against these 10 common warning signs can help narrow down your suspicions. The claim might be a fraud if: You receive the report on a Monday morning, even if the injury was said to have happened the Friday before; The alleged accident is reported right after or before the employee is fired, given less work, or quit; The employee’s lawyers or doctors have a record of dealing with multiple or suspicious claims; There are no witnesses to, or an illogical reason was given for the accident; The employee’s story regarding the injury does not match with the evidence given by medical records; The employee has a reputation for lying or making questionable claims; The employee refuses to have a check-up with a medical...
by Candy | Sep 4, 2018 | Taxes
Four years, 15,000 victims, hundreds of millions of dollars stolen, and over 50,000 individuals’ personal information abused – the U.S. Justice Department announced the arrests and closure of the first multinational, large-scale IRS phone scam the nation has seen. This complex scheme involving Indian call-centers posing as Immigration or Internal Revenue Service officials, contacted vulnerable Americans – such as immigrants and seniors – and threatened jail time, deportation, or other forms of retribution if the victim didn’t pay off their “debts” immediately. Once the money was received – either via wire transfer or prepaid card – “runners” would then launder the funds through bank accounts under falsified names and documents, each man taking a small percentage as payment for his services, before the money would finally reach the scam’s ringleaders situated across eight states. “This type of fraud is sickening,” Ryan Patrick, the U.S. attorney for the United States District Court for the Southern District in Houston, Texas, said after sentencing 21 perpetrators up to 20 years in prison, while yet another 32 Indian contractors were indicted overseas for their role in the scam and are awaiting arraignment. In San Diego, an 85-year-old woman paid $12,300 to the fraudsters after they impersonated an IRS official and threatened arrest over a mock tax violation. Another man in Chicago similarly sent $5,070 to what he thought were immigration and state police officers after being blackmailed with deportation. Even a woman in New Hampshire claimed that her phone’s caller ID showed “U.S. Government” when she received a call from the scammers – later going on to also fund $3,980 to whom she...
by Candy | Aug 31, 2018 | Business
For many small businesses, opening a business line of credit is a financial essential – perfect for easing the stress of cash-flow interruptions or helping with sudden purchase orders. What is a business line of credit? Think of it as a mix between a business loan and a credit card. Like a loan, you have money to spend on any and all business expenses as they arise, whereas like a credit card you only pay interest on the amount borrowed, when it is borrowed. As such, the funds available with a business line of credit is typically lower than a loan, depending on the funder, but still can be a substantial amount of money capable of carrying most small businesses through hard times or unusually busy seasons, without risking serious debt from expensive loan interest rates. Looking to open up your own business line of credit? Here’s what you need to know… General Starting Requirements Before approving your business for a line of credit, (the exact guidelines vary from funder to funder), most banks check that your company fulfills the following general requirements: Your business has been open for at least one year; You have a personal FICO credit score of 580 or more; You are receiving a monthly business income of at least $10,000; You can prove the existence of short-term assets like accounts receivable for collateral; and You have had no recent bankruptcies, tax liens, or foreclosures to stain your financial credibility. All the boxes checked? You’re ready to go! Preparing Your Business Beforehand About 6-8 months before you meet with your funder, begin preparing your company...
by Candy | Aug 28, 2018 | Uncategorized
It’s no secret that young people rarely begin saving for their retirement until later in life, though it’s easy to see why. With a typically smaller income, most twenty-somethings put their funds directly into tuition, rent, or other essentials, while whatever’s leftover is usually spent quickly. Very few even think about retirement as they begin new careers, while fewer still save for it. This common mistake, however, can mean the loss of valuable compounded interest, or even force a later retirement due to insufficient funds. For this reason, it’s important that parents push their young adults to begin a retirement plan early. Looking for ideas on where to start? Here are five simple ways parents can encourage early retirement saving in their kids. 1) Start Now It’s easy for young adults to think there’s no rush to save as they have years until retirement becomes a reality, while their often-smaller income means a majority will go towards their monthly bills. However, as they grow, so will their expenses – adding mortgages, student loans, costly insurances, and other bills to the pile – until retirement will become even less of a priority than it is now. Saving is a lifelong habit that should be cultivated early and maintained, no matter the income. It’s okay to start small, just start now. 2) Teach the Basics Retirement can seem a dry and distant subject for young adults, making them avoid learning the basics. But according to Mark Henry, investment advisor, founder/CEO of Alloy Wealth Management, and estate planner, understanding how to best save for retirement can instill a sense of pride and...
by Candy | Aug 24, 2018 | Sales Tax
Fall is just around the corner, and with the change in season comes harvest festivals. For many small businesses, running an event booth is a great way to sell their wares and spread the word, but festivals can be tricky when it comes to understanding and collecting the appropriate sale tax. Are you looking to open a vendor table or organize an event yourself? Brush up on your sales tax basics through this article and learn just what you need to operate as a festival seller! For Vendors If you’re a vendor selling taxable items, the first thing you should do is apply for a sales tax permit in your home state. If you already have a permit but are opening a booth in a different state, then the next step would be to check that state’s requirements on festival sales tax. In general, you’ll need to collect the combined sales tax rate of the state, county, district, and city that you are in with each purchase – information that your festival coordinator should have or can be calculated here. Additionally, some states require that you obtain a temporary sales tax permit within that event’s location, on top of your home state seller’s permit, while others like Alaska, Oregon, Delaware, Montana, and New Hampshire don’t require sales tax at all. For California vendors, whether local or visiting, a California sales tax permit is required along with an additional “sub-permit” for each event your wares are sold at. For Festival Organizers As a festival organizer, while the sales tax collection itself is up to the vendor, it’s your responsibility to...
by Candy | Aug 21, 2018 | Payroll
A recent case, Troester v Starbucks, has just received a ruling from the California Supreme Court that could bring on a significant wave of change for businesses and hourly workers across the nation. In the lawsuit, Douglas Troester, a Starbucks employee, sued the café chain for refusing to compensate the five to ten minutes of time he spent locking up the store each night off-the-clock. These few minutes of unpaid time, known as “de minimis” in court, added up to a total of $102.67 and while most courts don’t handle cases of such small proportions, the California Supreme Court did and decided in favor of Troester. “That is enough to pay a utility bill, buy a week of groceries, or cover a month of bus fares,” Associate Justice Goodwin Liu commented. “What Starbucks calls ‘de minimis’ is not de minimis at all to many ordinary people who work for hourly wages.” What This Means So, why is this case now such a big deal for businesses? Though historically California has consistently maintained one of the highest wage protection laws in the country, de minimis payments have always been a tricky subject in court and are usually ignored as off-the-clock working time is either too hard to track, or too irregular to pursue in a legal case. Until now. With Troester’s win of the case, the California Supreme Court has effectively stated that businesses no longer have an excuse and that all time spent working, no matter how small, must be compensated. As such, businesses should be prepared for a wave of similar lawsuits to sweep the state. The question...
