Restaurant Qualified Improvements

  The Tax Cuts and Jobs Act that was passed late last year repealed the qualified retail, restaurant and leasehold improvement rules and replaced them with a new qualified improvement property acquired and placed in service after 12/31/2017 and before 12/31/2022. Qualified improvement property consists of interior modifications to commercial property (except elevators, escalators and enlargements). Prior laws enabled write offs for much of the improvements to a space which…  Read more

Changing Accounting Methods

August 3, 2018 the IRS released Revenue Procedure 2018-40 regarding changing accounting methods because of last year’s Jobs Act.  This is another attempt to simplify the lives of small business taxpayers.  Unfortunately, it is complicated before it gets simpler. Who is eligible?  Taxpayers with average revenues for the 3 prior years of $25 million or less that are currently using the accrual method accounting may change back to the cash…  Read more

Federal Tax Withholding for 2018

Federal Tax Withholding for 2018 – In late 2017 Congress passed a major tax bill which resulted in lower Federal taxes for many Americans.  When we reviewed taxes with our 2017 clients, we offered the warning “don’t spend it, ’cause they will want it back”.  In February of this year, the IRS changed their withholding tables and mostly reduced the amount of tax being withheld from paychecks.  The intention was…  Read more

Minnesota K-12 Tax Benefits

K-12 Education Credit For parents, it’s almost time to start back-to-school shopping. Most school supplies could qualify for valuable K-12 tax benefits on your 2018 Minnesota income tax returns. Do not forget to save your school supply receipts. “Each year, parents invest in their children’s education by purchasing school supplies,” said Revenue Commissioner Cynthia Bauerly. “Keeping the receipts for these purchases can help parents save when it comes time to file…  Read more

Minnesota Sales Tax

Minnesota will require remote sellers and Marketplace Providers facilitating sales into Minnesota to collect sales tax no later than October 1, 2018 ST. PAUL, Minn. – The Minnesota Department of Revenue will require remote sellers and Marketplace Providers facilitating sales into Minnesota to begin collecting sales tax no later than October 1, 2018. Remote Sellers Minnesota law requires all sellers to collect sales or use tax to the extent allowed under the United…  Read more

Internet Sales Tax

Sales Tax Issues In a case with nationwide ramifications, on June 21st the US Supreme Court overturned the old Quill corporation decision in the case of South Dakota versus Wayfair, which will now allow individual states to attempt to collect sales tax from out-of-state sellers, such as online and website sales. Since 1967, remote vendors without a physical presence in a state could not be forced to collect sales tax. In…  Read more

  IRS Unveils Draft Form 1040 ‘Postcard’ But Critics Are Not Impressed The new Form 1040 released by the Treasury Department this week meet the administration’s promise of a smaller “postcard style” tax form, but skepticism remains on whether the revisions are a meaningful step toward tax simplification. A draft version of the 2018 Form 1040, available here, reduces the number of line-items from 79 to 23 and shortens it from two…  Read more

Why your business needs you to say no

Just Say No! Being open to new possibilities is a positive trait shared by most entrepreneurs—but saying yes to all the people you meet and opportunities that come your way can get you into trouble. When we over commit—especially when we take on projects that don’t actually benefit our business—our stress can hit the roof. It’s much hard to be productive when we’re feeling burned out and resentful. One of…  Read more

Business mileage log requirements

F Recent Court Case Illustrates that a contemporaneous mileage log is required.  • Edwards, T.C. Memo. 2018-44 Written contemporaneous mileage logs are a requirement to claim a deduction for business mileage. The taxpayer’s job required him to respond to emergencies, such as floods and hurricanes that could adversely affect the state’s transportation system. He was responsible for supervising communications and for assigning personnel and equipment to disaster locations.  For a…  Read more

Does “mindfulness” have a place in business?

According to Google, which offers employees a course on mindfulness meditation, and Lululemon, a company that keeps a Director of Mindfulness on staff, the answer is a resounding yes. Mindfulness, as American scientist Jon Kabat-Zinn defines it, is simply “paying attention in a sustained and particular way – on purpose, in the present moment and non-judgmentally.” Research has shown that practicing mindful meditation can lead to reduced stress, lowered blood…  Read more

Bipartisan Budget Act of 2018

Bipartisan Budget Act of 2018 On February 9, 2018, the President signed into law H.R. 1892, the Bipartisan Budget Act of 2018, which extends federal funding for the government. The law also contains a number of tax provisions, including the extension of a number of provisions that had expired as of the end of 2016. These changes affect the preparation of 2017 tax returns.  This may delay filing of returns until the IRS…  Read more

2017 Tax Cuts Act: Pass-Through Income

Currently, owners of partnerships, S corporations, and sole proprietorships – as “pass-through” entities – pay tax at the individual rates, with the highest rate at 39.6 percent. The highest rate is reduced to 37 percent under the Tax Cuts and Jobs Act. The Act also allows a temporary deduction in an amount equal to 20 percent of qualified income of pass-through entities, subject to a number of limitations and qualifications.…  Read more

Tax Reform Guidance

 Tax Reform Guidance “Job One” At IRS  Implementing the new tax law will dominate the guidance landscape for 2018, practitioners said at a recent Tax Reform Conference sponsored by the DC Bar Association.  NSA Executive VP John Ams, who attended the conference, said that a number of Treasury and IRS attorneys responsible for implementation of the tax reform bill were panelists at the conference but few had any answers.  “That’s…  Read more

Tax Cuts and Jobs Act

Re: 2017 Tax Cuts Act: What it Means For Individuals   The Tax Cuts and Jobs Act was signed by President Trump on December 22. The Act makes sweeping changes to the U.S. tax code and impacts virtually every taxpayer. Individuals are more impacted by the provisions of the act than any other class of taxpayer. With the reduction in effective tax rates, the elimination of some deductions, exclusions, and…  Read more

Is it better to buy or lease a company vehicle?

If you need a car to operate your business, you may wonder whether it makes more sense to purchase or lease. On the one hand, if your business owns the car you’ll have a long-term asset and may qualify for more tax deductions. On the other hand, buying a car is a huge expense and monthly lease payments tend to be lower than car loan payments; they may also be…  Read more

Year End Taxes – 2017

A new Tax Bill was introduced in early December and we can be sure of at least one thing: future tax rates are going to change. Because this is a year-end 2017 letter, our guidance in this letter is aimed at 2017 tax planning rather than predicting 2018, but one thing we are pretty sure of is that tax rates will be lower in 2018. The general guidance for most…  Read more

Minnesota Minimum Wage Change

Minimum-wage rate adjusted for inflation as of Jan. 1, 2018 Minnesota’s minimum-wage rates will be adjusted for inflation beginning Jan. 1, 2018, to $9.65 an hour for large employers and $7.87 an hour for other state minimum wages. Under Minnesota law, the commissioner of the Department of Labor and Industry is required to determine and announce the inflation-adjusted minimum-wage rate each year by Aug. 31. This year, the change in…  Read more

What is your succession plan?

According to recent research, a staggering two thirds of US millionaire-owned businesses are operating without a succession plan—and even fewer small business owners around the globe are prepared for their CEO’s eventual exit. Recent stats from PWC Global show that family owned businesses are no more prepared: 43% don’t have a succession plan in place, and only 12% survive to the third generation. No matter whether your company has one…  Read more

3 easy and inexpensive ways to look more professional when you’re starting out

For bootstrapping young businesses, making a professional first impression as you build your brand is key. Although hiring a branding expert may be too large an expense in the early days, you can still help your business stand out in the best possible way without breaking the bank. Just follow these simple marketing moves that will help people to know, like, and trust you. 1. Build credibility with your own…  Read more

Differences Between Gross and Net Profit (and Why Neither Matter Unless You Get Paid!)

Wondering if you’re doing everything you can to boost revenue and cut costs? Or if your business is actually more profitable this year than it was last? The best way to answer these questions is with a thorough assessment of profitability. That’s where gross and net profit calculations come in. These are two of the most important metrics for measuring your capacity to generate earnings relative to costs and expenses.…  Read more

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