QuickBooks Tip #1: Customize Your Settings

QuickBooks Tip #1: Customize Your Settings

As the most popular accounting software around, QuickBooks is designed to be used by almost any type of business. Whether you’re just getting started or have been using QuickBooks for years, take a little time to set (or update) your company’s settings. You can do this by clicking on the small gear icon in the upper right corner. The window that opens may look similar to this:

Start by clicking on Account and Settings, and then click on the various tabs to verify and/or edit:

Company — Check that all the information here is correct and up-to-date. It may not be if you’ve moved, changed a phone number, etc.

Billing & Subscription — Click here to change your plan (upgrade or downgrade) if your business has changed or you need different features.

Usage — Check your usage limits here for users, accounts, classes and locations.

Sales — Customize the design of your invoice, set preferred terms and delivery methods, add messages to your email forms and more.

Expenses — Choose whether to track expenses and items by customer, make expenses billable, use purchase orders and more.

Payments — Set up or connect an existing merchant account so customers can pay you via credit card and bank transfer.

Advanced — While some of the settings here are easy to complete, we can provide guidance on items like “Accounting method,” “Close the books” and “Tax form.”

We speak fluent “QuickBooks” here at Premier CPA Services. Just give us a call at 706-632-7850 and we’ll be happy to give you a lesson or two!

Updated QBI Rules for a Rental Real Estate Enterprise

The IRS recently updated qualified business income (QBI) rules to provide a safe harbor for certain taxpayers with a “rental real estate enterprise” (Sec. 199A). Under the new rules, a rental real estate enterprise is treated as a trade or business if at least 250 hours of services are performed each tax year. These hours are services performed by owners, employees and independent contractors and include time spent on:

  • Maintenance, repairs, rent collection and payment of expenses,
  • Provision of services to tenants, and
  • Efforts to rent the property.

Note that time spent in arranging financing, buying property, reviewing financial statements, and traveling to and from the property are NOT considered hours of service. Also, the IRS requires:

  • Separate books and records for the rental real estate enterprise.
  • Contemporaneous records such as time logs with details on hours spent, services performed and contractor names.
  • An annual statement attached to the tax return.

There are other rules and limitations, so be sure to talk with us about your specific situation.

The information provided here by Premier CPA Services PC is for general information only. It does not constitute legal, accounting, tax or other professional advice or services, and is presented without any representation or warranty as to the accuracy or completeness of the information. Please contact us for information as it relates to your circumstances.
Buy or Lease: What’s Best for Your Business Equipment?

Buy or Lease: What’s Best for Your Business Equipment?

Every business is different, but every business faces the decision on whether to buy or lease equipment. Whether it’s a new computer system for your office or a new truck for your construction business, there are plenty of considerations.

What’s the Cost?

Leasing often makes sense if the equipment will become obsolete quickly or requires regular maintenance, which can be wrapped into the lease agreement. Buying may be the better choice if the item will provide many years of reliable service.

How Will It Affect Your Cash Flow?

Leasing can help protect your cash flow by spreading the purchase cost over time. Lower-budget items may be better suited for outright purchase if it will not strain your cash flow. Also keep in mind that financing equipment purchases can impact your ability to secure credit for other items down the road.

Pros and Cons

Some of the advantages and disadvantages of leasing include:

LEASING PROS:

  • Lower initial expense
  • Potential for tax deductions
  • Flexible terms
  • Ease of upgrading equipment
  • Ease of repairs/maintenance

LEASING CONS:

  • Higher overall cost
  • Lack of ownership/equity
  • Obligation to pay/length of term
  • Availability of product may be limited

Advantages and disadvantages of buying:

BUYING PROS:

  • Ownership/equity
  • Resale value
  • No need for contract
  • Increased product availability
  • Tax incentives/depreciation deductions

BUYING CONS:

  • Higher initial expense
  • Difficulty in upgrading
  • Repair/maintenance costs

If you’re weighing leasing versus buying, give us a call. We can help you look at how the various options will play out so you can make an informed decision.

Don’t Be Scammed

While most everyone is familiar with the old “Nigerian prince” email scam, there are plenty of others that are not so obvious. Keep these tips in mind:

 The IRS will never send you an unsolicited email, or email you about your refund. Many of these scam emails ask you to click a link that takes you to a website that looks similar to the IRS website. If this is the case, do NOT enter personal information such as passwords or Social Security numbers. Instead, forward the email to phishing@irs.gov.

If you receive a call from someone saying they are from the IRS or FBI instructing you to send money someplace, be careful and do not provide any personal information. Verify the details of any “payment” options they may offer by checking your tax information online. It’s also smart to call the IRS or FBI directly using a number available on their official website.

More IRS scam information can be found here: https://www.irs.gov/privacy-disclosure/report-phishing

Other common scams include harassing debt collection calls, telemarketers saying they’re from a bank or credit card company, fake prizes or sweepstakes winnings, and work-at-home offers. If you’re not sure if something is real, check the Federal Trade Commission website or Consumer Fraud Reporting website for the latest information.

The information provided here by Premier CPA Services PC is for general information only. It does not constitute legal, accounting, tax or other professional advice or services, and is presented without any representation or warranty as to the accuracy or completeness of the information. Please contact us for information as it relates to your circumstances.
What Else Can We Do for You?

What Else Can We Do for You?

Many of you meet with Donna or I at tax time, when you’re closing out your year — or trying to figure out why your tax bill suddenly went up! But there are plenty of other times throughout the year that we can help — and maybe save you some money! Here are just a few:

#1 – Home-Related Issues

Because we are intimately familiar with your finances, we can help you understand how buying or selling a home will impact your income, taxes and financial strategies. This also applies to renting out your home or cabin, whether it’s through a local property management company or via Airbnb or VRBO. There are many tax considerations that go into renting, including paying sales & lodging taxes and earning additional income.

#2 — Children

If you’re having a child (or adopting one), you know that your expenses will be impacted. But so will your taxes, most likely in a positive way. We can help you maximize any tax credits or exemptions you may be entitled to, as well as guide you on college savings through tax-advantaged vehicles like 529 plans.

#3 — Marriage or Divorce

While these are both very personal events, you’ll find the government is more involved than you realize! Changes in your life situation will obviously change your tax filing status and could put you in a different tax bracket. In the case of divorce, we can help you understand the tax implications of future alimony payments before you go into negotiations.

#4 — Large Purchases

If you’re considering a major purchase (e.g., boat, RV, home addition), we can help you consider the best ways to pay for it. For example, if you’re selling stock to make the purchase, will you be liable for capital gains? Is a home equity loan your best option for remodeling your home? And which home remodeling receipts do you need to save?

#5 — New Job

If you’re considering a new career opportunity, keep us in the loop. We can help you determine proper withholding amounts, as well as possible write-offs and deductions, such as mileage, education expenses and 401(k) contributions.

#6 — New Business

Many of our clients are business owners, whether they’ve purchased an existing business or are starting from scratch. We can help you make some smart decisions with regard to business loans, employee payroll and taxes, budgeting for expenses and getting started with software like Quickbooks. We can also help you choose the most-advantageous entity for your new business — LLC, an S Corp or a C Corp.

Remember, we are your CPAs all year long, not just at tax time. Please call or schedule an appointment today, and let us help you make those important decisions in ways that benefit you, your family and your business!

 Jackie & Donna

Georgia Business Tax Climate

Georgia currently ranks 33rd on the Tax Foundation 2019 Index. However, the state’s business tax climate can be expected to improve and Georgia taxpayers should see lower tax rates next year once reform kicks in.

Click on image to enlarge.

The information provided here by Premier CPA Services PC is for general information only. It does not constitute legal, accounting, tax or other professional advice or services, and is presented without any representation or warranty as to the accuracy or completeness of the information. Please contact us for information as it relates to your circumstances.
How Do the Fed Rate Cuts Effect You?

How Do the Fed Rate Cuts Effect You?

In July, the Federal Reserve lowered the federal funds rate by 25 basis points, to a range of 2% to 2.25%. This is the first time the Fed has lowered interest rates since 2008, in the midst of the global financial crisis. Federal Reserve Chairman Jerome Powell has signaled the possibility of another rate cut as soon as next month. In fact, President Trump is seeking a cut of as much as 1%.

Typically, such a rate cut is a preventive measure designed to keep the economy on track. Lower rates put more money into the economy, encouraging businesses to invest and consumers to spend and borrow. While lower interest rates do help, they don’t help everyone. Here’s who stands to benefit the most — and who could suffer a hit:

Home Buyers: Mortgage rates were already trending lower, so the Fed’s move is good news if you’re in the market for a mortgage or refi. You’ll also see a little relief if you have an adjustable-rate home equity loan or line of credit.

Credit Cardholders: If you’re carrying a balance (nearly half of all cardholders do), you may see a slightly lower APR, depending on your credit card issuer. A lower APR could help, considering the average U.S. household pays more than $1,150 in interest each year.

Savers: Expect interest rates on savings accounts, money market accounts and CDs to decline. This might be a good time to rate-shop savings accounts and lock in a rate with a CD.

Investors: Lower interest rates generally boost the stock market. However, investors tend to get nervous if the Fed cuts rates repeatedly, because it may indicate a recession is looming.

(Sources: NPR, Bankrate.com, CNBC)

Did You Know?

The U.S. Mint’s online store offers a variety of unique products, including:

Uncut sheets of paper currency in $1, $2, $10, $20, $50 and $100 denominations.

An engraved print of the Gettysburg Address that includes a portrait of President Abraham Lincoln.

$1 coins for the new American Innovation Coin Program.

Gold Congressional Medals honoring the Native American Code Talkers from WWI and WWII.

2019 coin sets commemorating a birth, a birthday or other special occasion.

Visit the website to order online.

 

The information provided here by Premier CPA Services PC is for general information only. It does not constitute legal, accounting, tax or other professional advice or services, and is presented without any representation or warranty as to the accuracy or completeness of the information. Please contact us for information as it relates to your circumstances.
The Million Dollar Question: Are You (Really) Ready for Retirement?

The Million Dollar Question: Are You (Really) Ready for Retirement?

People tend to underestimate how much they are going to need for retirement. Americans aged 65-74, for example, currently spend an average of $55,000 a year. But 60% of Baby Boomers who haven’t yet retired believe they will need less than that to live on during retirement — in fact, 44% believe they will need less than $35,000.

Unfortunately, those statistics are just two of the many disconnects we have over the need for retirement savings. Several recent studies find that many Americans, especially younger ones, might not be financially ready to retire when the time comes. Consider:

  • 66% of working Millennials (those aged 22-37) have no retirement savings whatsoever, and only 5% are saving adequately for retirement.
  • Thanks to the “Great Recession,” Millennials today generally earn about 20% less in wages, are less likely to own a home and have accumulated about half of the wealth of their parents at the same stage of their lives.
  • 47% of Gen Xers (those aged 38-53) have no retirement account, and about 48% of those who do have less than $50,000 saved.
  • Some reports say up to 45% of Baby Boomers (those aged 54-72) have zero retirement savings!
  • For retiring Boomers, the average Social Security check is $14,000 a year. And only 23%-38% of Boomers expect any income from a private company pension plan.

The news doesn’t have to be all bad, though. Individual Retirement Accounts (both Roth and Traditional) remain a proven way to put away money on a tax-advantaged basis. And special “catch up provisions” allow taxpayers age 50 and older to sock away a little more each year. For 2019, your total contributions to all of your traditional and Roth IRAs is limited to $6,000 ($7,000 if you’re age 50 or older), or the total amount of your taxable compensation for the year (if it’s less than the limit). And you have until April 15, 2020, to make this year’s contribution.

Just call us at 706-632-7850 or email us to schedule an appointment — we’ll be happy to walk you through your retirement saving options!

Sources: National Institute on Retirement SecurityCNBCBusiness Insider ForbesMarketWatch, IRS

Term of the Week:
Tax-deferred

Tax-deferred refers to investment earnings, such as interest, dividends or capital gains, that accumulate tax-free until the investor takes the profits — at which time income taxes and capital gains taxes come due. The most common types of tax-deferred investments are individual retirement accounts (IRAs) and deferred annuities. Because no taxes are paid until you take a withdrawal, your money can grow at a faster rate than it would in a taxable product.

So You Want to Be an Astronaut

Adventurous (and rich!) folks can soon take a ride to the International Space Station (ISS). NASA has opened up the ISS to companies that fly “private astronauts” into space for a visit of up to 30 days. It will only cost you about $52 million to buy a seat on SpaceX, Elon Musk’s famous spaceship! (Source: CNBC)

The information provided here by Premier CPA Services PC is for general information only. It does not constitute legal, accounting, tax or other professional advice or services, and is presented without any representation or warranty as to the accuracy or completeness of the information. Please contact us for information as it relates to your circumstances.
Section 179 Expensing: Great News for Rental Property Owners

Section 179 Expensing: Great News for Rental Property Owners

When you own rental property, your best tax deduction is usually depreciation. Unfortunately, the depreciation period for residential rental property is 27.5 years. That’s a long wait to deduct the full cost.

Fortunately, there is a way to speed things up. In fact, you may be able to deduct the cost of your rental property in a single year using a provision called first-year expensing, or Section 179 expensing.

Even better, landlords can now use Section 179 expensing to deduct the cost of personal property purchased for use inside rental units (e.g., kitchen appliances, carpets and drapes). For example, if you spend $3,000 for a new stove and refrigerator for a rental unit this year, you may be able to deduct the entire amount with Section 179 expensing.

You can also use Section 179 to deduct property not located inside your rental buildings.

For example, if you spend $1,000 for office furniture for the office you use in your rental business, you may be able to deduct the entire amount in a single year using Section 179. Eligible property also includes:

  • computers and software,
  • cell phones and office equipment,
  • cars and other vehicles, and
  • maintenance equipment such as lawnmowers.

Used properly, Section 179 expensing could be a big break for many cabin rental and lodging businesses in Fannin County! That said, calculating the most beneficial depreciation strategy for your business can get a bit tricky, so I hope you’ll set up some time to talk. Just call 706-632-7850 or email me for an appointment — and we’ll walk through the options.

Term of the Week:
Above the Line

In business, “above the line” refers to all revenue generated and expenses incurred by a business that have a direct impact on profits (the bottom line). So, the sale of goods and the associated cost of goods sold are considered to be above the line — and are reported on an organization’s income statement. The term does not refer to other activity that only impacts the financing or cash flows of the business.

The information provided here by Premier CPA Services PC is for general information only. It does not constitute legal, accounting, tax or other professional advice or services, and is presented without any representation or warranty as to the accuracy or completeness of the information. Please contact us for information as it relates to your circumstances.
The More You Know: How Do Americans Spend Their Money?

The More You Know: How Do Americans Spend Their Money?

Ever wonder if it’s just your imagination — or are prices really going up? You’ll find the answers in some fascinating data from the U.S. Bureau of Labor Statistics (yes, there really is such a thing). The data shows average prices for popular consumer items — everything from ground beef and coffee to gasoline and electricity. These figures are used to formulate the broader Consumer Price Index (CPI).

While you’re at it, you might be interested in seeing how much others in your age group and income level spend each year for things like gasoline and dining out. The tables on households with three people, four people, and five or more people will help you compare your family’s spending to households with similar income. You can even see how much inflation has changed your spending power over a specified period of year.

Click the links to the right for all the details.

The information provided here by Premier CPA Services PC is for general information only. It does not constitute legal, accounting, tax or other professional advice or services, and is presented without any representation or warranty as to the accuracy or completeness of the information. Please contact us for information as it relates to your circumstances.
Easy IRS Tax Calendar

Easy IRS Tax Calendar

Stay on top of your business taxes this year with a free Tax Calendar from the IRS. It’s easy to customize this handy calendar tool to keep track of important dates and deadlines. For example, you can list dates when payroll deposits are due, or filing deadlines for 1099 and W-2 forms.

Here’s how to access the calendar (https://www.tax.gov/calendar/):

ONLINE – Simply bookmark the link in your web browser and refer to it each month. You can also skip through tabs for previous and upcoming months, as well as view last year’s key dates. A filter option allows you to sort and view tax dates and event types.

SUBSCRIBE – Subscribe to or download the calendar and incorporate it into your Microsoft Outlook, Apple Calendar, on your iPhone or iPad, or any other calendar that uses .ics format.

RSS FEED – You can have your Calendar reminders sent to your email inbox via RSS feeds one or two weeks in advance of when a form or payment is due.

Let Us Help!

Are you feeling a bit overwhelmed just trying to keep up with all the tax filing due dates? Let us help relieve some stress. We can manage your payroll filing, sales tax deposits and other tedious tasks for you. Contact us today to find out more. Call 706-632-7850 or email Jackie today.

Organizational Sanity: Win the Paper Chase with These 5 Tips

Organizational Sanity: Win the Paper Chase with These 5 Tips

Whew! Tax season has finally wrapped up, and we can all breathe a sigh of relief. The hunt for paperwork is over … for now.

If pulling your tax records together was a struggle this year, I’m going to suggest some simple tips for storing your financial records. Ultimately, the tax return we prepare for you or your business is a product of your record-keeping.

Consider these tips for keeping your documents — and your sanity — together:

1 — Put in the time. Spend some time each month to make sure your documents are in order. Go ahead and put it on your calendar or to-do list that you will spend an hour or two one afternoon or evening a month.

2 — File everything immediately. You don’t have to organize everything as you go, but do put receipts and statements in a folder or envelope. “I’ll get to it later” doesn’t always happen.

3 — Create a central location. Have a place for all statements, tax forms, receipts and other documents — ideally in a fireproof safe or cabinet.

4 —Organize electronic records the same way you would paper records. Keep your electronic scans and statements in a central location on your computer, organized and clearly labeled. Give everything a once-over during your monthly organizing.

5 — Keep everything secure. File cabinets should be locked, computers should be password protected and backup copies should be kept in a separate safe place, such as a safety deposit box.

It won’t take a lot of your time now, but following these five tips can save you time come next tax filing season! Of course, we’re always here to answer your tax questions, so feel free to email or call us at 706-632-7850.