Keeping track of Mileage?
on Dec 08 in Uncategorized tagged by janaolson
The IRS has set the following for mileage:
IRS Announces 2011 Standard Mileage Rates |
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Taking Stock of the Business Year – How to Conduct a Year-End Review & Plan for the Year Ahead
on Dec 07 in Uncategorized tagged by janaolson
How is your business doing? Have you conducted a business review lately? As the year draws to a close, there is no better time to start planning again – and this invariably means taking stock of the business year, reviewing your market position, and deciding where to take your business in 2010.
Conducting a holistic year-end review has meaningful benefits for every small business owner – not least of which is planning for and positioning your business for economic recovery in the year ahead.
Below are some tried and tested tactics you can employ to review your business performance, together with some tips for seeing beyond the malaise of 2009 and finding optimism in your accomplishments.
Give Yourself a Pat on the Back – Focus on Your Accomplishments
Where better place to start than focusing in on what your business has done well – a year is a long time in business and while we celebrate the highs, it is often the lows that stay with us. Change this attitude by reading *Make Your Year End Review A Morale Booster from About.com’s Tana Woodward. Not only do Woodward’s tips help remind you of your successes they can help you repeat them.
Next you will want to assess key areas of your business including core activities, sales and marketing, employees, and business finances, here are some things to consider:
1. Assess your Core Activities (i.e. What you Do and Who Your Market Is)
Core activities essentially encompass your business operations – areas to assess include your core products and services as well as your customer base. Ask yourself questions such as:
- Which products or services are the most profitable? How can you optimize operations around the success of these?
- Are any products that are failing? Are there any changes you can make to enhance their sales or profitability (production, distribution, sales, marketing, price, etc.)?
- Are your products or services still aligned with your target market? Has your core customer base changed in the past year, what market forces impact your customer base? If the answer is yes, you may need to go back to the drawing board and assess what your customer needs are. Read this Market Research Guide to help you make more informed decisions about your market.
- What can you do to optimize your cost base? Many businesses have closed their brick and mortar establishments to operate online only (get tips on starting an online business). Others have become home-based to save costs. Where can you realize efficiencies?
- What do your customers think of you? In this *article on OPENForum, Karen Rogers, Vice President of FedEx Marketing and Jeff Barry, Vice President of the Enterprise Council on Small Business, stress the importance of having a “customer-centric” approach to business. More than just customer service: “…successful businesses watch the customer, become the customer, and involve the customer. Frame your market research in terms of living the customer’s life…” In *The End is Near (of 2009!) – Are you Ready?, Denise O’Berry offers some great tips for doing exactly this.
2. Conduct a Sales and Marketing Review
In addition to measuring your sales performance and marketing ROI against your objectives and business plan, a full sales and marketing review should also include an analysis of market forces and the benchmarking of your business against the competition – an efficient way to do this is to conduct a SWOT analysis. Read *SWOT Analysis: A Great Strategic Tool (courtesy of Chemeketa. OR, *Small Business Development Center).
3. Evaluate your Employees
Annual performance reviews are traditionally always something that managers and employees alike tend to dislike, if not dread. But a well prepared and honest performance review is an invaluable way to base line employee performance (strengths and weaknesses), recognize achievement, and ensure that individual goals are aligned with overall business goals. Get more tips on employee performance reviews from SCORE *here. Once you have held reviews, you may need to revisit job descriptions and look for training and cross-training opportunities to prepare and align your employees with your changing business landscape.
4. Review your Business Finances
Every business is different so it’s worth talking to your accountant about your individual circumstances, but as a guide you will need to review:
- Budget – Do you have one and are you sticking to it? Read *5 Tips on Budgeting from SCORE.
- Cash flow – Is it sufficient? Can you forecast cash flow trends so that you can anticipate problems and prepare for them in advance? Do you need and have a contingency plan? Learn more about *Managing Your Cash Flow from SCORE.
- Profit – What is the state of your gross profit margin?
- Cost Base and Pricing – Review your cost base (constantly). Do you need to adjust pricing – how will this impact your customer relationships?
- Borrowing - Are you staying on top of your business loan or overdraft obligations? Should you options for refinancing?
- Taxes – Get a step ahead of tax season pressures now to help maximize your deductions and sail through tax season. Read Small Business Tax Preparation Tips – Stay a Step Ahead of “Tax Season” Today for tips.
Additional Resources
- Writing a Business Plan – Resources, templates and tutorials to help small business owners develop a sound business plan.
IRS Leniency
on Nov 11 in Uncategorized tagged by janaolson
There is advertising stating the IRS is more lenient, and now is a good time to settle. I want to be very clear that the rules have not changed regarding resolutions with the IRS. The IRS still expects to get paid. If the IRS does not get paid and a viable resolution is not presented, you as the taxpayer will get levied or wages garnished. No leniency program is providing taxpayers with a magical answer. The resolutions that can be considered depend upon whether you have filed all tax returns and, if a business, paid your current quarter tax deposits. Resolutions fall into three basic categories: payment plan, offer in compromise, or uncollectible status. There are a few other variations for businesses. Due to the fact that the IRS is still out to collect the most money in the shortest period of time, I suggest my free consultation to go through your options.
Pennies on the Dollar
on Nov 11 in Uncategorized tagged by janaolson
As an attorney that works with taxpayers owing money, I absolutely cringe when I hear this phrase. There are ads that run out constantly on TV and the radio claiming that “anyone” can settle their debt for “pennies on the dollar”, they just have to call. This misleading phrase has caused a lot of people to expect more than what can be done on their case, pay more money to those that are false adverstising, and end up with a general bad taste in their mouth.
Is there such thing as settling your debt? Yes, BUT there are only two ways to do so, an offer in compromise and/or penalty abatement. These methods of settling your debt are available to both business and personal tax debt. HOWEVER, there are very few offers that are accepted on the business end. Most of the offers in compromise work best on the individual level.
OFFERS:
Basically, when you submit an offer, it is not a number that you pick to settle your debt, but the amount of your net worth. Thus, there is a 656 booklet that one must follow in order to submit an offer. Those “pennies on the dollar” offers are the people that have absolutely nothing and are not making very much income. Yes, there have been some very big offers that I have settled, but that person has also lost a lot in assets and is usually making very little of what they used to make. Another caveat in this equation is the set of national standards for living expenses. The IRS only allows up to the maximum of these living expenses; anything over is considered “excess” and the IRS very seldom allows. An offer is not for everyone. It is best to look at all the resolutions that are available to decide if the offer in compromise is the best option to pursue.
PENALTY ABATEMENT:
A penalty abatement is a request to abate penalties that accrued on the tax that you are owing. The penalty abatement is also a way to appeal the civil penalty if you feel that you were wrongly assessed and you did not appeal the 1153 letter. The penalty abatement is not an abatement of the tax owing, but relief from, say, failure to file penalty, or failure to pay penalty. The penalty abatement is most effective when it is a first time penalty—such as failure to file, and every other time you have been timely. For a penalty abatement to go through, the person or business must have reasonable cause as to why they were not able to pay the tax timely or file the tax return timely. Reasonable cause criteria could be that you were ill, there was a natural disaster, an accountant gave you erroneous advice, or the IRS gave you erroneous advice. Penalty abatements, if accepted, remove penalties, and the interest is then adjusted. Interest is never abated, but it does run on the total amount owed; thus, if you have penalties removed, the total amount is less and therefore your interest is reduced.
I provide a free consultation to work through issues, such as the above, that can be confusing. There are many ads that can mislead, if you call a number to get some help and a sales guy is the one taking your call be wary. Make sure the person you hire is a licensed Attorney or CPA.
The Green Financing Guide For Small Businesses by NicoleD on 10-20-2010 11:34 AM – last edited on 10-21-2010 10:03 AM
on Nov 11 in Uncategorized tagged by janaolson
Green businesses many be eligible for grants, loans, and other financial incentives. Read on to find out more about green financing opportunities for your business.
Loans and Grants
If you are looking for environmental financing for your business, your first stop should be the Loans and Grants tool on Business.gov. After answering a brief questionnaire about your business, you’ll receive information on financing programs that you may be eligible for.
Remember – the federal government does not provide grants for starting or expanding a business.
However, if your startup invented a new green product or technology that is in the national interest or creates new jobs, it may qualify for small business innovation grants, such as the Small Business Innovation Research (SBIR), Small Business Technology Transfer (SBTT), or USDA Rural Development programs. Even in these cases, the competition is stiff and you may be required to match funding that you receive. To learn more about these and related financing opportunities for entrepreneurs, read Business.gov’s guide on green technology innovation.
Additionally, your state government may have other grant opportunities for green innovation or efficiency upgrades. Check with your state department of energy resources for details.
If you do not qualify for a grant, you may find financing alternatives in loans. Use Business.gov to find lenders in your state that provide loans to small businesses interested in making energy efficient upgrades.
Tax Incentives
Another way to save is through energy efficient tax incentives. A tax credit can provide significant savings by reducing the amount of income tax you have to pay. Unlike a deduction, which reduces the amount of income subject to tax, a tax credit directly reduces the tax itself. Tax credits are available to manufacturers, for small business that upgrade commercial buildings, and for home builders. Learn the basics of federal tax credits for energy efficiency on Business.gov.
The newly-passed American Recovery and Reinvestment Act of 2009 (Economic Stimulus) includes new and extended energy efficiency incentives for consumers and small businesses. Read Business.gov’s article on green tax incentives for a detailed list of new incentives – but keep in mind that the eligibility dates vary, and some are close to expiring.
For the most up-to-date guidance on tax incentives, speak with your attorney or review the Energy Incentives for Businesses in the American Recovery and Reinvestment Act at IRS.gov.
Other Ways to Save
Aside from financing opportunities, Business.gov’s Green Business Guide includes a whole host of resources and initiatives that help small businesses expand their businesses while saving energy costs.
Green Commuting and Green Fleets
- Commuting is a hassle at the best of times, but employers who take advantage of teleworking options can help improve their employees’ work life, productivity, and carbon footprint. Even better for business owners, the federal government offers a variety of financial incentives to employers and employees to pursue green commuting options. Read “Green Commuting Options – From Teleworking Programs to Transit and Ride Share Tax Incentives” for details.
- Another area that has a huge impact on the environment and your business bottom line is your business fleet. It needn’t be so, because just a few simple measures – planning an efficient route or picking the right vehicle for the job – can help you save money and reduce carbon emissions. Read more in “Greening Your Business Fleet – A 5 Step Approach that Can Save you Money”.
Greening Your Office
- Supporting the green movement helps the environment and shows clients that your business cares about affecting it in a positive way. By going paperless, you’ll save mass amounts of paper through electronic documentation as well as other storage equipment such as folders and storage units. Energy savings can also be found by minimizing the use of print and copy machines. Learn more by reading Save Time and Money by Going Paperless.
- There are many ways for home-based businesses to “go green”. It might start with simple actions like recycling used paper and ink cartridges, and powering off electrical equipment when not in use. In fact, “going green” is limitless – for example, a home-based child daycare business might consider reducing its carbon footprint by using cold water wash cycles for laundry, buying furniture and toys from thrift stores and garage sales, and using reusable dishes at mealtimes. Read this list of additional ways to green your home-based business at Business.gov.
- Finally, see if you can lock in additional savings on utilities by inquiring if your gas and electric providers offers any rebates on green improvements.
Need Assistance?
- You may want to visit a small business development center or a SCORE office in your area. Both offer free counseling and they are knowledgable about the various government loan programs currently available. Read more about in-person services near you at Business.gov
- You can try to reach someone at your local economic development office to learn if there are employment grants in your area.
- Consider partnering with local solar manufactures or trade groups and associations for additional financial assistance or mentoring.
Related Resources
- Read more about environmental loans, grants, and incentives on Business.gov.
- From the Home Office to Main Street – The Ultimate Guide to Green Small Business – Even baby steps can make a difference – from encouraging telework policies to greening your home-based business – going green isn’t an expensive pipe dream, and can even save you money. Read a summary of ideas, insights, and resources that can help your business play its part in greening America.
- Save Money Through Energy Efficiency Laws – Small businesses can cut more than 25% off of their energy expenses when they follow an energy saving plan. Read on to learn more about how to save money through energy-saving tax credits, grants and other incentives.
The Ultimate Guide to Hiring, Managing, and Nurturing your Small Business Team
on Nov 11 in Uncategorized tagged by janaolson
Hiring and managing employees is one of the most demanding and challenging aspects of business ownership. From the recruitment process, to “on-boarding” a new employee, and all the while ensuring you are compliant with a whole range of employment law – the responsibilities can seem overwhelming.
This guide consolidates many aspects of finding, hiring and managing employees, and offers suggestions for keeping your team motivated and collectively focused on the success of your business.
Building your Team – Finding and Recruiting the Right Talent
Navigating the recruitment process – which includes creating a job description, building a realistic compensation package, advertising your job, interviewing and making your decision – is a tricky business for all companies, big or small. To guide you through the process, read: 7 Tips for Finding and Hiring the Right Employee – the First Time.
An alternative option for hiring talent is to recruit interns. This article explains the benefits and where to start: Hiring Interns – 6 Tips for Setting up an Internship Program. Another option is to hire an independent contractor. The law has very strict requirements on how you report and reimburse contractors, so be sure to check out this guide to Hiring Independent Contractors.
Bringing Employees into the Fold – Know your Regulatory Obligations
For a solid overview of the steps you need to take once you have made a hiring decision and you have someone on board, read Business.gov’s guide: Ten Steps to Hiring Your First Employee, to help you stay on top of your regulatory requirements such as withholding taxes, and so on. If you are hiring foreign workers you’ll need to go through a few extra steps. This guide can help: Hiring Foreign Workers? Welcome to America.
Building a Benefits Plan
While its commonplace to expect benefits as an employee, it’s important for employers to understand what the law dictates with regard to benefits – some are required and some are not. Check out Business.gov’s guides to Employee Benefits and Wage and Hour Laws, and the following brief articles:
- Employee Benefit Plans: What’s Law and What’s Optional
- Finding and Managing the Right Retirement Plan for Your Small Business
Setting up Payroll
Whether you have one employee or 50, setting up a payroll system not only streamlines your ability to stay on top of your legal and regulatory responsibilities as an employer, but it can also saves you time and helps protect you from incurring costly IRS penalties. Here are 10 steps to help you set up a payroll system for your small business.
Nurture and Grow Your Team
Legal obligations and benefit packages aside, a truly successful employee is one who is motivated, functioning as a team player, and is almost as invested in your business success as you are.
To quote Laurie Benson, CEO of Wisconsin-based Inacom Information Systems and 2009 “SBA National Women in Business” Champion: “Very few people are ever successful or a failure by themselves, and probably, one of the most powerful elements in creating success – is a powerful team.”
There are many ways of building successful teams, from employee
incentive programs and empowerment activities, mentoring team members, hiring motivated employees, and more. These two articles offer some easy-to-implement techniques for building powerful teams in the small business workplace:
- Growing your Business as a Team: 10 Team Building Tips from the Real World of Small Business
- Get More from Your Team – 5 Employee Incentive Program Ideas that Pay Off
Stay on Top of Labor Laws
A critical part of employee management is understanding and adhering to labor law as they pertain to the workplace and what is and what isn’t acceptable – from workplace poster requirements, health and safety regulations, and anti-discrimination laws, these quick guides can help you stay compliant:
- Workplace Safety and Health Guide – How to stay compliant with the Occupational Safety and Health Act
- Employer’s Guide to Discrimination: Fair Wages and The Equal Pay Act
- Employer’s Guide to Pregnancy Discrimination
- Employer’s Guide to Discrimination: Hiring and Managing Employees with Criminal Records
- What You Need to Know About Employing Young People in the Workplace
- Sexual Harassment in the Workplace – Forming a Basis for Prevention and Management
- Hurt on the Job: An Employer’s Action Plan for Workplace Injuries
- FAQs about the Age Discrimination Act
Terminating Employees
An unfortunate and painful fact of life for most employers is having to downsize, layoff, or otherwise terminate employees. This guide – Handling Layoffs as a Small Business Owner – can help you understand how to handle your legal responsibilities as an employer and includes guidance on advance layoff notice, severance paperwork, COBRA, and so on. For additional information, Business.gov offers a comprehensive guide on terminating employees.
Top Five Reasons Why Start-up Businesses Fail
on Sep 16 in Uncategorized tagged by janaolson
1. Insufficient Capital (money): Start-up businesses with $50,000 or more in initial capical have a much better chance of keeping their doors open. You will have to pay vendors, employees, utilities, rent and a wide variety of aother expenses. Plan on having a minimum of six months cash available to keep the business operating.
2. Lack of Management experience: Many new entrepreneurs have the passion to start a company, but lack the day-to-day management skills to run a business. You may love to ski, and think you want to run a ski supply company. In addition to having a passion for skiing, you need to prepare yourself for the business aspects of starting a company too. Those include: understanding cash flows, marketing, and who your customers are.
3. Poor Business location: If customers cannot readily find your business location, they won’t buy your products and services.
4. Poor Inventory Management: Too much inventory will kill your cash flow. This is an issue many new businesses have, and many owners have no clue how to manage it.
5. Lack of initial Planning: This includes the misuse of personal assets to fund the business, how to handle unexpected sales growth, poor sales in the first 90 days of business, understanffing, and unreliable vendors. Your mantra should be “business plan, business plan, business plan.”
Excerpt taken from FIVE CREATIVE WAYS TO START a NEW SMALL BUSINESS in a TURBULENT ECONOMY by Greg Lopez .
Estimating Realistic Startup Costs
on Sep 16 in Uncategorized tagged by janaolson
Businesses spend money before they ever open their doors. Start-up expenses are those expenses incurred before the business is running. Many people underestimate start-up costs and start their business in a haphazard, unplanned way. This can work… but is usually a harder way to do it. Customers are wary of brand new businesses with makeshift logistics.
Use a start-up worksheet to plan your initial financing. You’ll need this information to set up initial business balances and to estimate startup expenses. Don’t underestimate costs.
- Startup expenses. These are expenses that happen before the beginning of the plan, before the first month. For example, many new companies incur expenses for legal work, logo design, brochures, site selection and improvements, and other expenses.
- Start-up assets. Typical start-up assets are cash (the money in the bank when the company starts), and in many cases starting inventory. Other starting assets are both current and long-term, such as equipment, office furniture, machinery, etc.
- Start-up financing. This includes both capital investment and loans. The only investment amounts or loan amounts that belong in the Start-up table are those that happen before the beginning of the plan. Whatever happens during or after the first month should go instead into the Cash Flow table, which will automatically adjust the Balance Sheet.
Timing is everything
Some people are confused by the specific definition of start-up expenses, start-up assets, and start-up financing. They would prefer to have a broader, more generic definition that includes, say, expenses incurred during the first year, or the first few months, of the plan. Unfortunately this would also lead to double counting of expenses and non standard financial statements. All the expenses incurred during the first year have to appear in the Profit and Loss statement of the first year, and all expenses incurred before that have to appear as start-up expenses.
Don’t count expenses twice: they go in Start-up or Profit and Loss, but not both. The only difference is timing. Don’t buy assets twice: they go into the Start-up if you acquire them before the starting date. Otherwise, put them in the Profit and Loss.
Expenses vs. assets
Many people can be confused by the accounting distinction between expenses and assets. For example, they’d like to record research and development as assets instead of expenses, because those expenses create intellectual property. However, standard accounting and taxation law are both strict on the distinction:
- Expenses are deductible against income, so they reduce taxable income.
- Assets are not deductible against income.
What a company spends to acquire assets is not deductible against income. For example, money spent on inventory is not deductible as expense. Only when the inventory is sold, and therefore becomes cost of goods sold or cost of sales, does it reduce income.
Read more: http://articles.bplans.com/starting-a-business/estimating-realistic-start-up-costs#ixzz0zhzdRImZ
Understanding the Basics
on Sep 16 in Uncategorized tagged by janaolson
Business vs. Personal
Starting up a business can be a tremendous strain on your personal finances. It can take six months or more before your new venture is profitable and can provide financial support for you and your family. Before going into business it is always wise to get your finances in order.
Write a monthly household budget that accounts for your income and your household expenses. Be as conservative as possible, because it is vital to your success that you have the resources to maintain your household expenses while your business is growing. Any strain on your personal budget will put the financial success of your business at risk.
It is also a good idea to check your personal credit situation. Too often, entrepreneurs think that their business credit and personal credit are separate. But business credit is built upon the owner’s personal credit. Because you have not established a business credit history, lenders and suppliers will use your personal credit history to determine your terms of credit.
Your credit report, which is issued by a credit bureau, determines how you will be perceived by potential lenders and suppliers. You should know what appears on your credit report because you may find errors that you will want to have corrected. You can get a copy of your personal credit report from one of the three major credit bureaus: Equifax, Experian, or Trans Union.
For information on how to check and correct your personal credit report, see Credit History.
In addition, it is very important for business owners and entrepreneurs to make sure their business credit report is accurate before they submit a loan application. To get copies of your business credit report, contact one of the business credit reporting agencies, including D&B eUpdate.
Partnerships
on Sep 16 in Uncategorized tagged by janaolson
Partnerships |
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