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Making the Most of Bookkeeping Services

Do you conduct your own bookkeeping services? The tax season is upon us, a time when some business owners struggle doing their returns.

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On today’s show, we have Kay Leland from The Bean Counters Bookkeeping LLC, located in Wilmington, North Carolina. She began her accounting career while still at school and has a master’s in accounting from the University of North Carolina Wilmington. She worked for the US Army Audit Agency for some years before setting up her own business which provides bookkeeping services and accounting services to small businesses as well as teaching them how to be more efficient.

Bookkeeping services – Key Points

  • There are three different levels of accounting.
  • CPAs will typically not get involved in regular bookkeeping.
  • The number one tip is to outsource early and often.
  • There are a lot of accounting certifications and many people who do bookkeeping, but you want to find someone with an accounting degree.
  • Accounting and bookkeeping touch every part of your business. Despite its importance, it is probably one of the most ignored things because it’s not fun to do.
  • Every small business is different, therefore you want a bookkeeper to know your business and understand how it runs.
  • How Kay helped an established restaurant business save money and become more efficient.
  • An online business store resolved cash flow problems by learning about invoice terms.
  • Don’t let things snowball: many entrepreneurs discover issues during tax time.
  • Be sure to establish an effective communication process with your bookkeeper.
  • You need to have a bookkeeper who knows about your industry and thus can proactively give valuable insights for the company.
  • Outsource everything you can, as often as possible.

Tune in for practical tips to improve your business while protecting your purpose.

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When a Non-Compete Agreement Has Been Violated

Do you know what to do when a non-compete agreement has been violated? In Amit Bindra’s last episode, we talked about protecting trade secrets and confidential information.

We continue this conversation today by diving into what happens when you need to take an employee to court when a non-compete agreement has been violated in the workplace. We touch on what the process looks like and the impact of recent laws in Nevada, Utah, and Illinois.

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With us is Amit Bindra from The Prinz Law Firm located in Chicago Illinois. He uses his extensive experience in employment law to run a practice focused on non-compete agreements, non-solicitation agreements, and trade secrets.

When a Non-Compete Agreement Has Been Violated – Key Points

  • A non-compete agreement can remain valid whether an employee leaves voluntarily or is terminated.
  • Legal redress for a violation often happens quickly.
  • A preliminary injunction or a TRO decision (temporary restraining order) could be issued.
  • Employees may try to file suit to declare an employer’s action void or invalid.
  • Illinois recently passed the Illinois Freedom to Work Act to protect low wage earners.
  • Utah passed a law that a non-compete agreement that last more than one year is not enforceable.
  • Nevada amended their non-compete law that limits enforcement if a client seeks out a former employee, rather than the employee soliciting the client.
  • Congress recently passed the Defend Trade Secrets Act.
  • Employers use the Computer Fraud and Abuse Act to prevent employees from accessing their computer system without permission.
  • When drafting agreements, work with your attorney to protect the company’s interests.
  • Typically, employers include a clause in the agreements to ensure if they win, their attorney fees and expenses will be paid by the employee.

We hope you enjoy listening; have a great day!

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The Employment Side of Starting a Business: Hiring Employees

We are continuing our conversation on the ABCs of starting a business. We will follow the progress of a fictitious newly formed Yoga Studio. In episode 128 we looked at business structure and today we will focus on hiring employees.

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With us is Cory Johnson from Cory W. Johnson, CPA, LLC  which is located in Silver Spring, Maryland. He has about 200 individual clients and about 30 business clients located all throughout the country. He provides accounting, payroll, CPA, incorporation, and tax services.

Hiring Employees  – Key Points

  • When hiring employees, you can choose to hire either employees or  contractors to work for your business.
  • The front desk worker is probably an employee while the yoga instructor is most likely a contractor.
  • Look for guidance to help you determine whether someone is your employee or a contractor.
  • In addition to salaries, payroll-related expenses include social security, medicare, and unemployment tax payments.
  • Use a payroll service provider to make mandated state and federal payments as well as monthly or quarterly filing of relevant taxes.
  • Monthly, quarterly, and annual employer tax returns may need to be filed.
  • A business owner can have a solo 401(k), but if you are employed and run a business, there are limits to what you can contribute to it.
  • Putting money away in a retirement savings account reduces your tax obligation.

Listen in and find out Cory’s best tip on doing due diligence.

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The ABC’s of Starting a Business

When starting a business, there are steps to take in fulfilling legal, state and federal requirements. The business structure you choose determines whether you will incur double taxation or make savings by paying less in taxes.

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We’re talking to Cory Johnson from Cory W. Johnson, CPA, LLC which is located in Silver Spring, Maryland. Originally from Baltimore, he graduated from Temple University in Philadelphia with a BBA in accounting and then worked as an accountant and auditor for Aramark, Grant Thornton LLP, and KPMG. He is currently an accountant with The Architect of the Capitol which is a federal government legislative branch agency.

Starting a Business – Key Points

  • Start with an operating agreement or bylaws.
  • File your organizing documents in your state of residence or where you want your business to be incorporated.
  • Before you launch your business, obtain a federal employer identification number from the IRS.
  • Clients often don’t have the tools to keep accurate financial records and are unaware of how their business will affect personal taxes.
  • Sole proprietors end up being double-taxed on the same net profit: at the individual income tax rate as well as self-employment tax.
  • Partnerships also incur double taxation.
  • Most people prefer to get professional help to handle tax papers and IRS documents.
  • The LLC is the most commonly used business structure because of the tax benefit.
  • Cory and Hans go through an example of how you pay less tax with an LLC-S Corp compared to a sole proprietor or general partnership.

Tune in for a high-level discussion on getting your business started.

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Setting up a Commercial Real Estate Deal

We are continuing our conversation with Dennis Theodossis from Dixon Hughes Goodman LLP. In episode 126, we talked about the brewery industry, and today we’ll transition to commercial real estate with an emphasis on the commercial side.

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Apart from his work with breweries, Dennis works with clients in real estate and development. Dixon Hughes Goodman LLP is located in Asheville, North Carolina and has offices in 12 other states.

Commercial Real Estate – Key Points

  • Typically, in a real estate deal, one party with a great idea and concept will need to partner with investors to finance the business.
  • The operating agreement or shareholder agreement outlines the rules of the game. Your lawyer must approve it, and you should fully understand the document.
  • Getting things right ensures there are no unintended tax consequences.
  • A lot of the commercial real estate and development deals taking place are transactional work.
  • A 1031 exchange is a way to defer capital gains tax on investment property.
  • All your hard work in planning and transactional work on a real estate deal will come to fruition on your tax return.
  • Money received for a 1031 transaction has to be channeled through a qualified intermediary.
  • When you’re entering into a complex transaction, you need a sizable professional team to do things correctly.
  • If an operating agreement is not done right, it could lead to problems in future and a lot of extra costs.

We hope you enjoy.

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Getting into the Brewing Industry

Do you like micro-brew? Interested in becoming involved in the brewing industry? Today, we look at the state and federal legislation and its impact on independent brewers, as well as their manufacture, distribution and retailing of their products.

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We have with us Dennis Theodossis from Dixon Hughes Goodman LLP, located in Asheville, North Carolina. He has been with the firm for about eight years. His particular focus is breweries within the manufacturing and distribution space.

Dixon Hughes Goodman LLP is the 17th largest accounting firm in the country with a footprint that spreads along the East Coast.

Brewing Industry – Key Points

  • Western North Carolina has experienced an expansion of microbreweries in in recent years.
  • A three-tiered system separates the manufacture, distribution, and retailing of beer across all states.
  • Different states have different limits on how much can produce before you have to use a wholesaler.
  • Manufacturers may sell beer out of their tap room until they hit a certain threshold, rules depend on the state.
  • Become familiar with the accounting and tax implications of your business operations.
  • Taxes can be paid quarterly or monthly, depending on the amounts produced.
  • Due to certain regulations, bars are sometimes required to operate as a private membership facility.
  • If you have a restaurant component in your business, your brewery might not be considered as a manufacturer, which is not necessarily a good thing.
  • Contacting an attorney prior to entering a co-packing agreement will  save you time and money.
  • You are required to file tax returns in their state when contract-brewing for out-of-state parties.
  • Dennis explains recent developments concerning regulation and compliance in the industry.

You definitely want to hear what Dennis has to say.

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What You Should Know about Estate Planning and Gift Tax

Gifting your business to heirs or other parties could result in substantial tax payments; estate planning helps you minimize the cost.

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Our guest today is Ryan Moore from Riney Hancock CPAs. He will help us look at how estate and gift taxes are applied as well as the best way to pass along the value of your business. Ryan has been in public accounting for almost a decade and currently specializes in estate planning, tax planning and tax services. Riney Hancock CPAs have offices in Owensboro, Kentucky (right outside of Louisville) and Evansville, Indiana.

Estate Planning – Key Points

  • Owners of closely held businesses can choose to transition over a period, giving away portions of the business incrementally.
  • When you make a transfer without receiving anything in return, a gift tax is incurred .
  • You can transfer up to $14,000 per taxpayer, tax-free each year.
  • The lifetime estate tax exemption is roughly $5.5 million and includes IRAs.
  • If you transfer 50% of your business to your children in a single year, you have to file a gift tax return.
  • Estate planning is one more reason to get a business valuation.
  • If you gift stocks to your children during your lifetime, the tax basis will be the original cost and not the current market value.
  • Always make sure that your accountant, attorney, and financial advisors are all on the same page.
  • Keep an eye on the proposed tax reform to understand how it will affect you.
  • Ryan can offer you a few tips to help ask the right questions and make better decisions.

Join us for 20 minutes as we dive into this.

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Why Business Owners Should Talk about Divorce

We are continuing our conversation with Dave Joley, an attorney from Arnold Terrill Anzini, P.C., and today we’re looking at how divorce affects your business. What should you do before you even think about getting a divorce and what happens when the matter goes to court?

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Dave has been in practice for about 12 years and has a broad focus, representing clients in multi-disciplines such as criminal matters, business matters, and divorce. Arnold Terrill Anzini, P.C. is located in Fort Wayne, Indiana.

How Divorce Affects your Business – Key Points

  • What to do if a business owner is faced with a divorce situation and no prenuptial agreement.
  • Divorce puts the business owner in a difficult position because it’s impossible to separate business from personal life.
  • Divorce is designed to split both the personal and financial lives of two people.
  • A business is considered part of the family’s financial assets.
  • Both parties contribute to the business’s success even if one spouse is not actively involved in running it.
  • You must contact an attorney in your area as rules on family law and divorce are state-specific therefore.
  • Pre-trial mediation: getting an agreement vs. taking matters to trial.
  • Talk to an attorney and a CPA before the divorce process begins.
  • How the business’s value is determined.
  • The owner can negotiate payment terms if an enterprise is not liquid.
  • What is the purpose of a provisional order hearing?
  • Don’t speak to an attorney after the court has already made a ruling.

This episode is a must-listen if you own a business.

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How to Protect Your Business Before You Get Married

In this episode, we’re talking to Dave Joley from Arnold Terrill Anzini, P.C. about prenuptial agreements. You’ve worked hard to set up your business. We take a high-level view of what you can do to protect your business before you get married.

Dave has been in practice for about 12 years and has a broad focus, representing clients in multi-disciplines such as criminal matters, business matters, and divorce. He considers himself more of a litigator than anything else because he practices quite a bit in court. If an issue is destined for the courts, he is the go-to attorney.

Arnold Terril Anzini, P.C. is located in Fort Wayne, Indiana.

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Protect Your Business Before You Get Married – Key Points

  • Each state has its laws for the formation of business and for divorce.
  • Most states recognize prenuptial agreements, but there may be state-specific formalities required to formalize them.
  • Attorneys who practice family law will have a good understanding of the requirements for prenuptials.
  • Divorce can impact a business in which you are not the sole owner; all the more reason to establish rules beforehand.
  • Although family law varies among states, the general rule is that parties can agree to include whatever they want in an agreement.
  • You always want to be as specific as possible.
  • Prenuptials should not include matters involving children.
  • Seek counsel to make certain that there’s nothing in your contract that a court would find unacceptable in a divorce proceeding.

Tune in to find out how to protect your business.

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Health Insurance Could Cost Less

So much has changed in the health insurance industry in the last couple of years. In this episode, Travis Gensler from Beacon Point is back to give us tips that could save your business money. Whether you have five employees or more, with the right information, you might find a better deal than what you currently have for you and your employees.

Travis has over 10 years’ experience in the industry. Beacon Point is an insurance firm located in Independence, Missouri, just outside of Kansas City.

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Health Insurance – Key points

  • The Health Care Reform Act has changed the rules on how health insurance is treated.
  • The number of employees on your payroll should influence which insurance plan you select.
  • The benefit of partially self-insured group health plans.
  • You should review your healthcare plan every year because of regulatory changes.
  • A business’s location might affect the cost of premiums.
  • Reduce your annual premiums by getting a health savings account plan (HSA).
  • Work with your insurance broker to find an option that is the best fit for both the employee and the company.
  • There are things outside regular health insurance that you can pay for out of your HSA.
  • People that are willing to plan and look long-term can make the most of savings plans.
  • Rather than be restricted to options from one company, work with an independent agent or broker.
  • Ask your agent or broker what technical training they have done in the recent past.

Find out how you could potentially save thousands of dollars annually.

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