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Making the Most of Bookkeeping Services

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

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 and accounting services to small businesses as well as teaching them how to be more efficient.

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, so 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 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 and protect your purpose.

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When a Non-Compete Agreement Has Been Violated

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Do you know what do do when a non-compete is 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 for violating a non-compete, non-solicit or confidentiality agreement. We touch on what the process looks like and the impact of recent laws in Nevada, Utah, and Illinois.

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

Key Points

  • A non-compete could be 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.
  • Sometimes employees try to preempt an employer’s action by filing a suit to declare an agreement 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 that exceeds one year is not enforceable.
  • Nevada amended their non-compete law to limit enforceability if a former employee did not solicit your client or if the client left on their own to seek that employee.
  • Congress recently passed the Defend Trade Secrets Act.
  • Employers use the Computer Fraud and Abuse Act to prevent an employee from accessing their computer system without authorization.
  • When drafting agreements, work with your attorney to protect the company’s interests.
  • Typically, employers include a clause in the agreements to ensure that if they win, 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

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

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 all throughout the country, providing accounting, payroll, CPA, incorporation, and tax services.

Key Points

  • You can either have an employee or a contractor working 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, medical care, and unemployment tax payments.
  • Use a payroll service provider who will make the mandated state and federal payments as well as do monthly or quarterly filing of relevant taxes.
  • You need to file monthly, quarterly, and annual employer tax returns.
  • A business owner can have a solo 401(k).
  • If you are employed and also run a business, there are limits to what you can contribute to a solo 401(k).
  • Putting money away for retirement 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

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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.

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.

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

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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 real estate with an emphasis on the commercial side.

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.

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 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

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Do you like micro-brew or have you ever thought about opening up a microbrewery? Today, we look at state and federal legislation that affects independent brewers in the manufacture, distribution and retailing of their products.

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, and 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.

Key Points

  • There has been an expansion of microbreweries in Western North Carolina in recent years.
  • Across all states, there is a three-tiered system separating the manufacture, distribution, and retailing of beer.
  • Different states have different limits on how much you can produce before you have to use a wholesaler.
  • Depending on the state, manufacturers sell beer out of their tap room until they hit a certain threshold.
  • Get familiar with the accounting and tax implications of your business operations.
  • Depending on the amounts you produce, taxes can be paid quarterly or monthly.
  • Sometimes bars are 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, and that’s not necessarily a good thing.
  • Contact your attorney before getting into a co-packing agreement.
  • When you are contract-brewing for out-of-state parties, you are required to file tax returns in their state.
  • 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

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

Our guest today is Ryan Moore from Riney Hancock CPAs, and 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 tax planning and tax services. Riney Hancock CPAs have offices in Owensboro, Kentucky (right outside of Louisville) and Evansville, Indiana.

Key Points

  • Owners of closely held businesses can choose to transition over a period, giving away portions of the business incrementally.
  • Gift tax is incurred when you make a transfer without receiving anything in return.
  • Amounts up to $14,000 per taxpayer can be transferred tax-free each year.
  • The lifetime estate tax exemption is roughly $5.5million 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 advisor are all on the same page.
  • Keep an eye on the proposed tax reform to understand how it will affect you.
  • A few tips from Ryan to help you ask the right questions and make better decisions.

Join us for 20 minutes as we dive into this.

Contact Information

www.rineyhancock.com

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Why Business Owners Should Talk about Divorce

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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?

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.

Key Points

  • What to do if you own a business and are faced with a divorce situation and no prenuptial agreement.
  • When you are the owner of an enterprise, divorce puts you 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.
  • Rules on family law and divorce are state-specific.
  • Pre-trial mediation: getting an agreement vs. taking matters to trial.
  • Before the divorce process begins, talk to an attorney and a CPA.
  • How the business’s value is determined.
  • If an enterprise is not liquid, the owner can negotiate payment terms.
  • What is the purpose of a provisional order hearing?
  • You don’t want to 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

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

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.

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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Healthcare Insurance Could Cost Less

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So much has changed in health insurance 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.

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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