Summer is coming to an end – did a memorable vacation leave you thinking about a vacation home? Real estate can be a great investment, but there are some points to consider before making a vacation home purchase. My family has owned rental properties for 30+ years, and I personally own rental property and manage properties for some of my clients. When it comes to spending a significant amount of money like this, it’s a good idea to thoroughly evaluate the scenario to help ensure you make a sound investment.
First, how do you intend to use the property? Will it be solely for personal use, or do you need rental income to supplement the mortgage payments? And what are the pros and cons to each scenario? We can advise you on ownership, depreciation, expenses, lease or rental contracts and management expenses to help you make the best decision for your situation.
It’s important to note that there are rules for personal use if you intend to rent as well. For example, personal use cannot exceed 14 days in a calendar year, or the property does not qualify as a rental. And if you are going to use a management company, make sure to get several references that you are confident in and do plenty of research before you sign with a company. Know UPFRONT what your costs will be; this can be a nasty surprise if you don’t do your due diligence.
As you can imagine, additional property impacts your taxes, and there is another layer when you add in the rental piece. Record-keeping is probably the most important thing with a rental property. And if you own more than one rental property, make sure you’re keeping clear and separate records for each. You need to be able to document rent income – when it was received and from whom. You also must track related expenses for each property you own.
Rental losses are not deductible against normal income, unless you are a real estate professional for tax purposes. This is why many rental property owners have more than one property – losses on one may offset against income on another. And, generally speaking, rental properties are “independent” of your principle residence deductions. Rentals are reported on Schedule E, and must be reported per property, with the appropriate income and expenses.
It’s our job to be the expert on tax laws and how they apply in a variety of scenarios. If you’re considering a vacation home purchase and want to discuss the ins and outs as you work your way toward a decision, give us a call any time!
While peaches may be in season as late as September, the season is generally at its peak from July-August. Take advantage of these fruits and make this Easy Peach Cobbler from Food Network. It can be served warm or cold!
And speaking of warm, here’s a good recipe for Homemade Apple Cider from AllRecipes.com. Apple picking season is just a few weeks away, so save this one in your files for fall!
When talking about tax exempt statuses as they relate to non-profit organizations the first distinction that needs to be made is whether we are talking about a “non-profit” entity or a 501(c)(3) registered charitable organization. There are clear distinctions between the two when it comes to tax laws and operations, so it’s important to know the differences.
A 501(c)(3) organization requires specific approval by the IRS that includes the submission of a 30-page application that details activities the organization will engage in. We recommend partnering with an experienced tax attorney to complete and submit the application. Some examples of well-known organizations that meet these requirements are charities like The Salvation Army, American Red Cross or United Way. If this is the exemption you seek, it’s also worth noting the approval process can be as short as three weeks or stretch as long as 12 months.
The process for not-for-profit organizations is a bit simpler. The organization must apply for a Federal Tax Identification Number (FEIN) in order to establish a bank account, and generally has a list of governing rules for operation of the organization. The application for this exemption can be completed online and the approval is instant. Examples of organizations that may fall in this category include: social clubs; church-controlled organizations; community or volunteer groups; a homeowners association or PTA group.
As with all exemptions and deductions, it’s important to stay current on specifics and tax laws. We have experience working with both types of organizations and are familiar with the ins and outs to help. If you want to partner with an accountant to help manage taxes or accounting for your non-profit, our knowledge and expertise can benefit you. We can also provide recommendations for area tax attorneys to provide application guidance. You can reach us at (913) 888-9100.
CPAs and accountants are more than just tax preparers. These professionals can provide guidance and assistance to your business in a number of ways. However, before you partner with a new accountant, it’s important to step back to evaluate your business needs.
First of all, are you happy with the work your current CPA/accountant is doing for your business? If so, do you really have a reason to change? Or, perhaps are there adjustments that could be made to the existing relationship to make it suit your needs better? If you are unhappy, be sure you can identify the points you seek differently in a new CPA/accountant relationship and articulate those up front.
Second, how often do you want to meet with your accountant – weekly, monthly or quarterly – and what do you want to accomplish at each of those sessions? Set a schedule with topics when you begin work so expectations are clear among all parties.
Third, what accounting needs does your business have on a regular basis? Do you need help with payroll, month-end, financial statements, bank reconciliations and/or invoicing? Be sure to select a CPA/accountant with solid experience in the areas you need and with potential to service your needs in a timely fashion.
If you’re looking to make a change with your business accounting or just want to discuss how our services could benefit your business, contact us to schedule a meeting. We have extensive experience with a variety of small business structures and focuses. We would welcome the opportunity to learn about your business and demonstrate how we can add value. You can reach us (913) 888-9100.
allrecipes.com
Summertime and cookouts go hand-in-hand. If you’re looking for a couple new recipes for your next BBQ, give these a try. You can’t go wrong with potato salad for a side – it goes with EVERYTHING. And this Bratwurst recipe adds a twist over just tossing on the grill.
The World’s Best Potato Salad recipe on allrecipes.com is the real deal. If you’re looking for a traditional potato salad with hard-cooked eggs, you should give this one a try! Pair it with the brat recipe below, or serve it as a side for burgers, hot dogs, chicken and more!
Brats are tasty plain on the grill, but his recipe for Wisconsin Bratwurst takes them to the next level! The butter, beer and onions add a savory flavor. All you need to polish these off are some great buns and mustard!
Do you have a favorite potato salad or bratwurst recipe to share? Comment below! If you try these, ENJOY!!
Your income taxes cover your most important financial details. It’s smart to partner with a tax professional to ensure you’re covering all your bases and making the most of potential deductions available to you. With that said, there are a few key questions we think you should ask a tax accountant before making a commitment to work together:
A lot of the “free file” programs will only let you file electronically IF you qualify. This is often 1040EZ only, and doesn’t include state filing. You have to pay for that separately. At Adams Accounting Solutions, we file both federal and ALL states with no additional charges. For additional customer confidence, we also get confirmation numbers for all returns to prove they were filed, along with a date and time stamp. This is the only acceptable proof for the IRS and State Departments of Revenue. Keep in mind, the IRS has become one of the most “Prove it or Pay” problems for the 2014 tax year.
As for extensions, we can help there, too. Many people wait until the very last minute to file an extension, and when they finally do, they mail a paper form. If you do not have proof of mailing (and at the last-minute, most do not), the IRS can deny your extension, noting it was not filed on time. As with e-filing, we can get a confirmation number, along with date and time stamp, for proof of your extension filing.
When you’re reviewing payment with potential tax preparers, you will find most require you pay for the returns before you get copies and they are filed. We are able to have your prep fees automatically deducted from your tax refund, so you don’t have to pay out of pocket for your returns. We charge a $15 fee, but that’s only because it must go through a third party (secure processor bank) to complete the transactions. If you find a preparer that offers this service, inquire for the fee. Most charge more than $15.
Want to learn more about our services? Give us a call! We would love to talk with you!
This week marks the end of the first half of 2015. For business owners, this is a good time to assess tax-related tasks to ensure you’re on track. Are you making your estimated tax payments? Should these amounts be adjusted? How is your business performing – better or worse than “budget” expectations?
Once you have made these evaluations, determine what needs to be adjusted to make this year a success. Do you need to increase revenue? Should expenses be reduced? Do you need to acquire new customers?
We Manage Your Business Accounting & Tax Needs
We review these things with our clients to evaluate performance January-June. Then we work together to project EOY earnings to determine if we have enough set aside to pay taxes in net income.
At the midpoint of the year, we also discuss the future of the business. If an expansion or purchase, or plans to sell the business are imminent, we adjust to stay in line with objectives.
Review Personal Taxes, Too
While tax preparation doesn’t top your list for summer fun, spending a bit of time on your 2015 taxes now can make preparation to file much easier when the time comes.
If you haven’t already, start a file or folder for your 2015 personal taxes and add items you have collected so far this year. For those of you with special deductions – like a home office or business expenses, medical expenses or charitable contributions – gather documentation for the first half of the year. Tackling some of this legwork while it is fresh in your mind now is easier than trying to go back and piece together a year’s worth later!
Use our 2014 tax organizer. If you have questions or want help preparing your 2015 taxes, give us a call – (913) 888-9100. We have the confidence and experience to benefit your business or personal tax needs!
Summer is officially here. While many people take advantage of the season to get away for vacation, small business owners often struggle with taking time off. However, it’s important to take a break from your business once in a while – even if it’s only for a few days. Everyone needs time away from work to relax and rejuvenate! And in the case of small business owners, time away from the business may also bring fresh eyes to problems or issues.
Delegation and training can help your business function more efficiently and ease your stress level. We’re available to train your employees on QuickBooks or other accounting software. We can also suggest a plan for cross-training. Together, these things will improve the day-to-day management of your business. Vacation aside, it’s smart to have redundancy systems in place to ensure the viability of your business. If the business can’t run smoothly for a few days of vacation without you, what would happen if an accident prevented you from working unexpectedly for weeks or longer?
When you have a proper accounting structure and payroll system in place, the business can function more seamlessly. This can give you peace of mind to step away. If you don’t have the employees to support your accounting needs, we can manage these issues for you when you are out of the office or on an on-going basis.
Carve out time for a summer vacation and start planning NOW so you can enjoy yourself when time off arrives. Alert your clients in advance and work ahead so everyone has a good comfort level prior to your absence. Most importantly, “unplug” for a designated period each day while you’re away. This can be the most difficult part, but we highly recommend it! If you’re looking for accounting support for a vacation or on a regular basis, let us know. We would love to learn more about your business and identify ways our services can support you!
When it comes to tax preparation, it’s not uncommon for people to have questions about deductions, especially when you’re dealing with more specific details, like business-related deductions. While this comic is extreme, from experience, it’s not that far off.
We get all sorts of questions about home office deductions and deductions related to business expenses. Sometimes it’s our clients seeking our guidance as to whether a particular item qualifies for deduction or not. Often times, it is us providing suggestions for potential deductions our clients may not have considered.
That’s where professional expertise can be beneficial, particularly for small business owners. When you partner with an accountant to help manage your business or a tax professional to prepare your taxes, you should expect them to bring knowledge to the table to guide you to choices that will be most beneficial for your business structure.
Asking questions of a professional is the best way to ensure you’re meeting the tax laws, and also a good way for us to identify potential deductions or structure adjustments that can save you money. It’s our business to be current on tax laws and knowledgeable about how to apply them to a variety of scenarios. You should always feel comfortable asking questions of anyone you are working with related to your personal or business finances. More importantly, you need to feel confident in the validity of the answers and knowledge provided to you.
We specialize in small business accounting and are experienced in tax preparation for individuals and businesses. Let us know if you would like to set up a time to discuss your needs and how we can be of assistance to you!
Summer is a great time of year to use fresh ingredients and cook on the grill! Here are a couple recipes to throw into the mix this season for your next party or BBQ!
Chicken Salad
Chicken salad is a summertime favorite. It’s light and ideal for feeding a crowd, as it can be prepared in advance. Keep this recipe in mind for a family reunion or birthday gathering. Buy some croissants to serve the chicken salad on, add a pasta or fruit salad, chips and dessert, and you have an easy meal to feed a group!
Grilled Shrimp
Shrimp is an alternative to traditional summertime grilling fare, like burgers, chicken or steak. Similar to the chicken salad above, the prep work for this recipe can be done in advance. The marinade provides a fresh flavor with a kick, and the shrimp are ready to go on the grill just minutes before mealtime. Pair this dish with a salad, grilled veggies or rice and you’re all set!
What’s your favorite summer recipe for entertaining? Comment below to share!
Richard Adams is a graduate of Benedictine College in Atchison, Kansas, with dual majors in Accounting and Business Administration. He is also a graduate of Wentworth Military Academy in Lexington, Missouri.