Event: FREE Consultation with IRS at Small Business Solution Station (Chicago)

Let’s sit on chairs and party!

Event: Small Business Solution Station [City of Chicago Department of Business Affairs & Consumer Protection]

When: Friday May 25th, June 29th and July 27th 9:30am to 3:00pm

What: The IRS will be on hand to provide small businesses in Chicago with a free one-on-one consultation. Options. Tax questions. Resources. Assistance. Get your questions answered and understand once and for all what’s required of you when it comes to small business taxes!

Where: Small Business Solution Station

121 N. LaSalle Street

City Hall-Room 800

Chicago, IL

For more information, call 312-744-2086.

RDS Bookkeeping  has provided expertise in accounting and bookkeeping to small business owners and individuals throughout Chicago for over 8 years. We serve every client with thoughtful, efficient care and strive to go above and beyond so that you can do what you set out to do- get down to business.  We are the proud founders of Pit Crew IL Rescue.  Sambuca is our dog.

A Few Last Minute Items for Tax Day

Ugh what? This isn't over yet?

1. Worrying that you missed the usual April 15th deadline? No worries- taxes aren’t due until April 17th this year (tomorrow)! It’s like when you go to school and you forgot to study for the big math test only to discover the teacher is out sick and there’s a substitute who likes to eat pizza and play dance music! Hurrah! Reprieve!

2. Dreading Tax Day? You shouldn’t- some companies are doing special promotions on Tax Day like… giving away free food! Show a special coupon at places like Arby’s, Cinnabon and Panda Express and get some sweet freebies! More info here.

3. Worrying about the cost of filing? It’s free to file your federal taxes. (You didn’t think they’d make it difficult to get your money, did you? Ha ha, silly peoples.)

4. Not sure when all the extensions and due dates are? We’ve got them right here!

It’s almost over- hang in there!

RDS Bookkeeping  has provided expertise in accounting and bookkeeping to small business owners and individuals throughout Chicago for over 8 years. We serve every client with thoughtful, efficient care and strive to go above and beyond so that you can do what you set out to do- get down to business.  We are the proud founders of Pit Crew IL Rescue.  Sambuca is our dog.

 

Sambuca Plays Watchdog for Illinois Taxes

It's... fine. Everything is fine.

People love to comment on Illinois- they like to make comments about our politicians and their “windyness” and cracks that rhyme with “Blago.”  But the recent tax situation has picked up the most press recently. And Sambuca is going to make sure you know what’s going down.

Here are a few choice reads to get you up to speed:

Tax-Friendly Attitude Hasn’t Helped Illinois– LA Times (March 19, 2012)

But the state’s budget problems can’t be blamed just on people on state aid. Much of the $6 billion in new revenue from the tax hikes went to fund Illinois’ pension obligations and to pay bills the state had skipped out on in past years; the state is still $500 million in the hole. Without reforming Medicaid, government employee pensions and healthcare costs, no amount of tax increases can patch the hole that states such as Illinois — and California — will eventually face, said Msall of the Civic Federation.

We are not happy. No, we are not. And we’re taking it to the polls.

The Six States Where Taxes Are Soaring– 24/7 Wall St.

Several of the states that increased revenue from taxes the most had among the worst budget gaps during the recession. In 2010, California, Illinois, New York and Rhode Island, all of which increased revenue from taxes by over 9%, had among the highest deficits, exceeding 30% of general funds. California faced a gap of more than 50%, second only to Arizona. Despite cutting spending and increasing tax revenue, many of these states have continued to experience major shortfalls. Projected budget deficits for California, New York and Illinois remain among the highest in the country.

Yup, there we are!

Tax hike pushes Illinois near top of state economy ranking: report– Crain’s (March 30, 2012)

Illinois came in at No. 6 on the Bloomberg Economic Evaluation of States, which measures how states perform from quarter to quarter. The fourth-quarter report found that 34 states posted economic improvements in the final three months of last year.

Yay, we’re No. 6! Wait, is that good news or bad news?

Big Lottery Win Could Easily Be Followed By Big Loss-  USA Today

This doesn’t really have anything to do with Illinois. I just thought it’d be fun if we fantasized a little about winning $640 million dollars. I like the quote at the end. “Mad money” indeed!

Need more reads on taxes? 7 More Easily Missed Deductions , 1 Week Until Tax Day (Checklist), Isabella’s Quick Tax Deductions.

RDS Bookkeeping  has provided expertise in accounting and bookkeeping to small business owners and individuals throughout Chicago for over 8 years. We serve every client with thoughtful, efficient care and strive to go above and beyond so that you can do what you set out to do- get down to business.  We are the proud founders of Pit Crew IL Rescue.  Sambuca is our dog.

Countdown to April 15: Fun With Tax Stats!

Nerd glasses on? Check.

Oh, APRIL. You approach with a ferocity that is frightening to all of us who pay taxes (yes, dogs pay taxes. They do not call money “bones” for nothing, you know! Actually, why do they do that?)

Sambuca has decided to ease you into it this year. Let’s start with tax stats! The IRS (oh, adorable nuggets that they are) has released the Fiscal Year 2011 Data Book: “A rip roaring read,” says… no one.  Regardless! There’s some interesting factoids! I know! I was surprised too.

“This e-File business is a fad! A FAD!” says Grandpa. Nope.
Taxpayers e-filed more than 133 million business and individual income tax returns, including 77 percent of all individual income tax returns.

Just how much in refunds are issued anyway?
More than 119 million individual income tax returns, about 83 percent of all individual returns, resulted in refunds, totaling almost $338 billion. WHOA.

“I am terrified of being audited.” Well…
The IRS examined 1.1 percent of all individual income tax returns and 1.5 percent of corporation income tax returns (excluding S corporation returns). Feel better? ONE PERCENT.

Taxes are easy. Sure, when you have help.
The IRS provided taxpayer assistance through 319 million visits to IRS.gov and assisted nearly 83 million taxpayers through its toll-free telephone helpline or at walk-in sites. It’s amazing how helpful people will be when they want you to pay.

Guess what? You can get the WHOLE Data Book free! Yes! Don’t all rush the download button at once now.

Need more reads on taxes? 7 More Easily Missed Deductions , 1 Week Until Tax Day (Checklist), Isabella’s Quick Tax Deductions.

RDS Bookkeeping  has provided expertise in accounting and bookkeeping to small business owners and individuals throughout Chicago for over 8 years. We serve every client with thoughtful, efficient care and strive to go above and beyond so that you can do what you set out to do- get down to business.  We are the proud founders of Pit Crew IL Rescue.  Sambuca is our dog.

President Obama’s Budget Proposal (2012) and What It Means For Taxes

Best friends are tax deductible right?

Good morning, peoples! It’s going to be a wonderful week, don’t you think? (Because February is almost over! And February is the WORST!)

As you may have heard, President Obama released his proposed Federal Budget for 2013 on February 13th. There are numerous proposals that would affect taxes on both business and personal levels. We thought it w0uld be helpful if we broke down those laws that pertain to business taxes and tax credits, so here we go:

Note: These are proposed changes. Some of them will pass. Others will, doubtlessly, be debated within an inch of their lives before anything comes to pass. You have a responsibility as a tax payer, and a citizen, to stay informed. Don’t be blindsided. And if you can, make your voice heard through your local representatives. Contact your accountant or attorney for more information.

– The payroll tax cut that reduces the Social Security payroll tax from 6.2% to 4.2% will be extended through the rest of 2012. As of Wednesday, this has been passed and put into effect.

– Change the tax treatment of carried interests in investment partnerships. Instead of taxing them at capital gain rates (currently 15%), they would be taxed at ordinary income rates.

– The 100% bonus first-year depreciation deduction originally set to expire at the end of 2011 would be extended through 2012.

– After 2013, certain employers would be required to provide for automatic enrollment in IRAs (in which savings are deducted from paychecks automatically and deposited in the worker’s own account). Employers don’t make contributions and employees can opt-out at any time. There would be a credit for small business employers to implement the automatic enrollment in IRAs and the existing start-up credit for smaller employers who offer a retirement plan (401k, etc) would be doubled.

–  Taxpayers would no longer be able to use the last-in, first-out accounting method for tax years beginning after December 31, 2013.  They would be required to report their beginning-of-year inventory at its first-in, first out (FIFO) value.

– A new income tax credit for employers who increase their payroll (through job creation, increased wages or both), the credit equal to 10% of the increase in employer’s 2012 eligible wages over the 2011 wages. (Maximum would be $5 million per employer in wage increases, maximum credit of $500,000.) Effective during the one-year period beginning on January 1, 2012.

RDS Bookkeeping  has provided expertise in accounting and bookkeeping to small business owners and individuals throughout Chicago for over 8 years. We serve every client with thoughtful, efficient care and strive to go above and beyond so that you can do what you set out to do- get down to business.  We are the proud founders of Pit Crew IL Rescue.  Sambuca is our dog.

 

Tax Concerns for Small Businesses in 2012

How about YOU worry about taxes and I'll have a drink.*

Here is the connection between dogs and politics: politics make people nervous. Nervous people make nervous dogs. As we speak, Harley Buttons is huddled in a corner watching one of the Republican debates on the YouTube (I have reminded her that she is both deaf and blind but that does not seem to faze her, apparently. That’s not a hidden dig or anything. She is literally both deaf and blind. Sambuca, in case you are wondering, is a Libertarian like Ron Swanson. Mostly because we both enjoy turkey legs wrapped in bacon- how can you argue with a genius?)

Still, political changes leave everyone feeling a bit shaky and on edge as they wonder how the changes in office will affect our businesses. Joe Mont wrote a wonderful article on “Tax Traps of 2012” and, if you have a moment, you should read it in its entirety. Here, we have excerpted and summarized some of his small business concerns:

What happens to health care as a result of the Patient Protection and Affordable Care Act of 2010?

– Among items affected is a credit for small business employers who pay at least 1/3 of the health insurance coverage cost for their employees.

In November, the Treasury Inspector General for Tax Administration issued a report that found that the volume of claims for the credit has been low despite IRS efforts to inform 4.4 million taxpayers who could potentially qualify for it. As of mid-May 2011, slightly more than 228,000 taxpayers had claimed the credit, for a total amount of more than $278 million. The Congressional Budget Office had estimated the credit would cost $37 billion over 10 years and that taxpayers would claim up to $2 billion of credit for tax year 2010.- Joe Mont

What about Medicare?

A 3.8% Medicare tax on investment income is slated to go into effect in 2013. This affects all taxpayers.

What about estate tax?

Small businesses will also be anxiously awaiting news on potential changes to the estate tax, with some advocates arguing that higher rates can be blamed for family-owned businesses forced into dissolution due to tax bills that arise because a deceased owner’s includes business assets. – Joe Mont

No matter what happens, stay educated! Read the news, do your own research on candidates and don’t go by sound bites and campaign ads alone- be an informed, contentious voter. It’s your responsibility as both a citizen and a small business owner in America.

RDS Bookkeeping  has provided expertise in accounting and bookkeeping to small business owners and individuals throughout Chicago for over 8 years. We serve every client with thoughtful, efficient care and strive to go above and beyond so that you can do what you set out to do- get down to business.  We are the proud founders of Pit Crew IL Rescue.  Sambuca is our dog.

*Notice the bottle cap is on. Lady is crazy but not that crazy.

2012 Changes to Social Security and State Minimum Wage Increases

Is he here? IS HE HERE?

Seasons Greetings, peoples! How is everyone doing, this fine December? Are you busy filling your doggies’ stockings and, erm, Hanukkah socks with bacon bits and rubber toys? If you are not, you should be.

An announcement for you today, boys and ladies! We’ve just gotten an **ALERT** from payroll that there are 2012 Social Security and State Minimum Wage Changes afoot. Specifically:

As of 2012, the employee Social Security rate will increase to 6.2% of taxable earnings, with the employer’s rate remaining at 6.2%. There is also an increase to the maximum amount of earnings subject to Social Security tax: it will be $110,100.

With regards to an increase in hourly minimum wages, they only apply to:

Arizona ($7.65 for non-tipped/$4.65 for tipped)

Florida ($7.67 for non-tipped/$4.65 for tipped)

Montana ($7.65 for non-tipped and tipped employees for employers with annual sales exceeding $110,000.)

Ohio ($7.70 for non-tipped/$3.85 for tipped. Applies to employers who gross more than $283,000 per year starting in 2012)

Oregon ($8.80 for non-tipped and tipped employees)

Vermont ($8.46 for non-tipped/$4.10 for tipped)

Washington State ($9.04 for non-tipped and tipped employees)

Updated: Colorado too! ($7.64)

So, to my friends who are minimum wage earners, now you know where to move in 2012. (Cough- Washington- cough.)

RDS Bookkeeping  has provided expertise in accounting and bookkeeping to small business owners and individuals throughout Chicago for over 8 years. We serve every client with thoughtful, efficient care and strive to go above and beyond so that you can do what you set out to do- get down to business.  We are also proud supporters of pit bulls and animal rescue organizations. Sambuca is our dog.

“Ten Tax Moves” & More from Sambuca’s Reading List

Oh, the humanity.

Happy Thanksgiving, peoples!

The turkey has been eaten, the treats have been plentiful and the snoozing has been so good, oh the snoozing we have had! Do not think for a moment that there is any holiday better for a dog than Thanksgiving- after all, after Day Four of turkey leftovers, where do you think it all goes, huh? Into Fido’s bowl. Yes. Thank you, peoples and pilgrim-peoples.

I have been scouring the Internets for good things to tell you and I found so many wonderful articles that I thought I would share them all with you! Introducing Sambuca’s Must-Read List!

10 Tax Moves to Make Before the End of the Year– Nov. 23, 2011 from FOX Business

A nice summary of all the things you can do between now and December 31 to make the most of your tax return.

Top 5 Tax Changes for 2011, 2012- from OnlineTax

Still confused about what were the big tax changes for this year and next year? This super-brief summary tells you about the top tax changes/adjustments in simple, easy-to-understand language.

LLC or SCorp– by Dan Lucas, CPA for Your Smart Money Moves

It’s the very first step when you open a business. Are you absolutely certain you’re getting the best tax breaks by being an LLC? Maybe filing as an S-Corp would benefit your company better. This in-depth article will give you all the answers you need, before you talk to your own accountants.

Cyber Monday: 6 Years of Online Discounts-  from Mashable

A great infographic that shows the progression of Cyber Monday (Which is today!) over the last 6 years.

Best Motivational Books for Small Businesses– by Ivana Taylor for Small Business Trends

Motivation! Check out this great list of books that can motivate your partners, employees and the other small business owners in your life- it’s a tough climb out there and we need all the motivation we can get. Positive thinking + leftover turkey = endless possibilities.

RDS Bookkeeping  has provided expertise in accounting and bookkeeping to small business owners and individuals throughout Chicago for over 8 years. We serve every client with thoughtful, efficient care and strive to go above and beyond so that you can do what you set out to do- get down to business.  We are also proud supporters of pit bulls and animal rescue organizations. Sambuca is our dog.

Taking Advantage of Expiring Business Tax Incentives

What? Sometimes Sambuca cannot relax?

Thanksgiving is almost upon us, peoples! Have you bought your turkeys yet and the bacon that you will use to wrap said-turkeys like a delicious present?

Yes. It is real. And it is spectacular!

Ahem. Before we get to the goodies, let’s discuss some business or some “biz” as the puppies are saying these days. Oh, kids.

With the end of the year approaching faster than you can say Snausage Roll, we turn our attention to one of the tax incentives that may expire at the end of this year, unless extended by Congress. Can your business benefit? Let’s find out. And then, we feast!

Depreciation deductions

Do you have items of property (like machinery, equipment or software) that was used over the last year to generate income for your business? If so, you are entitled to recover some of that cost through annual depreciation deductions.

Ho hum, it’s all good. BUT- there’s also a temporary, additional depreciation deduction that applies to new items- this first year depreciation deduction is equal to 100% “of the adjusted basis of the property” for items purchased between 9/8/2010 and 1/1/2012.

As of December 31st of this year, that percentage drops to 50% and then will expire in 2013. Talk to your tax planner about whether or not it would be prudent to purchase new equipment in 2011 as opposed to next quarter. While you’re at it, ask them about any other expiring tax incentives now so you can take advantage before the end of the year!

Don’t wait for people to come to you- stay educated and be proactive, especially in this economy when every penny back counts. Sambuca is here for you!

RDS Bookkeeping  has provided expertise in accounting and bookkeeping to small business owners and individuals throughout Chicago for over 8 years. We serve every client with thoughtful, efficient care and strive to go above and beyond so that you can do what you set out to do- get down to business.  We are also proud supporters of pit bulls and animal rescue organizations. Sambuca is our dog.

Harley Buttons Talks Tongues and QCDs

It is I, Harley Buttons!

No, not suspicious at all...

Sambuca is out sick today because he bit his tongue- someone may have told him it tasted like bacon… Do not look at Harley Buttons like that! I would never do such a thing! (And even if I did, at least now we know once and for all that tongues definitely do NOT taste like bacon. You’re welcome, SCIENCE.)

Well, it is November. Another year is almost over, Lady is very busy and bustling around with her new rescue and it got me thinking, mostly about something I heard Sambuca muttering about called “Qualified Charitable Distributions.”

From the IRS website, “The qualified charitable distribution provisions were renewed for 2010 and 2011, allowing individuals age 70½ or over to exclude from gross income up to $100,000 that is paid directly from their individual retirement accounts (excluding SEP or SIMPLE IRAs) to a qualified charity. ”

Curious if your donations qualify?

1. The IRA trustee must make the distribution directly to the qualified charity.
2. Any distributions the IRA owner receives can’t qualify.
3. Tax withholdings on behalf of the owner from an IRA distribution can’t qualify either.
4. If the owner received their RMDS and wants to “recontribute those distributions to an IRA to have them redistributed directly to a qualified charity as a QCD,” he can’t unless that distribution is in excess of the 2010 RMD. But only within 60 days.

You can find more info about this at the IRS website!

I love you!

Harley Buttons

RDS Bookkeeping  has provided expertise in accounting and bookkeeping to small business owners and individuals throughout Chicago for over 8 years. We serve every client with thoughtful, efficient care and strive to go above and beyond so that you can do what you set out to do- get down to business.  We are also proud supporters of pit bulls and animal rescue organizations. Sambuca is our dog. (Harley Buttons lives there too and blogs sometimes.)