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Thanks to the Family and Medical Leave Act, companies that employ 50 or more people are required to offer up to 12 weeks of unpaid leave per year to all eligible employees.
Outsourced chief financial officer firms provide you with an external expert to guide your company's financial strategy, operations and planning on a part-time, contract or project basis. Leveraging this kind of external managed service can improve your company's ability to adapt quickly and scale efficiently.
Let's say you decide to onboard a freelancer, also known as an independent contractor. What should your next tax- and finance-related moves be? Let's find out!
Have you found yourself becoming more and more fascinated by all this talk of AI these days? Does the opportunity to drive more strategic growth and gain a competitive edge excite you?
Many employees dash off emails with little attention paid to them. As a manager, you can help focus and train your team on some techniques for effective messaging.
Your business has employees' and may have customers' personal information (names, Social Security numbers, credit card information) stored both physically and electronically. You use this data to meet payroll, fill orders and perform necessary business functions.
Employee classifications are based on job duties and responsibilities. The classifications impact compensation, benefits and work hours; they are also used by employers to maintain compliance with labor laws.
Have you been thinking about establishing an S corporation? Maybe you have the opportunity to become a shareholder of a corporation of this type. Here's what you should know about S corporations and how they work before getting involved in one:
What is an S corporation? An S corporation essentially passes its income, losses, deductions and credits to its shareholders for the sake of federal tax purposes. From there, shareholders of S corporations report this information as part of their personal tax returns. The shareholders are assessed by the IRS at their individual income tax rates, which makes it possible for S corporations to avoid facing double taxation on corporate income come tax season. How are shareholders taxed? People within an S corporation who are responsible for performing a service for said S corporation will be paid a wage as an employee, even though these people are also considered shareholders. Also known as corporate officers, those who perform more than minor services to an S corporation and receive — or are entitled to receive — compensation will have to pay federal employment taxes. This is true even in instances when shareholders take distributions, accept dividends or receive other forms of compensation. What happens if shareholders do not report wages from an S corporation? Distributions from an S corporation evade the 15% or higher employment tax bracket. This puts small-business owners in a position where they could potentially experience considerable savings. Now, if shareholders fail to declare wages obtained through an S corporation, the IRS will become interested in whether those payments were genuinely paid in exchange for services rendered. The IRS might impose higher taxes if it finds instances of low salaries coupled with high distributions to be suspicious. What are the key provisions of an S corporation? It's important to note that shareholders are not personally responsible for any liabilities or debts associated with the business endeavors of an S corporation. As a result, creditors are not entitled to make any claims on the personal assets of shareholders when settling debt belonging to the S corporation. To qualify as an S corporation, the business is required to be registered as a domestic corporation. S corporations are allowed to consider individuals, trusts and estates as shareholders, but corporations, partnerships and individuals who aren't U.S. residents are not permitted to hold shareholder status. The total number of shareholders for an S corporation cannot exceed 100. Furthermore, each S corporation is eligible for one class of outstanding stock, and the S corporation must be eligible. In other words, there are certain sales corporations, financial institutions and insurance companies that cannot be classified as an S corporation. What documents are involved when opening an S corporation? To officially become an S corporation, you'll need to fill out and then submit Form 2553, Election by a Small Business Corporation. This document must be signed by all shareholders of your S corporation. You'll also need to file Form 1120-S, U.S. Income Tax Return for an S Corporation. All the profits, losses and deductions for each shareholder will be documented via Form 1065, U.S. Return of Partnership Income, which is known as Schedule K-1. Last but not least, S corporation shareholders can expect to file Form 1040, U.S. Individual Income Tax Return, as well as Form 1040 (Schedule E), Supplemental Income and Loss. Are there important advantages of having an S corporation? There are undeniable benefits of establishing an S corporation, hence its appeal. For instance, when you adopt the S corporation structure for your business, you'll end up subsequently lowering the amount of self-employment tax relevant to your company. Additionally, S corporations are viewed as highly credible in the eyes of vendors, partners and customers. Should you be concerned about the disadvantages of having an S corporation? There are possible disadvantages you should be aware of when looking at forming an S corporation. For starters, there are many protocols that you must follow when establishing this type of corporation. As an example, directors and shareholders have to attend scheduled meetings that must last for a certain number of minutes. There also are formalized bylaws that S corporations are required to uphold, not to mention the maintenance of proper records and various corporation-specific recordkeeping requirements. What happens if you want to transfer ownership of your S corporation? On the bright side, it is rather easy to transfer interest within an S corporation, especially compared to the same task with other types of business entities. You can structure the sale in one of two ways: You can set up an outright sale, where the buyer will make the purchase and ownership is transferred immediately; and alternatively, you can opt for a gradual sale, where the purchase takes place over time. Either way, the transfer of ownership regarding the S corporation needs to be facilitated via an official written sales agreement in order to formalize the process. Before establishing your business as an S corporation, keep in mind that your company will likely require paying more attention to the accounting and bookkeeping side of things than ever before. It's best to onboard the help of qualified accountants who can assist you. Don't be afraid to contact professionals who can provide you with banking and legal advice when it comes to business loans, taxation laws and other related issues. Harik Thompson CPAs and Advisors is committed to providing exceptional service and delivering tailored solutions to meet our clients’ financial needs. Your satisfaction is our top priority, and we constantly strive to exceed your expectations. As part of our ongoing efforts to better serve our valued clients, we need your help. Your feedback is invaluable and will assist us in refining our services. It will also help potential clients make informed decisions about their accounting, tax, and advisory service provider. Please take a moment to share your feedback by leaving us a Google Review. Thank you very much! Form I-9 asks your employees to present documents to attest to their identity and employment authorization. It's your job to make sure the documents seem genuine and relate to the employee.
There's no limit on the number of hours employees age 16 and older may work in any workweek. The FLSA doesn't require overtime pay for work on Saturdays, Sundays, holidays or regular days of rest, unless overtime is worked on such days.
Advantage Plans are offered by private companies, such as UnitedHealthcare and Humana, approved by Medicare. They are all-in-one programs that may appear to provide advantages over original Medicare, such as reduced or nonexistent premiums. But it is a balancing act, as they may require higher copays and out-of-pocket costs and may have a more limited number of providers.
Time sheets come in an array of formats. From handwritten papers and punch cards to typed spreadsheets and automated time clock systems, you have options. All that matters is that you find a time sheet style that is clear and concise for your company. This will greatly improve your company's ability to manage both in-person and remote teams by ensuring that everyone remains consistent while following the same practices no matter their role in the business.
According to Public Law Number 117-154 (06/23/2022), the U.S. Tax Code is 6,871 pages. When you add the federal tax regulations and official tax guidance, the number of pages increases to approximately 75,000. Some very helpful tax breaks can get lost in the shuffle!
Lenders and banks check your credit before they approve you for new credit cards or loans. They do this to be sure that in the past you've paid your debts on time. If you have, you are more likely to pay your new loan or credit card payments on time.
Managing payroll is often regarded as an overwhelming and daunting task. From tracking the unique tax codes for each of your employees and the seemingly countless deduction options to determining whether each employee is an hourly or salaried worker, there are many details to be mindful of, all while avoiding making payroll-related errors.
A company newsletter can link all employees, providing a mix of useful and engaging information to captivate readers' attention. Time and money are well invested. According to the Content Marketing Institute, every dollar spent generates an average return on investment of $38.
A recent McKinsey survey showed what many business leaders felt intuitively: The old normal is gone forever. It will not come back even after the COVID-19 pandemic is over. Here are some statistics that show why.
Enacted at the end of 2020, the Consolidated Appropriations Act, 2021, allocates $325 billion to small businesses, nonprofits and venues hit hard by the COVID-19 pandemic. Of that amount, approximately $284 billion goes toward the Paycheck Protection Program. The previous round of PPP funding ended earlier in 2020.
An employer-sponsored retirement plan can be a great way for employers to show workers they care about employees' long-term financial prospects while giving workers a way to save on their taxes.
The pandemic relief package (Consolidated Appropriations Act, 2021) gives a break to small businesses by reopening the Paycheck Protection Program so that some of the hardest-hit small businesses can apply for a second loan.
Over the past 10 years or so, companies have spent trillions of dollars on research and development (R&D). To remain competitive after the Covid-19 pandemic ends, companies must continue making these investments. But they need to rethink how they do that.
The much discussed aid package has been signed into law after significant delay and controversy. We'll be revisiting this topic in the coming days as the details become clearer. Meanwhile, here are the key takeaways:
According to a recent release from the Small Business Administration, borrowers can apply for forgiveness of their PPP loan using new SBA Form 3508S if the total PPP loan amount they received from their lender was $50,000 or less. "SBA Form 3508S requires fewer calculations and less documentation for eligible borrowers. Borrowers that use SBA Form 3508S are exempt from reductions in loan forgiveness amounts based on reductions in full-time equivalent (FTE) employees or in salaries or wages," says the form instruction.
The Social Security Administration typically updates key numbers for the upcoming year in the fall. One of the key numbers for retirees is the cost-of-living change: A 1.3% increase will begin with benefits payable to more than 64 million Social Security beneficiaries in January 2021. Increased payments to more than 8 million SSI beneficiaries will begin on Dec. 31, 2020. The Social Security Act ties the annual COLA to the increase in the Consumer Price Index as determined by the Department of Labor's Bureau of Labor Statistics.
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