Archive for the ‘Business Advice’ Category

Ready, Set, Download: IRS2Go Mobile App 2014

Monday, October 20th, 2014

In June, the Internal Revenue Service (IRS) made the 2014 version of IRS2Go available to mobile users. This free app can help you stay on top of your federal income tax refund. You can also request your tax return or account transcript or receive tips and updates from the IRS via the app.

Benefits of IRS2GO App

Compatible with Apple and Android devices, the IRS2Go mobile app has been redesigned and includes several new and updated features, such as:

  • IRS2Go makes it easier for individuals to check their refunds at a time that’s convenient for them. To get there, just click on “Refund Status,” enter your Social Security Number (which is masked for security purposes), then select your filing status and the amount of your anticipated refund. The new “status tracker” allows users to identify where their return is in the tax return process. NOTE: Returns filed electronically can be viewed 24 hours after the return was received by the IRS. Paper returns take longer to process and can take up to four weeks before their status is available to view.
  • Another helpful feature is your ability to request your tax records or your account transcript. While, for security reasons, the records cannot be viewed immediately on your Smartphone or device, the request will be processed and your records will be delivered promptly to the address on record.
  • If you need help preparing your tax return, IRS2Go helps users find IRS Volunteer Income Tax Assistance (VITA) or Tax Counseling for the Elderly (TCE) programs by simply entering a ZIP code and mileage range.
  • Users also have the opportunity to stay connected, view more content and interact directly with IRS on Twitter, YouTube, Facebook or by signing up for email updates.

To download the IRS2Go app on your Apple iPhone, iPad or iPod Touch device, visit the iTunes app store. To download IRS2Go on your Android devise, visit the Google Play store.
By Kelly Leslie, CPA (Cambridge office)

 

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‘Ghost Assets’ Haunting Your Business?

Tuesday, October 7th, 2014

The IRS recently issued taxpayer-friendly guidance regarding the disposition of a component of real or personal property.

Under the Internal Revenue Code, taxpayers are required to capitalize certain amounts paid to acquire, produce or improve real or tangible personal property during the year and that is used for a trade, business or for the production of income. However, prior to the issuance of new regulations in 2013 taxpayers were unable to write-off the remaining cost of a component of a larger asset or building that was repaired or replaced (e.g. a roof). In fact, under the old rules, it was not uncommon for business owners to be required to depreciate “ghost assets” – assets that were removed or replaced by the taxpayer and are no longer in service.

The good news is that the IRS has changed its mind on these, so-called, “partial dispositions.”

So, What’s Changing?

Beginning Jan. 1, 2014, taxpayers were able to deduct the remaining cost of such components in the year they were replaced/repaired by making an election on their tax return.

Additionally, the IRS allowed taxpayers to apply the regulations to dispositions that had already happened in prior years as long as the ghost assets were still being depreciated.

What was unclear until recently was how a taxpayer could effectively make the election on a retroactive basis given that businesses were required to file their 2013 year tax returns before the IRS had issued definitive guidance.

The IRS’ Response

The IRS officially announced a specific revenue procedure that provides a limited opportunity for taxpayers to write-off assets that were disposed of during a prior year. The guidance outlines the procedures necessary for taxpayers to secure the write-off, as well as what documents they should include when filing their request. If you do plan to write off a ghost asset from a previous year, you must make plans do so now as this retroactive election opportunity is time sensitive. Taxpayers who miss this opportunity will be required to continue depreciating these ghost assets. For some, this means that you could be depreciating ghost assets for another 15-20 years.

Are you a business owner who is still paying the IRS for assets that you no longer have or that have been replaced? Do you want to learn more about the IRS’s new rules on ghost assets and how they can impact your business? Email Rea & Associates to find out if you can write off ghost assets that continue to haunt your business.

Author: Chris Axene, CPA (Dublin office)

 

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To Shred Or Not To Shred: That Is The Question … Ask Your Financial Advisor

Monday, October 6th, 2014

Are you wondering what to do with all those tax documents and records you have piling up around your office or in your computer files? Are you thinking about wiping them from your company’s hard drive or sending them to the shredder? Not so fast. The IRS has several rules when it comes to how long your business should keep its records. Make sure you are up to date on the current records retention schedule before you permanently delete something important.

Generally speaking, records that support your income or deduction claims for tax return purposes should be kept until the period of limitations for a particular tax return expires. The “period of limitations” is defined as the period of time the IRS gives you to change information on your return, particularly when the information relates to a refund or credit you have claimed. Also, just because you aren’t planning to make any changes to your tax return doesn’t mean the IRS won’t. Therefore it’s in your best interest to keep your documents until the IRS can no longer assess additional taxes or request additional information from you.

Below is a quick reference guide pertaining to some common records your office has been collecting over the years and how long you should keep them.

Records You Should Keep Permanently:

  • Copyright registration
  • Correspondence (legal and important matters)
  • Deeds, mortgages, bills of sale
  • Depreciation schedules
  • Financial statements (end-of-year)
  • General and private ledgers (and end-of-year trial balances)
  • Insurance records, current accident reports, claims, policies, etc.
  • Minute books for director and stockholder (including bylaws and charter)
  • Property appraisals by outside appraisers
  • Retirement and pension records
  • Tax returns and worksheets, revenue agent’s reports and other documents relating to determination of income tax, sales tax, or payroll tax liability

Records That Should Be Retained For At Least Seven Years:

  • Accident reports and claims (settled cases)
  • Accounts payable/receivable ledgers and schedules
  • Expense analyses and expense distribution schedules
  • Garnishments
  • Inventories of products, materials and supplies
  • Plant cost ledgers
  • Telephone logs/message books
  • Time books/cards
  • Withholding tax statements
  • Employee payroll records (W-2, W-4, annual earnings, etc.)

Records That Can Be Destroyed After Three Years:

  • Bank deposit slips
  • Employment records
  • General correspondence
  • Internal work orders
  • Production and sales reports
  • Sales commission reports

If the records you are looking for aren’t listed above, you can find additional record retention recommendations in our current record retention schedule.

IMPORTANT: The actual amount of time you are required to keep a specific document may be longer depending on your business or what is contained in the document. If you have questions about specific documents or would like some advice on your current record retention practices, email Rea & Associates.

Author: Joe Popp, JD, LLM (Dublin office)

 

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From Good To Great: 5 Ways You Can Improve Your Manufacturing Business

Friday, October 3rd, 2014

Today, millions of hard-working men and women will celebrate Manufacturing Day across our nation. United in their mission to address common misperceptions about the industry, manufacturers will rally together to take charge of the industry’s public image, address the industry’s skilled labor shortage and promote the ongoing prosperity of manufacturing throughout the U.S.

Manufacturing has always been the backbone of Ohio – and Rea has been proud to support many companies throughout the state. In recognition of Manufacturing Day, here are five ways you, as a manufacturer, can overcome challenges facing your industry.

Be The Leader You Want to Be. 

As a seasoned manufacturer, you know your business inside and out – when there is a problem, you provide a solution; when a ball drops, you pick it up. If this sounds like you, then it’s time to get out of your comfort zone. If you always find yourself in the middle of daily business operations, you’re unlikely to get out in front of opportunities that could maximize your company’s long-term value. Be the leader your company needs. Stop putting out fires. Instead, make waves.

Tell Your Story, Invest In People. 

The manufacturing industry has had its share of problems when it comes to attracting and retaining a talented workforce, but you can alter how people think about a career in manufacturing by simply sharing your own stories and experiences. Unless you take the time to personally promote the manufacturing industry, your would-be employees may incorrectly associate the industry with unprofessional, dead-end jobs in dirty factories. Get out and connect with local vocational schools and other educational entities and community groups to tell your story.

Embrace A Strategy; Minimize Risk. 

Every company should have a strategic plan. From financial objectives to operational goals, your strategic plan should provide your workforce with an overview of the company’s operational and growth initiatives. Formal plans should also address the company’s budget and financial forecast. Proper utilization of these plans will help you reap optimal results by providing you with the information needed to make better decisions. Below are initiatives you can include in your strategy to gain greater insight into the industry and to learn how you can better manage your current financial and operational objectives.

  • Benchmarking is a proactive way to stay in line with, or ahead of, the competition. It’s important for you to understand how your company stacks up against the competition, as well as gain insight into current trends, future opportunities and potential risks.
  • Key performance indicators (KPIs) are critical to the management of your daily operations. In order for you to deliver results, you and your management team must understand the resources you are working with and how you are affected. Key indicators also provide management with insight into production and can alert leaders to potential areas of risk.
  • Get to know your ERP system. Many companies have implemented some type of enterprise resource planning (ERP) system in the hopes of streamlining their accounting, production, benchmarking and KPI efforts. Unfortunately, many are unable to actually use the system in the way they would like. You must take control of your ERP system and insist the vendor meet with your team to set up the ERP system in a way that makes sense to your company. An ERP system that is set up properly will provide your company with the data you need to manage your business more effectively.
  • Understand your cost structure. For example, understanding what it costs to make, distribute and/or sell each unit of each product line, will give you a better grasp of how much you’re spending on material, labor and overhead, which will better equip you to allocate your efforts and resources. Unfortunately, many managers don’t understand the company’s cost structure, which puts the company at risk of losing money in the long run.

Back-Up For Safety. 

Many companies in the manufacturing industry have taken steps to embrace technology and have added hardware and software to help collect data and streamline workflow; however, with the introduction of new programs and equipment comes the introduction of additional risks. Some companies have chosen to back-up their information as a way to avoid losing important data, but if the back-up isn’t tested, there is no guarantee that it will actually work. Unfortunately, some companies lose critical data simply because they fail to test the back-up.

Consider Going Lean. 

The manufacturing industry underwent a significant transformation in the 90s with the wide-spread practice of Lean Six Sigma, which helps companies become more efficient and effective by introducing better processes throughout the organization. Many companies, however, have yet to incorporate Lean Six Sigma into their operations. Much has changed over the course of two decades and new uses for Lean Six Sigma have been discovered and applied to additional departments outside of just the manufacturing floor, the service and transactional functions of businesses have really benefited. You should consider Lean Six Sigma as a way to become more efficient and effective in every aspect of their business. Especially while the industry struggles to attract new talent, Lean Six Sigma may be just your company needs when you need to do more with less.

These are just a few examples of challenges facing the manufacturing industry where a trusted advisor can help you navigate through possible solutions. If you own a company in the manufacturing industry or if you want to explore ways to improve your business’s efficiency, effectiveness, profitability and risk management systems, email Rea & Associates. Our team is passionate about helping manufacturers reach new heights, mitigate risks and attract and retain employees.

Author: Kyle Stemple, CPA, Director of Manufacturing Services (New Philadelphia office)

 

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Ohio Prepares For Year Three Of Its Workforce Training Voucher Program

Tuesday, September 23rd, 2014

The State of Ohio announced that it will launch its third round of the Incumbent Workforce Training Voucher Program. As in previous years, the state has upped the ante.

This time around businesses will have a chance to claim a piece of $29.4 million, which will allow Ohio’s employers to enhance the skills of their workforce. That’s the good news. The bad news however, is that you have to be quick if your business has a desire to claim any portion of these funds. We expect all of the training dollars to be claimed within hours of the application going live at 10 a.m. on Sept. 30.

According to the state, the funds are to be made available on a first-come, first-served basis. Employers can apply for a credit that will reimburse them up to 50 percent of eligible training costs – which could mean the business could be reimbursed up to $4,000 per employee. Training performed between Aug. 1, 2014, and Dec. 31, 2015, qualifies for the third round of the Incumbent Workforce Training Voucher Program – meaning that employers have the option to apply vouchers to training that has already taken place.

Similar to round two of the program, a pre-application process is available. The period to complete this process began Sept. 15, and will continue until the application officially goes live on Sept. 30. Pre-application allows employers to enter as much information and specific details as possible. Then, the minute the application goes live; all you need to do is log on to your account and submit it. Because we expect all funds to be accounted for within the first few hours of the application going live, we urge businesses to take time to complete the pre-application process as soon as possible.

What Is Considered Eligible Training?

  • Classes at an accredited education institution
  • Training that leads to an industry recognized certificate
  • Training provided in conjunction with the purchase of a new piece of equipment
  • Upgrading computer skills (e.g. Excel, Access)
  • Training for the ICD-10-CM/PCS diagnostics classification system
  • Training from national, regional or state trade associations that offers certified training
  • Training for improved process efficiency (e.g. ISO-9000, Six Sigma, or Lean Manufacturing)
  • HR Certification – limited to HR staff only

What Companies Can Apply?

For-profit entities located in Ohio and that operate in one of the following industries are eligible to apply for the Incumbent Workforce Training Voucher Program.

  • Advanced Manufacturing
  • Aerospace and Aviation
  • Automotive
  • Bio Health
  • Energy
  • Financial Services
  • Food Processing
  • Information Technology and Services
  • Polymers and Chemical
  • Research and Development
  • Companies with a Corporate Headquarters in Ohio (with limited availability of funds)

The Importance Of Pre-Application:

If your business wants to have a chance at claiming any of these dollars, it is imperative that you complete the pre-application. Your objective should be to simply log on to the page on Sept. 30 to formally submit your application. It is so important to carefully and completely fill out the pre-application form with as many specific details about the proposed training as possible. If you will apply, or think you may qualify and would like to apply, do your homework now.

If you would like help determining if your business is eligible for the program or if you want more information, email Rea & Associates.

Author: Josh Carlisle (New Philadelphia office)

 

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