taxes

Is it time for a financial check-up?

Most of us take the time to schedule our regular or annual doctor check-ups or take our vehicles for regular service appointments.  But, what about your finances?  Summer is the perfect time to review what has happened year to date for your personal or business taxes, evaluate changes coming up, determine if your withholdings or quarterly estimates are enough (or too much), and have the time to address these items before the close of the year.  Hand in hand with taxes are the other financial areas to look at:

  • Are you saving for retirement?  Are you making the best choices for your tax situation?  
  • Do you have an existing 529 plan for your child?  If so, are you paying attention to the returns you are earning?  Do you need to reallocate within your account based on poor financial performance?
  • Are you and your family protected with life insurance?  If so, what type do you currently own?  Just in the past few years, there are some great products that have been developed that will protect you and your family by providing death as well as living benefits, such as long-term care.
  • Do you have goals/dreams you want to achieve?  Retire early?  Travel? Be debt free?

Now is the perfect time to schedule your free financial check-up with us!  We look forward to serving you and the needs of your family and businesses.

Happy summer!

 

Xero and Xerocon 2016

How many of you get excited when the topic of accounting is mentioned? (Crickets…) I know I do, but I will admit to being an accounting nerd. The last few years, I have been using a cloud-based solution called Xero.  It has transformed how I have managed my own business, which is why I get excited to share it with others.  I have been assisting clients make the move to Xero from other platforms or getting them set up with an accounting system for the first time for their new or existing businesses.

 

Xerocon 2016 - San Francisco, CA

Xerocon 2016 - San Francisco, CA

This past week was Xerocon in San Francisco.  This is an annual gathering of accounting professionals who come together to learn about the direction of the company (Xero), the way technology is being harnessed to provide efficiencies, and share ideas with each other, excited to bring home our learnings to our firms and our clients.  (It was also 40 degrees cooler in San Francisco than back home in Phoenix, so that was another plus!). What I love about Xero is their passion for supporting the business owner.  By harnessing the power of the Internet and mobile technology, we business owners can manage our businesses while also living our lives.  Xero being in the cloud gives you access on whatever device you have available at the moment...computer, tablet, mobile phone.  As a parent of four, I am frequently waiting for someone.  In a matter of minutes, I can log in and reconcile bank transactions or check on outstanding invoices from my clients.  I can even invoice from my mobile device without having to wait to return to my office.  Do you track a lot of expenses on the go?  Xero’s mobile app allows you to snap a photo of the receipt and upload to your accounting system without even being at your computer.  The beauty of Xero is having real-time access to your accounting.  

Our passion is for helping business owners improve their efficiencies.  By improving your accounting efficiencies, you can better plan for tax preparation as well, whether you prepare them yourselves or have them prepared for you.  Over the coming weeks, we will share with you more of what we learned at Xerocon.   Topics to include: structuring an effective cloud platform, managing payroll through Xero, Energy vampires, the power of collaboration, and so much more.

Interested in getting your accounting (business or personal) in order?  Now through August 31, I am offering free account setup into Xero (2016 transactions only) and your first 3 months free.  Imagine getting to January 1 and being ready to turn your information over to your CPA.  No last minute panic and scramble to provide business or personal information.  Don’t miss out on this opportunity!

We look forward to hearing from you.  Comment below if you have questions.

Michele Simphoukham, CPA

 

 

Have you issued your 1099s for 2015?

After a great discussion in one of my networking groups this morning, I realized that not all small businesses are aware of when they should be issuing 1099-MISC forms to individuals or to other businesses that they have paid throughout the year.  This only applies to payments made in the course of business, not to personal expenses.  The deadline to file these 1099s to your payees is February 1 this year, with the IRS copy due by February 29th, 2016.  There is still time to get these forms prepared, so please reach out to us should you need help with this reporting requirement!

Here are the general rules:

As a business owner, any individuals or LLCs that you pay more than $600 in a calendar year for services should receive a 1099-MISC form from your business. Example: independent contractors such as accountants, your landlord, attorney, office assistants.   As a general rule, you do not need to issue a 1099-MISC to corporations at this time; however, the exemption from reporting payments made to corporations does not apply to payments for legal services. Therefore, you must report attorneys' fees (in box 7) or gross proceeds (in box 14) as described earlier to corporations that provide legal services.  There are other 1099 types, such as for interest payments, forgiveness of debt, etc.  (1099-INT, 1099-C)

It is important to be in compliance with your 1099s, as the penalties for not filing them can be steep, especially for the small business owner.  From IRS:  "If you fail to file a correct information return by the due date and you cannot show reasonable cause, you may be subject to a penalty. The penalty applies if you fail to file timely, you fail to include all information required to be shown on a return, or you include incorrect information on a return. The penalty also applies if you file on paper when you were required to file electronically, you report an incorrect TIN or fail to report a TIN, or you fail to file paper forms that are machine readable. The amount of the penalty is based on when you file the correct information return. The penalty is: $30 per information return if you correctly file within 30 days (by March 30 if the due date is February 28); maximum penalty $250,000 per year ($75,000 for small businesses, defined below)."

To make the reporting process easier, request a W-9 before you issue payments.  That way, you will have your payee name, address, and tax id number easily available come year end when it is time for 1099 reporting.  Using software such as Xero or Quickbooks helps to make determining vendor payment totals for the year easier too!

Help is only a phone call or email away!  Contact Michele Simphoukham at 602-451-7016 or michele@mahkengine.com.

 

Top Ten Reasons to Use Xero

Happy New Year 2016!  January is here and it is a busy month for sure! It is time to organize 2015 information for taxes and also to start fresh for 2016.  Are you satisfied with how your 2015 business or personal financial records were organized?  If not, what are you struggling with?  For 2016, why not consider a fresh approach for your business or personal accounting.

Here are ten reasons why Xero may be a great solution for you

  1. Xero is based in the cloud, so you can access your information from any device with connection to the internet.

  2. Xero offers real-time collaboration with other team members or with your accountant or bookkeeper.  No longer do you need to exchange files and wait for the other person to finish their entries before you can continue working.

  3. The Xero dashboard provides real-time information on account balances as well as other information that is important for your business.

  4. Updates and upgrades are done automatically without you having to purchase new software.

  5. Xero reduces manual data entry by allowing you to create transaction rules which will automatically categorize your transactions.

  6. Xero uses bank-level security to protect your financial information.

  7. Xero integrates with hundreds of other business applications to increase your efficiency.

  8. With Xero, you have the ability to create beautiful client invoices from your computer, smartphone, or tablet.

  9. Xero can also be customized to manage your personal finances.  Often times, our personal finances can be more complicated than our business finances.

  10. Xero is a great tool for managing your rental properties.  By managing income and expenses throughout the year, year-end reporting for taxes is easier.

Contact us if you would like to try a free 30 day trial to see how Xero can help you!

Michele Simphoukham

End of the Year and Things to Think About...Besides Turkey

Best wishes from MAHKENGINE to you for a wonderful holiday season ahead!  Hard to believe that 2015 is coming to a close.

Between now and the end of the year, it is important to take a little time (in between the various work, social, and family gatherings) to evaluate your accounting and tax situation.  Yes, I hear the voices in your head that are saying I don't want to worry about that now.  However, by evaluating a few areas, you may be able to take advantage of some year end deductions and strategies to help reduce your 2015 tax liability.

Charitable giving: Make sure to mail your year end gifts or pay online before 12/31 to your favorite charity or your church.  Included in here are also the tax credit payments to public or private schools (Arizona taxpayers).  These payments will be an itemized deduction on your Federal return and a credit for your state return.


Contributions to retirement:  if you are self-employed, you can make a SEP contribution for 2015 by the due date of your returns (April 15 or October 15 if extended).  Start thinking now, so there is time to set aside available funds.  Your allowable contributions will reduce taxable income.
 

Capital gains/losses:  If you have sold some stocks, mutual funds, or other assets during the year at a gain, now might be the time to see if you have any losses to recognize before year end to help offset any gains.

Businesses owners:  Evaluate if there are expenses, equipment or other asset needs for your business.  Before year end is a good time to make these purchases to be able deduct them for 2015.

Ready for a new accounting system?  If you have been wanting to improve your accounting system, now is the time to get this set up so you are ready to go come January 1 with a new system.  Or, maybe your 2015 accounting records need some help to be tax ready for you or your tax preparer to be able to prepare for taxes.  Contact us and we can help you with a data conversion to Xero, get you organized for taxes, and start 2016 with an efficient system.