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Why an Employee Handbook is Necessary

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BookPro, Inc. - Your Bookkeeping Professionals - Why an Employee Handbook is NecessarySusie wanders in half an hour late two or three times a week. James checks his personal e-mail and monitors Internet auction prices at work. They’re both good workers — but they’re giving the other employees the wrong message. If you have problems like these, it might be time to create an employee handbook.

Sound too “corporate”? The truth is, even very small businesses can benefit from having an employee handbook. Having things in writing puts your employees on equal footing, gives you rules to enforce, and helps new hires learn the rules quickly.

Mission statement. Start your handbook by painting the big picture: What is your company all about? What are your goals? A mission statement can help your employees feel more like part of the team.

General policies. This is where you spell out your dress code; your hours of operation, pay periods, and holidays; the company policy on telephone and Internet use; and other general information.

Leave. This section covers your policies on sick leave, vacation time, maternity leave, jury duty, personal and funeral leave, and military duty.

Benefits. Here’s where you provide information about any health, disability, or life insurance, or any other benefits you provide.

Discipline. This part can get tricky. Some courts have considered employee handbooks as legally binding contracts. Check with an employment attorney for help and advice.

For more tips on how to keep business best practices front and center for your company, give us a call today. We can’t wait to hear from you.

Request a free consultation or call us today at 407-281-7375 to start working with an experienced Longwood, FL accounting firm with a reputation for integrity and quality service.

Depreciation: Is It Right for You?

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BookPro, Inc. - Your Bookkeeping Professionals - DepreciationDepreciation is a deduction from income tax that lets you recover the cost of property. Click through to see how the IRS allows for the wear and tear, deterioration or even obsolescence of items.

Depreciation of tangible property — buildings, machinery, vehicles, furniture and equipment, even cell phones — as well as intangible property, such as patents, copyrights and computer software, in some situations, is allowed by the IRS and can be used to offset income from your business. Does your property meet these requirements?

  • You own the property.
  • Or you lease the property and make capital improvements.
  • You use the property in business and for personal purposes. (In this case, you can only deduct depreciation for business use of the property.)
  • The property must have a determinable useful life of more than one year.

However, not everything can be depreciated. For example, land is off the table: It doesn’t get used up and is not subject to wear and tear. Inventory is not depreciated either.

You depreciate an asset over time. When you place property in service to use in your business or trade or to produce income, that’s when depreciation begins. However, property stops being depreciable when you’ve fully recovered the property’s cost or other basis or when you retire it from service — whichever happens first.

There are different schedules for different items: For computers, office equipment, cars, trucks and appliances, the recovery time is up to five years; office furniture and fixtures work on a seven-year schedule. Residential rental properties can be recovered over 27.5 years, while commercial buildings and nonresidential properties can be recovered over 39 years, depending on the year you acquired them.

You need to know the initial cost of the asset and how long you can depreciate it for. There are three depreciation methods summarized below. Particular situations will dictate which ones are most appropriate for you.

  • Straight line — depreciate the property an equal amount each year over its useful life.
  • Accelerated method — take larger depreciation deductions in the first few years of the property’s useful life and smaller deductions later on.
  • Section 179 deduction — deduct the entire cost of the asset the year it’s acquired.

And to ensure that you properly depreciate property, you need to consider:

  • The depreciation method for the property.
  • The class life of the asset.
  • Whether the property is Listed Property (as defined by the IRS)
  • Whether you’ve elected to expense any portion of the asset.
  • Whether you qualify for any bonus first-year depreciation.
  • The depreciable basis of the property.

Use depreciation to decrease your tax burden — you are lowering your overall taxable income. Depreciation doesn’t affect your company’s cash flow or its actual cash balance — it’s a noncash expense. However, before making any decisions, keep in mind that this is just an introduction to a very complex topic, and the provisions and methods described here are not applicable in every situation.

Contact us today at 407-281-7375 and ask for Denise May to discuss your business needs with an experienced Longwood, FL accountant or request your free consultation online now.

Getting Started with Accounts in QuickBooks Online, Part 1

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BookPro, Inc. - Your Bookseeping Professionals - QuickBooksQuickBooks Online was built to work with transactions downloaded from your online financial institutions. Here’s how to work with them.

The ability to import transactions from financial institutions into QuickBooks Online is definitely one of the best things about the site. You may have even signed up for that very reason. By now, you’ve probably already set up at least one connection. But are you using all of the QuickBooks Online’s account tools? There’s a lot you can do once you’ve imported in data from your bank or credit card provider.

We’ll explore these features in this column and the next.

First Steps

If you’re a new subscriber, you may not have established these critical links yet. It’s an easy process. Start by clicking the Banking link in the left vertical navigation pane. In the upper right corner, click Add Account and enter the name of your financial institution if it’s not pictured. Then follow the instructions you’re given on the screen. These can vary depending on the bank or credit card provider, but you’re always at least asked to enter the user name and password that you use to log into each online.

Need help with this? Let us know.

Viewing Your Transactions

Once you’ve made a successful connection, you’ll be returned to the Bank and Credit Cards page. You should see a card-shaped graphic at the top of the screen for each account you’ve linked. Click on one. The table that opens is not your account register. The view here defaults to For Review, which refers to transactions you’ve downloaded. The All tab should also be highlighted; we’ll get to Recognized transactions later.

When you first download transactions into QuickBooks Online, before you’ve done anything with them, many will appear under For Review.

There’s a lot going on here, so don’t be surprised if you’re confused. Review each transaction by clicking on it. QuickBooks Online will have guessed at how it should be categorized, but you can change this by opening the list in the category field and selecting the correct one. It’s critical that you get this right, since it will have an impact on reports and income taxes. If you need to Split it between multiple categories, click on that button found to the right. If the transaction is Billable, check that box and choose a customer from the drop-down list. If you don’t see this box, click the gear icon in the upper right and select Account and Settings | Expenses. Check to see that Make Expenses and Items Billable is turned On (click on Off, then check the appropriate box to turn it on).

Next, determine how you want to process the transaction by clicking on one of the three buttons at the top of the transaction box. Do you want to accept it and Add it to that account’s register? Do you want QuickBooks Online to Find (a) Match for it (like a payment that matches an invoice, for example)? Or, do you want to Transfer it to another account? Once you’ve made one of these three selections, the transactions that you’ve added or matched will move under the In QuickBooks tab (where you can still Undo them) and will be available in the account’s register.

Other Options

You can save time by using QuickBooks Online’s Batch Actions tool.

Say you run a cross some duplicate or personal transactions that you don’t want to appear in the current account’s register. Check the box in front of each, then click the arrow in the Batch Actions box. Select Exclude Selected. They’ll then be available under the Excluded tab. You can also Accept or Modify multiple transactions simultaneously by using this tool.

So far, you’ve been viewing All your transactions. Click on Recognized to the right of it. These are transactions that are already familiar to QuickBooks Online because they’ve appeared before and/or have been matched, or because you’ve created Bank Rules for them (we’ll address that concept next month). You’ll need to address these the same way you did the transactions in the For Review section; you can either Add or Transfer them.

If you’re new to QuickBooks Online, this may all sound pretty complicated. It can be at first. But once you’ve worked with downloaded transactions for a while, you’ll understand the flow much better. If you’re not clear on the process from the start, it can lead to trouble. Contact us at your convenience. We’d be happy to sit down with you and go through it all using your own company’s data; the familiarity may help.

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If you’re new to QuickBooks Online, there’s a lot you need to understand about dealing with downloaded transactions out the gate. Let us help.

When you download transactions into QuickBooks Online, the site sometimes automatically “matches” them to existing entries. We’re here to explain and help you navigate this. Tired of reviewing downloaded transactions one by one in QuickBooks Online? Click on the Batch Actions button to explore this feature. We can show you how.

QuickBooks Online often guesses at how downloaded transactions should be categorized. You should always check these for accuracy, and we can show you how.

Call us at 407-281-7375 or request your free consultation online now and find out how you can leverage QuickBooks to precisely track your finances.

Get Your Business Costs Under Control Today

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cost control imageIncreasing your profits requires selling more and/or spending less. While building up your sales may require an extended effort, business costs are often very ripe for a quick trimming. Here are some possibilities.

Supplies and Other Purchases

Usually, in any business, relatively few items represent a very large share of all outlays. The first step in cutting expenses is, therefore, to identify your highest costs. You may be able to trim many of these costs by making sure you always bid out significant purchases or by more actively seeking less expensive alternatives.

For many companies, inventory carrying costs are a very significant expense. Focusing on matching your inventory quantities more closely to your short-term needs could result in significant savings.

Telecommunications and Other Services

The ongoing services you buy may also offer the potential for cost savings. Revisit your choice of telecommunications vendor and your usage.

Look carefully at your costs for financial services. If you borrow or maintain a line of credit, always compare the rates from more than one financing source before you commit. Make sure you are not paying higher-than-necessary fees for your company’s checking and deposit services.

Cash Management

To control cash outlays, take advantage of discounts for early payment whenever possible. And look to delay payments for as long as you can without giving up discounts.

On the receiving side, deposit all receipts daily. And always actively pursue collection of any invoices that are past due. To help control your working capital needs and, therefore, your credit costs, try to match any new liabilities to your anticipated cash flow.

Fixed Expenses

One other category worth examining is fixed expenses that are long-term commitments. While you usually can’t change these quickly, be aware of when a window for change will open and prepare well in advance by considering lower cost alternatives.

To learn more ways to control your business costs give us a call today. Our trained staff of professionals is always available to answer any questions you may have.

Call us at 407-281-7375 now and request a free consultation to find out how we can work together for your success.

A Quick Guide to What Paper You Need to Keep and What You can Toss

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Young Asian small business owner working at home officeIf you’re like most people, you’ve got lots of paper. Some of it you need to keep, and some of it you don’t. Here’s a look at what to hang on to and the best place to store it.

It’s in the Box

A safe deposit box at your bank or a fireproof box in your home should hold birth ­certificates for you and other family members, marriage and divorce documents, naturalization papers, adoption papers, and death certificates. You may also want to keep property deeds and vehicle titles there as well. And you may want to include stock certificates and bonds that aren’t held by your broker.

Let Your Lawyer Hold It

Your will, power of attorney, health care proxy, trust documents, and other legal papers should be on file with your lawyer. You’ll probably want to keep copies of these documents in your home files and give copies to your personal representative or executor.

On Your Own

Keep records of stock purchases used for determining cost basis, income-tax returns and supporting documents, insurance policies, warranties, and receipts for home improvements in your home filing cabinet where they’re easy to access if you need them.

What To Toss

Credit card statements, receipts, and similar items can be tossed quarterly if you won’t need them for tax purposes. Consider shredding these and other sensitive records before putting them in the trash.

Whether you need individual or business tax advice, give us a call. We’ve got the answers you’re looking for, so don’t wait.

Get back to the job of running your business and leave the accounting to us! Call us at 407-281-7375 now and request a free consultation to find out how we can work together for your success.

Home Equity Loan Interest is Still in Play

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house on a pile of moneyMost of us will agree that our biggest investment is in our home. So, it shouldn’t surprise you that your house or condo is your first port-of-call whenever there’s a need to borrow money. And the easiest way to draw funds against the security of real estate is by arranging a Home Equity Loan.

Home Equity funding helps us in important ways:

  • Number one, the interest rates payable on this type of loan are arguably the lowest available.
  • Secondly, you can get the cash working for you quickly with the least bother, paperwork and tedious protocol.
  • Then there’s the third big reason: help from Uncle Sam.

Up to now all interest payments on a Home Equity Loan were tax-deductible. It made borrowing almost a no-brainer! Who wouldn’t opt for already-low interest rates to be pulled even lower? Benefits like this are rare in our modern world where it seems like everything, including financing fees, are only going up.

Well, it’s time for a retake on the “Uncle Sam thing”: the new taxation laws as per the Tax Cuts and Jobs Act of 2017, enacted in December of the same year, have removed some delectable treats from the traditional “Home Equity feast”.

Is it likely to change your borrowing behavior anytime soon? No, but it should give you pause. There’s a certain logic to it that really can’t be argued with. Here are the new Home Equity items to keep in mind:

  • The amount you can borrow is tied to the value of the residence, be it a primary or secondary home. The I.R.S. has decided that your total loan value cannot be more than the assessed value of the asset as a start.
  • And in combination with all other mortgages cannot exceed $750,000. So Home Equity lending is not the bottomless well some may believe it to be.
  • Tax breaks haven’t disappeared but at the same time, they simply are not what they used to be. Any Home Equity draws you make from now on have to be used to build, renovate or essentially improve your residence to qualify the interest payable on them for a tax deduction.

So on this last point, for example: if you use your new funds to pay off student loans, reduce your credit card debt or splurge it on a vacation, nobody is going to stop you. What they are going to stop is anyone claiming tax relief for this type of expenditure for the foreseeable future.

TD Bank in a survey points out that 32% of Home Equity Lending fits the new definition for deductibility. Looking at it from the other side, 68% of the tax deductions we took for granted for so long now fall away. That said, we all know that there’s no substitute for smart thinking to make the most of new terms and conditions.

So don’t hesitate to consult with our professional tax team when it comes to making your Home Equity decisions, or to clarify your thinking on any tax matter. We often see benefits buried under the “strict letter of the law” – we could make a difference.

Our accounting firm can show you how to tap in to the potential of your real estate business! Call us now at 407-281-7375 to find out how we can design a package of accounting services around your needs or request your free consultation online.