November 19, 2018 § Leave a comment
In observance of the holiday, our offices will be closed on Thursday, November 22nd and Friday, November 23rd. We will resume our normal business hours on Monday, November 26th. We hope you enjoy time with your family and friends!
November 9, 2018 § Leave a comment
It’s nice to be back to normal again – I can watch television without wondering who is going to raise my taxes, cut Social Security benefits or do any number of things to hamper my way of life. Yes, the mid-year elections are over and we should have a couple months before the 2020 Presidential candidates start showing up in Iowa. Enjoy the downtime, it won’t last long!
I thought I’d share some thoughts on the election results and where things may go from here.
Locally, Governor Reynolds defeated Fred Hubbell in the Governor’s race and the Republican party maintained its control of the Iowa legislature, giving up some seats in the house and increasing their majority in the Senate. In May of 2018 – the Iowa legislature passed a fairly significant tax bill that will impact tax filings for the next few years. The politicians will tell you that Iowa’s tax bill is the greatest thing since sliced bread. From my CPA viewpoint, the legislation is a bit of a mess, with multiple provisions treated differently at the State level than at the Federal level, causing confusion for small-business owners and taxpayers and headaches for tax preparers. While I’d like to hope that they will revisit the legislation in the next session, I don’t think that will happen. Beyond that, I’m not sure on the other issues they may take up in 2019.
A couple of other items that I found interesting with Iowa’s election results. For the first time in more than 40 years, Iowa will have a non-CPA leading the State Auditor’s office. Essentially, the State Auditor’s office is a CPA firm, conducting audits of municipalities across the state, so it will be interesting having someone without auditing experience in charge of that office.
Another interesting take away from the election was Governor Reynolds defeating Fred Hubbell at the same time as the Democratic party nearly sweeping the Iowa Congressional House elections. Governor Reynolds won by a vote of 663,000 to 623,000 while the Republican congressional candidates were defeated by a total vote of 608,000 to 657,000. It is encouraging to see that to some extent, people were voting more for an individual and less for a particular party.
Gridlock – I think that is what we will see on the federal level for at least the next couple of years with the Democrats seizing control of the House and the Republicans maintaining control of the Senate and Trump at the controls in the White House. The Tax Reform package that was passed in December of 2017 should be safe until the 2020 election cycle comes around and it would be difficult to see any significant legislative actions with a split Congress. It will likely be a quiet next couple of years, which may not be a bad thing.
My final thought is in regard to the campaigns themselves. I wish both parties would stick to the issues, rather than continue to rely on finger pointing, fear mongering and negativity to earn a vote. Wishful thinking – I know! But I am hopeful.
Brian Newton, CPA, Partner
November 5, 2018 § Leave a comment
Client Accounting Services (CAS) is a unique service department that offers ways to simplify your business’ accounting process. Check out this video by CAS Manager, Jonathan Porter, as he explains what CAS is and how they can help you and your business.
October 30, 2018 § Leave a comment
The Tax Cuts and Jobs Act implemented significant changes to meals and entertainment and how they are taxed for organizations. Check out this video by Nick Finkenauer, CPA, as he explains the changes that were made and how they could impact you.
October 29, 2018 § Leave a comment
Well, it is that time again! Not just for Holiday parties and Christmas shopping, but more importantly, it’s time to do your tax planning! Why, you may ask? Well, here are the top five reasons I recommend planning to my clients.
- The Tax Cuts and Jobs Act (TCJA) – The TCJA was signed into law in December of 2017 and has many changes for both businesses and individuals. Reduced tax rates, changes in depreciation choices, the Qualified Business Income(QBI) deduction, standard versus itemized deduction changes for individuals – all parts of the TCJA. By planning now you can learn which of these changes will affect you and give you time to adjust what you have been doing to what makes the most sense so you can reduce your tax bill and your payments. Do you need to make a change in your salary or withholding? Should you buy that piece of equipment this year? Planning can help you make these decisions.
- Eliminate the surprises – Some surprises are great, but finding out that you owe hundreds or even thousands of dollars by April 15th would not be one of them for most of us. By knowing this in November or December, you can eliminate the shock and also make some adjustments which leads us to #3.
- Reduce or eliminate penalties – So if you owe money for your taxes, the next question I would ask is will you be subject to an underpayment penalty for not paying your taxes during 2018 or can you wait until April 15, 2019 to pay the balance owed? If you owe over $1,000, there are two exceptions that will keep you from owing a penalty. First, you have paid in 90% of the tax you owed for the current year OR you paid in 100% of your prior year’s tax liability (110% if your adjusted gross income was over $150,000 last year). If you meet either of these exceptions, you are not subject to an underpayment penalty and you can wait and pay in the amount owed by April 15, 2019. As you can see, the first exception requires that you are estimating your tax liability during the current year to be sure you are paying in the 90% so most people I know take advantage of the second exception by paying in what are called “safe harbor” estimates since they are based on the prior year liability which is a known amount and can be easily and exactly calculated. Using the safe harbor this year is a bit trickier due to the changes that are coming from the TCJA so planning can be helpful to see that you are where you need to be.
- Time Value of Money – If you have overpaid substantially, you may want to skip your 4th quarter estimate or you may want to adjust your withholding down so that you get back that extra tax in November and December instead of waiting until March or April. If you owe, it allows you to decide when to pay in the additional amount to keep penalties down, but hold on to your funds until needed.
- Be Prepared Earlier – Doing a projection now will get you situated so that when January comes and you get your tax documents in the mail, you will have already accumulated much of the other information that you need for your taxes. It will help you to have your accounting information for your business reconciled and recorded through much of the year. Also, by preparing a projection, you have time to talk to your CPA and ask questions about your taxes so that you have more information and knowledge on what is important for your tax situation and what you need to accumulate. You will be able to complete accumulating your tax info and be ready to get your taxes done first when your accountant is fresh and eager to get started.
Take a moment now and consider if any of these reasons make sense to you and if they do, give your CPA or tax accountant a call. It may be the best gift you have given yourself in a long time!
Kathi Koenig, Partner
October 25, 2018 § Leave a comment
This summer, we competed in the Des Moines Corporate Games, and for the second year in a row, we won the title of Division 4 Champions. Many associates participated in 25 events throughout the summer to gain this title. These events were not only a great chance to spend time with coworkers outside of work, but it also gave everyone an opportunity to participate in events they may never have participated in before. The Des Moines Corporate Games is just one example of how employers can help promote wellness in the workplace.
According to Mayo Clinic, there are several benefits to regular physical activity: improved moods, boosted energy, better sleep patterns, and it helps combat health conditions and diseases. Therefore, it is in the employer’s best interest to promote an active lifestyle and the employees’ best interest to engage in an active lifestyle. Besides participating in Des Moines Corporate Games, what are some other ways to promote wellness in the workplace?
- Offer a discount/reimburse to employees for a gym membership. This will encourage employees to join a gym and hopefully start living a more active life style.
- Get up and move throughout the day. Many people who work in an office are stuck sitting down for several hours a day. Simply getting up and stretching can help improve energy and attentiveness. Another option would be taking the stairs instead of the elevator or join a few employees for a quick walk over your lunch break.
- Inform employees of the importance of living an active lifestyle. Bringing in a guest speaker, perhaps a physical therapist, for a lunch and learn can be a great way to inform people of the benefits of exercise. Also, sending out a monthly newsletter with health benefits of exercises or an article with stretches, that can be done at your desk or in your office, can give employees ideas of ways they can be more active.
- Offer wellness screenings at your office. If the health screening is done at your office, it is very convenient and likely for employees to participate. This can help detect potential health concerns and allow the employees to take action and possibly change their lifestyle.
- Sign up for events together. Like I mentioned earlier, the Des Moines Corporate games is a great way to gather employees and participate in events together. Another option would be to sign up for a 5K walk/run together. As a firm, we participated in Iowa’s Healthiest State Annual walk, where people from all 99 counties in Iowa walked.
Katie Fevold, CPA, Senior Accountant
October 23, 2018 § Leave a comment
Wendy Moran, CPA, Assurance Partner continues her #RevRec series for the new Revenue Recognition Guidance that is required for all non-public companies for years beginning after December 15, 2018. This video explains step 5 of the new guidance – recognize revenue when or as performance obliations are satisfied.