Archive for May, 2017

4 digital marketing tips for every business

Wednesday, May 31st, 2017

You’d be hard pressed to find a company not looking to generate more leads, boost sales and improve its profit margins. Fortunately, you can take advantage of the sales and marketing opportunities offered by today’s digital technologies to do so. Here are four digital marketing tips for every business:

1. Add quality content to your website. Few things disappoint and disinterest customers like an outdated or unchanging website. Review yours regularly to ensure it doesn’t look too old and consider a noticeable redesign every few years.

As far as content goes, think variety. Helpful blog posts, articles and even whitepapers can establish your business as a knowledge leader in your industry. And don’t forget videos: They’re a great way to showcase just about anything. Beware, however, that posting amateurish-looking videos could do more harm than good. If you don’t have professional video production capabilities, you may need to hire a professional.

2. Leverage social media. If you’re not using social media tools already, focus on a couple of popular social media outlets — perhaps Facebook and Twitter — and actively post content on them. Remember, with some social media platforms, you can create posts and tweets in advance and then schedule them for release over time.

3. Interact frequently. This applies to all of your online channels, including your website, social media platforms, email and online review sites. For example, be sure to respond promptly to any queries you receive on your site or via email, and be quick to reply to questions and comments posted on your social media pages.

4. Tie it all together. It’s easy to end up with a hodgepodge of different online marketing tools that are operating independently of one another. Integrate your online marketing initiatives so they all have a similar style and tone. Doing so helps reassure customers that your business is an organized entity focused on delivering a clear message — and quality products or services.

When it comes to marketing, you don’t want to swing and miss. Our firm can help you assess the financial impact of your efforts and budget the appropriate amount to boosting visibility.

© 2017

Donating a vehicle might not provide the tax deduction you expect

Wednesday, May 31st, 2017

All charitable donations aren’t created equal — some provide larger deductions than others. And it isn’t necessarily just how much or even what you donate that matters. How the charity uses your donation might also affect your deduction.

Take vehicle donations, for example. If you donate your vehicle, the value of your deduction can vary greatly depending on what the charity does with it.

Determining your deduction

You can deduct the vehicle’s fair market value (FMV) if the charity:

  • Uses the vehicle for a significant charitable purpose (such as delivering meals-on-wheels to the elderly),
  • Sells the vehicle for substantially less than FMV in furtherance of a charitable purpose (such as a sale to a low-income person needing transportation), or
  • Makes “material improvements” to the vehicle.

But in most other circumstances, if the charity sells the vehicle, your deduction is limited to the amount of the sales proceeds.

Getting proper substantiation

You also must obtain proper substantiation from the charity, including a written acknowledgment that:

  • Certifies whether the charity sold the vehicle or retained it for use for a charitable purpose,
  •  Includes your name and tax identification number and the vehicle identification number, and
  • Reports, if applicable, details concerning the sale of the vehicle within 30 days of the sale.

For more information on these and other rules that apply to vehicle donation deductions — or deductions for other charitable gifts — please contact us.

© 2017

Consider the tax consequences before making an employee a partner

Tuesday, May 30th, 2017

In today’s competitive environment, offering employees an equity interest in your business can be a powerful tool for attracting, retaining and motivating quality talent. If your business is organized as a partnership, however, there are some tax traps you should watch out for. Once an employee becomes a partner, you generally can no longer treat him or her as an employee for tax and benefits purposes, which has significant tax implications.

Employment taxes

Employees pay half of the Social Security and Medicare taxes on their wages, through withholdings from their paychecks. The employer pays the other half. Partners, on the other hand, are treated as being self-employed — they pay the full amount of “self-employment” taxes through quarterly estimates.

Often, when employees receive partnership interests, the partnership continues to treat them as employees for tax purposes, withholding employment taxes from their wages and paying the employer’s share. The problem with this practice is that, because a partner is responsible for the full amount of employment taxes, the partnership’s payment of a portion of those taxes will likely be treated as a guaranteed payment to the partner.

That payment would then be included in income and trigger additional employment taxes. Any employment taxes not paid by the partnership on a partner’s behalf are the partner’s responsibility.

Treating a partner as an employee can also result in overpayment of employment taxes. Suppose your partnership pays half of a partner’s employment taxes and the partner also has other self-employment activities — for example, interests in other partnerships or sole proprietorships. If those activities generate losses, the losses will offset the partner’s earnings from your partnership, reducing or even eliminating self-employment taxes.

Employee benefits

Partners and employees are treated differently for purposes of many benefit plans. For example, employees are entitled to exclude the value of certain employer-provided health, welfare and fringe benefits from income, while partners must include the value in their income (although they may be entitled to a self-employed health insurance deduction). And partners are prohibited from participating in a cafeteria plan.

Continuing to treat a partner as an employee for benefits purposes may trigger unwanted tax consequences. And it could disqualify a cafeteria plan.

Partnership alternatives

There are techniques that allow you to continue treating newly minted partners as employees for tax and benefits purposes. For example, you might create a tiered partnership structure and offer employees of a lower-tier partnership interests in an upper-tier partnership. Because these employees aren’t partners in the partnership that employs them, many of the problems discussed above will be avoided.

If your business is contemplating offering partnership interests to key employees, contact us for more information about the potential tax consequences and how to avoid any pitfalls.

© 2017

Friday, May 26th, 2017

Want your voice heard in Washington? Start here http://bit.ly/2r4xro4

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Friday, May 26th, 2017

What you need to know as Gen Z enters the workforce http://bit.ly/2qk0lUi

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Fun at the Ball Game!

Thursday, May 25th, 2017

Yesterday, KBST&M held their Staff Appreciation Day at Orioles Park. Even though the Orioles lost we still had a great time! 😀

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Thursday, May 25th, 2017

4 Things Advisers Should Know about Technology Today http://bit.ly/2r1nLNg

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Thursday, May 25th, 2017

Learning from Prince’s $250 Million Mistake http://bit.ly/2r0uDIM

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How nonprofit youth sports leagues can prevent fraud

Thursday, May 25th, 2017

Many not-for-profit youth sports leagues are at risk for fraud and don’t even know it. Because cash transactions are common and leagues usually are managed by volunteers with little oversight, it’s easy for crooked individuals to take advantage of the situation. Unfortunately, sports league fraud is usually committed by board members or officers who are well known and respected in their communities. How then can your league prevent this crime?

Simple steps

By far the most important step you can take is to segregate duties. This means that no single individual receives, records and deposits funds coming in, pays bills and reconciles bank statements. Assign someone uninvolved in handling deposits and payments to receive and reconcile the bank statement. A different person should monitor the budget, and every payment (or at least payments over a certain threshold) should require two signatures. If your league has credit or debit cards, ask someone who isn’t an authorized user to review the statements.

Also, your league should:

Mandate board review. Your board of directors should receive and review financial reports on a quarterly or monthly basis — including when the league isn’t in season. The treasurer should submit a report for every board meeting, with bank statements attached.

Require online registration and payment. A lot of leagues still use paper registrations and accept payment by cash or check. Cash can be pocketed in the blink of an eye, and checks can be diverted to thieves’ own accounts. But with online registration, payments are deposited directly into the league’s account.

Rotate treasurers. Treasurers are the most likely youth sports league officials to commit fraud because they have the easiest access to funds and the ability to cover their tracks. Make sure no one person stays in the treasurer position for more than a couple of years. If funds are available, consider hiring a part-time bookkeeper who will report directly to your board.

Not all fun and games

Many youth sports leagues are ripe for fraud, in large part because of their lack of formality and their environment of trust. Structure may seem counter to the spirit of amateur leagues, but if your group doesn’t adopt some smart business practices, it could end up out of business. Contact us for more information.

© 2017

Could stronger governance benefit your business?

Thursday, May 25th, 2017

Every company has at least one owner. And, in many cases, there exists leadership down through the organizational chart. But not every business has strong governance.

In a nutshell, governance is the set of rules, practices and processes by which a company is directed and controlled. Strengthening it can help ensure productivity, reduce legal risks and, when the time comes, ease ownership transitions.

Looking at business structure

Good governance starts with the initial organization (or reorganization) of a business. Corporations, for example, are required by law to have a board of directors and officers and to observe certain other formalities. So this entity type is a good place to explore the concept.

Other business structures, such as partnerships and limited liability companies (LLCs), have greater flexibility in designing their management and ownership structures. But these entities can achieve strong governance with well-designed partnership or LLC operating agreements and a centralized management structure. They might, for instance, establish management committees that exercise powers similar to those of a corporate board.

Specifying the issues

For the sake of simplicity, however, let’s focus on governance issues in the context of a corporation. In this case, the business’s articles of incorporation and bylaws lay the foundation for future governance. The organizational documents might:

• Define and limit the authority of each executive,
• Establish a board of directors,
• Require board approval of certain actions,
• Authorize the board to hire, evaluate, promote and fire executives based on merit,
• Authorize the board to determine the compensation of top executives and to approve the terms of employment agreements, and
• Create nonvoting classes of stock to provide equity to the owner’s family members who aren’t active in the business, but without conferring management control.

As you look over this list, consider whether and how any of these items might pertain to your company. There are, of course, other aspects to governance, such as establishing an ethics code and setting up protocols for information technology.

Knowing yourself

At the end of the day, strong governance is all about knowing your company and identifying the best ways to oversee its smooth and professional operation. Please contact our firm for help running a profitable, secure business.

© 2017