Hawkins Ash CPAs https://hawkinsashcpas.com Part of your business. Part of your life. Tue, 20 Nov 2018 16:07:47 +0000 en-US hourly 1 Employee Benefit Plan Resources: November 2018 https://hawkinsashcpas.com/employee-benefit-plan-resources-november-2018/ Thu, 15 Nov 2018 21:06:32 +0000 https://hawkinsashcpas.com/?p=6748 Check out our latest Employee Benefit Plan Resources Newsletter. This edition includes the following topics: 401(k) Plan Contributions for Student Loan Repayments: Potential Future Standard Practice? Selecting 3(21) Versus 3(38) Third Party Fiduciary Advisors Hawkins Ash CPAs Exhibit Expertise in Employee Benefit Plan Audits with AICPA Advanced Certificate The Employer Plans Compliance Resolution Program (EPCRS) […]

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Check out our latest Employee Benefit Plan Resources Newsletter. This edition includes the following topics:

  • 401(k) Plan Contributions for Student Loan Repayments: Potential Future Standard Practice?
  • Selecting 3(21) Versus 3(38) Third Party Fiduciary Advisors
  • Hawkins Ash CPAs Exhibit Expertise in Employee Benefit Plan Audits with AICPA Advanced Certificate
  • The Employer Plans Compliance Resolution Program (EPCRS)

View the newsletter>

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Nonprofit Connection: November 2018 https://hawkinsashcpas.com/nonprofit-connection-november-2018/ Thu, 15 Nov 2018 21:03:04 +0000 https://hawkinsashcpas.com/?p=6746 Read and sign up for the Nonprofit Connection Newsletter. Topics in this quarter’s edition include: Board-Designated Net Assets Nonprofit Tax Tidbits: Form 990 Schedule E and F The Tax Cuts and Jobs Act (TCJA) – New Requirements for Tax Exempt Organizations State and Federal Compliance Updates Client Feature and Executive Direct Q&A: Marshfield Clinic Health […]

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Read and sign up for the Nonprofit Connection Newsletter. Topics in this quarter’s edition include:

  • Board-Designated Net Assets
  • Nonprofit Tax Tidbits: Form 990 Schedule E and F
  • The Tax Cuts and Jobs Act (TCJA) – New Requirements for Tax Exempt Organizations
  • State and Federal Compliance Updates
  • Client Feature and Executive Direct Q&A: Marshfield Clinic Health System YMCA

View newsletter>

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Withholding Under the New Tax Bill: Podcast https://hawkinsashcpas.com/withholding-under-the-new-tax-bill-podcast/ Tue, 06 Nov 2018 15:58:14 +0000 https://hawkinsashcpas.com/?p=6728 Back in February of 2018, the IRS came out with new federal tax withholding tables for employers to use based on the new tax law. Although these tables were designed for the average taxpayer, there are scenarios where these tables may not work. In these cases, taxpayers may find out at April 15 that they […]

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Back in February of 2018, the IRS came out with new federal tax withholding tables for employers to use based on the new tax law. Although these tables were designed for the average taxpayer, there are scenarios where these tables may not work. In these cases, taxpayers may find out at April 15 that they thought that they were getting refunds because they had in the past, but they may not get any refunds, or may even owe. Click the orange circle below to listen to this episode.

Script

WHO MAY GET CAUGHT BY THIS?

There are a number of situations that we found, and this is obviously not an inclusive list, but individuals that were paying high amounts of state and local taxes but were not in the alternative minimum tax may be affected by this because as we learned in previous episodes, the most you can deduct now for state and local taxes is $10,000. If someone was deducting $20,000-$30,000 in previous years, that is $10,000-$20,000 of additional income that is going to show up on their return that they probably weren’t expecting.

There are also people with three or more dependents that are over age 16, and they may be affected due to the fact that some of those exemptions went away.

Also, taxpayers with high business expenses and investment expenses, like the unreimbursed employee expenses that used to be itemized as miscellaneous deductions and now are not deductible. Those people will be affected by the new tax law. And also, just a normal couple that had about $24,000 in itemized deductions may be affected because they are going to lose those exemptions.

WHAT CAN A PERSON DO?

The IRS has really encouraged people to go onto their website and look at their withholding calculator and perform what they call a paycheck checkup. This calculator should give you a good idea on the correct allowances to take.

You could also talk to your tax preparer or CPA who can actually run a calculation for you. There is normally a little bit of a cost associated with this type of service depending on the complexity, but it would provide you with peace of mind.

WHAT SHOULD PEOPLE DO IF THEY NEED TO CHANGE THEIR WITHHOLDING?

What taxpayers should do at that point is file a new Form W-4 with their employer to change how much withholding comes off of their checks. One thing to remember with that is as it gets later and later into the year, you are only changing your withholding from this point to the end of the year. You may still have been short those first months of the year to now.

It was the intention of the legislators when they set up the new tax withholding tables to get the benefits from the tax reform bill to taxpayers as soon as possible. That is the reason why they made this change. Taking appropriate steps now can stop unexpected surprises later.

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Is Now the Time for Some Life Insurance? https://hawkinsashcpas.com/is-now-the-time-for-some-life-insurance/ Tue, 06 Nov 2018 15:39:09 +0000 https://hawkinsashcpas.com/?p=6726 Many people reach a point in life when buying some life insurance is highly advisable. Once you determine that you need it, the next step is calculating how much you should get and what kind. Careful Calculations If the coverage is to replace income and support your family, this starts with tallying the costs that […]

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Many people reach a point in life when buying some life insurance is highly advisable. Once you determine that you need it, the next step is calculating how much you should get and what kind.

Careful Calculations

If the coverage is to replace income and support your family, this starts with tallying the costs that would need to be covered, such as housing and transportation, child care, and education — and for how long. For many families, this will be only until the youngest children are on their own.

Next, identify income available to your family from Social Security, investments, retirement savings and any other sources. Insurance can help bridge any gaps between the expenses to be covered and the income available.

If you’re purchasing life insurance for another reason, the purpose will dictate how much you need:

  • Funeral costs. An average funeral bill can top $7,000. Gravesite costs typically add thousands more to this number.
  • Mortgage payoff. You may need coverage equal to the amount of your outstanding mortgage balance.
  • Estate planning. If the goal is to pay estate taxes, you’ll need to estimate your estate tax liability. If it’s to equalize inheritances, you’ll need to estimate the value of business interests going to each child active in your business and purchase enough coverage to provide equal inheritances to the inactive children.

Term vs. Permanent

The next question is what type of policy to purchase. Life insurance policies generally fall into two broad categories: term or permanent.

Term insurance is for a specific period. If you die during the policy’s term, it pays out to the beneficiaries you’ve named. If you don’t die during the term, it doesn’t pay out. It’s typically much less expensive than permanent life insurance, at least if purchased while you’re relatively young and healthy.

Permanent life insurance policies last until you die, so long as you’ve paid the premiums. Most permanent policies build up a cash value that you may be able to borrow against. Over time, the cash value also may reduce the premiums.
Because the premiums are typically higher for permanent insurance, you need to consider whether the extra cost is worth the benefits. It might not be if, for example, you may not require much life insurance after your children are grown.

But permanent life insurance may make sense if you’re concerned that you could become uninsurable, if you’re providing for special-needs children who will never be self-sufficient, or if the coverage is to pay estate taxes or equalize inheritances.

Some Comfort

No one likes to think about leaving loved ones behind. But you’ll no doubt find some comfort in having a life insurance policy that helps cover your family’s financial needs and plays an important role in your estate plan. Let us help you work out the details.

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Taxable vs. Tax-Advantaged: Where to Hold Investments https://hawkinsashcpas.com/taxable-vs-tax-advantaged-where-to-hold-investments/ Tue, 06 Nov 2018 15:33:24 +0000 https://hawkinsashcpas.com/?p=6723 When investing for retirement or other long-term goals, people usually prefer tax-advantaged accounts, such as IRAs, 401(k)s or 403(b)s. Certain assets are well suited to these accounts, but it may make more sense to hold other investments in traditional taxable accounts. Know the Rules Some investments, such as fast-growing stocks, can generate substantial capital gains, […]

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When investing for retirement or other long-term goals, people usually prefer tax-advantaged accounts, such as IRAs, 401(k)s or 403(b)s. Certain assets are well suited to these accounts, but it may make more sense to hold other investments in traditional taxable accounts.

Know the Rules

Some investments, such as fast-growing stocks, can generate substantial capital gains, which may occur when you sell a security for more than you paid for it. If you’ve owned that position for over a year, you face long-term gains, taxed at a maximum rate of 20%. In contrast, short-term gains, assessed on holding periods of a year or less, are taxed at your ordinary-income tax rate — maxing out at 37%. (Note: These rates don’t account for the possibility of the 3.8% net investment income tax.)

Choose Tax Efficiency

Generally, the more tax efficient an investment, the more benefit you’ll get from owning it in a taxable account. Conversely, investments that lack tax efficiency normally are best suited to tax-advantaged vehicles.

Consider municipal bonds (“munis”), either held individually or through mutual funds. Munis are attractive to tax-sensitive investors because their income is exempt from federal income taxes and sometimes state and local income taxes. Because you don’t get a double benefit when you own an already tax-advantaged security in a tax-advantaged account, holding munis in your 401(k) or IRA would result in a lost opportunity.

Similarly, tax-efficient investments such as passively managed index mutual funds or exchange-traded funds, or long-term stock holdings, are generally appropriate for taxable accounts. These securities are more likely to generate long-term capital gains, which have more favorable tax treatment. Securities that generate more of their total return via capital appreciation or that pay qualified dividends are also better taxable account options.

Take Advantage of Income

What investments work best for tax-advantaged accounts? Taxable investments that tend to produce much of their return in income. This category includes corporate bonds, especially high-yield bonds, as well as real estate investment trusts (REITs), which are required to pass through most of their earnings as shareholder income. Most REIT dividends are nonqualified and therefore taxed at your ordinary-income rate.

Another tax-advantaged-appropriate investment may be an actively managed mutual fund. Funds with significant turnover — meaning their portfolio managers are actively buying and selling securities — have increased potential to generate short-term gains that ultimately get passed through to you. Because short-term gains are taxed at a higher rate than long-term gains, these funds would be less desirable in a taxable account.

Get Specific Advice

The above concepts are only general suggestions. Please contact our firm for specific advice on what may be best for you.

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The Shortcuts That You Want, Where You Want Them https://hawkinsashcpas.com/the-shortcuts-that-you-want-where-you-want-them/ Tue, 06 Nov 2018 15:13:50 +0000 https://hawkinsashcpas.com/?p=6717 Here’s how to make your QuickBooks navigation quick, easy, and best of all, personalized. On the far left of your screen is the shortcut menu. If you’ve minimized it, it’s the strip (still on the far left of your screen) that says, “My Shortcuts.” You can open this back up with the arrow at the […]

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Here’s how to make your QuickBooks navigation quick, easy, and best of all, personalized.

On the far left of your screen is the shortcut menu. If you’ve minimized it, it’s the strip (still on the far left of your screen) that says, “My Shortcuts.” You can open this back up with the arrow at the top.

This shortcut bar provides one-click access to many of the functions of QuickBooks. Need the Customer Center? Click “Customers.” Vendor Center? Click “Vendors.” Want to see how your business is doing? Click “Snapshots.” You can already see the time savings start to add up. But it’s true that beauty lies even deeper than that. The shortcuts as you see them can be personalized.

At the bottom of the “My Shortcuts” section, there is a link called “Customize Shortcuts” that you can click on. Alternately, if you right-click inside the box, you can get the “Customize Shortcuts” option to open in a popup link. When you click on this, the content of the shortcut bar becomes the canvas that you paint. You can move the shortcuts to whatever order you want by clicking and dragging. If you decide you won’t use a particular shortcut, you can delete it from the bar. If you have a particular function of QuickBooks that you use that is not listed on these shortcuts, you can click “Add…” and a number of additional potential shortcuts will be listed. Simply click the function you want, click any corresponding icon you want to represent it, name it what you want, and hit “OK.” You now have a personalized shortcut in the window. You can move the location of this shortcut up on the list just like any others.

Between setting up your options in the order you would use them, adding the shortcuts that you use and removing those that you don’t, your new personalized menu will be what you want to help save you time and make your work that much easier.

Author: Steve Arnold
Direct: 507.453.5962
Email: sarnold@hawkinsashcpas.com

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Tax+Business Alert: November 2018 https://hawkinsashcpas.com/taxbusiness-alert-november-2018/ Tue, 06 Nov 2018 15:10:37 +0000 https://hawkinsashcpas.com/?p=6715 Headlines of the November 2018 Tax+Business Alert include the following: Taxable vs. Tax-Advantaged: Where to Hold Investments Podcast: Ways to Save for Retirement Education Opportunities Doing Due Diligence on Dividends Is Now the Time for Some Life Insurance? View the newsletter> Subscribe>

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Headlines of the November 2018 Tax+Business Alert include the following:

  • Taxable vs. Tax-Advantaged: Where to Hold Investments
  • Podcast: Ways to Save for Retirement
  • Education Opportunities
  • Doing Due Diligence on Dividends
  • Is Now the Time for Some Life Insurance?

View the newsletter>

Subscribe>

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Ways to Save for Retirement: Podcast https://hawkinsashcpas.com/ways-to-save-for-retirement-podcast/ Tue, 23 Oct 2018 17:49:25 +0000 https://hawkinsashcpas.com/?p=6666 Whether you are an employee or you own your own business, retirement plans can be the best way to retire with dignity. With fewer companies offering pensions, it is really important that we save on our own for our own retirements. That being said, although workers are getting better, most still need to contribute more. […]

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Whether you are an employee or you own your own business, retirement plans can be the best way to retire with dignity. With fewer companies offering pensions, it is really important that we save on our own for our own retirements. That being said, although workers are getting better, most still need to contribute more.

Listen in now; click the orange circle below:

Script

Whether you are an employee or you own your own business, retirement plans can be the best way to retire with dignity. With fewer companies offering pensions, it is really important that we save on our own for our own retirements. That being said, although workers are getting better, most still need to contribute more.

As employees, it is critical that you take advantage of plans that are offered by your employers. Most of these plans, in a lot of cases, offer matches – which is like getting free money.

WHAT TYPES OF RETIREMENT PLANS ARE AVAILABLE?

There are really six (6) different kinds of retirement plans if you don’t count the pension plans.

  1. IRAs – Normally contributions to Traditional IRAs are tax deductible (pre-tax dollars), but you will pay tax when it is withdrawn on your contributions and earnings.
  2. Roth IRA – Contributions are not tax deductible (after-tax dollars), but you will not need to pay any tax when it is withdrawn; not on the contributions or the earnings.
  3. 401(k) – Employees can contribute pre-tax dollars. The benefit to the employee is that the company also may match some of their contributions.
  4. Roth 401(k) – Employees can contribute after tax dollars. Once again not taxed later on contribution or earnings, plus you may get a match.
  5. SIMPLE IRA Plan – Employees can contribute pre-tax dollars and receive an employer match of up to 3%.
  6. SEP – Retirement plan fully funded by your employer. Different from a pension (guaranteed income).

In summary, you can do an IRA if your employer doesn’t have a formal plan, and as most of us know, as long as we fit into income limits, we can make contributions to our IRA which is deductible, but later on when we take that money out, we have to pay taxes on the money we put in, plus any of the earnings.

There are also Roth IRA’s. Roth IRA’s work a little bit differently. You can put money into a Roth IRA, again assuming your income limits are there, but that is not tax deductible. The advantage is, however, that when you take it out you don’t pay tax on what you take out or any of the earnings. So this is what a lot of people really like to do.

Then you have your 401(k)’s, your Roth 401(k)’s, and your Simple IRA Plans. These are plans wherein you can simply put money away, either tax-free or pre-taxed, like in the Roth 401(k) or the Simple Plan, or you can put it away after-tax, like in the 401(k). Those three vehicles allow you to put more away than you can in an IRA, which really helps. If your employer does what is called an SEP, or if you are self-employed, you can set up an SEP. That retirement plan is fully funded by your employer.

It is important to talk over these options with your tax preparer, but it is even more important that people start to contribute. You may say that there is no room in your budget to be able to do it, but I would come back and argue that if you start off with 1 or 2%, and then every year just bump it up 1 or 2%, it’s probably going to be something that you are not going to even notice. Plus, like I mentioned earlier, the match is FREE MONEY. In some of these retirement plans, the employer is matching some of your contributions.

WHAT IF A BUSINESS OWNER WANTS TO SET UP A RETIREMENT PLAN FOR THEIR EMPLOYEES?

If you are a business owner, there are many options available that can provide benefits to your employees: Like we talked about earlier, the 401(k)’s, the Simple Plans, and the SEP Plans. My advice would be for you to talk to your CPA if you are interested in setting up a plan.

ARE ANY OF THESE RETIREMENT PLANS THE BEST ONE OR ARE THEY ALL JUST DIFFERENT?

They are really all different. If you are looking at an IRA, your limit is fairly low. If you are looking at a Simple Plan, that is where you can put away kind of in the middle, maybe somewhere around $13,000-$14,000, or if you want to put even more away, the 401(k) might be your best option. It really depends on where you want to be in that savings spectrum.

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Payroll and Year-End Reporting Webinar https://hawkinsashcpas.com/payroll-and-year-end-reporting-webinar/ Thu, 18 Oct 2018 14:31:35 +0000 https://hawkinsashcpas.com/?p=6655 As an employer, you know year-end payroll processing and reporting is a complex undertaking that adds to the stress of closing the books for the year. To ensure a smooth, error-free year and to get the latest information, please join us for our Payroll and Other Year-End Reporting Webinar. This webinar is offered to bookkeepers, […]

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As an employer, you know year-end payroll processing and reporting is a complex undertaking that adds to the stress of closing the books for the year. To ensure a smooth, error-free year and to get the latest information, please join us for our Payroll and Other Year-End Reporting Webinar. This webinar is offered to bookkeepers, business owners and payroll professionals free of charge.

Debbie Denny, Tax Manager, will address compliance issues of year-end payroll processing and reporting and bring you up to date on the latest changes that affect the close of 2018 and beginning of 2019.  Topics covered in the hour and a half webinar will include:

  • Fringe benefits
  • W-2 add backs
  • ACA reporting
  • Independent contractor issues
  • 1099 rules and due dates

Date

Thursday, December 6, 2018

Time

9:00 – 10:30 a.m.

Registration

Complimentary Webinar Registration>>>

Questions

Call: 920.337.4544

Email: info@hawkinsashcpas.com

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Hawkins Ash CPAs Exhibit Expertise in Employee Benefit Plan Audits with AICPA Advanced Certificate https://hawkinsashcpas.com/hawkins-ash-cpas-exhibit-expertise-in-employee-benefit-plan-audits-with-aicpa-advanced-certificate/ Wed, 17 Oct 2018 20:03:08 +0000 https://hawkinsashcpas.com/?p=6647 Hawkins Ash CPAs is pleased to announce that Erica Knerzer, CPA, Charles Wendlandt, CPA, Randall Miller, CPA, Abe Leis, CPA, and Randy Juedes, CPA, have earned the American Institute of Certified Public Accountants’ (AICPA) Advanced Defined Contribution Plans Audit Certificate. The certificate program was designed to show certificate awardees’ high level of competency and commitment to performing […]

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Hawkins Ash CPAs is pleased to announce that Erica Knerzer, CPA, Charles Wendlandt, CPA, Randall Miller, CPA, Abe Leis, CPA, and Randy Juedes, CPA, have earned the American Institute of Certified Public Accountants’ (AICPA) Advanced Defined Contribution Plans Audit Certificate.

The certificate program was designed to show certificate awardees’ high level of competency and commitment to performing high-quality audits. Developed by leading experts and members of AICPA’s Employee Benefit Plans Audit Quality Center, the competency-based examination for certification tests one’s ability to plan, perform and evaluate employee benefit plan audits in accordance with the latest AICPA standards and Department of Labor and IRS requirements. The certificate acknowledges their achievement by declaring their dedication to quality and distinguishes their knowledge and expertise in this area.

Learn more about Hawkins Ash CPAs ERISA Audit Services>

Erica Knerzer, CPA

Knerzer is a senior audit manager in the Hawkins Ash CPAs La Crosse, Wis., office. She serves as the co-chair of the Employee Benefit Plan services group, focusing on the development of employee benefit plan audits and also works on audits of privately held organizations. Erica joined the firm in 2000 and is also a member of the firm’s Audit and Accounting Committee. She is a graduate for UW-La Crosse and is a Certified Public Accountant.

 

Charlie Wendlandt, CPA

Wendlandt joined Hawkins Ash CPAs in 2011. As a manager in the firm’s Marshfield office, his main responsibilities include planning, test of transactions and preparation of financial statements for ERISA audits outside of tax season. During tax season, he works on compilations and reviews and the preparation of corporate tax returns. Charlie serves as co-chairperson of the firm’s Employee Benefit Plan Service Group. He is a graduate of UW-Eau Claire and is a Certified Public Accountant.

 

Randy Miller, CPA

Miller has provided accounting and auditing services from the firm’s Manitowoc, WI office since 1982. He is the quality control partner of the firm’s Accounting and Auditing Committee and is the chairperson of the firm’s Executive Committee. He is also a member of the firm’s Employee Benefit Plan Service Group and Governmental Service Group. He has extensive experience providing accounting and auditing services to commercial entities, governmental entities, nonprofit organizations and employee benefit plans. He is the firm’s designated partner for the AICPA Governmental Audit Quality Center. He is a graduate of UW-Whitewater and is a Certified Public Accountant.

Randy Juedes, CPA

Juedes joined Hawkins Ash CPAs in 2001. As partner-in-charge of the Hawkins Ash CPAs Medford, WI, office, his experience includes audits of commercial entities and employee benefit plans and individual and corporate taxation. He is a member of the firm’s Employee Benefit Plan Service Committee and Accounting and Audit Committee. He also serves on the firm’s Executive Committee. He is a graduate of UW-Eau Claire and is a Certified Public Accountant. He is the firm’s partner for the AICPA Employee Benefit Plan Audit Quality Center.

 

Abe Leis, CPA

Abe LeisLeis is the firm’s Managing Partner, based in La Crosse, WI, the firm’s headquarters. He joined Hawkins Ash CPAs in 1998 after starting his career as an intern. Abe also serves clients and has extensive knowledge and experience working with commercial entities, real estate entities, tax credit projects, retirement plan audits, and private school audits. He is a graduate of UW-La Crosse and is a Certified Public Accountant.

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