Remember those resolutions?
According to experts, 78% of people who make New Year’s resolutions fail to keep them. However, as a consultant to many small businesses, I know many business owners make resolutions in the hopes that each new year will bring improvement for their business.
As a CPA who works extensively in the tax areas, I would like to share a few “partway- through-the-year” resolutions that you may be motivated to make (and keep) as you move through this tax season.
- Resolve to review your financial numbers as they are completed at year-end. Analyze them to see how you can accomplish your goals in the new year.
- Resolve to be better organized. We often find that people lose tax deductions because they did not take time to complete the required documentation. Why pay more in taxes than you have to?
- Resolve to look beyond the numbers. As a business owner, sometimes it is possible to be too close to the internal workings of your company, which makes it difficult to come up with new ways of doing things. Employees may have ideas on how to make the company better, whether through improved procedures or cost-cutting means. Networking can bring ideas to the table that you haven’t considered.
- Resolve to offer something to your community. As a business leader, consider volunteering for your favorite charity or a group that promotes your industry.
May you have successful growth in your business and personal life. Here’s wishing you all the best for the rest of 2012.
Are you flirting with disaster?
Although the winter of 2011-2012 has been mild, at least by Wisconsin standards, it is always important to remember that the reason that significant weather events are reported on the 10 o’clock news is because they are unusual, newsworthy, and impactful. And unfortunately, the impact is always negative.
Disaster planning is an important part of being a responsible business owner. If your business does not have a disaster recovery plan, now is the time to create one. These tips can get you started:
- Think about what kinds of emergencies might affect your company both internally and externally, including the types of natural disasters that are common in the areas in which you operate.
- Be sure to consider fire safety. Fire is the most common of all business disasters.
- Consider how your company functions. Determine which staff, materials, procedures and equipment are absolutely necessary to keep your business operating. Include your computer and software needs in this evaluation, and be sure you have off-site backups.
- Create a contact list of suppliers, vendors, and employees that can be accessed from a remote (out-of-office) location.
- Plan what you will do if your facility is not accessible.
- Define your crisis management procedures and areas of responsibility. Be sure everyone involved in your plan understands what he or she is supposed to do.
If your business is involved in a disaster, the IRS offers Publication 584-B – Business, Casualty, Disaster, and Theft Loss Workbook. This workbook is designed to help you calculate losses in the event of disaster, casualty, or theft.
Preparer tax identification numbers – what they mean
If you are using a paid preparer for your income tax preparation, be aware that the IRS now has new requirements for these tax preparers. Effective Jan. 1, 2011, all paid preparers were required to have a preparer tax identification number (PTIN). These PTINs are renewed annually through the IRS website. Be sure your preparer has renewed his or her number. As part of the renewal process, there is a requirement for a competency exam to be taken by Dec. 31, 2013 if the preparer is not a CPA, attorney, enrolled agent, or a supervised preparer.
What does this mean for you? The IRS has determined that there is a need for greater regulation of income tax preparers. Since competence must be displayed by passing a professional exam, better income tax preparation with fewer errors is the expected result. The IRS will also be able to identify unscrupulous return preparers more easily.
This regulation and required education is designed to serve you better. Be sure your paid preparer is current with his or her PTIN requirements.
Jean M. Willard, CPA, is a principal in the Middleton offices of Reilly, Penner & Benton, LLP. A University of Wisconsin-Madison graduate, she has worked in public accounting with a focus on helping small business and individual clients.
Sign up for the free In Business Wisconsin Report – your weekly resource for local business news, analysis, voices, and the names you need to know. Click here.