On February 25, 2016 FASB issued an Accounting Standard Update with the hopes of improving reporting related to lease transactions.  In addition the intent was to bring U.S. Generally Accepted Accounting Principles closer to the existing reporting treatment of lease transactions as set by International Accounting Standards Board.

Under this new guidance leases with terms of greater than 12 months will be required to be recognized as both an asset and liability of the company.   Previously only leases classified as capital leases required recognition of an asset and liability.

The standard takes effect for financial periods beginning after Dec. 15, 2018 for public companies and beginning after December 15, 2019 for other organizations.   Although these dates may seem to be far off in the future, many companies will need to be aware of how the lease transactions that they are currently engaged in (as well as the transactions they will enter into in the interim) will ultimately be reported in their financial statements.

To read the full referenced article, click here. For more information on financial reporting and the new standard issued by the FASB, please contact Ed Elsner at (231) 726-5848.

We are pleased to introduce our newest members of Brickley DeLong:

Jacob Barton, staff accountant (Grand Rapids)
Jacob joined the Firm in January 2015 as a tax intern. He continued working with us after tax season part-time and began full-time in January 2016. He is a graduate of Grand Valley State University. In his free time, Jacob enjoys watching and playing sports; and, he has a specific interest in college football and basketball. He currently resides in Wyoming, MI.

Kim DeJonge, receptionist (Muskegon)
Kim joined the Firm in January 2015. She lives in North Muskegon with her husband of 25 years. She has three kids and eight grandkids. Kim is a graduate of Baker College and has previously worked as a paraprofessional and an office manager. In her free time, she loves to hike, bike, and spend time with her grandkids.

Sara Evans, staff accountant (Muskegon)
Sara joined the Firm in February 2016 as a staff accountant. She is from Rothbury, MI and has lived in Muskegon for the past 12 years. Sara received her bachelor’s and master’s degree from Kaplan University. Her prep courses for the CPA exam are completed, and she plans to finish the exam in the next year. She is married and has a seven-year-old son and an eight-year-old daughter. In her free time, she enjoys spending time with her family and watching her children’s sports.

Lannon Unick, staff accountant (Muskegon)
Lannon grew up in Farmington Hills. She started her career in retail banking, then bookkeeping, and then tax prep (when she went back to school full-time). She has lived in New York City for the past ten years. Her degree is from Brooklyn College in public accountancy. In her free time, she enjoys reading, knitting, Netflix, and languages. She speaks fluent Spanish, conversational French, rough Italian, and has begun learning German.

Margaret Westman, intern (Grand Rapids)
Margo began interning with us in January 2016. She is from Harbor Springs, a small town in Northern Michigan. She moved to Grand Rapids to attend Aquinas College where she is currently a sophomore in the process of obtaining a degree in professional accountancy. Upon completion of the five-year program, Margo plans to take time off to travel. Margo’s hobbies include hiking, kayaking, skating, and reading.

Beth Wilcox, staff accountant (Grand Rapids)
Beth joined the Firm in 2016 as a staff accountant. She is from Fremont, MI. She received her degree from Ferris University, which allowed her to stay relatively close to her family. Her hobbies include board games and scrapbooking. She recently got her scuba diving license. So far, she has only been diving in one lake and is excited to do more this summer. She has a fox terrier named Gambit, which she refers to as her baby.

Learn more about careers at Brickley DeLong.

In impeccable time before Valentine’s Day, author Susan Steinbrecher, in an article published in Inc., lists 21 ways to win the hearts of your employees. As an employee in charge of recruiting and retention, I feel the ideas expressed by Steinbrecher are crucial for employers to retain talent and keep employees engaged. The 21 ideas she lists are:

1. Be a good listener. Employees will be motivated when you listen in the present moment with empathy and understanding.
2. Coach, mentor and develop your associates. Provide ample opportunities for growth and development.
3. Ask better questions and offer support.
4. Tell the truth.
5. Hold yourself accountable.
6. Be approachable. Have an open door policy.
7. Celebrate successes.
8. Make work interesting and challenging.
9. Trust people to make the right decisions. This boosts confidence and cultivates mutual respect.
10. Support and encourage health and wellness programs.
11. Be flexible with scheduling, whenever possible.
12. Avoid judgments and quick assumptions. Instead, pause and seek to understand.
13. Affirm or enhance self-esteem.
14. Say “thank you” for a job well done, and be specific with your feedback.
15. Observe the day-to-day operations and make time to personally connect with others.
16. Relinquish control. Doing so empowers employees and fosters confidence-building opportunities.
17. Practice mindfulness. Know the impact of your words and actions.
18. Commit to ongoing personal growth and build the habits that you want others to emulate.
19. Be humble; be teachable. Do not be afraid to admit your mistakes.
20. Encourage creativity. Endeavor to be open to new ideas.
21. Be courageous enough to lead with your heart.

At Brickley DeLong, we believe in the importance of all of our employees. We strive to commit to many of these practices as a Firm. For example, we uphold a family/team-oriented culture. A client is a Firm client, and we work together to deliver the best possible client service. With our open door policy, employees are encouraged to ask questions. Staff members regularly sit down with Partners and Managers to discuss client work. It is our goal through training and work-experience to empower our employees to grow their skills and continue to take on more challenging work and roles.

To read the full referenced article, click here. For more information on working at Brickley DeLong, please visit our career pages or contact Jennifer Kloosterhouse at (616) 608-8532 or jkloosterhouse@brickleydelong.com.

Brickley DeLong is pleased to announce the following promotions:

Michael Atkinson, CPA has been promoted to Supervisor. Mike began with the Firm in July 2013. Prior to being employed with Brickley DeLong, he worked at a Firm in Jackson, MI. He holds a bachelor’s and master’s degree in accounting from Michigan State University. He is employed at the Firm’s Muskegon office.

Donny Baird has been promoted to Senior Accountant. Donny began with the Firm in January 2014. He is a graduate of Grand Valley State University. He is currently preparing to sit for the CPA exam. He works at the Firm’s Grand Rapids and Muskegon offices.

Kerry Halloran, CPA has been promoted to Manager. Kerry began with the Firm in July 2008 following graduating with her Master’s from Michigan State University. She is employed at the Firm’s Muskegon office.

Jennifer Kloosterhouse has been promoted to Director of Marketing, Recruiting, and Retention. Jennifer began with the Firm May 2012 following her graduation from Grand Valley State University. She holds a degree in Advertising and Public Relations. She will headed at the Firm’s Grand Rapids office.

Elizabeth Kramb, CPA has been promoted to Supervisor. Liz began with the Firm in December 2011 after her previous Firm merged with Brickley DeLong. She is a graduate of Davenport University, and is employed at the Firm’s Grand Rapids office.

The House passed the Protecting Americans from Tax Hikes Act of 2015  (Path Act) just before recessing for the Holidays. To read about the Path Act, please view the attached PDF from CCH.

CCH Coverage of 2015 PATH Act

Author: Sherri VanArendonk

Enrollment in Medicare Part B can be difficult and lead to large fines if done at the wrong time. For example, if an individual fails to enroll, he or she must pay a late enrollment penalty (LEP) of 10% his or her monthly premium for life. James Sullivan, in an article published in the Journal of Accountancy, discusses how to maneuver the Part B enrollment process.

What does Medicare Part B cover?

Medicare Part B covers outpatient medical care such as: medical services, tests, and supplies used outside a hospital or skilled nursing care facility.

The 3 Enrollment Periods

Source: Medicare General Information, Eligibility, and Entitlement Manual, Centers for Medicare & Medicaid Services.

The IEP leads to no penalty, but may lead to gaps in coverage. The SEP can only be used by someone who is losing employer-provided coverage. The GEP is used as a last resort and may lead to gaps in coverage and late penalties.

To read the full referenced article, click here. For assistance in navigating the Medicare Part B enrollment process, please contact Sherri VanArendonk at (231) 726-5898 or svanarendonk@brickleydelong.com.

Learn more about our individual taxation services.

On January 1, 2016, there will be a minimum wage increase in Michigan. The increase is part of the Workforce Opportunity Wage Act of 2014.

Effective January 1, 2016:

• Minimum wage in Michigan will increase from $8.15 to $8.50 an hour.
• Tipped employees’ wages will increase from $3.10 to $3.23.
• Minors (age 16-17) rate stays the same at $7.25, or 85% of the minimum hourly wage.

The next increases will happen January 1, 2017 to $8.90 and January 1, 2018 to $9.25.

For more information on the Workforce Opportunity Wage Act, click here. For assistance in your business’s payroll or bookkeeping services, contact Terry Maycroft at (231) 726-5825 or tmaycroft@brickleydelong.com.

Learn more about our payroll and accounting services.

In an October article published in MiBiz, reporter John Wiegand discusses a new scholarship fund for Muskegon County high school seniors that pays for two years of community college.

The goals of the Muskegon Area Promise are to increase the area’s educated workforce, develop talent, and attract new families. The program emulates a similar program in Kalamazoo which has seen an 11% return on investment since 2005.

According to the article, once fully funded, students who graduate from 12 Muskegon County school districts, and maintain a 3.5 GPA will have the ability to use the Promise to cover 100% of tuition and fees for an associate degree or equivalent technical program at Muskegon Community College or Baker College of Muskegon. Students can also choose to take 62 credits of general education, and then transfer to a four-year university.

This scholarship fund will relieve or reduce the burden of paying for college education that many Muskegon parents and students face. Undoubtedly this will lead to more young adults in the area receiving higher education, and an improving workforce.

To read the full article about the Muskegon Promise, click here.

The Time is Here: Reporting Requirements for Applicable Large Employers

Under the health care law, applicable large employers (ALE) – those with 50 or more full-time employees, including full-time equivalent employees, in the preceding year – are required to report some information regarding health coverage by filing information returns with the IRS and furnishing statements to full-time employees.

If you’re an ALE, you report information about health coverage you offered to each full-time employee, or to show that you didn’t offer coverage to the full-time employee. This information will help the IRS determine whether an employer shared responsibility payment applies to your organization and is also used in determining the eligibility of employees for the premium tax credit. Here are some key points about the information reporting requirements for ALE’s under the health care law:

• You are required to report certain information to the IRS, as well as to all of your full-time employees, regardless of whether you offer health insurance coverage.
• Your first information reporting returns are due in 2016 for the year 2015.
• There are new IRS forms that ALEs will use to complete this reporting.
• You are required to furnish each full-time employee with a statement, Form 1095-C, by January 31.
• You must file the information returns Forms 1094-C and 1095-C with the IRS no later than Feb. 28 – or March 31 if filed electronically.
• If you’re an ALE that sponsors a self-insured group health plan for your employees, you also must report information about employees and their dependents who enroll in the coverage, whether or not the employee is a full-time employee.

New IRS Resource helps Employers Understand the Health Care Law

The new ACA Information Center for Applicable Large Employers page on IRS.gov features information and resources for employers of all sizes on how the health care law may affect them if they fit the definition of an applicable large employer.

Final 2015 Health Care Reporting Forms are Now Available

The Internal Revenue Service has released the final versions of two key 2015 forms and the related instructions that employers and insurers will send to the IRS and individuals this winter to report health care coverage they offered or provided.  The IRS released draft forms and instructions for 2015 this summer and the final forms and instructions for 2015 are largely unchanged from the previously released drafts.

The 2015 version of Form 1095-C, Employer-Provided Health Insurance Offer and Coverage, used by employers with 50 or more full-time employees are now available on IRS.gov. Form 1095-B, Health Coverage, primarily used by insurers and health coverage providers, including employers that sponsor self-insured plans, is also available on IRS.gov.

What to do next

While Congress has put the oversight with the IRS and the reporting obligations on the employer, it is important you consult your health insurance provider and begin gathering the necessary information at your earliest convenience.  If we can be of assistance to you in assessing your reporting obligations, please do not hesitate to contact us at (231) 726-5800 or (616) 608-8500.

The Social Security Administration recently confirmed that there will be no cost of living increase for 2016.

Michael Cohn, in an article in Accounting Today, states that there are nearly 65 million recipients of monthly Social Security and Supplementary Social Security Income. A decline in oil prices has driven down inflation for many consumer goods that the federal government includes in its cost of living computation. This is the reasoning for there being no increase.

The Social Security Act offers an increase in Social Security and SSI benefits if there is an increase measured by the Consumer Price Index for Urban Wage Earners and Clerical Workers, or CPI-W. By comparing the third quarter CPI-W for 2014 to the third quarter CPI-W for 2015, it was determined that there was no increase.

The Department of Health and Human Services has not yet announced Medicare premium changes for 2016. However, if such likely increase happens, 30% of Medicare recipients could experience a hike in premiums. While 70% of Medicare recipients are protected under a “hold harness” provision that protects them from an increase in Medicare Part B premiums subject to Social Security increase, the other 30% are unprotected.

Information about Medicare changes for 2016 will be available at www.medicare.gov when available.

For more information on cost of living and social security, please read the referenced article or contact Sherri VanArendonk at (231) 726-5898 or svanarendonk@brickleydelong.com.

Author: Sherri VanArendonk

Individual Taxation