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General Articles

Brian McFarren
In General Articles

IRS Phone Scam Ringleader Gets 14-Year Sentence

Sahil Patel of Pennsylvania and organizer of a fraudulent scheme in which taxpayers were threatened by phone calls claiming to come from the IRS and/or the FBI demanding payment, has been sentenced to 14 years in prison and 3 years of supervision upon his release.

Michael Cohn, published in Accounting Today, stated that Patel hired English-speaking employees in India-based “call centers” to attempt to receive payment from his U.S. targets.

In total, the scam was able to victimize U.S. citizens out of at least $1.2 million dollars.

Despite Patel’s arrest, the scams like this have been on the rise in the past year. To help recognize phone scams, the IRS has published Five Easy Ways to Spot a Scam Phone Call. The IRS does not:

  1. Call you to demand immediate payment. They will not call about taxes you owe without first mailing you a bill.
  2. Demand that you pay taxes without giving you the chance to question or appeal the amount they say you owe.
  3. Require you to use a certain payment method for your taxes, such as a prepaid debit card.
  4. Ask for credit or debit card numbers over the phone.
  5. Threaten to bring in local police or other law-enforcement to have you arrested for not paying.

If you have been targeted, an incident can be reported to the Treasury Inspector General for Tax Administration at www.tigta.gov, or by calling the TIGTA hotline at 1-800-366-4484.

For more information on this IRS Phone Scam please visit the referenced article or contact Brian McFarren at BMcFarren@brickleydelong.com or 231-726-5815.

Individual and Business Tax Preparation

Michael Davis
In General Articles

How S Corporations Can Avoid Unreasonable Compensation Audits

A recent article by Stephen D. Kirkland published in the Journal of Accountancy, discusses the red flags the IRS looks for when identifying compensation audits for S Corporations (S-Corps). The biggest red flag the IRS identifies is insufficient compensation paid to shareholders. While many S-Corps reduce compensation and increase distributions for tax reasons, this is one of the most prevalent reasons for an IRS examination. The tax rules that apply to compensation of shareholders and officers for S-Corps is not simple, but these nine items can go a long way toward helping S-Corps file returns that achieve the best results:

  1. Identify the officers
  2. Find the correct business activity code
  3. Confirm percentage of time devoted to business
  4. Be consistent
  5. Encourage each shareholder who works for the company to take reasonable compensation
  6. Encourage shareholders to maintain written logs
  7. Explain the rules to clients
  8. Provide comparability data
  9. Encourage shareholders to minimize loans from the company

For more information on S-Corps and compensation audits, please visit the referenced article by Stephen D. Kirkland in the Journal of Accountancy, or contact Terry Maycroft at tmaycroft@brickleydelong.com or (231) 726-5825.

Accounting Services

Tim Arter
In General Articles, Tim Arter

Delegation: The Essential Leadership Skill

Roger Allred, in a recent article published in Accounting Today, discusses the importance of delegation in leadership. If a business is to grow and expand, it needs to have employees who can effectively delegate work. Delegation is of the utmost importance when trying to maximize productivity.

Roger Allred and his brother Russ Allred, list six was to effectively delegate in their book The Family Business – Power Tools for Survival, Success, and Succession:

  • Determine who should do the job and express confidence in their ability
  • Let them know what you expect
  • Establish a negotiated deadline and get a commitment to the job and deadline
  • Allow them to use their imagination and initiative
  • Train them by following up, not taking over
  • Express appreciation for actual results

Following these tips is a step in the right direction when becoming a more effective leader. As a Partner at Brickley DeLong, it is crucial to be able to delegate work to staff members. Following these steps not only will benefit the leader, but also the one being led. The leader can be satisfied with results and, the delegate will be more fulfilled and produce better results because he or she clearly understand the project, is able to use their skills and imagination towards the project, and receives gratitude for the outcome.

For more information on leadership and delegation, please the referenced article by Roger Allred in Accounting Today, or contact Timothy Arter at tarter@brickleydelong.com or (231) 726-5820.

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Michael Davis
In General Articles

Interview at Brickley DeLong

Author: Calvin VanderWal, Intern

Ever since high school, I knew I wanted to work in a field related to business. Everything about the business world intrigued me, and I could not wait to learn more about it during my college years at Central Michigan University. Knowing I was skilled with the understanding of numbers, I declared Finance as my major during my freshman year of college. After two years of business classes and discussions with my peers, I switched my major to Accounting. Following many peoples’ recommendations, I became involved with an accounting organization on campus, and it only increased my interest in the accounting profession.

Involvement in the accounting organization sparked my interest in the public accounting world, as there seemed to be a plethora of opportunities through public accounting firms. I was first exposed to Brickley DeLong through a friend from high school, whose parent was a partner at the firm. Having no recruiting presence at Central Michigan, I had never heard of Brickley DeLong before. I decided to give them a shot, and I eventually landed an interview with them for a summer internship.

My interview at the Muskegon office was a few hours long, and I met with various partners and staff. I learned about the history of the Firm, what the future holds, and what kind of work I would be participating in, among many other topics. Every partner I interviewed with was welcoming and friendly, and the discussions seemed more like conversations than question and answer, which made the interview go quickly. I could tell during the interview that this firm could be a good fit for me. My interview ended with the Firm Administrator giving a tour and answering any other questions I had.

An hour or two after the interview, I received a call from the Firm Administrator extending me an official internship offer. I was ecstatic and went on to accept the offer.

For more information on recruiting and hiring at Brickley DeLong PC, please visit our career pages or contact Christine Dill, cdill@brickleydelong.com or (231) 726-5835.

Patrick Mutchler
In General Articles

Credit Unions Seek Greater Flexibility in Business Lending

A recent article by Mark Sanchez published in MiBiz, discusses a proposed change in federal regulation that may change how credit unions structure business loans. Proposed by the National Credit Union Administration, this change would essentially allow greater flexibility in business lending through credit unions. Key changes in the proposal include:

  • Allowing credit union loan officers to waive personal guarantees on member business loans,
  • Removing the 80 percent loan-to-value limits for collateral, and
  • Raising limits on construction and development loans.

While credit unions are looking forward to more latitude while structuring a deal, many banks oppose the proposed regulation changes, claiming Congress enacted lending caps for good reason.

For more information on credit unions and business loans, please visit the referenced article by Mark Sanchez in MiBiz, or contact Patrick Mutchler at pmutchler@brickleydelong.com or (231) 726-5870.

Brian McFarren
In General Articles

Snyder Signed Package of Bills to Assist School Districts

Governor Snyder signed a package of bills aimed to assist school districts in receiving faster help in a financial emergency.

The package, House Bills 4325-4332, combines:

  1. More financial reporting,
  2. The expansion of deficit elimination plan programs,
  3. The creation of enhanced deficit elimination plans, and
  4. Changes how the Michigan Department of Education and Treasury Department can withhold state aid payments to school districts.

The goal of this package of bills is to help school districts fix financial difficulties. To read the entire referenced article from MLive, click here.

For more information on school districts and the significance of these bills, please contact Brian McFarren at bmcfarren@brickleydelong.com or (231) 726-5815.

Brenda Jacobs
In Brenda Jacobs, Business Consulting, General Articles, Services

How CFOs Can Keep Up With Ever-Changing Technology

As a partner at Brickley DeLong with over twenty years’ experience in the profession, I have witnessed both our firm, as well as clients, and CFOs struggle to keeping up with the ever-changing technology.  “Moore’s Law” states that computing power doubles approximately every two years. This can cause strain on businesses managers, as it is essential to keep up with these fast paced changes.

In a recent article in the CGMA, author Jeff Drew, discusses seven tips for keeping up with technology changes, which are:

  • Hire financial staff with strong technology knowledge
  • Interact with in-house staff and/or outside consultants who are trusted technology experts
  • Attend conferences featuring sessions on current and emerging technologies
  • Set up RSS feeds with specific technologies as keywords
  • Join and become active in technology user groups
  • Collaborate with CFOs at other companies that use the same technologies
  • Meet with fellow CFOs to discuss technology issues

What has your business done to keep up with changing technologies? To read the article referenced above, click here.

 

Brickley DeLong is a West Michigan Accounting Firm, offering personalized accounting services with offices in Muskegon, Hart, and Grand Rapids, Michigan. 

Brian McFarren
In Business Consulting, Closely Held Businesses, General Articles, Industries

Avoid S-Corporation Termination

When choosing the right business entity, it is important to understand the positives and negatives of each option. S-corporations (S-Corps) can be a preferred choice for many closely held businesses because of their tax advantages; however, the requirements to qualify as an S-Corp can be more difficult. The IRS gives five requirements for S-Corporation Status:

  • Be a domestic corporation
  • Have only allowable shareholders

o   May be individuals, certain trusts, and estates and o   May not be partnerships, corporations or non-resident alien shareholders

  • Have no more than 100 shareholders
  • Have only one class of stock
  • Not be an ineligible corporation (i.e. certain financial institutions, insurance companies, and domestic international sales corporations).

In prior years, those that did not qualify for S-Corp status, or lost their qualification, faced significant fines. Now, the IRS allows for a Simplified Method for Relief. Author Sally Schreiber outlines the requirements of S Corps under this method that makes a corporation not subject to the three-year, 75-day deadline, but instead has no time limit on requesting relief:

  • The corporation is not seeking a late corporate entity classification election;
  • The corporation fails to qualify as an S corporation solely because Form 2553 was not timely filed;
  • The corporation and all of its shareholders reported their income consistent with S corporation status for the year the election should have been made and all later years;
  • At least six months have passed since the corporation filed its first S corporation year tax return;
  • The IRS did not notify the corporation and the shareholders of any problem with the S corporation status within six months after the return was filed; and
  • The completed election form includes statements from all shareholders from the date the election was to have been effective to the date of the filing stating that they have reported their income consistent with S corporation status.

Click here for the full article. For more information on corporation requirements, or setting up a new business, please contract Brian McFarren at (231) 726-5815 or bmcfarren@brickleydelong.com.

Brickley DeLong is a West Michigan Accounting Firm, offering personalized accounting services with offices in Muskegon, Hart, and Grand Rapids, Michigan. 

Michael Davis
In General Articles

The Importance Getting Employees Excited About Work

In a recent article from the Harvard Business Review, the authors, Kelly and Ben Decker, discuss the importance of getting employees excited about their work, and how to motivate them.

Studies show that 67% of employees are not engaged at work.

Kelly and Ben Decker discuss the importance of “aspire to inspire” employees. Through this, they developed a Communicator’s Roadmap, which measures emotion and content in messages.

To help retain top talent, it is important to shift conversations to “audience-centered content” through “emotional content”. These messages aim to inspire employees and give them a purpose and a personal level of accountability.

This graph is important to all career fields. At Brickley DeLong, we believe in the importance of employee engagement and strive to communicate effectively with our diverse group of employees. When you empower your coworkers, you give them a greater sense of being and they become better, happier employees. By inserting emotional content, you become more real with coworkers, and therefore, more relatable.

We would love to hear your input on this subject. Please comment below with and thoughts.

To read the full article, click here.

 

Brickley DeLong is a West Michigan Accounting Firm, offering personalized accounting services with offices in Muskegon, Hart, and Grand Rapids, Michigan. 

Michael Davis
In General Articles

What are the Tax Implications of Hiring a Nanny?

Becoming a new parent is an exciting time; however, the decision on whether or not a parent will stay home with the child, or pay for someone else to take care of him or her, can be difficult. One option that is appealing to many families is hiring a nanny. An in-home nanny can provide convenience and personalized care for parents and their child or children. When choosing this decision, it is important to look at the tax implications on hiring a nanny.

Susan Allen, in an article from the AICPA, discusses a few points that are important if a family choose to hire a nanny.

  1. Nannies are household employees
  2. Employers must pay employment taxes and manage other payroll responsibilities
  3. Employers need to consider benefits

While these points may make is seem more complicated if one so chooses an in-home nanny, rather than a daycare facility, Allen also offers points on how to allow the in-home nanny transition go smoothly.

  1. Find the perfect nanny
  2. Use an inexpensive payroll service to manage the administrative burdens
  3. Take advantage of the depedent care flexible spending account
  4. Let your nanny help with other household chores

 

To read the full referenced article, click here. For assistance in understanding your obligations in hiring a nanny, please contact Terry Maycroft at (231) 726-5825 or tmaycroft@brickleydelong

 

Brickley DeLong is a West Michigan Accounting Firm, offering personalized accounting services with offices in Muskegon, Hart, and Grand Rapids, Michigan.