Nearly1% of taxpayers got audited on their 2017 tax returns. Likely, the majority of those tax returns turned up a red flag that warranted a deeper look by the IRS.
That number might rise this year as many people are dealing with the changes spurred by the Tax Cuts and Jobs Act.
Since many of us are preparing tax returns before the April 15 deadline, we thought it would be a good idea to highlight some of the red flag items that could trigger an audit.
Making More than $200,000
Apparently, success can generate attention from the IRS. While about 1% of tax returns get audited, statistics show that the number increases to 4% for folks making $200k to $1million. If you’re a millionaire, that number rises to 12.5%.
Don’t think hiding income can reduce your chances of an audit. The IRS has a robust system to look for discrepancies. They’ll compare your return with the information they received from W-2s, 1099-MISCs, 1099-Ks and other forms. Failing to report income can generate an automatic IRS letter.
Being Overly Charitable
With charitable donations being one of the few remaining deductions available to taxpayers, it’s also one that could be noticed by the IRS—especially if it’s above the norm for your income level. Don’t worry about being too generous to charities. If you have the documentation proving your donations, you’ll satisfy the IRS.
Not Reporting Early Withdrawals from Retirement Funds
Sometimes you may need to dip into your retirement funds before turning 59 and a half. The IRS charges a 10% penalty on withdrawals unless it’s for eligible scenarios like purchasing a home for the first time, education expenses and emergency medical costs. Surprisingly, 40% of taxpayers didn’t report the withdrawals. Remember, the IRS has a robust discrepancy system and will know about that withdrawal.
Running a Business
The IRS is especially sensitive for returns from small business owners. They look for owners who report substantial losses and businesses that are typically cash-intensive (taxis, car washes, bars, hair salons, restaurants, freelancers, etc.). They’ll also look closely at your deductions for personal vs. business expenses. For example, is your car strictly used for business? How about larger than norm traveling expenses? Were those actual business-related meals you deducted? Keeping your deductions well documented can be a big help during an audit.
Claiming Hobby Losses
If you have a weekend passion that costs a bit of money, it might be tempting to write off some of those expenses. That makes you a prime audit target for the IRS. Multiple years of losses can be a red flag. If you show profit generation for three of every five years, the IRS will consider you an actual business. Again, documentation can be a big help to you.
Running a Marijuana Business
As states start legalizing medical marijuana, businesses are popping up everywhere to cash in. However, on the federal level, deductions of controlled substances are disallowed. The IRS is keeping an eye on legal marijuana firms.
Lesson Learned: Stay Well Documented
If you’re well documented, generally you’ll have nothing to fear is you receive a letter from the IRS. Keep in mind, the IRS can audit tax returns from three years ago. So keep your files well organized and handy for a few years.
Too Busy? Delegate Your Tasks
As stated, recordkeeping is very important and while it could end up saving you in an audit it can be time-consuming. We can help! Delegate this and other business tasks such as bookkeeping, administrative, and marketing to us, a team of well trained, experienced professionals ready to put our skills to work for you. Give us a call at (904) 429-4588 and “You do what you do best; we’ll take care of the rest”.
When people type your business name in a search engine, what do they see?
Typing your business name in a search engine is considered a branded search. If you haven’t considered what a branded Google search for your business would look like, you should check it out.
Branded searches can be great for your business. Most businesses have found that branded searches account for a high percentage of their website traffic. In fact, branded keyword searches have shown a 2x higher conversion rate than non-branded searches.
Branded searches aren’t just about traffic to your website. As we shared last month on the importance of conducting a Google My Business audit, Google is working hard to serve up answers about your business without sending searchers to your website.
Why would a potential customer want to do a branded search on your business? They might have:
- Seen your ad in the mail, magazine or billboard
- Glimpsed a mention of your business on Facebook
- Been referred to your business by a past customer
In most cases, these searchers are considering doing business with you and want to check out your company.
What People Might See if They Google Your Business Name
Since these are potential customers, it’s important to understand what they might encounter when they search online for your business.
Here are some possibilities of a branded search:
At the top of the search result page: Pay-per-click ads from competitors who took advantage of your branded name as a keyword and paid to get their name above yours.
In the organic search section: They might see a link to your website that includes a meta-title and meta-description of your business. Also, they might see sitelinks to popular webpages on your site.
Other links they might see is your Facebook and other social media properties. Possibly there will be third-party review sites listing your business. If you’ve been mentioned in the news, there might be a link to the article. Also, if you have videos online, they might appear in the organic search section.
Your business information in a Knowledge Panel: If you have a Google My Business profile, likely you’ll have a Knowledge Panel showing the following information about your business:
- Your Name, address, and phone number
- Links to your website
- A button to call your business
- Hours of operation
- Customer reviews
- Links to directions and a Google Map with your location
- Photos and videos
- Google Posts
- Questions and answers
How to Manage Your Branded Search
For the most part, Google will provide search results that the search engine company deems useful to the intent of the searchers.
Your goal would be to provide the information that Google would find useful for the branded searches.
Maintain a Google My Business Presence: Make sure you have a Google My Business profile and have fully provided content to all of the available sections.
Make Sure Your Website is Optimized for Searches: This includes making sure your webpages have:
- Meta-titles and meta-descriptions
- Consistent name, address phone numbers
- Content that would be useful to potential customer searches
Create and Maintain Third Party Online Presence: Wherever you can create a profile online and provide content about your business, do so.
- Facebook and other social media networks
- Business listings
Consider PPC Ads if You Find Competitors on Your Branded Search: Being on top of the search engine results page is advantageous—it’s the location that gets the searchers immediate attention. That’s why your competitors are there—and why you should be as well.
Is Managing Your Branded Search Results More than You Can Manage? Reach Out for Help.
Given the importance Google is placing on branded searches, it’s imperative for your business to start managing what potential customers see.
If you’d like help, contact us for a free consultation. Give Business Solutions Unlimited a call at (904) 429-4588 and let us start helping your business today.
As tax season gets into gear, many small businesses will be adjusting to the major tax legislation passed in December 2017 and implemented in 2018.
As a small business, Business Solutions Unlimited makes it a point to stay up to date on current tax laws. That way we ensure we’re paying the right amount each year—plus reduce the impact of surprises that could impact our finances when the tax bill comes due.
While we don’t promote tax services as part of our virtual assistance services, we like to help keep other small businesses informed about tax issues.
So, let’s explore some of the tax matters that could impact your business this year.
Reduction of Corporate Tax Rate
C Corporations pay a flat 21%, reduced from a previous rate of 35%. While that’s great for some businesses, the elimination of the lower 15% corporate rate means some businesses will be paying the higher 21% rate this year.
Tax Relief for Pass-through Businesses
Sole proprietors may qualify for a 20% pass-through deduction of their QBI, qualified business income. Exceptions apply for businesses in the following industries:
- Actuarial Sciences
- Financial Services
- Brokerage Services
- Performing Arts
- Specified Service Trades/Business: Trade or business where principal asset is the skill of one or more employees
Entertainment & Meal Write-offs
In years past, businesses could write-off pretty much any entertainment expenses related to their business. Not anymore. The new tax law removed that option. However, taking clients out to dinner or bringing meals in for employees is still deductible.
Business Mileage Rates
Business standard mileage rate is 54.5 cents per mile. Businesses have a choice between standard mileage deductions and 50% of your actual driving expenses (gas, insurance, parking, tolls, repairs, etc). Most experts recommend business use the:
- Standard mileage rate if driving less than 50% for business
- Actual expenses if driving more than 50% for your business
Deductions (Section 179) on business asset purchases increased. That means you can deduct up to $1 million on qualifying assets purchased and placed into service after September 27, 2017. In many cases, this could be 100% of the cost of your purchase.
Bonus depreciation increased from 50% to 100% for qualified property purchased and placed into service after September 27, 2017.
Businesses that provide paid or medical leave to employees can get a temporary credit equal to 12.5% of the amount of wages paid during the leave.
Where to Get Answers on Small Business Taxes
It’s always good to go to the actual source when seeking information. That’s why we recommend going to this IRS webpage dedicated to how tax reform provisions affect businesses.
Too Busy? Delegate Your Tasks
As QuickBooks ProAdvisors we can help you by providing experienced bookkeeping services and working with your tax preparer, saving you time and money. Feel free to give us a call at (904) 429-4588 to discuss this service and many more we offer to help you delegate time-consuming tasks while maintaining low overhead.
In recent years, Google has not-so-quietly been staging a bit of a takeover on the Web. Not content to be the largest search engine in the world, Google is actively working toward a “zero-click-query” environment.
Basically, Google wants to serve up answers to searcher queries—without sending them to a website. Google wants to keep users on Google.
That’s why Google is investing heavily on adding new features to their Google My Business (GMB) platform.
To stay competitive in local online search, businesses should take full advantage of the features available on GMB. Doing so will help the business develop and maintain a robust online presence that’s not solely dependent on a website for converting searchers to clients.
Today, GMB will display clickable phone numbers, hours of operation and other business information plus options to book or schedule appointments—even to make a purchase.
If you want your business to remain relevant in Google local searches—particularly branded searches—it might be time to audit your GMB presence.
What an GMB Audit Should Entail
When we conduct GMB audits for small businesses, we look at seven factors that have shown to have a significant impact on local searches and conversions.
Confirmation of a GMB Presence
A Google My Business (GMB) presence is considered the hub of your online Google presence. It’s important that businesses claim their Google My Business listing. This will be where businesses can manage the majority of information as it appears in Google.
It’s also a key factor Google references to generate a Knowledge Panel on branded searches for your business.
If you’ve been in business for a while, you probably have a GMB presence—whether you created one or not. Google is active at crawling and finding businesses.
If a GMB exists for a business, we’ll determine if the business has actually claimed it.
What Business Categories Are You Listed Under?
Business categories in GMB can be one of the most influential factors in ranking on Google and Google Maps. Being specific in your primary category can help influence rankings in a competitive environment.
Consistent Name, Address and Phone Number (NAP)
Your business name, address and phone number should be consistent throughout your online presence. A mismatched NAP between your GMB listing and your website could create consistency issues—impacting how Google shows or doesn’t show your business.
Reviews on Google continue to increase in importance in local search and reputation building. They influence both ranking and customers’ decision making. Google looks at various signals to influence its search rankings and reviews can provide the search engine with valuable information.
During an audit, we’ll look at:
Number of Reviews: Nationwide, local businesses that rank in the top 3 positions of Google Local Search have an average of 47 Google Reviews. While having a large number of reviews doesn’t guarantee rankings, it could be considered an important signal to Google that you’re an active business.
Responses to Reviews: Business responses to reviews is a signal to Google that you are an engaged business.
Keywords in Reviews: Reviews that include keywords such as specific services and products can help boost rankings for those specific searches.
Photos and Videos
Google reports that businesses with photos receive 42% more requests for directions and 32% more clicks than businesses without photos. GMB has made images an important and prominent feature in the Knowledge Panel.
Google advises businesses to include at least three strong exterior and interior images. An image of the common area and reception area. A minimum of three management and team photos.
Additionally, Google encourages businesses to include videos as part of its GMB visual presentation.
GMB provides businesses opportunities to post images, copy, call to actions (book an appointment, learn more, sign up, etc.), URL links, and events that will appear on their Knowledge Panel.
Posts can be a great way to add more information and grab searcher attention to your Google presence. Google posts are limited to 300 words of which 100 characters appear in the Knowledge Panel. Posts can appear for a maximum of 7 days on GMB. Event & offers will appear until they expire.
By adding keywords in the copy, Google Posts may appear on relevant searches.
Google Questions & Answers
GMB Question and Answers feature allows searchers to pose questions to your business. This provides the business with an opportunity to provide authoritative and expert answers that remain on your Knowledge Panel.
Google also encourages businesses to create a Frequently Asked Questions and Answers list and post these on your GMB. This is an opportunity for businesses to get out in front of potential questions the public may have about your business or services you provide.
Questions and Answers can be “upvoted” by both the business and searchers. By being the one of the first to add Q&As, your postings can be “upvoted” more frequently over time.
Don’t Have Time to Audit Your GMB? Reach Out for Help.
Surprisingly, there are a substantial amount of businesses that haven’t claimed, developed or fully used their GMB profiles. Given the importance Google is placing on this, these businesses are doing themselves a huge disservice.
We understand this all takes time to complete, manage and stay on top of. That’s why we’re here. Give Business Solutions Unlimited a call at (904) 429-4588 and let’s discuss how we can start helping your business today.
By the end of 2018, Intuit’s QuickBooks Online (QBO) surpassed 3 million users. Small business owners apparently desire live access to their accounting information from this cloud-based service.
A market that size certainly attracts the interest of app makers. Intuit lists thousands of software applications in their marketplace.
We thought we’d provide a guide to some of the more popular apps that sync well with QuickBooks Online.
With a 4.8 star rating in the Intuit app center, Method:CRM is a customer relationship management (CRM) tool that integrates communications and activities (such as leads, sales, and financial data) to employees, vendors, customers and prospects all from one platform.
Monthly subscriptions start at $25 per user. Method:CRM offers a free 30-day trial period.
TSheets Time Tracking
With a 4.9 star rating in the Intuit app center, TSheets integrates employee time tracking directly inside QBO. Employees can clock in from various devices including their smartphone, computer and time clock kiosk. Time can also be tracked against job/project codes—a useful feature for businesses working with multiple clients.
The app is free for one user. For multiple users, pay plans start at $20 per month plus $5 per additional users.
With a 4.5 star rating in the Intuit app center, Expensify seamlessly integrates with QBO to track receipts, mileage, expenses, and credit card transactions. A handy feature is Expensify’s ability to read merchant name, date and amounts of receipts with just a snap a photo from your smartphone.
Monthly subscriptions start at $5 per user per month.
With a 4.8 star rating in the Intuit app center, Business Payments syncs transactions from PayPal and Strip with QBO. This allows small businesses to automatically track invoice payments, single payments, ongoing payments, shopping cart payments, refunds, and expenses associated with the payment platform.
Monthly subscriptions are free for up to 50 transactions and start at $9 per month for up to 500 transactions.
With a 4.5 star rating in the Intuit app center, Bill Pay allows small businesses to pay bills from vendors and contractors directly from QBO with a single click—saving time on double data entries.
There are no monthly subscription fees to use Bill Pay. Transactions are $0.99 per ACH and $1.99 per check.
Customize Your QuickBooks Online to Fit Your Business Requirements
Intuit has made QBO scalable to provide customized solutions for small businesses of all types and sizes. Business owners looking to streamline their activities should look into how these apps and others can extend the functionality of this powerful online accounting tool.
Too Busy? Delegate Your Tasks
Managing a business is time-consuming. We understand. Consider delegating tasks like managing QuickBooks and looking for ways to streamline your accounting activities to a virtual assistant firm like Business Solutions Unlimited. Give us a call at (904) 429-4588, we have a QuickBooks ProAdvisor ready to help you.