Category: Uncategorized

Posted on

2020- Why This is the Year You can Profit from a CPA Partner

Do you fit in one of the following categories?

  • A business owner (regardless of size)
  • Self-employed
  • A business owner who received COVID-19 related SBA loan proceeds
  • An employer who took advantage of COVID-19 payroll tax incentives
  • An investor
  • A real estate owner
  • A recipient of income from partnerships and/or s-corps
  • An individual with significant out of pocket medical expenses
  • An individual who received and/or sold inherited assets

If you fit into any of the above categories, or believe that your accounting/tax situation includes some complexity this post is for you.

We all know that this has been a crazy year in terms of not only our national public health, but also in terms of our economic and business environment. During 2020 we have all seen an abundance of tax-related legislation introduced surrounding the COVID-19 pandemic crisis response. By now we have all grown familiar with hearing the terms PPP, EIDL, payroll tax deferral, employee retention credit, sick and family leave credit, and many more. Prior to 2020, these were unknown terms. Much of this legislation has also been revised a few times throughout the year, and has continued to grow increasingly more complex as 2020 has advanced.

If you are a complex individual, a business owner, or even someone with a “side gig” who has thought many times about extending your business partner reach by working with a CPA firm for accounting and tax preparation, this may be the right time. Due to the newly enacted tax regulations surrounding all things COVID-19, as well as the continuation of the regulations put in place through the Tax Cuts and Jobs Act (TCJA) this is a great time for you to establish a relationship with a trusted advisor who can help you navigate these complex times.

Why a CPA Firm?

I get the question quite often, “Why a CPA firm? Can’t someone who is a tax preparer just do my taxes?” Although it is true that someone who is a “tax preparer” can prepare and file your taxes for you, the greater question you should ask yourselves is, “What level of education, professionalism, and proven dedication to a profession should be important to me in such a volatile season while I am considering a partner?”

CPAs have not only achieved a great deal of formal education and certification that proves their dedication to a profession of serving the best interest of clients, but CPAs are also required to obtain 80 hours of continuing education every two years to maintain licensure. It is through our continuing professional education requirements that we focus on learning complexities of the ever-changing tax law/accounting regulations and how to apply these to best assist our clients in their unique situations.

Only CPAs are held to this high standard of continuing education.

I’m Interested, What Next?

Our firm, Bynum CPA, PLLC and our bookkeeping subsidiary company Arc Accounting, PLLC, would like to earn your business as your trusted advisors during this season. If you are interested or know someone who may be interested in tax planning, tax preparation, business bookkeeping, or payroll services please reach out to us.

You can email us directly at info@bynumcpa.com or head over to our website and fill out a contact form. Following that, we will reach out to you to arrange a time to chat about your needs either in person or via video conference.

As always, we are striving to serve our clients well and would welcome you as one of our own.

-Wes

Check out our family of brands:

Wisdom of Wealth Blog

Bynum CPA, PLLC

Arc Accounting, PLLC

Posted on

Retirement Withdrawals and The CARES Act

In response to the COVID-19 pandemic, Congress passed into law the Coronavirus Aid, Relief, and Economic Security Act (CARES Act). There are provisions in the CARES act that are intended to benefit the hardships faced by many businesses, as well as COVID-19 related challenges faced by individuals and families. One such provision included for the benefit of individuals is the ability for “qualified individuals” to avoid penalty for withdrawals from retirement savings and also increased the allowable amount of loan from a 401(k) plan from $50k to $100k.

Who is a “qualified individual”?

A qualified individual is broadly defined as anyone who has suffered adverse consequences due to the Coronavirus. This can mean that you were physically impacted by you or a close relative having been diagnosed with the Coronavirus. It can also mean that you were negatively affected from a financial perspective due to loss of job, loss of hours, decrease in wages, change of role, layoff, furlough, etc.

What is the benefit?

An individual can avoid the 10% early withdrawal penalty that is normally assessed on a retirement plan withdrawal made prior to age 59 1/2 (or the 25% penalty on SIMPLE plan withdrawals). Funds withdrawn from a plan under the CARES act provisions can be spread out evenly as income over the next three years, therefore lessening the tax burden faced in the year of withdrawal.

The CARES Act also increases the amount that you can take as a loan from your retirement plan from $50k to $100k if you are considered a “qualified individual”.

Final Thoughts-

The above mentioned CARES act was created to assist those who may be facing a difficult season due to the Coronavirus and need easier access to their retirement savings. Remember that it is generally not recommended to pull from retirement savings unless absolutely necessary due to the loss of future tax deferred earnings on your investments. Please consult your financial planner or CPA prior to withdrawing funds from your retirement under the protection of the CARES act provisions to make sure that you understand some of the more complex issues involved.

If you would like to discuss this in greater detail, please reach out to us at info@bynumcpa.com or via phone at (615) 896-2864.

Posted on

PPP Loan Update- New Forgiveness Rules

During the COVID-19 pandemic, many small businesses were able to work through their local banks and SBA lenders to access funds through the Payroll Protection Program (PPP). In response to a national emergency, this program was created quickly and many revisions to the terms have been made along the way. The most recent changes to the forgiveness terms were passed in the Paycheck Protection Program Flexibility Act and signed into law on June 5.

Many of my small business owner clients and friends were able to obtain funding through this program, and are now preparing to apply for forgiveness. If you are a small business owner and have not yet applied for the PPP program and feel like you might be eligible, act quickly. The deadline to apply through an approved SBA lender is June 30. I wanted to share with you some of the most important term revisions that the June 5 Flexibility Act created.

  • Extends the deadline to use PPP funds from June 30 to December 31, 2020.
  • Reduces the proportion of the loan that must be used for payroll-related costs from 75% to 60%.
  • Payback terms extended from two years to five years. No retroactive application of this rule for notes that were in place prior to June 5.
  • Eliminates the original forgiveness penalty based on businesses being required to maintain employee headcount at the same level as pre COVID-19.
  • Gives businesses 10 months to apply for loan forgiveness with their loan originator.
  • Defers loan payments of any kind until a forgiveness decision is made on each case by the SBA and original lender.
  • The period of time allowed to spend funds on allowable business expenses and apply for forgiveness is extended from the original 8 week period to 24 weeks from the date of loan issuance.
  • Businesses who received PPP funds can now utilize the payroll tax deferral rules that were included in the CARES Act and previously excluded PPP borrowers.

Your CPA business advisor can be a valuable resource in helping you with the application for PPP loan forgiveness.

Be sure to follow the Wisdom of Wealth blog for more news updates and articles from Bynum CPA, PLLC and Arc Accounting, PLLC.

Check out www.bynumcpa.com and www.arcactg.com to learn more about professional services offered.

Posted on

Welcome!

Thank you for taking the time to check out the Wisdom of Wealth blog! I am new to this, but hope that you will find my writing relevant and follow along! My goal is for the followers of Wisdom of Wealth to gain building blocks from my posts that they find useful in day to day application in their personal financial lives or business management.

In my writing, I plan to address many of the common questions that arise from my practice as a CPA serving individual and business clients among many different backgrounds and industries.

In the meantime, if you would like to check out my virtual bookkeeping/CFO business to see how we are changing the way that modern business owners and modern accountants interact, follow the link below-

http://www.arcactg.com