SmallBusiness.com – SmallBusiness.com https://smallbusiness.com Small business information, insight and resources | SmallBusiness.com Thu, 15 Nov 2018 17:41:39 +0000 en-US hourly 1 https://wordpress.org/?v=4.9.8 A Pickup in October Retail Sales Bolsters Holiday Shopping Expectations | 2018 https://smallbusiness.com/retail/october-retail-sales/ https://smallbusiness.com/retail/october-retail-sales/#respond Thu, 15 Nov 2018 17:31:24 +0000 https://smallbusiness.com/?p=33482

Retail sales in October were up 5.6 percent year-over-year, according to calculations released today by the National Retail Federation.  “Today’s pickup in retail sales shows a healthy pace of spending and a sign of ongoing consumer strength which is consistent with the state of the US economy,”  said. “The figures bolster expectations for the major shopping period of the year, the holidays,” says Jack Kleinhenz, NRF chief economist. “Thanks to a high level of consumer confidence surrounding the current and future economy, we expect spending to maintain its strong momentum.” The pickup in October was also due in part to delayed spending associated with the hurricanes in early fall, according to Kleinhenz.


October sales were up 4.3 percent on a three-month
moving average compared with the same period a year ago.


NRF’s numbers are based on data from the U.S. Census Bureau, which released overall October sales – including automobiles, gasoline and restaurants – which indicated a seasonally adjusted increase from September and 4.6 percent above October 2017.

Specifics from key retail sectors

Online and other non-store | Sales were up 13.9 percent unadjusted year-over-year and up 0.4 percent seasonally adjusted from September.

Building materials and supplies stores | Sales were up 6.5 percent unadjusted year-over-year and up 1.0 percent seasonally adjusted from September.

Clothing and accessories stores | Sales were up 4.7 percent unadjusted year-over-year and up 0.5 percent seasonally adjusted from September.

Food and beverage stores | Sales were up 3.7 percent unadjusted year-over-year and up 0.3 percent seasonally adjusted from September.

Health and personal care stores | Sales were up 3.6 percent unadjusted year-over-year and unchanged from September.

General merchandise stores | Sales were up 3.4 percent unadjusted year-over-year and up 0.5 percent seasonally adjusted from September.

Furniture and home furnishings stores | Sales were up 3.2 percent unadjusted year-over-year and down 0.3 percent seasonally adjusted from September.

Electronics and appliance stores | Sales were up 2.4 percent unadjusted year-over-year and up 0.7 percent seasonally adjusted from September.

Sporting goods stores |  Sales were down 7 percent unadjusted year-over-year and up 0.5 percent seasonally adjusted from September.

The October numbers come as retail continues a long-term pattern of increased sales. Total retail sales have grown year-over-year every month since November 2009, and retail sales as calculated by NRF – excluding automobiles, gasoline stations and restaurants— have increased year-over-year in all but one month since the beginning of 2010.


GettyImages

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How to Display Special Holiday Hours on Your Yelp and Google Business Listings https://smallbusiness.com/digital-marketing/google-yelp-business-listings-temporary-information/ https://smallbusiness.com/digital-marketing/google-yelp-business-listings-temporary-information/#respond Tue, 13 Nov 2018 06:01:08 +0000 https://smallbusiness.com/?p=30721

(Updated | November 13, 2018)

One of the handiest features of services like Yelp or Google’s business listings is their display of a company’s hours of operation. Seeing that a shop is “about to close” has stopped me from driving across town on several occasions. But what about those days when a cafe may be closed because of a private party? Or perhaps it may have different hours related to the seasons of the year? There are times when the owner of the business needs to change the time of operation for one day only. Some small restaurants close on the weekend, or perhaps on Mondays. In some countries, shops and cafes close during mid-afternoon hours. On some official U.S. holidays, nearly all American businesses close (Thanksgiving, for example). However, there are certain days that aren’t actually holidays, but on which many businesses close (the day after Thanksgiving, for example). Most confusing are the closing times during the end-of-year shopping holidays, (including the Small Business Saturday).


Here’s how to manage special days and times on Yelp and Google’s listings pages. (Tip: You also should also update your website.)



How to change information related to a special date or time on your company’s Google business listings

Before Starting | If you haven’t already claimed your Google Business listing, start with our tutorial on “How to Start Using Google My Business.” If you’d like to learn a lot about using Google My Business, visit the SmallBusiness.com Guide to Managing a Listing on Google Search and Maps.

Start | Sign in to Google My Business

  1. For a single location:
    1. From card view, choose the listing you’d like to set special hours for and click Manage location. If you’re viewing your locations as a list instead of cards, switch to card view by clicking the cards icon  on the right side above your locations.
    2. Click Info from the menu on the left side of the page.
  2. For multiple locations:
    1. From list view, select the locations you’d like to set special hours for. If you’re viewing your locations as cards instead of a list, switch to list view by clicking the list icon  on the right side above your locations.
    2. Click the pencil icon  in the top-right corner of the page.

Click the  Special hours section | (You’ll only see this section if you’ve already provided regular hours.)

  • Click Confirm hours next to an upcoming holiday. Or click Add new date to choose a different date.
  • Enter the opening and closing times for that day.
  • Slide the circle to “Closed” to indicate that the location is closed all day.
  • If you’re open 24 hours, click Opens at and select 24 hours from the drop-down menu that appears.
  • If you enter closing hours past midnight, make sure to set them properly.
  • When you’ve finished entering all of your special hours, click Apply.

Your special hours will appear to customers on Google only for the designated days.


How to set a special date or time on your Yelp business listing

First things first | If you haven’t done so already, find and claim your Yelp Business Page. (More information about claiming your business.) After you have claimed your Yelp Business Page and have been verified by Yelp, do the following.

Log-in at biz.yelp.com. (You may also want to download the Yelp for Business Owners app for mobile access.)

Log into the Yelp for Business Owners admin page on either the app or your Yelp listings page.

  • On “Business Information” select “Special Hours.”
  • Mark your business as being closed or opened during a specific window of time.
  • Special hours are set on a day-by-day basis, so add each day where your operating hours will be different from the hours regularly listed on Yelp.


Once your hours are set, customers will see a banner highlighting your special hours on your Yelp Business Page as well as call outs in the hours’ section.

istock, yelp.com

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Facebook is Featuring 100 Small Business Products in Nine Macy’s Pop-Up Holiday Stores https://smallbusiness.com/retail/macys-facebook/ https://smallbusiness.com/retail/macys-facebook/#respond Wed, 07 Nov 2018 16:45:43 +0000 https://smallbusiness.com/?p=33436

Facebook is opening nine holiday pop-up stores in Macy’s around the U.S. that will feature 100 digital-native brands and small businesses that have found success on Facebook or Instagram. In other words, there are some things about retailing that begs for high-touch, not just high tech.


According to Facebook, millions of people discover brands and products they love on Facebook and Instagram (which is owned by Facebook). The pop-up stores will allow customers to get up-close and personal with around 100 of these products. The digital-native businesses will have the opportunity to showcase their brands in a physical location, allowing shoppers to feel the brand’s clothing for themselves, according to Facebook.

The pop-up stores will be in Macy’s in the following cities

  • New York City
  • Pittsburgh
  • Atlanta
  • Fort Lauderdale
  • San Antonio
  • Las Vegas
  • Los Angeles
  • San Francisco
  • Seattle

Among the 100 products that will be featured


Image | TwoBlindBrothers.com
Image | Facebook

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Does Your State Require Employers to Provide Time Off for Employees to Vote? https://smallbusiness.com/employees/employee-vote-election/ https://smallbusiness.com/employees/employee-vote-election/#respond Mon, 05 Nov 2018 17:24:14 +0000 https://smallbusiness.com/?p=33416

According to the United States Elections Project, an estimated 34,417,530 Americans have already voted in tomorrow’s (11.6.2018) mid-term (also called, “general”) election. Most of these votes were cast in one of the 37 states that offer some form of early voting. Others used absentee or “write-in” ballots. No matter what the method, it is a record year for early voting.


37 | States that offer some form of early voting (in addition to absentee)
34,417,530 | Estimated votes (as of 11.4.2018) cast early in the 2018 mid-term/general election
20,500,000 | Votes cast early in the 2014 mid-term/general election
68% | Percentage increase in early voting since 2014


 

voting 2018

 

State requirements related to providing employees time to vote.

In addition to voting early, many states have laws requiring employers to provide time for employees to vote. Each state is different and not all states have such regulations. Click on the link to your state to learn more about their specific requirements. Or, to be sure, call your local board of elections or your state labor department for more information. (Source: Vox.com, Nolo.com)

  • AlabamaEach employer is required by law to give its employees the “necessary time off” — not exceeding one hour.
  • AlaskaVoters who don’t have the “sufficient time” to cast a ballot may, without loss of pay, take off as much working time to do so. Employees who have two consecutive hours either before or after the polls open to vote are not eligible.
  • Arizona: Employers are required to give their employees up to three hours of time off for voting, unless that employee has a consecutive three hours before or after their shift to do so.
  • California: If a worker doesn’t have enough time to vote, their employer must give them sufficient time either at the beginning or end of their mandated hours. Up to two hours off must be paid, and employees must give their employers a two-day notice.
  • ColoradoEmployees must give prior notice, and the time off needs to be at the beginning or end of a shift. The mandate excludes workers who have at least three hours to vote when the polls are open, and they aren’t working.
  • Hawaii: Voters are entitled to two hours off from work and won’t risk any pay loss to do so. If someone takes time off to vote and doesn’t, that employer may deduct the appropriate amount from their salary.
  • Illinois: For special and general elections, employees can request two hours off to vote. If they ask on Election Day, the employer is allowed to say no.
  • IowaIf an employee doesn’t have three consecutive hours to vote outside of their regular shift, they may request time off to vote. The employer will designate the time slot, and may not penalize the worker or deduct any of their wages.
  • KansasEmployers in this state are required to provide time off work to vote, unless the polls are open for two hours before or after the employee’s shift.
  • KentuckyThe law requires employers in Kentucky to provide its workers with at least four hours of time off to vote or to obtain an absentee ballot. Employees cannot be penalized for doing so, but must request the time off at least one day before the election.
  • Maryland: Employers must permit at least two hours of paid leave for its employees to vote, so long as the employee doesn’t also have two hours of continuous, off-duty time when they could do so. They also must show proof to employers that they voted.
  • MassachusettsUnder the law, employers must allow employees in manufacturing, mechanical or retail industries to take time off to vote during the first two hours the polls are open. Workers — who will not be compensated for the time — must request the time off ahead of the election.
  • MinnesotaEmployers must pay their employees for the time off they need to vote. No specific time is given, so but employees are advised to “take only as much time” as they need to vote.
  • Missouri: Employers must give employees three hours paid time off to vote, but can choose the hours themselves.
  • NebraskaThe law in this state requires employers to give two hours off to voters who do not have two consecutive hours between when the polls open and close.
  • Nevada  Workers must notify their employers before Election Day, but can receive between one to three hours of paid time off to vote.
  • New Mexico: If your shift begins within two hours of polls opening or ends less than three hours before polls close, you’re entitled to up to two hours of paid leave to vote. Employers who violate the law can be fined up to $100.
  • New York: If registered voters don’t have sufficient time outside of their working hours, they may take up to two hours without loss of pay to do so.
  • Oklahoma: Employers must give its employees up to two hours paid time off work in order to vote.
  • South DakotaUnder state law, employees who don’t have two consecutive hours to vote are allowed to take time off to vote. Employers can determine the leave time for their employees.
  • TennesseeEmployers must provide a reasonable amount of paid time off to vote — up to three hours — if employees don’t have three consecutive hours to do so when not at work.
  • Utah: Employees who have less than three non-work hours when polls are open are eligible to request leave, so long as they do so before Election Day.
  • West VirginiaLike most states, the only employees eligible are those who don’t have three consecutive hours of their own time during polling time. Otherwise, they must ask for their employers in writing three days before Election Day for time off to vote.
  • WyomingEmployees can have an hour paid time off to vote, so long as they don’t also have three consecutive hours off work when the polls are open.

(Source: Vox.com, Nolo.com)

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Comparison Chart of Previous vs. New Small Business Tax Laws | 2018 https://smallbusiness.com/2018-tax-law/small-business-tax-2/ https://smallbusiness.com/2018-tax-law/small-business-tax-2/#respond Thu, 01 Nov 2018 19:54:36 +0000 https://smallbusiness.com/?p=33367

This chart was supplied by IRS.gov. It compares the old tax law provisions vs. the new that are part of the Tax Cuts and Jobs Act (TCJA). The side-by-side comparison can help you understand the changes — but you should also seek advice from your trusted and professional accounting, finance, and tax advisors.  Provisions of the TCJA that affect individual taxpayers can also affect business taxes. Businesses and self-employed individuals should review tax reform changes for individuals and determine how these provisions work with their business situation. One more time, remember: Different small businesses may have different factors that will cause the provisions to be different than yours. Also, see the IRS PDFs for more detail.: Publication 535, Business Expenses; Publication 946, How to Depreciate Property.


Deductions

Deductions 2017 Law Changes under TCJA

New deduction for qualified business income of pass-through entities

No previous law for comparison. This is a new provision.

This new provision, also known as Section 199A, allows a deduction of up to 20% of qualified business income for owners of some businesses. Limits apply based on income and type of business.

Limits on deductions for meals and entertainment expenses

A business can deduct up to 50% of entertainment expenses directly related to the active conduct of a trade or business or incurred immediately before or after a substantial and bona fide business discussion.

The TCJA generally eliminated the deduction for any expenses related to activities considered entertainment, amusement or recreation. However, under the new law, taxpayers can continue to deduct 50% of the cost of business meals if the taxpayer (or an employee of the taxpayer) is present and the food or beverages are not considered lavish or extravagant. The meals may be provided to a current or potential business customer, client, consultant or similar business contact.  If provided during or at an entertainment activity, the food and beverages must be purchased separately from the entertainment, or the cost of the food or beverages must be stated separately from the cost of the entertainment on one or more bills, invoices, or receipts

Notice 2018-76 provides additional information on these changes.

New limits on deductions for business interest expenses

The deduction for net interest is limited to 50% of adjusted taxable income for firms with a debt-equity ratio above 1.5. Interest above the limit can be carried forward indefinitely.

The change limits deductions for business interest incurred by certain businesses. Generally, for businesses with 25 million or less in average annual gross receipts, business interest expense is limited to business interest income plus 30% of the business’s adjusted taxable income and floor-plan financing interestThere are some exceptions to the limit, and some businesses can elect out of this limit. Disallowed interest above the limit may be carried forward indefinitely, with special rules for partnerships.

Changes to rules for like-kind exchanges

Like-kind exchange treatment applies to certain exchanges of real, personal or intangible property.

Like-kind exchange treatment now applies only to certain exchanges of real property

For more information, see Form 8824, Like-Kind Exchanges, and its instructions, as well as Publication 544, Sales and Other Disposition of Assets.

Payments made in sexual harassment or sexual abuse cases

No previous law for comparison. This is a new provision.

No deduction is allowed for certain payments made in sexual harassment or sexual abuse cases.

Changes to deductions for local lobbying expenses

Although lobbying and political expenditures are generally not deductible, a taxpayer can deduct payments related to lobbying local councils or similar governing bodies.

TCJA repealed the exception for local lobbying expenses. The general disallowance rules for lobbying and political expenses now apply to payments related to local legislation as well.

Depreciation

Depreciation

2017 Law

What changed under TCJA

Temporary

100 percent expensing for certain business assets

Certain business assets, such as equipment and buildings, are depreciated over time.

Bonus depreciation for equipment, computer software, and certain improvements to nonresidential real property allows an immediate deduction of 50% for equipment placed in service in 2017, 40% in 2018, and 30% in 2019.

Long-lived property generally is not eligible. The phase down is delayed for certain property, including property with a long production period.

TCJA temporarily allows 100% expensing for business property acquired and placed in service after Sept. 27, 2017 and before Jan. 1, 2023.

The 100% allowance generally decreases by 20% per year in taxable years beginning after 2022 and expires Jan. 1, 2027.

The law now allows expensing for certain film, television, and live theatrical productions, and used qualified property with certain restrictions.

For more information, see Tax Reform: Changes to Depreciation Affect Businesses Now and New 100-percent depreciation deduction for businesses.

Changes to rules for expensing depreciable business assets (section 179 property)

A taxpayer can expense the cost of qualified assets and deduct a maximum of $500,000, with a phaseout threshold of $2 million.

Generally, qualified assets consist of machinery, equipment, off-the-shelf computer software and certain improvements to nonresidential real property.

TCJA increased the maximum deduction to $1 million and increased the phase-out threshold to $2.5 million.

It also modifies the definition of section 179 property to allow the taxpayer to elect to include certain improvements made to nonresidential real property.

Publication 946, How to Depreciate Property, and the Additional First Year Depreciation Deduction (Bonus) FAQs provide additional resources on this topic.

Changes to depreciation of luxury automobiles

There are limits on depreciation deductions for owners of cars, trucks and vans.

TCJA increased depreciation limits for passenger vehicles. If the taxpayer doesn’t claim bonus depreciation, the greatest allowable depreciation deduction is:

  • $10,000 for the first year,

  • $16,000 for the second year,

  • $9,600 for the third year, and

  • $5,760 for each later taxable year in the recovery period.

If a taxpayer claims 100% bonus depreciation, the greatest allowable depreciation deduction is $18,000 for the first year, and the same as above for later years.

Changes to listed property

Computers and peripheral equipment are categorized as listed property. Their deduction and depreciation is subject to strict substantiation requirements.

TCJA removes computer or peripheral equipment from the definition of listed property.

Changes to the applicable recovery period for real property

The General Depreciation System (GDS) and the Alternative Depreciation System (ADS) of the Modified Accelerated Cost Recovery System (MACRS) provide that the capitalized cost of tangible property is recovered over a specified life by annual deductions for depreciation.

The general depreciation system recovery periods are still 39 years for nonresidential real property and 27.5 years for residential rental property. The alternative depreciation system recovery period for the nonresidential real property is still 40 years. However, TCJA changes the alternative depreciation system recovery period for residential rental property from 40 years to 30 years. Qualified leasehold improvement property, qualified restaurant property and qualified retail improvement property are no longer separately defined and given a special 15-year recovery period under the new law.

 

Businesses with employees: Changes to fringe benefits and new credit

For businesses that have employees, there are changes to fringe benefits and a new tax credit that can affect a business’s bottom line.

Fringe benefit

2017 law

What changed under TCJA

Suspension of the exclusion for qualified bicycle commuting reimbursements

Up to $20 per month in employer reimbursement for bicycle commuting expense is not subject to income and employment taxes of the employee.

Under TCJA, employers can deduct qualified bicycle commuting reimbursements as a business expense.

Employers must now include 100% of these reimbursements in the employee’s wages, subject to income and employment taxes.

Suspension of exclusion for qualified moving expense reimbursements

An employee’s moving expense reimbursements are not subject to income or employment taxes.

Under TCJA, employers must include moving expense reimbursements in employees’ wages, subject to income and employment taxes. Generally, members of the U.S. Armed Forces can still exclude qualified moving expense reimbursements from their income.

Prohibition on cash, gift cards and other non-tangible personal property as employee achievement award

Employers can deduct the cost of certain employee achievement awards. Deductible awards are excludible from employee income.

Special rules allow an employee to exclude certain achievement awards from their wages if the awards are tangible personal property. An employer also may deduct awards that are tangible personal property, subject to certain deduction limits. TCJA clarifies that tangible personal property doesn’t include cash, cash equivalents, gift cards, gift coupons, certain gift certificates, tickets to theater or sporting events, vacations, meals, lodging, stocks, bonds, securities, and other similar items.

Tax Credit

2017 law

What changed under TCJA

New employer credit for paid family and medical leave

No previous law for comparison. This is a new provision.

The TCJA added a new tax credit for employers that offer paid family and medical leave to their employees.

The credit applies to wages paid in taxable years beginning after December 31, 2017, and before January 1, 2020.

The credit is a percentage of wages (as determined for Federal Unemployment Tax Act (FUTA) purposes and without regard to the $7,000 FUTA wage limitation) paid to a qualifying employee while on family and medical leave for up to 12 weeks per taxable year. The percentage can range from 12.5% to 25%, depending on the percentage of wages paid during the leave.

For more information on the new credit, see Notice 2018-71 and New credit benefits employers who provide paid family and medical leave.

 

Business structure and accounting methods

An organization’s business structure is an important consideration when applying tax reform changes. The Tax Cuts and Jobs Act changed some things related to these topics.

Business structure topic

2017 law

What changed under TCJA

Changes to cash method of accounting for some businesses

Small business taxpayers with average annual gross receipts of $5 million or less in the prior three-year period may use the cash method of accounting.

The TCJA allows small business taxpayers with average annual gross receipts of $25 million or less in the prior three-year period to use the cash method of accounting. The law expands the number of small business taxpayers eligible to use the cash method of accounting and exempts these small businesses from certain accounting rules for inventories, cost capitalization and long-term contracts. As a result, more small business taxpayers can change to cash method accounting starting after Dec. 31, 2017.

Revenue Procedure 2018-40 provides further details on these changes.

Changes regarding conversions from an S corporation to a C corporation

In the case of an S corporation that converts to a C corporation:

  • Net adjustments that are needed to prevent amounts from being duplicated or omitted as a result of an accounting method change and attributable to the revocation of the S corporation election (e.g. adjustments required because of a required change from the cash method to an accrual method): net adjustments that decrease taxable income generally were taken into account entirely in the year of change, and net adjustments that increase taxable income generally were taken into account during the four-taxable-year period beginning with the year of change.

  • Distributions of cash by the C corporation to its shareholders during a post-termination transition period (generally one year after the conversion) are, to the extent of stock basis tax-free, then capital gain to the extent of remaining accumulated adjustments account (AAA). Distributions more than AAA are treated as dividends coming from accumulated Earnings and Profits (E&P).  Distributions after that period are dividends to the extent of E&P and taxed as dividends.

The TCJA makes two modifications to existing law for a C corporation that (1) was an S corporation on Dec. 21, 2017 and revokes its S corporation election after Dec. 21, 2017, but before Dec. 22, 2019, and (2) has the same owners of stock in identical proportions on the date of revocation and on Dec. 22, 2017.

The following modifications apply to these entities:

  • The period for including net adjustments that are needed to prevent amounts from being duplicated or omitted as a result of an accounting method change and attributable to the revocation of the S corporation election is changed to six years. This six-year period applies to net adjustments that decrease taxable income as well as net adjustments that increase taxable income.

  • Distributions of cash following the post-termination transition period are treated as coming out of the corporation’s AAA and E&P proportionally.

See Revenue Procedure 2018-44 for more detailed information.

Businesses or individuals that rehabilitate historical buildings

Topic

2017 law

What changed under TCJA

Changes to the rehabilitation tax credit

Owners of certified historic structures were eligible for a tax credit of 20% of qualified rehabilitation expenditures.Owners of pre-1936 buildings were eligible for a tax credit of 10% of qualified rehabilitation expenditures.

TCJA keeps the 20% credit for qualified rehabilitation expenditures for certified historic structures but requires that taxpayers take the 20% credit over five years instead of in the year they placed the building into service.The 10% credit for pre-1936 buildings is repealed under TCJA.

 

Opportunity for tax-favored investments

Opportunity Zones are a tool designed to spur economic development and job creation in distressed communities. Businesses or individuals can participate.

Topic 2017 law What changed under TCJA

Opportunity Zones

No previous law for comparison. This is a new provision.

Investments in Opportunity Zones provide tax benefits to investors. Investors can elect to temporarily defer tax on capital gains that are reinvested in a Qualified Opportunity Fund (QOF). The tax on the gain can be deferred until the earlier of the date on which the QOF investment is sold or exchanged, or Dec. 31, 2026. If the investor holds the investment in the QOF for at least ten years, the investor  may be eligible for a permanent exclusion of any capital gain realized by the sale or exchange of the QOF investment.For more information, see Notice 2018-48 and Revenue Procedure 2018-16.

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What Business Owners Should Know About the 20 Percent Tax Deduction https://smallbusiness.com/2018-tax-law/small-business-tax/ https://smallbusiness.com/2018-tax-law/small-business-tax/#respond Tue, 30 Oct 2018 15:10:56 +0000 https://smallbusiness.com/?p=33315

As we always advise, small business owners should seek advice regarding taxes and finance from a trusted business, tax, or financial professional. This year, that advice is especially important. Why? Because last year’s tax legislation begins to have an impact on your taxes for the first time this year (in 2018). The increased deductions most small businesses will see will start showing up on the federal income tax return you file in 2019. Here are some things the IRS would like you to know. (Also, see the bottom of this page for a collection of IRS services we’ve posted.)


Eligible taxpayers may deduct up to 20 percent of certain business income from domestic businesses operated as…

  • Sole proprietorships
  • Partnerships
  • S corporations
  • Trusts
  • Estates
  • Certain dividends

 

Things business owners should know about the 20 percent deduction

  • The deduction applies to qualified:– Business income
    – Real estate investment trust dividends
    – Publicly traded partnership income
  • Qualified business income is the net amount of qualified items of income, gain, deduction and loss connected to a qualified U.S. trade or business. Only items included in taxable income are counted.
  • The deduction is available to eligible taxpayers, whether they itemize their deductions on Schedule A or take the standard deduction.
  • The deduction is generally equal to the lesser of these two amounts:– Twenty percent of qualified business income plus 20 percent of qualified real estate investment trust dividends and qualified publicly traded partnership income.
    – Twenty percent of taxable income computed before the qualified business income deduction minus net capital gains.
  • For taxpayers with taxable income computed before the qualified business income deduction that exceeds $315,000 for a married couple filing a joint return, or $157,500 for all other taxpayers, the deduction may be subject to additional limitations or exceptions. These are based on the type of trade or business, the taxpayer’s taxable income, the amount of W-2 wages paid by the qualified trade or business, and the unadjusted basis immediately after acquisition of qualified property held by the trade or business.
  • Income earned through a C corporation or by providing services as an employee is not eligible for the deduction.
  • Taxpayers may rely on the rules in the proposed regulations until final regulations appear in the Federal Register.

 

 Also on SmallBusiness.com

IRS Resources Related to How the New Tax Law May Affect Your Business | Q3-2018

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The ‘Founding Garages’ of Four Famous Small Businesses That Grew into Giant Companies https://smallbusiness.com/history-etcetera/garage/ https://smallbusiness.com/history-etcetera/garage/#respond Fri, 26 Oct 2018 15:12:32 +0000 https://smallbusiness.com/?p=33289

The biggest companies in the world have to start somewhere. Sometimes, especially in Silicon Valley, that starting place is a car garage. To understand how incredible the journey of these garage startups have been, the on-demand home services company HomeAdvisor created these clever models of where four legendary garage startups began.


Apple | 1976 | Steve Jobs’ parents’ garage | Los Altos, California

Steve Jobs’ parent’s garage is the mythological birthplace of Apple. Jobs, Steve Wozniak and Ronald Wayne worked on their early designs and marketing plans in the legendary garage. As with many “founding myths” of successful startups, the Apple story has competing accounts, but the home is still owned by Jobs’ step-mother and is a popular tourist spot for Apple fans.


 

Disney | 1923 | The garage of Walt and Roy Disney’s Uncle Robert | Los Angeles

When Walt Disney moved to Hollywood to join his older brother Roy, the two set up in their Uncle Robert’s garage where they would start what would one day grow into the world’s biggest animation studio. Saved from demolition in 1998, the garage was moved to the Stanley Ranch Museum in Garden Grove, where small groups can visit and see Disney memorabilia.


 

Hewlett-Packard | 1939 | Dave and Lucile Packard’s garage | Palo Alto, California

Bill Hewlett‎ and ‎David Packard became Hewlett-Packard when the two co-founders started working from a garage outside the house Packard and his wife were renting in Palo Alto. Hewlett lived in a shack on the property also.


Google | 1998 | Susan Wojcicki’s garage in Menlo Park, California

Stanford students Larry Page and Sergey Brin rented Susan Wojcicki’s garage between September 1998 and February 1999 to begin work on Google. The eight-employee then moved to an office in Palo Alto. Today the house is owned by Google and was used to commemorate the company’s 15th anniversary.

For more about the Google garage, google it.


Sources 

Martin, J. (2015) On the set of Steve Jobs film cnet.com
Haire, C. (2015) A piece of Disney history in Garden Grove ocregister.com
Eventually Made. (2018) Garage Tales eventuallymade.com
Johnson Mandell, L. (2017) The HP Garage – The Birthplace of Silicon Valley hpmuseum.org
Eventually Made. (2018) Garage Tales eventuallymade.com
Parmar, N. (2014) Wanted from the Middle East: the next Apple or Microsoft thenational.ae
Wagner, K. (2013) In the Garage Where Google Was Born mashable.com
Bohn, D. (2013) Garage brand: Google taps its founding myth in search of a new beginning theverge.com

Models from HomeAdvisor. Used with permission.

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7 Tips for Overcoming Your Fear of Making a Presentation https://smallbusiness.com/how-to/presenting/ Tue, 23 Oct 2018 10:00:35 +0000 http://smallbusiness.com/?p=5981

Perhaps you recall the old Jerry Seinfeld joke in which he observed, “According to most studies, people’s number one fear is public speaking. Number two is death. Death is number two. Does that seem right? That means to the average person, if you have to go to a funeral, you’re better off in the casket than presenting the eulogy.”


While it is debatable whether public speaking (aka “stage fright”) ranks number one among our fears, a couple of things are certain:

1 |  Public speaking causes a great deal of anxiety, stress and fear for a large percentage of small business owners and managers.

2 | Speaking before groups is part of the job for many of those who own and run small businesses.

If, stage fright is keeping you from doing your best in front of an audience of any size, here are seven tips that can help you overcome your discomfort.


 

1 | Stop thinking the presentation is about you or your product. The presentation is about the people in your audience, and their needs and fears

Publisher and presenter extraordinaire Kathy Sierra says that the worst thing to do if you are trying to improve as a presenter is to focus on your presentation skills. If you do, you’ll be focusing on YOU, rather than on the only thing that matters: The person you are presenting to.

2 | Start with a question you know the audience wants to ask

Raised hands in class of university

Most people will tell you the best part of a presentation is the Q&A session that comes at the end. So why wait? Use questions and answers as the framework of your presentation. If you do this, you don’t have to worry about what questions might be asked–or how the questions might be posed. Chances are, you’ll answer the questions the audience members might have and, if not, the questions will likely be simple follow-ups to the questions you have already answered.

3 | Focus on the challenges that keep the people you’re presenting to awake at night? What can you share that will help them rest easier?

If you are in the audience during a presentation, which of these would you find more compelling and helpful: (1) Charts, graphs and bullet points outlining every detail, no matter how small, of the presenter’s product or service, or (2) A presenter who is describing a dilemma you are experiencing and sharing with you how others have successfully overcome the dilemma. (Note: If you chose #1, you probably shouldn’t be making presentations.)

4 | Look marvelous

presenting

(Photo via youtube.com)

You’ll feel more confident if your presentation looks good, and you look good, as well. Remember the words of the caricature impersonation of Fernando Lamas performed by Billy Crystal on Saturday Night Live, “It’s better to look good than to feel good and darling: You. Look. Marvelous.”

5 | Relax beforehand

Don’t be that presenter who waits until the night before to throw something together. You’ll end up foregoing the one thing you need  most before you present: rest. Get your preparation done in time so that you can sleep well and, if at all possible, be able to go for a walk or some other light physical activity before your presentation.

6 | Hydrate

Staying hydrated is necessary. Have you ever noticed a professional deliver a speech? They always carry water. If you aren’t hydrated properly you will have a dry throat that can act like a mute button on your voice. (Note: Drinking lots of water beforehand, along with the stress, may cause you to take several trips to the restroom before a presentation. Don’t worry. That urge will disappear once you start presenting.)

7 | Get experience

presenting

(Photo via JohnDiew0107 on Flickr)

Although all of these tips can be helpful, you must do one more thing that is required to improve any skill: practice, practice, practice. But you are not alone. Chances are, there’s a local chapter of Toastmasters nearby. Join it and gain the warm and positive support of others who, like you, are seeking to improve their speaking skills and to gain more confidence in front of an audience.


(Photo: Wikimedia Commons)

]]> Scholars Claim These are the Best Times of Day for Social Media Posts https://smallbusiness.com/marketing/best-times-for-social-media-posts/ Thu, 18 Oct 2018 17:19:02 +0000 https://smallbusiness.com/?p=33250

A social media manager tasked with posting ten stories in a day with a budget to promote four of those stories can schedule the sequence of social media posts in over seven trillion ways. Which of those seven trillion options should they choose to post?


 

Recently, three graduate business school academics (Vamsi K. Kanuri of Notre Dame, and Shrihari Sridhar and Yixing Chen of Texas A&M) tackled a vexing problem for those who market their companies with social media posts (and tweets, we guess): “What are the best times to post?” (Really, we don’t make up these research projects. We even read it in the Harvard Business Review.)

It’s an important issue, according to the professors, as U.S. companies are expected to spend more than $37 billion dollars annually on social media by 2020 — representing 24 percent of the economy’s total digital advertising spend. And a lot of these dollars will be spent by small businesses.

Rather than posting randomly, there is a better way to spend that advertising budget, say the professors. Their research on circadian rhythms suggests that content platforms like CNN, ESPN, National Geographic, etc. can enhance their profit payoffs by at least eight percent by:

  • Posting content following the biological responses of their audience’s sleep-wake cycles
  • Targeting content types to when the audience is most naturally receptive to it

Working Memory

According to their research, the professors’ posting recommendations are tied into what is called, “Human Working Memory.”  This type of memory is highest when we wake up in the morning, lowest in mid-afternoon, and moderate in the evening. “Higher availability of working memory makes individuals alert and feel the need to seek information. This means that consumers’ desire to engage with content will likely be highest in the morning, lowest in the afternoon, and moderate in the evening,” they write.

Here are some of the recommendations they culled from their interviews:

  • All else equal, posting content in the morning results in higher engagement.
  • Boosting posts (paying to promote posts) is most effective when the target audience is experiencing low working memory.
  • Assuming the majority of the audience start their day in the morning, it is ideal to post content conveying high-arousal emotion (i.e., angry or worried) in the morning and “deep think” content in the afternoon.
  • A firm does not need an additional boosting budget to increase gross profits. Simply rearranging the posts to match content preferences of the target audience can do the trick.
  • Increasing boosting budget does not necessarily increase gross profits. There is a tipping point where additional spending results in only marginal increases in gross profits.

Harvard Business Review | A Study Shows the Best Times of Day to Post to Social Media

GettyImages

]]> Small Businesses Are Selling for Record-High Prices | Q-3 2018 https://smallbusiness.com/economy/business-selling/ Mon, 15 Oct 2018 18:13:09 +0000 https://smallbusiness.com/?p=33197

The prices small businesses sold for during the third quarter of 2018 reached record highs, according to the 2018 third-quarter Insight Report from BizBuySell.com, the online business-for-sale marketplace. The record sale prices are related to stronger business financials which also hit new levels in Q-3″ according to Bob House, president of BizBuySell.com. “With buyers able to offset increasing prices by acquiring healthier businesses, the result is a well-balanced market. To be in a place where both buyers and sellers are able to capitalize without the other party losing out is fantastic and a testament to the strong will of entrepreneurs.”


$249,000 | Median sales price of a small business during Q-3, 2018
10.7% | Percentage growth of median sales price (year-over-year) (Highest increase since BizBuySell started collecting data in 2007)

2018 Q3 Small Businesses Sale Price vs Asking Price

Buyers are purchasing businesses with better financial footings

$530,995 (up 7.4% year-over-year) | Median revenue
$116,229 (up 2.8% year-over-year) | Median cash flow

2018 Q3 Key Financials for Sold Small Businesses

 

Tariffs and elections take center stage as market aims to continue record pace

Even as small business asking prices have continued to rise, buyer demand has not swayed thanks to the attractive financials absorbed in an acquisition. However, as witnessed during the Great Recession, small business success is greatly tied to the performance of the overall economy.

30%  | Percentage of owners who say they will be negatively affected by the tariffs.
76% |  Percentage of owners who approve the tariffs (including half of those believed to be negatively impacted)

30% | Percentage of buyers who approve the tariffs
23% | Percentage of buyers who said if tariffs remain in place, they would be less likely to purchase a small business

90% | Percent of Republican business owners who support the tariffs
27% | Percent of Democratic business owners who support the tariffs


“We’ve now had a few record-breaking years in a row in terms of transactions and it appears 2018 will be no different,” said BizBuySell.com’s House. “The fact that small businesses are selling for the highest price to date and demand hasn’t slowed shows how much confidence both sides have in today’s market.”

2018 Q3 Small Business Sales by Sector

Charts | BizBuySell.com Photo | GettyImages

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