Start-up Companies Can Now Benefit from the R&D Tax Credit
If you’re a start-up company with annual gross receipts of less than $5 million, you can now apply up to $250,000 of your R&D credit against your payroll tax liability.
The federal R&D tax credit is a dollar-for-dollar reduction of federal income tax liability for qualified expenditures incident to the development or improvement of a product, process, software, formula or invention. It was recently made permanent by The Protecting Americans from Tax Hikes Act of 2015 (“PATH” Act).
Previously, a company had to actually generate a profit and taxable income to utilize the R&D tax credit. Now the PATH Act allows start-up companies to utilize the credit against their payroll taxes, if the companies perform “qualified research”.
Rainmaking - It's On Sale
Happy Day After Thanksgiving to you and yours! This blog is posting on Black Friday. Why do I have time to write a blog today? Because I’m NOT one of the 137 million Americans who will begin their Christmas shopping – either in stores or online this weekend. Yes, wholly 40% of Americans shop this weekend. But it’s not a tradition that I partake in. For all of you that DO – you’ll certainly be in good company. Enjoy and charge safely out there!
But the thought of Black Friday got me thinking about the concept of offering special deals in general. Should service providers like CPAs, attorneys and other professionals ever offer specials? I’m in the process of offering one right now. Not in my multistate business, but on the Rainmaking side of the house. And I’m still trying to decide if it’s a good idea.
Here’s the situation:
The multistate side of Miles Consulting Group has been my main source of revenue for almost 15 years. Last year, in addition to multistate, I launched a speaking and educational program called Jumpstart Your Rainmaking. It’s all about helping professionals who need to sell their services. I use my 20+ years of experience in selling consulting services to train colleagues on developing their sales mindset, identifying their perfect target client, selecting the best direct and indirect marketing strategies to get in front of that audience, putting together a viable written plan, and then keeping themselves accountable. The program is delivered in a variety of ways – live speaking presentations, customized training for CPA firms, and a three part webinar series. Each delivery format is a little different, and offers training to people in ways that make sense to them.
Right now, we are preparing to offer the three part webinar series – a three week commitment (an hour per week) in December. Webinar participants will benefit from the items mentioned above, and will also learn how to develop their 2017 revenue generation plan. Before January, our program participants will have an easy to follow, measurable plan which will help them generate revenue in their pipeline next year.Read more
An Interesting Look at Sales Tax and Legal Marijuana
Although the presidential campaign seemed to dominate headlines earlier this month, there was another proposition that passed in California (as well as a handful of other states): recreational marijuana became legal. What does this mean for the Golden State’s sales tax revenue? And how will it affect other industries? I thought it would be worth taking a look at what other states have done and how California may proceed in the coming months.
How Colorado & Washington Approach Marijuana Sales Tax
Colorado and Washington legalized recreational marijuana in 2012. Here’s how they currently charge sales tax:
Colorado
In 2015, the state of Colorado received $135 million in sales tax revenue from nearly $1 billion in marijuana sales. It’s worth noting Colorado’s population is only about a tenth of California’s.
Recreational marijuana is subject to:
- 2.9% state sales tax (which is the rate for all tangible personal property)
- Any local sales taxes
- An additional 10% state marijuana sales tax
- Recreational marijuana is also subject to a 15% excise tax
In Colorado, the retail cultivator is liable for the excise tax, which is included in the price the consumer pays at the store (which is similar to liquor or tobacco). The sales tax is imposed on the sale from the retailers to the consumer.Read more
Rainmaking - Kicking Off Another Webinar Series
As we edge closer to the end of 2016, some of you may already be thinking about setting your goals for 2017. And, if you’re not, maybe you should be! In that spirit, we are once again preparing to deliver the three part “Jumpstart Your Rainmaking” webinar series, beginning December 7th. If you’re a follower of this blog and my communications, you know that we discuss topics designed for professionals who need to sell their services. It’s tough to go out there and sell yourself every day! Jumpstart focuses on how to develop the skills to keep your pipeline filled and how to generate revenue. Prior webinar participants have included CPAs, bookkeepers, attorneys, financial planners and even virtual administrative assistants. We are offering the webinar series now to help you put together a plan prior to year-end so that you’ll be ready to go with it come January 1. Won’t that feel good?
Why Take This Class?
You may be thinking – “Wait, Monika specializes in multi-state tax consulting!” That’s true. And as part of my practice, several years ago, I had to develop a system that would work for me to build my business. In the process of building that system over the years, I realized that it’s also teachable. So, in addition to having passion for helping clients navigate state tax issues, I also have passion for helping people understand how to build businesses and generate revenue. Why? It’s nice to help others grow and share in their success. I’ve had a lot of help over the years, and I want to pay it forward as well.
So, here are those rainmaking skills and the passion behind them, developed into a short, easy to manage Rainmaker webinar series for accounting and finance professionals. Why now? Because as I share with people what I’m doing and how – everyone tells me “Wow – this is really something people need!” So, I’m making it happen, with you in mind!Read more
FOCUS ON GEORGIA
The last of the original thirteen colonies is Georgia, the Peach State. Georgia is also known as the Empire State of the South. The state has varied terrain with mountains and natural rock in the northwest, urban areas, forest in the southern part and farmland.
There are also many points of interest that attract visitors to Georgia. In Atlanta, there are the World of Coca-Cola and the Georgia Aquarium. Stone Mountain, just north of Atlanta, is Georgia’s most popular attraction, receiving over 4 million visitors per year. Callaway Gardens, in western Georgia, is a family resort. The area is also popular with golfers.
The 10 Worst States for Women: Equality Issues Nationwide
Happy Election Day! Regardless of your politics, this is a notable election for many reasons, one of which is the possibility of our nation’s first female president. While we wait for the results to come in, I thought it would be interesting to take a look how women fare in states across the country. This article ranks the 10 worst states for women, based on economy, leadership and health (pulled from census data). Keep reading for the results.
Issues Surrounding Women’s Equality in the Workplace
No matter the outcome of today's election, the presence of a female presidential candidate sheds light on many women's equality issues, most notably the gender wage gap, inflexibility in the workplace for pregnant women and those with young children, and a clear lack of women in positions of political influence.Read more
SALES TAX EXPOSURE REVISITED
In our practice, we see many new clients who have sales tax exposure issues. And we, of course, are happy to help them identify and then mitigate that exposure. As we discussed in our blog last month, SALES TAX NON-COMPLIANCE: WHAT’S YOUR EXPOSURE, sales tax exposure can add up quickly. Sales tax is a gross tax and if not properly collected from the buyers at the time of the sale, it can come back to haunt the seller later.
In this month’s blog, we add a little more detail to the example we started last month, just to show how these liabilities can really add up- and how we can assist in remedying them.
When a client comes to us with multi-state tax issues, we start by asking the questions:
- Does the company have nexus in the state in which it sells its products? If yes, since when?
- Is the product taxable?
- Are there any exemptions?
- What is the potential retroactive exposure?
New: Important California State Tax Credits and Incentives Updates
Are you trying to pursue California’s state tax credits and incentives? If so, there are three recent updates you may want to know about:
California Competes State Tax Credit and Online Reporting Requirements
As of January 1, 2017, the Governor's Office of Business and Economic Development (Go-Biz) will be required to report more detail about businesses taking advantage of the the California Competes State Tax Credit.
Current law requires Go-Biz to report the following online:
- The name of each taxpayer that receives a state tax credit
- The estimated number of jobs that are created or retained by the credit
- The amount of credit the taxpayer is allocated
- The amount of state tax credit recaptured from the taxpayer
The new law requires Go-Biz to additionally post the following information online:
- The primary location where the taxpayer will increase the net number of jobs or investments
- Information identifying credits considered priority due to being located in a high unemployment or poverty area
- Information that identifies if the state tax credit awarded is counted toward the amount allocated for small businesses
Rainmaking – Building the Pipeline for your Firm
Most of us don’t like to have to go out and sell – partly because it makes us feel like we are “asking” for money. In my last Rainmaking blog, I asserted that it’s hard to ask for money and that theme continues to resonate. But what if asking for money were easier? What if it didn’t have to seem like asking for money? What if asking your clients to assist them with their tax, accounting and finance needs just seemed like an ordinary part of the conversation?
As accountants, many of us want to be valued by our clients because we are technically competent and trusted business advisors. But we don’t like to have to sell to them. And we certainly hate the thought of cold calling – it doesn’t really work in our businesses anyway! As partners or owners of firms, we understand that we must bring in business to survive, but younger staff members may not truly get that message – either because they simply don’t like to sell or because they are not receiving guidance from their supervisors. And we can all feel a little bit guilty about that. Yet, in order to build thriving CPA practices (or other professional services firms in general), we must be able to have the selling conversation with our staff so that they begin to add those skills. It begins largely with focusing on our existing clients and how we can provide additional value-added services to them. Here are some suggestions:
FOCUS ON WEST VIRGINIA
Known for its mountainous landscape and rolling hills, this month we travel east to West Virginia. The state has a rich history and is embedded in the Appalachian Mountains.
West Virginia is known for a wide range of outdoor recreational activities, such as skiing, whitewater rafting, fishing, hiking, backpacking, mountain biking and hunting. For something on the calmer side, the state offers many golf courses.
It is also one of the most densely Karstic areas in the world, making it a choice area for recreational caving and scientific research. Karstic topography is a landscape formed from the dissolution of soluble rocks such as limestone, dolomite, and gypsum. It is characterized by underground drainage systems with sinkholes and caves. These underground hydrology systems contribute to much of the state’s cool trout waters.
