What Business Advisory Tools Do I Choose?

With a growing number of business advisory software tools on and entering the accounting market, it is often difficult to know what to choose.

At Smithink we recommend following our EnablerTM Seven Step to Success process using the best software at the critical steps. It is not as easy as having one tool for each step. There are several great applications that can be used. In this article, we will look at some of the tools that are available for each step.

The first step in the EnablerTM process is preparing your firm to succeed with business advisory services. This is critical to the ongoing delivery of services and should include the appointment of a champion and analysis of the right clients to start with. Many firms are using Excel sheets and Word documents to plan out their service packages and strategies for implementation. Key to this step is the development of a Client Relationship Management (CRM) solution such as MYP's Arm and Arm Pro.

From there you need to unlock your client's business advisory needs with an interactive client needs analysis. This, in my opinion, is the most important step, as it will indicate where the client's strengths and weaknesses are, and allows a proposal to develop to address specific needs. Great cloud tools here include Cash Flow Story's simple four-chapter approach to business performance and My Yardstick What's Important to you (WITY) tool and E-Scope automated pricing system can assist here to understand client needs and develop innovative proposals.

The third step is to create a "disturbance" in your client's mind using business value assessments. Paramount to this step is establishing how much the client thinks their business is worth against the commercial value and linking this to the concept of a Business Value Gap (BVG). Some of the best applications here are Cash Flow Story's Business Value Indicator and Bastar's materials, tools and programs that will calculate a capitalization rate for the client's business off financial data and a risk and value assessment. Another new tool in this space to increase the sellability of your client's business is Sellability Score.

From there we introduce financial diagnostic software to fill the gaps by analyzing and managing the client's key macro drivers and results that will improve their financial performance. We will look at where the business is today, its strengths (green flags) and weaknesses (red flags) and where it can be in the future. There are many solutions here including Cash Flow Story's Power of One, PANALITX, Fathom and Profit Guardian.

It is then time to look at the strategies required to implement micro services using smart tools and resources such as ESS BIZTOOLS and ESS BIZGrants. Attaché Software also has great tools here that can assist to implement key strategies with your clients.

Then track the performance of the client's business by preparing budgets and cash flows (or action plans) with Castaway, Calxa or Plan Guru. This step can link back to the development of business and action plans. MAUS Software's Master Plan is an innovative solution to address this need. Another great tool here is MYP's Estate Planning application to unlock your client's estate planning needs and develop key strategies for the future.

Finally, generate new business by growing your business advisory specialization through profitable scenario planning and offering your "how would you like to see the financial impact of every business decision before you make it" service. This look into the future requires software that can simply show the client their pre and post position. Any of the financial diagnostic tools will adequately handle this task.

With this myriad of choices, a firm needs to be confident that they select the right application for their clients and staff.


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How to Start a Consulting Business

Businesses certainly understand what consultants are. In 1997 U.S. businesses spent just over $12 billion on consulting. According to Anna Flowers, spokesperson for the Association of Professional Consultants in Irvine, California, the association has recently noticed an increase in calls for information from people who want to get into the business. "The market is opening up for [the consulting-for-businesses] arena," Flowers says.

Melinda P., an independent consultant in Arlington, Virginia, thinks more people are getting into the consulting field because technology has made it easier to do so. "The same technology that has helped me to be successful as a consultant has made it easier for others to do the same," she says.

A consultant's job is to consult. Nothing more, nothing less. It's that simple. There's no magic formula or secret that makes one consultant more successful than another one.

But what separates a good consultant from a bad consultant is a passion and drive for excellence. And--oh yes--a good consultant should be knowledgeable about the subject he or she is consulting in. That does make a difference.

You see, in this day and age, anyone can be a consultant. All you need to discover is what your particular gift is. For example, are you very comfortable working with computers? Do you keep up with the latest software and hardware information, which seems to be changing almost daily? And are you able to take that knowledge you have gained and turn it into a resource that someone would be willing to pay money for? Then you would have no trouble working as a computer consultant.

Or are you an expert in the fund-raising field? Maybe you have worked for nonprofit agencies in the field of fund-raising, marketing, public relations or sales, and over the years you have discovered how to raise money. As someone who has turned a decade of fund-raising successes into a lucrative consulting business, I can tell you that fund-raising consulting is indeed a growing industry.

Things to Consider Before You Become a Consultant

  • What certifications and special licensing will I need? Depending on your profession, you may need special certification or a special license before you can begin operating as a consultant. For example, fund-raising consultants don't need special certification, although you can become certified through the National Society of Fund Raising Executives. And in some states, you may need to register as a professional fund-raising consultant before starting your business.
  • Am I qualified to become a consultant? Before you hang out your shingle and hope that clients begin beating your door down to hire you, make sure you have the qualifications necessary to get the job done. If you want to be a computer consultant, for example, make sure you are up to date in the knowledge department with all the trends and changes in the computer industry.
  • Am I organized enough to become a consultant? Do I like to plan my day? Am I an expert when it comes to time management? You should have answered "yes" to all three of those questions!
  • Do I like to network? Networking is critical to the success of any type of consultant today. Begin building your network of contacts immediately.
  • Have I set long-term and short-term goals? And do they allow for me to become a consultant? If your goals do not match up with the time and energy it takes to open and successfully build a consulting business, then reconsider before making any move in this direction!

Top 20 Consulting Businesses Thriving Today

Although you can be a consultant in just about any field these days, the current top 20 consulting businesses include:

1. Accounting: Accounting is something that every business needs, no matter how large or small. Accounting consultants can help a business with all of its financial needs.

2. Advertising: This type of consultant is normally hired by a business to develop a good strategic advertising campaign.

3. Auditing: From consultants who audit utility bills for small businesses to consultants who handle major work for telecommunications firms, auditing consultants are enjoying the fruits of their labor.

4. Business: Know how to help a business turn a profit? If you have a good business sense, then you'll do well as a business consultant. After computer consulting, people in this field are the next most sought after.

5. Business writing: Everyone knows that most businesspeople have trouble when it comes to writing a report--or even a simple memo. Enter the business writing consultant, and everyone is happy!

6. Career counseling: With more and more people finding themselves victims of a corporate downsizing, career counselors will always be in demand. Career counselors guide their clients into a profession or job that will help them be both happy and productive as an employee.

7. Communications: Communications consultants specialize in helping employees in both large and small businesses better communicate with each other, which ultimately makes the business more efficient and operate smoothly.

8. Computer programmer: From software to hardware, and everything in between, if you know computers, your biggest problem will be not having enough hours in the day to meet your clients' demands!

9. Editorial services: From producing newsletters to corporate annual reports, consultants who are experts in the editorial field will always be appreciated.

10. Executive search/headhunter firms: While this is not for everyone, there are people who enjoy finding talent for employers.

11. Gardening: In the past decade the demand for gardening consultants has blossomed (pun intended) into a $1 million-a-year business. Not only are businesses hiring gardening consultants; so are people who are too busy to take care of their gardens at home.

12. Grantsmanship: Once you learn how to write a grant proposal, you can name your price.

13. Human resources: As long as businesses have people problems (and they always will), consultants in this field will enjoy a never-ending supply of corporate clients, both large and small. (People-problem prevention programs could include teaching employees to get along with others, respect and even violence prevention in the workplace.)

14. Insurance: Everyone needs insurance, and everyone needs an insurance consultant to help them find the best plan and pricing for them.

15. Marketing: Can you help a business write a marketing plan? Or do you have ideas that you feel will help promote a business? If so, why not try your hand as a marketing consultant?

16. Payroll management: Everyone needs to get paid. By using your knowledge and expertise in payroll management, you can provide this service to many businesses, both large and small.

17. Public relations: Getting good press coverage for any organization is a real art. When an organization finds a good PR consultant, they hang on to them for life!

18. Publishing: If you're interested in the publishing field, then learn everything you can and you, too, can be a publishing consultant. A publishing consultant usually helps new ventures when they are ready to launch a new newspaper, magazine, newsletter--and even websites and electronic newsletters.

19. Taxes: With the right marketing and business plan (and a sincere interest in taxes), your career as a tax consultant can be very lucrative. A tax consultant advises businesses on the legal methods to pay the least amount of tax possible.

20. Writing services: Anything related to the written word will always be in demand. Find your specialty in the writing field, and the sky will be the limit!

Target Market

Your idea may be the best one you have ever thought of, but there needs to be a market for your ideas. Someone must be willing and able to pay you for your expert advice.

In other words, who are your potential clients? Will you be marketing your consulting services to large corporations? Or will you offer a specialty that would only be of interest to smaller businesses? Perhaps your services will be sought after by nonprofit organizations. Whatever the case, before you go forward, make sure you spend time preparing both a business plan and a marketing plan. You won't be disappointed with the results--especially when clients begin paying you!

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10 Frequently Asked Questions About Payroll Processing

Processing payroll is one of the most complex and time-consuming tasks a business must complete. If you’re new to the process, payroll can be confusing. Here are answers to some of the most frequently asked questions about payroll.

What Is an EIN?

The IRS issues employee identification number (EIN) numbers. This 9-digit number is used on federal and state tax filings for businesses, including payroll tax reporting documents. You can apply for an EIN through IRS.gov.

The EIN number can be used for a variety of business entities, including sole proprietorships, S corporations, and C corporations. Assume, for example, that you operate a C corporation, Ganz Manufacturing. Your corporation can operate under more than one fictitious name, and you can use the same EIN number. Ganz Furniture and Ganz Tool and Die, for example, could be fictitious names used by the same corporation.

This policy simplifies the tax filing process. You’ll need to register your fictitious names in the state where your business is headquartered.

What Is an I-9 Form?

Employers use Form I-9 to verify the identity and employment authorization of individuals. Every U.S. employer must have a completed Form I-9 for each worker hired, whether or not the individual is a U.S. citizen. To complete the form, an employee provides documents as evidence of their identities, such as a driver’s license, birth certificate, or passport.

An employer must retain each Form I-9 for a specific period of time, and a state or federal government official may ask to inspect the forms. Government agencies review I-9 forms to verify that each employee is authorized to work in the U.S.

What Is a W-4 Form?

Each worker completes IRS Form W-4 to indicate the amount of tax withheld from gross pay for federal income taxes. Employees complete similar forms for state income tax withholding.

How Do I Determine Payroll Taxes?

Once a W-4 is completed, the employer uses IRS guidelines to calculate the dollar amount of federal income taxes withheld. Each state has similar guidelines to calculate state tax withholdings.

The payment schedules are published in IRS Publication 15.

What Does Withholding Actually Mean?

Withholding refers to the dollar amount of federal and state income taxes that an employer collects from a worker’s gross pay. The dollar amount is determined based on the IRS W-4 form and the state’s withholding form. The company sends the taxes withheld to the IRS and the state’s department of revenue.

The dollar amounts withheld are reported to the worker on Form W-2 after year-end. It’s the employee’s responsibility to file their personal tax return and calculate their tax liability. The worker subtracts the W-2 taxes withholdings from the tax liability, and any remaining amount of taxes owed should be paid when the tax return is filed. This process applied to both federal and state taxes.

What Are Third-Party Liabilities?

In addition to withholding taxes, employers may also withhold the worker’s share of payments for insurance premiums, retirement plan investments, and other benefits. The worker decides on the amounts withheld for the payments. Once these payments are withheld from gross pay, the employer forwards the payments to each third party (insurance company, an investment firm, etc.).

When Do I Need to File W-2s and 1099s?

W-2 and 1099 forms are issued for different reasons. A W-2 is issued to an employee to report gross wages earned, tax withholdings, and other withholdings from gross pay. If you have wages withheld to pay for insurance premiums or to fund a retirement plan, those amounts are reported on a W-2.

The IRS requires employers to mail W-2 forms to workers no later than January 31st of the year following the end of the tax year. So, 2017 W-2s must be mailed by January 31st of 2018.

If your firm has paid at least $600 to a vendor for a product or service, you must issue a 1099-MISC form to that vendor. Freelance workers are considered vendors and are issued a 1099-MISC form. The IRS also requires employers to mail 1099-MISC forms to vendors no later than January 31st of the year following the end of the tax year. The employer combines all of 1099 issued and reports them to the IRS on Form 1096.

What Is Workers’ Comp Insurance?

Businesses purchase workers’ comp (compensation) insurance policies to pay for medical care and other costs if a worker is injured or killed while working on the job. The insurance policy pays for medical expenses and makes payments to the injured party based on a state’s workers’ compensation laws.

The insurance premiums are based on the total dollar amount of payroll a company pays, and the type of work performed the employees. If workers perform manual labor or work in jobs that expose them to physical injury (such as construction), the insurance premiums will be higher.

Construction, engineering and other firms that have a higher risk for worker injury need to have safety plans in place to reduce the risk of workplace injuries. If you can limit worker injuries, you can keep your insurance premiums at a reasonable level.

Am I Required to Have Labor Law Posters?

There are state and federal labor law poster requirements for businesses. The posters address worker rights related to the federal minimum wage, equal employment rights, and worker safety, among others. Companies can purchase “all-in-one” posters for both federal and state labor law requirements. The posters should be displayed so that employees can see them each day. The posters are typically posted in a break room.

What Does a Payroll Company Do?

A payroll company can perform many of the complex tasks required to process payroll accurately. To get started with a payroll company, a business provides the gross pay and withholding amounts for each employee. The payroll company uses current tax laws to calculate the correct tax withholdings and also withholds any benefit payments.

You can give a payroll company access to your corporate bank account so that the company can send each net pay amount to employees. This outside firm submits the payments withheld to the IRS, state revenue departments, and any other third parties. The company will complete all payroll reports and create W-2s and 1099s at year-end.

Every business should consider using a payroll company. This decision will help you save time and ensure that your payroll processing is accurate.

QuickBooks offers a number of payroll solutions ranging from simply cutting checks to full-service payroll. All payroll products integrate directly with your accounting software to keep your books in order with less work.

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The most common mistakes when managing personal finances

The ability to manage money competently is especially valuable quality in the conditions of financial crisis, when the purchasing power of the population is shrinking, inflation is rising, and currency exchange rates are completely unpredictable. Below are the common mistakes related to money affairs along with financial planning advice to help manage your own finances properly.

The budget is the most basic thing in financial planning. It is therefore especially important to be careful when compiling the budget. To start you have to draw up your own budget for the next month and only after it you may make a yearly budget.

As the basis takes your monthly income, subtract from it such regular expenses as the cost of housing, transportation, and then select 20-30% on savings or mortgage loan payment.

The rest can be spent on living: restaurants, entertainment, etc. If you are afraid of spending too much, limit yourself in weekly expenses by having a certain amount of ready cash.

"When people borrow, they think that they should return it as soon as possible," said Sofia Bera, a certified financial planner and founder of Gen Y Planning company. And at its repayment spend all that earn. But it's not quite rationally ".

If you don't have money on a rainy day, in case of an emergency (e.g. emergency of car repairs) you have to pay by credit card or get into new debts. Keep on account of at least $1000 in case of unexpected expenses. And gradually increase the "airbag" to an amount equal to your income for up to three-six months.

"Usually when people plan to invest, they only think about profit and they don't think that loss's possible", says Harold Evensky, the President of the financial management company Evensky & Katz. He said that sometimes people do not do basic mathematical calculations.

For example, forgetting that if in one year they lost 50%, and the following year they received 50% of the profits, they did not return to the starting point, and lost 25% savings. Therefore, think about the consequences. Get ready to any options. And of course, it would be wiser to invest in several different investment objects.

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The Military Servicemember’s Guide to Starting a Business

Many of the personality traits that make a person an ideal candidate for military life, including independence, a desire to serve and the ability to stand firm in difficult circumstances, translate well into the world of entrepreneurship. If you are a veteran or someone in the reserves who is ready to start a business, there are a number of resources available to you. Here is an outline of what you need to do to start a successful business as you seek to attain financial security at home after serving the country abroad.

The Basics of a Business Plan

The foundation of any successful business is a business plan. This document outlines how you will start your business, how you will meet a need in your market and how you will see growth over the next three to five years. Your business plan will be the starting point for any financing you seek. Before lenders will be willing to extend financing, they will want to see that you have a solid plan for your business.

What is in a business plan? According to the Small Business Administration, it should contain:

  • Executive Summary – This introduction shows a basic snapshot of your business plan, including your goals and the outline of what your business will offer.
  • Company Description – This will provide information about what your business is going to do and how this is different than others to meet a need in your target market.
  • Market Analysis – This is an in-depth look at your potential target market and the competitors in it.
  • Organization and Management – This will outline exactly how your business will be structured.
  • Service or Product Line – This section will showcase what you are selling and how it will benefit your customers.
  • Marketing and Sales – This section will outline your marketing plan and sales strategy.
  • Funding Request – If you are going to look for funding, you will include this request in your business plan.
  • Financial Projection – This section will show that you have a plan to be financially profitable within a projected period of time.
  • Appendix – If you have additional information you need to add, including permits, resumes or lease agreements, it will go in the appendix.

In order to be successful in seeking to fund for your business, you will need to make your business plan stand out. This is a time when your service to the country is not going to help you in any way. Financial backers want to see that you have strong business sense. In order to stand out, make sure you:

  • Are clear in what sets your business apart.
  • Make it clear what you are going to sell, and be specific.
  • Clearly, identify your market and why you are needed in it.
  • Showcase that you have a niche that will be successful.
  • Clearly, differentiate yourself from your competitors.

With a solid business plan, you will set the stage to launch a successful business.

How to Get Started Legally

Before you seek to fund and open your doors for business, you are going to need the right paperwork and permits to start a business legally. While some of this will depend on the laws and regulations in your state, there are some steps that all businesses will need to take. These include:

  • Naming and Registering Your Business – Choose a name for your business, and register that business name with the county clerk or state government office in your area.
  • Registering with State Agencies – If you are going to operate as a corporation, non-profit or LLC, you may need to register with your state government. Those businesses operating as sole proprietorships may not need to take this step.
  • Get a License or Permit – Most businesses need either a license or a permit to operate legally. This may include a professional license that shows your expertise, a license for sales tax or the license to operate within any federally regulated industry. Permits are necessary to allow you to perform your service and handle the taxes needed to run a business. Research your business type in your state to determine what licenses or permits you need to operate legally, or talk to an accounting and business professional in your area for expert advice.
  • Learn the Required Time Frames for Paperwork – Take some time to learn how long you are required, by law, to keep your records on file. This will help you stick to these legalities as you seek to run an efficient and effective business.

Before you ever open the doors for your business, make sure you are operating legally and understand the permits and regulations surrounding your business type.

Finding Financing for Servicemembers

Few businesses are able to start without some form of a business loan or financing. A strong business plan is the starting point of seeking to fund, as it will be what potential investors will look at to determine how risky you are, but that’s just a starting point. You have to know where to look to find that funding before you can apply to get it.

As a startup business with a strong business plan, you have a number of options for your financing. These may include:

  • Financing from the Bank – The first place to look for financing is with your bank. However, it can be hard to get a business loan from a bank, particularly if you don’t have past business success to draw from. If you have something you are willing to use as collateral, like your home’s equity, or if you are not looking to finance a tremendous amount, the bank may be a great choice.
  • Small Business Administration Loans – The Small Business Administration offers loans to startup businesses that are a little bit easier to get than bank loans. This is often the first place a startup business will look for funding. To apply for this funding, send a funding request along with your business plan directly to the SBA. You will still need a strong business plan to get these loans.
  • Online Lending – An online lender may be less stringent in its requirements than a brick-and-mortar bank. Be careful, however, not to fall victim to fraud, which is easy to find online. Check a lender’s history before applying for a loan. Remember, if a loan seems too good to be true, most likely it is.
  • Venture Capitalists – A venture capitalist is someone who is willing to invest in a new startup that is considered high risk but has high-income potential. Venture provide cash to startup businesses in return for shares or an active role in the company. These investors look for young, high-growth companies, and are only paid if the company is successful. For this reason, venture capitalists take on a significant amount of risk and are therefore quite picky about whom they will lend to.
  • Crowdfunding – Crowdfunding is an interesting phenomenon that has really taken off with the introduction of online crowdfunding campaigns. With websites like Kickstarter and Indiegogo, small business startups can offer a small incentive for people willing to invest a little bit into their startup costs. Instead of ending up with a bunch of investors expecting dividends, you can use this to provide startup funding with the promise of a product when your product goes live. Crowdfunding is probably not big enough to provide all of your startup costs, but it can help fill in some of the gaps without all of the hoops you have to jump through to get a loan.
  • Grants – If your business is in science or research areas, you may qualify for a grant from the government. The Small Business Innovation Research and Small Business Technology Transfer programs both provide funding to businesses that will meet federal research-and-development goals with the goal and potential to be commercialized. Typically, grants do not have to be repaid with interest the same way a loan is, and so if your business qualifies, this is an excellent way to get the money to start up.

Don’t forget to tap into the good will of your friends and family, but do so fairly. People may be willing to invest in your idea, but make sure you are giving them something in return. Whether you offer shares in the company, a percent of your profits or repayment with interest, utilize friends and family only when you can do so ethically.

In addition to these sources of funding, as a veteran or active duty member of the military, you may have additional resources available to you for your startup costs. These include:

  • IFA VetFran Program – This grant program provides funding for veterans who are interested in starting a qualified franchise business, in addition to providing mentorship and training in business ownership.
  • USDA Veteran Farmers and Ranchers Program (2501 Program) – Historically, the USDA’s 2501 program has offered funding to help veterans who wish to start agricultural businesses get off the ground. Eligibility and application processes change from year to year, but if you are considering an ag-based business, this is a good place to look for funds.
  • Veterans Business Fund – The VBF is working to raise funding to provide loans to veterans with favorable terms as they seek to start their businesses. This funding will be available when the necessary number of donations have been received.
  • Hivers and Strivers – Hivers and Strivers is a group of angel investors who specifically invest in veteran-led businesses founded by graduates of U.S. Military Academies.
  • SBA Express Loans for Veterans – The SBA has a specific incentive for veterans that allows qualified veteran small business owners to borrow up to $350,000 with no upfront fee through the end of the 2016 fiscal year. Veterans can also get business counseling and training through government contracts through the SBA.

Finding Customers

Having a winning business plan and some funding is great, but it’s only the start. If you really want to find success in your new business, you need to get some customers. Here are some strategies to use to get customers for your business:

  • Learn marketing and commit to keeping up with it.
  • Use your network strategically.
  • Ask for referrals to build word-of-mouth business.
  • Harness the power of social media by tapping into Facebook, LinkedIn, Twitter, and other platforms.
  • Ask current customers to introduce you to new ones.
  • Dedicate a specific amount of time each day to prospecting.
  • Create a speech to use when people ask “what do you do?”
  • Be willing to do some cold calling.
  • Use local advertising platforms to generate local traffic.
  • Exceed the expectations of every customer you have so they will generate more customers.

Hiring Employees

While many businesses start with just the owner and his or her partners, as your business expands you may find that you need to hire employees. Perhaps your business will launch with a few employees at startup. Regardless, if you will be hiring employees at some point, here are the steps you need to take:

  • Register for an Employer Identification Number – The EIN ensures you can report payroll taxes to the IRS. You can apply for your EIN online or through the IRS over the phone.
  • Set up Your Books for Records for Withholding Taxes – The IRS requires employers to keep records of their employment taxes for a minimum of four years, so establish this at the outset before hiring your first employee. Make sure you are prepared to withhold both federal and state taxes and prepare your federal wage and tax statement report each year.
  • Verify Employee Eligibility – Before you hire someone, make sure that they are eligible to work in the United States by using Form I-9 to request documentation to prove citizenship or employment eligibility. Keep this form on file for three years after the date of hire or one year after the date of termination.
  • Register with Your State – Your state will have a new hire reporting program. Register your hiring of an employee within 20 days of the hiring date.
  • Purchase Workman’s Comp Insurance – All businesses must have workman’s compensation insurance, even if their workplace is not high risk. Talk to your insurance agent about buying this insurance.
  • Put up Required Notices – You need to post notices about rights in the workplace as well as the responsibilities of employees under labor laws.

What to Do When You Deploy

Running a business requires, in a large number of ways, your physical presence at the location of the business. Especially if you are running a sole proprietorship or are the sole owner of the business, you have to be present for it to be successful. Any time a major player in a business leaves for an extended period of time, problems can develop. When you are called to active duty, your business is left to flounder.

Does this mean you have to wait until you retire from military service to launch your business? No, absolutely not. What it does mean is that you are going to need a strong support group around your business to ensure it will operate solidly while you are away.

This means you have to have a plan for your deployment before it is even announced. Even if you feel a deployment is unlikely, you still need to know what you will do if it does happen. Your spouse, family, friends, employees, contractors and business partners will need to be able to run things while you are gone should a deployment happen.

Perhaps you are thinking that you will be protected because of the employment and financial protections afforded to those who are actively serving our country. For instance, you may have heard that you can’t have a credit account foreclosed on while you are away. This is true, but unfortunately, the financial and employment protections for military members are only for personal accounts and traditional employment. They do not extend to your business. So, what can you do to keep your business up and running? Here are some strategies to help prevent a devastating loss while you are overseas:

  • Train Someone Early – Sometimes you get little notice of your pending deployment, so make sure you have someone who is not in the military who is trained on running your business.
  • Keep Your Spouse in the Know – Even if you don’t train your spouse to run your business, give your spouse some say in the business while you are gone. Remember, your success is also your spouse’s success, so position gives your spouse some power to make decisions in your absence.
  • Consider Taking a Partner – Your business may be your baby and your brainchild, but sometimes you have to do what is necessary to protect it, and if you have the real chance of being deployed, that may mean taking on a partner. Choose wisely, and choose someone who is not in the military, but consider taking on a partner to oversee things in your absence if you deploy.
  • Have a Plan – Know what you will do when you deploy before you get orders. The months prior to deployment are filled with paperwork and decisions, so assume that you will eventually be deployed, and have your plan in place before you enter that difficult time.
  • Be Willing to Give up Control – You may have the freedom to check in from time to time while on deployment, but most likely you will need to be willing to give up freedom to make decisions during this time. That’s why it’s crucial to trust the leadership team you have in place during your deployment.
  • Tap Into the Military Reservists Economic Injury Loan – The Military Reservist Economic Injury Disaster Loan is an option to help those small businesses who are unable to meet their operating expense because an essential employee was sent to active duty after living as a military reservist. While you are not guaranteed this loan, the program is fairly easy to get approval through. Under this program, you can borrow up to $2 million to get through a challenging time. This might be what you need to keep your business financially solid in your absence.

Military-Specific Resources for Starting a Business

As you can see, starting a business as a member of the military is not much different than starting a business as a civilian. You have a few additional resources and considerations to make, but otherwise, the process is basically the same. That said, you will find a number of support resources to help you launch your business successfully. Here are some places for you to get additional information and support in your new endeavor:

  • VA Veteran Entrepreneur Portal (VEP) – Find federal services for small business owners and veteran small business owners in one convenient location.
  • SBA Office of Veteran Business Development – A portal for the Veteran Business Outreach Center which provides counseling, mentoring, business training and referrals for business owners who are also veterans.
  • Women Veterans Igniting the Spirit of Entrepreneurship (VWISE) – A program designed for women veterans who also wish to become entrepreneurs and need guidance or training.
  • EBV National Program – the EBV National Program is designed to provide training and small business management help to veterans and their families by taking veterans through a three-phase program to provide training in business. Applicants can have their training, lodging, travel expenses, course materials and meals covered while participating in the program.
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How an Experienced Tax Professional Can Help Reduce Your Debt

Oftentimes, we think we know what’s best for us when it comes to handling our own finances. The truth of the matter is everyone could use a little help, especially when tax season rolls around.

Many people who are in debt might not see how a tax professional can help them. After all, a tax professional deals in all things that are related to taxes, right? Well, that actually depends on what kind of tax professional you hire.

The Service You Might Be Used To

There are many storefront tax services that specialize in the “quick and dirty” annual tax filing. Nothing more. Nothing less. If what they’ve filed for you renders an outcome that’s other than a refund, then you are essentially on your own to work out some type of payment arrangement.

The Type of Service You Should Get Used To

The professionals at Success Tax Relief are invested in our clients. We do what we can to help our clients take care of their annual filing and see to it that they receive their refund as quick as possible. If for some reason, they end up owing the Internal Revenue Service (IRS), then we will also assist them with the means to making the payment. Oftentimes, the amount owed can be way more than taxpayers can afford. In cases like this, we communicate with the IRS on our client’s behalf to arrange an affordable monthly installment plan.

It can be said that other tax professionals do the exact same thing, but what sets Success Tax Relief apart from others is that we provide debt relief counseling services. We understand that when it comes to annual filings, sometimes you get a refund and sometimes you owe. It’s typically the owing part that can often get out of hand.

Managing Your IRS Payments

If you’re late with your filing or payments to the IRS, interests and penalty fees accrue, and if you’re already having issues keeping up with the payments, tacking on more money onto the existing debt can weigh you down. Because the consequences of a neglected tax payment are dire, this will certainly be the first debt that you want to pay. The problem is, other debts often get neglected because there’s only so much money to go around.

This is Where Debt-Ridden Tax Relief Can Help

The professionals at Debt-Ridden Tax Relief have over three decades of experience helping taxpayers like you stretch the dollar so that you’re taking care of all of your debt. We understand that many people who find themselves in debt are having problems managing it. This is usually the underlying problem and we have a service to specifically address just this.

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5 Simple Ways to Create a Balance Sheet

First things first: what is a balance sheet? A balance sheet is an essential way to evaluate a business’ financial health and can be calculated every month, quarter or half-year to create a snapshot of a company’s net worth.

In this article, we will be discussing how to calculate an annual balance sheet for a business. Creating an annual balance sheet will help you evaluate the equilibrium between your company’s assets against its liabilities, to determine the overall financial strength and value of your business. For an example of a full balance sheet, scroll down to see the example at the end.

1. Understand the Basic Equation

The following equation is a simplified representation of what a Balance Sheet calculates: the total sum of your company’s assets equals the value of the company’s liabilities and owner’s equity.

Assets = Liabilities + Owner’s Equity

As with any math equation, you can play around with the equation to isolate one category. Most business owners and investors use the following equation to calculate the value of the company’s equity.

Owner’s Equity = Assets – Liabilities

2. Calculate Assets

Assets, money, investments, and products the business owns that can be converted into cash: These are what put companies in the financial positive. A thriving company should have assets that are greater than the sum of its liabilities; this creates value in the company’s equity or stock and opens up opportunities for financing.

It’s important to list your assets by their liquidity—the facility by which they can be turned into cash—starting with cash itself and moving into long-term investments at the end of the list. For the purpose of an annual balance sheet, you can separate your list between “Current Assets,” anything that can be converted into cash within a year or less, and “Fixed Assets,” long-term possessions that can be sold or that retain value down the line, minus depreciation.

“Current Assets” may include:

  • Cash: All money in checking or savings accounts
  • Securities: Investments, stocks, bonds, etc.
  • Accounts Receivable: Money owed to the business by a client or customer
  • Inventory: Any products or materials that have already been created or acquired for the purpose of sale
  • Prepaid Insurance: Any payments made in advance for business insurance coverage or services (this tends to be paid in advance for the year).

“Fixed Assets” may include:

  • Supplies: Important objects used for business operations (manufacturing equipment, computers, office furniture, company cars, etc.)
  • Property: Any office building or land owned by the business
  • Intangible Assets: Intellectual property such as patents, copyrights, trademarks and other company rights that retain intrinsic value

3. Determine Liabilities

Liabilities are the negative part of the equation; these include operational costs, debt and material expenses. Generally speaking, the lower your liabilities, the greater the value of your company (and equity) can be. “Current Liabilities” include cash spent, as well as any debts that must be paid out within one year, while “Fixed Liabilities” refer to bills due anytime after one year.

“Current Liabilities” may include:

  • Accounts Payable: Money owed by a business to its suppliers or partners
  • Business Credit Cards: Company credit card bills due
  • Operating Line of Credit: Any money owed to a bank that has extended the business an operating line of credit
  • Taxes Owed: Any federal and state taxes owed for one year
  • Wages and Payroll: Employee compensation, including wages, medical insurance, etc.
  • Unearned Revenue: Any revenue garnered from a service or product that has yet to be delivered to the customer or client

“Fixed Liabilities” may include:

  • Long-Term Mortgages: Property or building mortgage expenses
  • Bonds payable: Long-term bonds owed to the government, as well as any interest paid on the bond (this interest is often semi-annual and can be added to “Current Liabilities”)
  • Pension Benefit Obligations: The total amount of money the company owes to employee pension plans up to the current date
  • Shareholder’s Loan: A form of financing provided by shareholders
  • Car Loan: Any long-term car loans on company vehicles (plus insurances costs)

4. Equity Valuation

Owner’s Equity = Assets – Liabilities

The value of your assets minus your liabilities will result in an estimation of the value of your company’s capital. If this equation results in a negative net worth, this can be dangerous for a small business; it will make it difficult for to secure financing, which can be troubling for a company whose expenses are already eclipsing its profits.

If, however, a company has positive equity, this means that business owners have the option of acquiring capital by selling part of their business through equity, stocks and/or dividends.

In a sole proprietorship, this is called the “Owner’s Equity”; in a corporation, this is called “Stockholder’s Equity,” and it can include common stock, preferred stock, paid-in capital, retained earnings, etc.

“Equity” may include:

  • Opening Balance Equity: The initial investment into the company
  • Capital Stock: The common and preferred stock a company issues
  • Dividends Paid: Profits paid out to shareholders by a company (applies to corporations)
  • Owner’s Draw: Portion of the revenue used by company’s owner (applies to sole proprietorships)
  • Retained Earnings: The sum of a company’s consecutive earnings since it began

Having an Income Statement will assist you in filling out this section since it helps you determine the opening balance equity and the retained earnings.

5. Consider All Applications

When you put it all together, a balance sheet will probably look something like this:

balance sheet example

A solid balance sheet is an essential financial statement and part of a complete financial report. It can be used to secure financing or take a snapshot of a company’s current financial state, but it can also be used to evaluate the worth of your company over time. While accounting software like QuickBooks can easily generate balance sheets and other financial statements, it’s good to know the process to ensure your calculations are accurate.

Comparing your “Current Assets” minus “Current Liabilities” on a yearly basis will paint a picture of your company’s annual growth and expenses, which may have room for improvement. Calculating “Fixed Assets” minus “Fixed Liabilities” can provide a more long-term view of the company’s value over time and its ability to pay back long-term debts or expenses built up over many years.

Remember, the expenses of different companies may vary greatly, so don’t forget the assets and liabilities that are specific to your industry or area. For more help with balance sheets and other financial statements, see our infographic on financial reporting.

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Income Tax Liability In Bankruptcy For Appreciated Property

People avoid filing Chapter 7 bankruptcy if they have the nonexempt property with significant equity. Yet, consider a debtor who owns real estate that has appreciated and therefore has a built in liability for capital gain. If that debtor files bankruptcy could the IRS hold him personally liable after bankruptcy for the income tax liability associated with the gain on the property?

When a person files bankruptcy all of his property interest is transferred to the Chapter 7 trustee and the property constitutes the bankruptcy estate. The trustee acquires the debtor’s property with its tax characteristics including gain and character. The trustee controls the sale of the property, and the trustee receives the sales proceeds for the benefit of creditors.

The trustee and the bankruptcy estate is liable to pay the tax liability created by the sale of the debtor’s property. The tax is an administrative expense. The debtor is not liable for tax on the sale of property he had conveyed to the bankruptcy estate upon filing bankruptcy. A trustee may avoid tax liability by abandoning the property instead of selling it.

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A Simple 6-Step Process to Starting a Small Business

A great small business always starts out as an idea, but you have to transform that idea into action. That’s where many individuals can start to feel overwhelmed. It’s understandable to freeze up at the deluge of things that are required to get a business started, but getting going is actually easier than you might think.

Like any big goal, if you start by breaking it down into smaller tasks, you’ll be able to tackle enough of the actions necessary to get started. Here are six ways to break down the process and simplify getting started with your own small business.

1. Write a one-page business plan.

The key to a successful small business, especially in the startup phase, is to keep things simple and costs low. Costs don’t just mean your monetary costs, but also your time.

Many would-be small-business owners fall into the trap of trying to create the world's biggest and most robust business plan. You’re only going to need that if you’re seeking investment or financing, and even if you will be seeking either of those things down the road, I always recommend small-business owners start out with by testing their ideas first before investing lots of time and money.

Related: Why You Must Really Know Yourself Before Starting a Business

So to get started, create your own simple, one-page business plan that is a high-level overview of the small business you’re about to start.

  1. Define your vision. What will be the end result of your business? 
  2. Define your mission. Different to a vision, your mission should explain the reason your company exists.
  3. Define your objectives. What are you going to do -- what are your goals -- that will lead to the accomplishment of your mission and your vision?
  4. Outline your basic strategies. How are you going to achieve the objectives you just bulleted?
  5. Write a simple action plan. Bullet out the smaller task-oriented ac