The Tax Bill and Vacation Homes

No more deducting interest on your vacation home

A common question this last week from my tax clients was how the tax bill would affect their deductions for their secondary (vacation) home. The answer, as always, is it depends. If you own the house out right, under the new bill, you can still deduct property taxes, combined with your primary home, up to $10,000. If you have a mortgage you could be in trouble. The tax bill does not allow for the deduction of interest on secondary homes.

what about home equity?

Many homeowners use home equity loans to not only improve their primary residence, but sometimes, to purchase a vacation home. Under the current tax code, homeowners can deduct interest on home equity loans, up to $100,000 principal balance. The new bill does  not allow for interest deductions at all.

Alexa For Small Businesses

I am currently considering Alexa for my office, now that it is on sale for $29.99.

Here is a great article I came across for using Alexa in your business.

24 Ways Alexa skills can help your business

Tax Bill

I am writing this on a Sunday night. As of right now, the tax reform bill is still being reconciled between Congress and the Senate.  It is hard to tell what the final bill will look like but we will try to keep you up to date.

Here are some interesting reads in the meantime:

Tax Exemption Applications

Sorry for the week off – I was sick.


A couple weeks ago a client asked if they could use the 1023 ez application for their nonprofit.

So here is the rub, very few organizations actually qualify for the 1023 EZ application. In my client’s case, a business association trying to revitalize a down town was not eligible to use the EZ application because they qualified as tax exempt under 501(c)(6).

If you apply for tax exemption using the EZ application and you were not eligible, your application fee is forfeited. Make sure you double check your eligibility before applying.

Here are some good websites to check your eligibility:

Do not be this employer

So a relative of mine, who is job hunting, sent me this article.

How to Recognize a Bad Workplace … Before You Take the Job

Small business owners have a hard enough time finding quality employees. Do not do any of the 8 things mentioned in the article during the hiring process if you can avoid it.

 


HOLIDAY CUSTOMER SERVICE MISTAKES — AND HOW TO AVOID THEM

If you have not yet checked out Square’s Business Resource Center then you are missing out of some great advice. Here is one for the holidays.


Holiday Customer Service Mistakes — and How to Avoid Them

The holidays are a critical time for your business. So it’s important that your customer service is on point.
Unfortunately, when you’re crazed, it can be easy to let things fall through the cracks. That could translate to a negative online review, which can really affect your reputation.
To make sure that doesn’t happen to you, we’ve highlighted some common holiday customer service mistakes and how to avoid them.
You don’t have a strong online presence.
Often, customers search online before hitting the streets, or they follow up and purchase from your site after they’ve visited your brick-and-mortar shop in person.
That’s why it’s really important to make sure your website features your products in a navigable, shoppable way. Also, put store hours and the address front and center and include information about applicable sales and discounts.
This applies to social platforms as well. But don’t stop there. Every day, have someone on staff answers questions that customers or potential customers may have posted to Facebook or Twitter, or sent to the company email address.

Accept chip cards and Apple Pay everywhere.

Order the Square contactless and chip reader.
You have an old POS — and long lines.
By now, larger retailers are on board with chip card and mobile payment point-of-sale (POS) systems. Small businesses should follow suit — especially when it comes to adopting a POS that can take mobile payments like Apple Pay.
Mobile payments are the fastest way to pay, not to mention the most secure. And because customers say slow checkout lines are their top shopping pain point, having a speedy POS makes for a much better experience at your store.
You’re not timing your marketing campaigns right.
Since it’s such a busy time of year, the key is to use a email marekting service to send messages that anticipate customers’ questions and helps them solve common problems with holiday gift giving. The same goes for your social channels.
Be smart about the timing of these messages — you want to catch customers who get a head start on the holidays as well as those who wait until the last minute.
You’re running out of inventory.
We’ve all been that frustrated customer frantically searching store to store for that one hot gift that’s on everyone’s list. No one likes coming up empty handed, so do your homework before the holiday season begins to make sure you’re adequately stocked across both your brick-and-mortar and online sales channels.
To do this, look to your historical sales data to make inventory projections. It’s also a good idea to onboard software that syncs your brick-and-mortar and online store inventory in real time after each sale. Read more about how to manage holiday inventory.
You’re short-staffed.
The holidays are the time of year to ramp up staff and make sure that everyone on the floor is well versed in your product. Because everyone is short on time (and patience), you don’t want to put customers in the position of waiting around for a staffer to get their size from the back or not being available to answer questions.
A lack of staff often translates to a loss of business, so build the cost of staffing up for the holidays into your annual budget. Learn more about hiring for the holidays.
You have pushy salespeople.
Just as important as having enough employees on the floor is having the right kind of customer-facing employees. Sure, you want employees to close the deal, but customers are often turned off by pushiness. Employees should be helpful, educating customers about your products, but not pushy.
Superb customer service is paramount when running a business — especially during the holiday season. So make sure everything’s running smoothly.
Related articles

Make your own Kombucha!

If you have not noticed, I like to make my own foods. Why? A few years ago I was diagnosed with an immune system disorder. My body was attacking my gut and caused a lot of damage. At the time, I was told that I had to make some major changes to my diet. I was on baby food for a few months while a recovered. However, I soon realized that many processed foods were setting off my immune system. Simple things like bread and juices had preservatives that made me sick. I was forced to learn how to produce my own food.

At first, it was extremely intimidating. As a business owner, it is not uncommon to work 12 hour days or 6 days a week. If there was barely time to do laundry how on earth was I going to be able to produce my own foods?

The answer is selecting low maintenance foods and a few cheap appliances. Grab yourself a couple of mason jars, flip top bottles, a sun tea jar, a breadmaker, a crockpot, and a rice cooker. Now you have everything you need to make everything from cheese, yogurt,  breads, jams, to kombucha and sodas, and, yes, even beer.

 

I personally recommend this bread maker. I make everything from pizza dough to jam in it. I usually set it up before heading off to work or before going to bed. It is amazing to wake up or come home to the smell of fresh bread. Do you have Celiac or a gluten intolerance? Experiment with some of the new gluten free flours on the market. They work really well. For about $2, I typically make 2-3 loaves of bread per week. 

But that is for another week. This week is about Kombucha. If you have any sort of immune issues or digestive issues, you really need to try out Kombucha. 

Those who have regularly partaken of this holy substance have found that Kombucha:

  • Boosts Energy
  • Improves Digestion
  • Strengthens at a Cellular level
  • Prevents Acid Reflux
  • Assists With Weight Loss
  • Improves Sleep
  • Relieves Constipation
  • Strengthens and restores hair
  • Beautifies the skin
  • Improves Circulation
  • Removes toxicity from the body
  • Improves eyesight
  • Eases the pain of arthritis
  • Relieves seasonal allergies

www.weedemandreap.com

However, Kombucha can get expensive if you are buying it daily. “It is significantly cheaper to brew it at home. I don’t know about the prices where you are, but an 16oz bottle of Kombucha can go for around $2.99. When you brew your own, the price comes down to about  $0.12 per bottle. Pretty amazing.”  – www.weedemandreap.com

You will need your sun tea jar, tea (black is better), some sugar for the starter, a starter, a dish towel, a rubber band, and some water. The process takes about a week.

The simple instructions are: bring water to a boil; stir in a cup of sugar; and your tea bags and brew your tea (6-8 bags per gallon) on simmer 3-5 minutes. Remove your brew from the heat and put some place out of the way to cool, oh and remove the bags. I usually go to work or bed and by the time I get back it is at room temperature. This step is critical because you can kill your starter if the tea is too warm. Now, pour tea in to the sun tea jar and add your starter. Place a dish towel over the opening and secure it with a rubber band. Put is somewhere out of the sun for a week. A film will form on the top of the liquid in the jar. This is the starter and can be reused to make more Kombucha. After a week, simply scope out the starter and about 1/4 of the brewed Kombucha. Save this for your next batch. I like to add my finished Kombucha to flip top bottles and then get another batch going right away.

**If your Kombucha is flat or tastes a bit vinegary, add 1/4 parts fruit juice to 3/4 Kombucha. Make sure there is some air space, and put it out of the light for another 2-3 days. Discard any new forming starter (the film).

This recipe is awesome because, after the first batch, the only real cost is the tea and sugar.

Check out the full recipe here from Weed’em and Reap:

 https://www.weedemandreap.com/brewing-kombucha-tea-basics-benefits-bravery/

 

Scaling Up Instead of Down at Retirement

A very interesting trend that is starting to occur with the baby boomers goes against all conventional wisdom. The conventional wisdom is that you should down scale your home upon retirement. However, in recent years many boomers are actually trading in their bungalows for larger homes, almost 30%. Why?

There are many societal issues at play. Some are up-scaling to accommodate visits from family and more grandchildren. Others may be up-scaling to have an elderly or disabled relative move in. However, as many are working later in life, more and more are working from home. Thus, a home office is becoming increasingly common. Workout rooms also hold appeal for active boomers.

Giving Tuesday is Today!

“Celebrated on the Tuesday following Thanksgiving (in the U.S.) and the widely recognized shopping events Black Friday and Cyber Monday, #GivingTuesday kicks off the charitable season, when many focus on their holiday and end-of-year giving. Since its inaugural year in 2012, #GivingTuesday has become a movement that celebrates and supports giving and philanthropy with events throughout the year and a growing catalog of resources.” – https://www.givingtuesday.org/


Taxpayers can use IRS Select Check tool before Donating on Giving Tuesday

Giving Tuesday is an annual event celebrated the week after Thanksgiving to kick off the season of charitable giving. Taxpayers making donations may be able to deduct them on their tax return. As people are deciding where to make their donations, the IRS has a tool that may help.

Exempt Organizations Select Check on IRS.gov is a tool that allows users to search for charities. It provides information about an organization’s federal tax status and filings.

Here are four facts about EO Select Check:

  • Donors can use it to confirm an organization is tax exempt and eligible to receive tax-deductible charitable contributions.
  • Users can find out if an organization had its tax-exempt status revoked. A common reason for this is that the organization did not file its Form 990 or notices annually as required.
  • EO Select Check does not list certain organizations that may be eligible to receive tax-deductible donations. This includes churches, organizations in a group ruling, and governmental entities.
  • An organization’s “doing business as” name is not searchable. Search using an organization’s legal name instead.

Taxpayers can also use the Interactive Tax Assistant, Can I Deduct my Charitable Contributions? to help determine if a charitable contribution is deductible.

More Information

HOW TO WORK FROM HOME LIKE A PRO

Square can have some really great articles and tips. This week I pulled one for those of us who work from home.


How to Work from Home Like a Pro

The ability to work remotely is becoming an increasingly sought-after perk among job seekers who value companies that are flexible when it comes to both hours and location.
It’s not hard to grasp the appeal of working from home: zero commute, no need to dress up, and fewer distractions from coworkers. Working from home can result in a major productivity boost, but it also comes with its own set of challenges — at least for the inexperienced. Here’s how to do it like a pro.
Make a schedule.
A great thing about working from home is that you have plenty of free time. Conversely, a terrible thing about working from home is that you feel like you should be working all the time.
Even though you’re not in the office, adopt the same mindset by giving yourself designated work hours, like 9 a.m. to 6 p.m. with a lunch break. Of course, you can allow yourself a little wiggle room, but try to stick to the schedule so you can reach your goals for the day.
If you work with people who are in an office (or other home offices), be available to coworkers who need to communicate with you during the day. And, if you’re going to be away from your computer, let them know when and for how long. When you’re done for the day, send them a “sign off” email and, if applicable, give them the status of the project you’re working on.
Finally, when your “office hours” are over, stop working.
Set a routine.
It’s tempting to be the “anti-office” version of yourself while working from home: wearing your pajamas all day, staying in bed, and otherwise blurring the lines between a weekday and the weekend. But to be successful at working remotely, you need to take it seriously.
Adopt some healthy workday habits. Set your alarm in the morning so you’re getting started at a consistent time every day. Brush your teeth, comb your hair, and get out of your pajamas. You don’t have to dress up, but changing your clothes really does change your mindset. Respect your home workday, and you’ll feel better about yourself and get more accomplished.
Create a work space.
One of the challenges of working from home is that you’re surrounded by personal distractions, from your family to pets to the pile of laundry that you can’t escape. If you have the space, set up a designated home office. Preferably, it is a place where you can close the door and shield yourself from disturbances. (It’s best that this space isn’t in your bedroom, which you should try to maintain as a restful, tech-free zone — one that you associate with relaxing, not working.)
Outfit your office with everything you personally need to work uninterrupted for a significant stretch of time, like computer, printer, phone — even beverages and snacks. That way, you don’t have to keep getting up and disturbing your flow.
If you don’t have an extra room, remove as many distractions as you can. For example, move the pile of unopened mail from your sight line, turn off the TV, and close any browser windows on your computer that aren’t related to work.
If you work from home consistently and going into your company’s office isn’t an option (especially if you are an independent contractor), coworking spaces are a great option. Not only do they have everything you need, but they also help you avoid the isolation and loneliness that can come with working from home.
Be active.
As mentioned above, working from home can be incredibly isolating, so it’s important to get outside every day. Whether it’s going to the gym, running a quick errand at lunch, or walking your dog in the afternoon, make sure to take some time to breathe some fresh air and clear your head.
If you know other people who work from home, consider planning meetups to discuss challenges, bounce ideas off each other, and just have some fun together. That way, you won’t completely lose out on the social aspect of working in an office.