Dugan & Lopatka eUpdate

Take a Refresher Course on 529 Plans

admin — Fri, 16 Sep 2011 16:12:41 +0000

Are you planning to tap into your Section 529 college savings plan for education expenses this fall? Before you do, you may want to take a quick refresher course on the tax consequences of withdrawals.

* Qualified distributions of contributions and plan earnings are tax-free, as long as you use withdrawn amounts to pay qualified higher education expenses.

* Qualified higher education expenses include your out-of-pocket expenses for tuition, fees, books, supplies, and equipment required for enrollment or attendance at an eligible educational institution. Also included is a limited, reasonable amount of room and board costs when you attend at least half-time (defined as half the school’s standard full-time course load). Expenses for special-needs services in connection with enrollment or attendance qualify too.

* As a general rule, an eligible educational institution is a college, university, graduate, technical or vocational school.

* A 10% additional tax applies to the earnings portion of distributions that fail to meet the tax-free criteria – unless an exception applies. Exceptions include withdrawals in cases of a beneficiary’s death, disability or attendance at specified military schools, and certain rollovers or transfers to other 529 plans.

Please call us for more information, including the most tax-efficient way to take distributions from your 529

plan and the interaction of withdrawals with educational tax credits and amounts taken from other tax-advantaged

accounts.

Important Tax Deadlines Coming Up

admin — Thu, 01 Sep 2011 18:49:29 +0000

You don’t usually think of fall as a major tax filing time, but there are several important tax deadlines coming up this September and October. Check the deadlines below to see if any apply to you or your business.

September 15 – Due date for third quarter installment of 2011 individual estimated income tax.

September 15 – Filing deadline for 2010 tax returns for calendar-year corporations that received an automatic

extension of the March 15 filing deadline.

September 15 – Filing deadline for 2010 partnership tax returns that received an extension of the April 18 filing

deadline.

October 3 – Generally, the deadline for self-employed individuals and small businesses to establish a SIMPLE

retirement plan for 2011.

October 17 – Filing deadline for 2010 individual income tax returns that received an extension of the April 18

filing deadline.

October 17 – Deadline for undoing a 2010 conversion of a regular IRA to a Roth IRA and switching the Roth back

to a regular IRA without penalty.

If you need more information or filing assistance, contact our office.

IRS Issues Tax Tips for Recently Married Taxpayers

admin — Fri, 19 Aug 2011 16:20:47 +0000

IRS Tax Tip 2011-20: Seven Tax Tips for Recently Married Taxpayers

With the summer wedding season in full swing, the Internal Revenue Service advises the soon-to-be married and the just married to review their changing tax status. If you recently got married or are planning a wedding, the last thing on your mind is taxes. However, there are some important steps you need to take to avoid stress at tax time. Here are seven tips for newlyweds.

Notify the Social Security Administration Report any name change to the Social Security Administration so your name and Social Security number will match when you file your next tax return. File a Form SS-5, Application for a Social Security Card, at your local SSA office. The form is available on SSA’s website at www.ssa.gov, by calling 800-772-1213 or at local offices.
Notify the IRS if you move If you have a new address you should notify the IRS by sending Form 8822, Change of Address. You may download Form 8822 from www.IRS.gov or order it by calling 800–TAX–FORM (800–829–3676).
Notify the U.S. Postal Service You should also notify the U.S. Postal Service when you move so it can forward any IRS correspondence or refunds.
Notify your employer Report any name and address changes to your employer(s) to make sure you receive your Form W-2, Wage and Tax Statement, after the end of the year.
Check your withholding If both you and your spouse work, your combined income may place you in a higher tax bracket. You can use the IRS Withholding Calculator available on www.irs.gov to assist you in determining the correct amount of withholding needed for your new filing status. The IRS Withholding Calculator will give you the information you need to complete a new Form W-4, Employee’s Withholding Allowance Certificate. You can fill it out and print it online and then give the form to your employer(s) so they withhold the correct amount from your pay.
Select the right tax form Choosing the right individual income tax form can help save money. Newly married taxpayers may find that they now have enough deductions to itemize on their tax returns. Itemized deductions must be claimed on a Form 1040, not a 1040A or 1040EZ.
Choose the best filing status A person’s marital status on Dec. 31 determines whether the person is considered married for that year. Generally, the tax law allows married couples to choose to file their federal income tax return either jointly or separately in any given year. Figuring the tax both ways can determine which filing status will result in the lowest tax, but usually filing jointly is more beneficial.

For more information about changing your name, address and income tax withholding visit www.irs.gov. IRS forms and publications can be obtained from www.irs.gov or by calling 800-TAX-FORM (800-829-3676).
Links:

Form 8822, Change of Address (PDF)
IRS Withholding Calculator
W-4, Employee’s Withholding Allowance Certificate (PDF)
Social Security website

YouTube Video:

Getting Married? - English

12 Powerful Ideas for Improving Sales Brochures

admin — Wed, 17 Feb 2010 16:39:07 +0000

Look at your existing sales brochures and see if one or more of these ideas could improve its effectiveness.

1.Show test results that confirm that your product or service performs as you say it does.
2.Use case studies showing the successful application of your product or service.
3.Provide sample calculations of cost savings or other benefits.
4.Compare your product or service with the competition, feature by feature.
5.Compare your product or service with the cost of the buyer doing nothing and sticking with his old ways.
6.Provide useful information about the application of your product or service that is not readily available.
7.Present points logically in a progressive persuasive order that answers the prospective customer’s probable questions and expected points of objection in an order that the prospective customer would ask them.
8.Design the materials so that it presents one major topic per spread or page.
9.Don’t cram too much material into the first page or spread. It must be very inviting if you are going to get your prospective customer started on your message.
10.For longer brochures, consider using an index or table of contents to direct the prospective customer to the right section.
11.Try to include at least one photograph of your product. Avoid drawings for new products as this suggests you haven’t made any of them yet.
12.Use tables and graphs to support your claims and present the properties of the product.

Year Tax Planning – Don’t Miss Your Opportunity!

admin — Fri, 11 Dec 2009 19:19:18 +0000

If you haven’t talked to your CPA yet, you need to do so immediately. Proper year-end tax planning can save you a lot of money in April when filing your tax return.

Cost of Losing A Customer

admin — Fri, 20 Nov 2009 15:40:32 +0000

How much are your existing customers worth to your company? If you don’t know the lifetime value of your customers, you need to find out. What is the Lifetime Value? Simply put, it is the total amount of money a single customer will spend with a company over their lifetime. In the case of business to business sales, the Lifetime Value is total amount of money a single customer will spend over the normal period of purchases. Where all else fails, use 50 years. For example, the lifetime value of a supermarket customer is $250,000. Put another way, the average customer, you and me, will spend $250,000 buying food and other products in our lifetimes at the supermarket.

Why is this information important? Because it puts a real cost to losing a customer.

Laura Liswood is a researcher specializing in lost customers—what makes them go away, what can we do to keep them, and so on. Her research quotes some amazing statistics. They are frightening.

She calculates that if a business loses just one customer per day and the average customer spends $50 per week, then the net loss to annual revenue is a frightening $989,000!

Couple that with the Lifetime Value and you begin to see why customer retention is so critical.

How well does your company handle customer complaints? What is your customer defection rate? If your company is continually replacing lost customers, you are stagnating your growth and wasting precious resources. It’s critically important we remember Laura Liswood’s research. And, it’s even more important we take action on it, don’t you think?