Author: Rosalind Fletcher
About Rosalind Fletcher
Posts by Rosalind Fletcher:
If you’re unlucky enough to have a car without GPS navigation maps, the next best thing to use is your smartphone. This article will take a look at apps that help to get you from point A to point B.
Google Maps is the all-around favorite, whether you own an iPhone or an Android. The default navigation system on the iPhone is Apple Maps, so you will need to download Google Maps to get it.
The database is robust, mostly up-to-date, and shows not only places but also traffic congestion.
Waze is a crowd-sourced app that is good for current traffic conditions. It has some fun features, such as the speed limit of the road you’re on. You can even set it to warn you when you’re speeding. Waze users let others know where local police are checking for speeders, although this is a bit of a controversial use of the software. Other user reports include the locations of construction, road hazards, gas stations, and toll roads. A carpooling feature is also available.
At this writing, Google Maps and Waze, both owned by Google, are the only apps available for Auto navigation on the Android.
Do you prefer to cycle or hike? If so, Komoot’s AllTrails app maps all of the hiking and cycling trails around your town. It lets you know the distance, elevation, and suggested fitness level of each trail so you can plan accordingly. You can set routes and save them as well as favorite your local trails.
There’s no fee to use the above apps. The following apps require a fee to use.
Bird and Lime
Don’t have your own ride? You may have seen people riding on motorized scooters or simply seen scooters parked on sidewalks scattered here and there. Welcome to the new field of micromobility. If you need to get somewhere that’s too short a distance for a car but too long to walk, you can unlock one of these rides with an app and hop on. A couple of companies in this space include Bird Rides Inc. (bird.co) and Lime (li.me), and Lyft.
Uber and Lyft
Of course, if you want a car, you can get a quick ride via Uber or Lyft as well as rent a car at all the traditional places.
Try out these apps so you can get where you want to go.
At first glance, this article topic might seem too simple. After all, to get paid, don’t you just take money out of your business? Well, yes, but there is much more to it in the long run as well as from an accounting side. Let’s take a look.
The Traditional Paycheck
If you’ve ever worked for someone else, you probably received a paycheck every few weeks. It took care of three major things:
- Your regular pay that you live off of from day to day
- Taxes you owe to the federal and state government
- Benefits. Depending on the employer, you might have received health care, retirement contributions, and vacation and holiday pay.
The employer took care of the needs you have today as well as some of your future needs.
Your Business Pay
Now that you’re the employer – of yourself, your business has to cover all of the items mentioned above. How it does that depends on the type of entity you chose when your business was formed.
If you are doing business as a sole proprietor, you take draws from your business instead of paychecks. A draw is simply a cash withdrawal that reduces the ownership investment you have made in your company. The draws do not include any kind of taxes, including self-employment taxes; these need to be deposited separately, usually through quarterly estimated tax deposits to the IRS and to any relevant state agency.
As a sole proprietor, you’ll likely need to find your own health insurance. And the most important thing you’ll need to do is plan for your retirement by investing in IRAs or otherwise saving money that is earmarked for your retirement.
From an accounting standpoint, owner’s draws are shown in the equity portion of the balance sheet as a reduction to the owner’s capital account.
If your business is formed as a C Corporation or an S Corporation, you will most likely receive a paycheck just like you did when you were employed by someone else. You will also be responsible for making the payroll tax deposit, funding the retirement plan, and paying for health care insurance.
Owners can also take money out of the business over and above their paychecks.
From an accounting standpoint, corporate payroll, taxes, and benefits are all considered expenses and are shown on the income statement. Any money taken out additionally is a reduction to the owner’s capital account, and this is shown in the equity section of the balance sheet.
If your business is formed as a partnership, each partner will be paid distributions based on the partnership agreement. Typically, that means receiving a base salary and a portion of the profits. You can also take money out of the partnership. Taxes are not included; you are responsible for making your quarterly estimated payments. Plus, you will also be responsible for paying self-employment taxes.
For benefits like retirement plans, partners can be eligible, but the tax treatment of these and other benefits is not necessarily the same as it is for a W-2 employee. The rules are complex for deductibility, so it’s best to contact a tax professional to find out more.
Evaluating Company Profits
It’s critical to understand where your wages show up on your books so that you can truly understand your business’s profitability. With corporations, the salaries are included in the expenses, so net income is after, or net of, salaries and payroll taxes.
With sole proprietors and partnerships, the net income figure on the income statement does not include owner salaries because there aren’t any. Instead, only the equity section is impacted. Net income for partnerships and sole proprietors should always be high enough to at least “cover” an amount equivalent to a “so-called salary” for all of the active, participating owners.
If you have questions or need help understanding how business owners get paid, please feel free to reach out any time.
With an alarming increase in scams, cybercrimes, and other fraud schemes, we all need to be extra diligent in our actions to protect our businesses, our computers, our children, and ourselves. Here are some things we need to watch out for and how to stay safe.
Virtual Environment Exploits
A record number of people are working from home, and cybercriminals see this as an opportunity. System vulnerabilities allow criminals to steal your private information by accessing your networks.
The FBI’s Crime Complaint Center has been inundated with grievances about COVID-19 related schemes, including many against health care workers and companies. Businesses with individuals working at home for the first time are particularly vulnerable since workers are learning the software and learning how to set up their VPNs.
Employers should make sure that the systems they are allowing workers to use meet the security protocols necessary for the type of data the company handles. For example, if HIPAA-level security is required, make sure the apps workers are using are HIPAA-compliant.
Employees should rely heavily on their IT departments to make sure they have set their systems up correctly and that they follow the right guidelines when using technology. It might be a great opportunity to offer training so employees can push through any learning curves they have been putting off when it comes to using software.
Just recently, Zoom meetings were being interrupted by uninvited people that eavesdropped on private meetings. Zoom changed the software interface and suggested that everyone use meeting passwords to avoid unwanted guests.
Watch out for fake CDC emails, people trying to sell you miracle cures, and counterfeit equipment. Especially be on the lookout for emails related to IRS refund checks, charities, airline refunds, and fake testing kits. All of these are current scams that are happening today.
This advice is timeless:
- Install anti-virus software on your computer and keep it updated.
- Don’t use software that you don’t know where it comes from; if the price is too good to be true, it probably is.
- Keep your passwords very strong and change them often.
- Use different passwords for each account, especially your banks, payroll systems, and other systems with sensitive data.
- Use 2-factor authentication when offered.
- Don’t provide personal information over the phone or via email.
- Don’t click links in emails from people you don’t know.
- Know your IT people and only hire reputable companies.
- Be careful of emails impersonating name brand companies.
- Be wary of leased or used equipment as it’s not always virus-free.
- Don’t share meeting links on a public platform.
- Make sure URLs you enter are correctly spelled.
- Watch out for schemes that ask you to wire or ACH money to a regular creditor when it is not really them.
- Raise the alarm when people ask you for last-minute changes or won’t talk to you via phone call.
- Put procedures in place to monitor children’s online educational and other activities to keep them safe from predators.
- Perform regular credit monitoring or lock down your account.
If you find out you are the victim of a fraudulent incident, immediately contact your bank or employer to stop funds or freeze your account. Change your passwords. As soon as possible, file a complaint with the FBI’s Internet Crime Complaint Center at www.ic3.gov or BEC.IC3.gov.
You can also report fraud here: https://www.justice.gov/coronavirus
Let’s stay safe in more ways than one.
On Friday, March 27, 2020, the Coronavirus Aid, Relief, and Economic Security Act (CARES) was signed into law, and one part of it includes two loan programs for small businesses.
Paycheck Protection Program (PPP) Loan
Owners of businesses, including nonprofits, with less than 500 employees that have been impacted financially due to the coronavirus can apply for a nonrecourse loan up to the lesser of $10 million or roughly 2.5 times the average monthly payroll (there is a formula to calculate the loan amount) to help them maintain their employees.
The proceeds of the loan must be tracked separately, preferably in a separate bank account and only be used to cover payroll, rent, utilities, mortgage interest, and health insurance costs. A portion of the loan can be forgiven if it has been used properly. If any employees were terminated during the loan period, forgiveness will be reduced accordingly.
The loan terms are 2 years, payments to start in 6 months, and 1% interest. You can apply at any SBA-approved 7(a) bank; here is a list of some of them: https://www.sba.gov/article/2020/mar/02/100-most-active-sba-7a-lenders
The loans are first-come, first-served and are available until the $349 billion fund runs out or June 30, 2020, whichever is sooner. The application form is here: https://home.treasury.gov/system/files/136/Paycheck-Protection-Program-Application-3-30-2020-v3.pdf. However, many banks have created their own applications and have also created additional conditions. For example, Bank of America requires borrowers to have an account with them.
Wells Fargo is no longer taking any more applications. https://update.wf.com/coronavirus/paycheckprotectionprogram/
Chase was encouraging borrowers to get in the queue here, and right now, it’s down: https://recovery.chase.com/cares1
Bank of America has already taken billions of applications and is taking them here:
Fifth Third is taking applications: https://www.53.com/content/fifth-third/en/alerts/covid-sba-cares-act.html
Economic Injury Disaster Loan (EIDL)
A second option is the Economic Injury Disaster Loan (EIDL). Owners of businesses, including nonprofits, with less than 500 employees that have been impacted financially due to the coronavirus can apply for a loan up to $2 million to help them cover payroll, rent, and utilities. There is a $10,000 forgivable advance that is supposed to be funded in 3 days.
The interest rate on this loan is higher and payments start in one year. There is no forgiveness on this loan (except for the advance). A business cannot get both loans. If a business has already applied for the EIDL, it can be rolled into the PPP loan.
Please be cautious when applying for any loan. There are very strong penalties for failing to comply with the requirements of these loans. If you need help with the payroll computation or setting up tracking for the loan proceeds and subsequent spending, please reach out any time.