All posts by Nancy McClelland

Illinois

Illinois Supreme Court Upholds Accountant’s Privilege

Leave a comment

Illinois CPA Society – “Illinois Supreme Court Upholds Accountant’s Privilege”

Fascinating update on an important court case for Illinois CPAs. The Illinois Supreme Court recently upheld that:

1) The accountant is the holder of what is known as Accountant’s Privilege (similar to attorney-client privilege), not the client;

2) That a particular common law exception — which for attorneys permits a breach of the privilege — does not breach the accountant’s privilege; and,

3) That the accountant’s privilege can be waived when the accountant discloses information to a party.  This means that if subpoenaed, CPAs must carefully consider from the beginning whether to disclose documents, as it could lead to inadvertently waiving the privilege.

Thanks to the Illinois CPA Society for bringing this important Regulatory Bulletin to my attention.  It’s big news!

 

IRS

IRS Spares Small Employers Big ACA Penalties For 2014

Leave a comment

In Last Minute Move, IRS Spares Small Employers Big Affordable Care Act Penalties For 2014.

This article is almost a month old, but it’s still the best one I’ve seen out there on the “critical takeaways” from IRS Notice 2015-17, and the relief it’s bringing to small employers.  It also explains a few confusing bits about why these penalties are of concern in the first place: for example, how old “health insurance reimbursement plans” are not compliant with ACA rules, and how it’s taken a while for the IRS and DOL to get on the same page about it.  It also confirms that S-Corp >2% single-shareholder health insurance is going to be treated the same as it always has — for the time being — but not if there’s more than one person (2% shareholder or not) on the policy.  Considering that the prior ACA guidance in these areas common to small businesses was either vague or conflicting (or both), this is welcome relief, indeed.

 

Education, IRS, Tips

S-Corp Accountable Plans

2 Comments

UPDATE 2/25/17 — please don’t confuse partnerships with S-Corps.  The home office deduction for partnerships is completely different than what I’ve outlined below.  There’s a fabulous blog post about partnership home office deductions here, by an excellent CPA firm in Oregon.

—————————

As you may know, many small businesses take a “home office deduction” on their personal return.  But that doesn’t include S-Corp shareholders.  Those business owners cannot take the home office deduction because they are considered employees of the business, as well as owners, and as such, they would be restricted under the same “2% of AGI” floor that regular employees are when they try to deduct unreimbursed employee expenses.

They also aren’t allowed to charge themselves rent — or if they do, they can’t deduct expenses against it, making that arrangement costly.

However, they can get reimbursed by the S-Corp for their out-of-pocket expenses.  It’s called an “Accountable Plan”, and it’s really quite simple.  Just keep decent records — which you’d have to do if you were claiming the home office deduction anyway.  Substantiate the portion of the space used by your business, divide it by the total square footage, and there you have your business-use-percentage.  Now multiply that by the expenses related to running an office out of your home — keeping in mind that you have to follow the same rules as sole proprietors: the space has to be used BOTH regularly and exclusively for business.  I have a couple of clients who wrote up an accountable plan (stating that the company would reimburse the shareholder-employee for these substantiated home office expenses) and attached a floor plan of the office space as further support for which portion is personal and which is business-use.  Nice touch.

I was really impressed by this lovely article that a CPA firm out in Colorado wrote on the topic, and they link to a “sample accountable plan reimbursement form” that’s quite nice (they even update it annually).  If you’re looking for a CPA in that area, I must say I was pretty impressed with their resources, offerings and pricing.

Pull Money Out of the S-Corp, Accountable Plan – Watson CPA Group- Tax KnowledgeBase and FAQs.

Education, QuickBooks Software, Tips

Determine an Accurate Cash Position in QuickBooks – March 11 Webinar

Leave a comment

I just got word in the latest edition of the “Intuitive Accountant” newsletter (one of my favorite resources) of an upcoming webinar on how to determine an accurate cash position in QuickBooks.  It’s designed by QB ProAdvisors for QB consultants, but I think it looks like a good resource for any small business owner who has a hand in doing his/her own bookkeeping as well.

Not only do they plan to walk through common issues with figuring out how much cash is “in the bank”, and how to fix them, but they also will discuss “adjusting entries and other reporting options for income tax preparation and GAAP-compliant financial reporting”, making it a worthwhile investment of time for staff accountants and bookkeepers.

If you decide to register for and take the webinar, let me know in the comments how you liked it, what you learned, and what you’d recommend for improvements.

The webinar will be offered twice on the same day — March 11 — at noon and 5 pm Chicago-time.  Click here for more information and to register:  Determine an Accurate Cash Position in QuickBooks – intuitiveaccountant.com.

Education, QuickBooks Software, Site News, Software

Best QuickBooks Conferences of 2015

1 Comment

I was chatting with my staff accountant the other day about her education and training goals for 2015, and she said she was actually more enthusiastic about QuickBooks-oriented training than tax-, technology- or industry-related conferences (which are my personal favorite topics).  That got me started looking into the “best” QuickBooks events of the upcoming year.  I’m sharing my research here but would love to hear any additional feedback from readers.

It seems there are three “biggies” in the specific world of QuickBooks: 1) QuickBooks Connect (a newcomer to the scene as of last year, but apparently big and beautiful), 2) Scaling New Heights (previously the star in the category), and 3) QuickBooks VCon (an entirely virtual conference, making it the obvious choice for the cash- or time-strapped).  Other resources are the annual Sleeter Group Accounting Technology Conference, which is not QuickBooks-specific, but does have many seminars on QB-related topics, including third-party add-ons, and the regular traveling schedule or online resources of QuickBooks ProAdvisor Program certification classes in both QB Desktop and Online, as well as POS, and

1) QuickBooks Connect — this conference had its inaugural year in 2014 and was apparently a big success.  See their “highlights” video here.

Personally, I’m not into the big-name inspirational speakers, concerts, and social “bonding” among new colleagues — but the actual list of workshops, panels, seminars and presentations was pretty darned impressive, with an optional pre-conference during which professionals could take certification classes and exams.

It’s slated for Nov 2-4, 2015 in San Jose.

2) Scaling New Heights — presented by Woodard Events, but contracted out by Intuit, this was until recently the “go-to” conference for QuickBooks users and professionals.  I’m uncertain as to how it’s different from QB Connect (New Orleans vs. San Jose, or is there more to it?), except that the sheer number and variety of workshops is mind-boggling.  The schedule and session description brochure was just released, and it’s wonderfully overwhelming.  (As a related aside, they also offer a series of free webinars with Intuitive Accountant, another favorite resource of mine.)

It’s slated for June 21-24, 2015 in New Orleans.

3) QuickBooks VCon – an entirely virtual conference sounds like an amazing way to save time and money… although also challenging if it is your main conference of the year, since it might be harder to convince yourself to maximize your time and attend all the sessions you can (when you could so easily be walking the dog or working on client projects instead).  That said, it’s put on by the same company that presents Scaling New Heights (above), is two-days long, and is Intuit’s single-largest event worldwide.

It’s slated for May 19-20, 2015.

4) Sleeter Group Accounting Technology Conference – not specifically QuickBooks-focused, but as one of the leading accounting software companies, there is a lot here to offer QB folks, not the least of which is exposure to third-party software add-on solutions and competing products (see my blog post).  PrintBoss even (mistakenly) refers to it as a “QuickBooks Conference” in their list of the best.

5) QuickBooks ProAdvisor Program – this is the place to go to find out about resources for certification, training, software, discounts, local advisor listings, support and more.  It’s free for QB Online consultants, although there is a charge for QB Desktop consultants (yet another indication that Intuit is encouraging folks to move into the cloud).

Not a QuickBooks consultant, but you use the program regularly in your job or in running your own business, or you’re applying for a job where they want proof that you know the software?  There’s a certification available for you, too: QuickBooks Certified User.

Other favorite QuickBooks training resources?  Please share in the comments below.

QuickBooks Software, Software

The State of Cloud Accounting 2015

Leave a comment

Greg Lam, my #1 favorite accounting software reviewer ever (and owner of a great small business resource, “The Small Business Doer” — see my post on it), has come out with another “state of cloud accounting” update, in which he summarizes many important definitions and trends in the small business online accounting world, as well as parses out some important distinctions among the various brands of software.

Here are the points he makes that I believe are spot-on, and if you don’t take the time to read his article, here’s what you must know at the minimum if you have questions about where things stand with online versus desktop accounting and bookkeeping:

1) Add-ons are often basic import / export tools instead of truly seamless integrations.

2) Security is still a major concern.

3) Automation helps certain businesses, but some users (yours truly and her staff accountant included) find the software slower than desktop.

4) The functionality is still not as deep in certain areas as desktop.

All that said, things are improving bit-by-bit and competition is increasing (both in pricing and in features), and if online access, invoicing and collaboration are essential for your business, cloud accounting is the way to go.  Otherwise, I still recommend QuickBooks for Desktop (especially if using QB POS).  My colleague, Bonnie Nagayama, offers great discounts on both QB Desktop and Online software — let me know if you’d like a referral, as I’m happy to connect you.

See Greg’s post here: The State of Cloud Accounting 2015 – QuickBooks and Beyond.

POS - Point of Sale, QuickBooks Software, Software

QuickBooks Point of Sale Desktop 12.0

Leave a comment

I was both disappointed and relieved when, while at a Point-of-Sale Software (POS) experts panel discussion a few months ago, I went up to the microphone and said that I hadn’t found a single online POS system that functioned properly with regard to its integration with QuickBooks — and the answer I got was, “that’s because there isn’t one; not yet.”

The unanimous reaction among the experts was that QuickBooks POS for Desktop is really the only system that truly and fully integrates with QuickBooks accounting software (there are other POS packages out there that integrate functionally, though not as fully — but they are also all desktop systems that work with QuickBooks desktop software).  None of the zillions of online offerings (Square, Vend and the like) have functioning integrations (although they claim to), leaving QuickBooks Online as a less-attractive option for those who depend on POS data.  (This doesn’t mean it can’t be done — I have plenty of clients for whom I have written up a recurring periodic journal entry that they book manually, or we’ve hired a developer to write a script to do the job.  But these are time-consuming or expensive options by comparison.)

Armed with this knowledge, I must say I was thrilled to read the reviews when the newest version of QuickBooks POS for Desktop was released.  They’ve apparently increased stability and reintroduced formerly-removed features (that actually work this time around).  For those clients of mine who will have to make the shift away from QB 2012 this year (see my post on support ending in May 2015), I’m going to recommend they upgrade to the newest POS version as well.

Check out David Glantz’s review, here:  QuickBooks Point of Sale Desktop 12.0 – from “QuickBooks and Beyond“.

QuickBooks Software, Software

Goodbye to QuickBooks 2012 Support as of May 2015

Leave a comment

Nice blog post by Charlie Russell, one of my favorite tech guys, outlining what it means that QuickBooks 2012 will no longer be supported after May 2015.  Most importantly to most small business accounting clients is that any related services will be discontinued: online banking, merchant services processing and payroll being the biggies.  If you’re a client of mine on QB 2012 and use any of these, especially if you’re using QB POS as well (see upcoming post on that topic), please reach out so that we can schedule a visit after tax season to get you updated.

See Charlie’s post here: Goodbye to QuickBooks 2012 Support.

Tips

Why you should take notes by hand — not on a laptop

Leave a comment

I switched back to making my to-do lists on paper about a year ago, and found it helped me organize my thoughts and remember what I wanted to get done better. Really neat to see that it wasn’t just a good hunch on my part… these studies show that taking notes by hand helps you remember better than if you type them on a computer.

Why you should take notes by hand — not on a laptop (Vox).

Education, Tips

Fabulous Small Business Accounting Resource

Leave a comment

I am wondering how I’ve never come across this resource before.  My favorite presenter at the Sleeter Accounting Technology Conference this year was Greg Lam — which is pretty funny, because due to a last-minute emergency, he had to record his presentations for us and have them played back during his sessions.  THAT’s how good a presenter he is… I watched his recordings and found his sessions to be the best of all the [amazing] presentations.

Anyway, it turns out that Greg runs an amazing little website called The Small Business Doer.  For $15 — a one-time fee for lifetime membership — you get access to all his incredible “how-to” video recordings, interactive lessons, quizzes, course materials, and the ability to ask him questions.  It sounds ideal for a small business entrepreneur who wants to learn more about accounting and bookkeeping, without paying someone like me to train them on the basics.

I kind of wish I could require all my clients to take Greg’s courses first, and then come to me for the bits and pieces of training specific to their situations.  I think it would be a win-win situation.  And lest anyone think I’m just trying to point folks toward a colleague’s website for marketing purposes, I should point out that I’ve never even met this guy — I’m just a huge fan of what he does, and I love reading his Sleeter Group articles (these are aimed at accounting professionals, as opposed to small business owners).

If you end up becoming a member and using his resources, or if you get to ask him questions or meet him, I’d love some feedback, to know how strongly I should be recommending this membership.  Please comment below.