Dear Mark,
It's hard to believe that Summer is over
already! The kids are back in school, the traffic
is back and before you know it this year will be
over. With that in mind, this issue of
Proactive Updates focuses on some
of the things you can do financially to make
the most out of the upcoming months.
We hope you enjoy the information and look
forward to hearing from you soon.
Sincerely,
Mark Wyssbrod, CPA
|
| Stay Vigilant!
Small Business
May Not Be Out of the Woods
Yet |
 The market rally from the
March 2009 lows to the end of July has left some
people forgetting that we are still in a
recession. Although most economists believe
the recession will end before 2009 is over, small
businesses still have a number of problems to be
concerned about. The "recession" from small
businesses may last long into the economic
recovery.
There is a disconnect between the market
rally indicating the economy may soon recover and
small businesses who continue to face a
challenging environment. You must keep
the market rally in historical perspective and you
must interpret the market's rally. The market
rally has caused some excitement due to being one
of the strongest market rallies in history.
However the 50% rise between March and July 2009
should be compared to other historical benchmarks.
For example:
- According to Barron's Market Week (August 3,
2009), in July 1997 the S&P ended at 954 and
the S&P ended July 2009 at 987.
- The return during a 12 year period was only
3% (total return, almost no return on an
annualized basis).
- Additionally, the July 2009 S&P level is
well below the October 2007 all time high of
around 1,580 (over 37% lower according to Yahoo!
Finance).
The current market rally is indicating that
for large and publically traded companies times
are beginning to stabilize. Perhaps not
improving, but less bad news is good news in the
current environment. Smaller businesses,
however, face more challenging times
ahead.
|
| Reminder
3rd Quarter
Estimated Tax Payments Due
9/15 |
 Be certain remit your
estimated tax payments and vouchers by September
15th. Additionally, please keep a copy of
your checks and vouchers for your records and
forward a copy to Pro@ctive CPA for our
records.
Remember your Pro@ctive CPAs offer year end
tax planning which allows us to make the most of
the tax rules and regulations depending on your
goals and we can re-calculate your estimated tax
payments to allow for a more breakeven
scenario. |
| Be Mindful of
Benefits Reported In W-2
Rules for
Deducting Premiums under IRS Notice
2008-1 |
|
Under IRS Notice 2008-1, S corporation
shareholders may deduct premiums paid for
themselves, their spouses and their dependents
if:
- A two-percent or greater shareholder has
earned income from the S corporation exceeding
the total of all premiums paid;
- The shareholder is not eligible to
participate in any subsidized health plan
maintained by the shareholder's or a spouse's
employer;
- The S corporation includes the premium cost
in the shareholder's Form W-2;
- The shareholder includes the premium cost in
gross income on Form 1040;
- If the S Corporation reimburses the
premiums, it must be in the same tax year.
Whether the policy is in the individual's or S
corporation's name or who initially pays for the
premiums are not the determining factors.
Please contact us or your payroll service to
discuss in more detail.
|
|
| IRS Circular 230
disclosure: To ensure compliance with
requirements imposed by the IRS, we inform you
that any U.S. federal tax advice contained in this
communication (including any attachments) is not
intended or written to be used, and cannot be
used, for the purpose of (i) avoiding penalties
under the Internal Revenue Code or (ii) promoting,
marketing or recommending to another party any
transaction or matter addressed
herein | | |
|
| Financial
Ratio of the Month -
The Quick
Ratio |
The Quick Ratio equals cash plus
accounts receivable divided by total current
assets.
QR = (Cash + Accounts Receivable) /
Total Current Liabilities
The Quick Ratio is an
indicator of liquidity. The higher the
ratio, the more liquid the business is positioned,
which is generally a good statistic.
Although be wary of uncollectible accounts
receivable.
|
| Contact Information
11770 Haynes Bridge
Road
Alpharetta, Georgia
30009
phone:
(770)
664-8583
fax:
(678)
762-9413
web:
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