Sullivan & Company - Certified Public Accountants 4709 Montgomery Lane #201 - Bethesda, MD, 20814 Phone: 301-657-8080

       

 

 

 

Financial Services by Sullivan & Company

Paul Sullivan, CPA

Financial services are now offered at Sullivan & Co., CPAs.  The story WHY:

 

You may wonder why your accounting firm wants you to invest with them. Years ago, CPAs were not allowed to venture into the investment world, but it always bothered us to see how poorly our clients were treated at their broker. It is not that the broker was not nice or attentive; it was the quality of the investments and, oftentimes, the lack of understanding for how the investments were going to affect the client in the future.

 

The amount of commissions and fees were oftentimes much larger than the client realized. Principles taught in universities were ignored by greedy advisors. Some forward thinking CPAs worked hard to get the accounting industry to see that we could, at the least, counsel our clients so that their investing experience was successful.

 

Our function is to work with you in all areas of your financial life. We prepare your tax returns and financial statements, of course, but there's a lot more decisions you make that we should be involved in. These include: succession planning for business owners such as HOW TO:

1) Sell your business

2) Retire comfortably

3) Handle your finances now that you are divorced or widowed

4) Provide for loved ones if you die

5) Pay for the education of your children

6) Determine if a trust is right for you

7) Minimize estate taxes

 

Worse than hearing that the IRS is going to audit is the call from a client who has plunged into an investment, whether stocks, bonds or another home without consulting us first.

 

Sometimes these decisions have unfortunate results and are difficult or impossible to undo. So, in response to this need, your CPA firm has well trained accountants and financial services professionals to help you navigate the financial world..

For a free review of your investments, give me a call at 301 657-8080 X 102.

 


 

 

Paul Sullivan, CPA

Sullivan & Company

 

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This Month's Feature Articles

- Small Business and the Affordable Care Act
- Hobby or Business? Why It Matters
- Which Moving Expenses are Deductible?

 

Tax Tips

- Reduce Your Taxes with Miscellaneous Deductions
- Tips on Travel While Giving to Charity
- Six Tips on Gambling Income and Losses
- Tips for Self-Employed Taxpayers



 

 

 

 

 

Here's a Quick Look at What You Need to Know About the Affordable Care Act


 

Whether you're self-employed or run a small business, here's a quick look at what you need to know about the Affordable Care Act.

 

Self-Employed

 

If you run an income-generating business with no employees, then you're considered self-employed. You can get coverage through the Healthcare Marketplace and use it to find coverage that fits your needs.

Note: You are still considered self-employed even if you hire independent contractors to do work for you.

 

If you currently have individual insurance--a plan you bought yourself and not the kind you get through an employer--you may be able to change to a Marketplace plan.

 

Note: You can't be denied coverage or charged more because you have a pre-existing health condition.

 

Small Businesses (50 or Fewer Employees)

 

If you have 50 or fewer full-time equivalent (FTE) employees (generally, workers whose income you report on a W-2 at the end of the year) you are considered a small business under the health care law.

 

As a small business, you may get insurance for yourself and your employees through the SHOP (Small Business Health Options Programs) Marketplace. This applies to non-profit organizations as well.

 

Note: Beginning in 2016, the SHOP Marketplace will be open to employers with 100 or fewer FTEs.

 

As an employer, you must provide notification to your employees of coverage options available through the Marketplace and are required to provide this notice to all current employees and to each new employee regardless of plan enrollment status or full or part-time employment. The Department of Labor has sample notices that employers can use to comply with this regulation. One notice is for employers who do not offer a health care plan and the second for employers who offer a health care plan.

 

 

If you have fewer than 25 employees, you may qualify for the Small Business Tax Credit (see next section). Non-profit organizations may be eligible for the tax credit as well.

 

Small Business Health Care Tax Credit

 

Small businesses and tax-exempt organization that employ 25 or fewer, full-time equivalent workers with average incomes of $50,000 or less, and that pay at least half (50 percent) of the premiums for employee health insurance coverage are eligible for the Small Business Health Care Tax Credit.

 

Starting in 2014, the tax credit is worth up to 50 percent of your contribution toward employees' premium costs (up to 3 percent for tax-exempt employers). The tax credit is highest for companies with fewer than 10 employees who are paid an average of $25,000 or less. The smaller the business, the bigger the credit is.

 

For tax years 2010 through 2013, the maximum credit was 35 percent for small business employers and 25 percent for small tax-exempt employers such as charities.

 

Businesses that have already filed and later find that they qualified in 2013 or an earlier year can still claim the credit by filing an amended return for the affected years. A three-year statute of limitations normally applies to these refund claims.

 

Note: The credit is available only if you get coverage through the SHOP Marketplace and is available to eligible employers for two consecutive taxable years.

 

If you are a small business employer who did not owe tax during the year, you can carry the credit back or forward to other tax years. In addition, because the amount of the health insurance premium payments is more than the total credit, eligible small businesses can still claim a business expense deduction for the premiums in excess of the credit--in other words, both a credit and a deduction for employee premium payments.

 

The credit is refundable for small tax-exempt employers as well, so even if you have no taxable income, you may be eligible to receive the credit as a refund as long as it does not exceed your income tax withholding and Medicare tax liability.

 

Additional Tax on Businesses Not Offering Minimum Essential Coverage

 

Effective January 1, 2015 an additional tax will be levied on businesses with 100 or more full-time equivalent (FTE) employees that do not offer minimum essential coverage. However, it will not apply until 2016 to employers with at least 50 but fewer than 100 full-time employees.

 

Employers subject to the employer responsibility provisions in 2015 must offer coverage to at least 70 percent of full-time employees as one of the conditions for avoiding an assessable payment, rather than 95 percent which begins in 2016.

This penalty is sometimes referred to as the Employer Shared Responsibility Payment.

 

You may have to pay this additional tax if you have 50 or more full-time equivalent employees and at least one of your full-time employees gets lower costs on their monthly premiums through the Marketplace.

 

Note: Employers with fewer than 50 FTE employees are considered small businesses and are exempt from the additional tax.

 

The amount of the annual Employer Shared Responsibility Payment is based partly on whether you offer insurance.

 

If you don't offer insurance, the annual payment is $2000 per full-time employee (excluding the first 30 employees for business with 50-99 full time employees and excluding the first 80 employees for those with 100 or more full time employees)

 

Note: For purposes of this calculation, a full-time employee does not include a full-time equivalent.

 

If you do offer insurance, but the insurance doesn't meet the minimum requirements, the annual payment is the lesser of $3000 per full-time employee who qualifies for premium savings in the Marketplace or $2,000 per full-time employee (minus 30 full-time employees).

 

Note: Unlike employer contributions to employee premiums, the Employer Shared Responsibility Payment is not tax deductible.

 

A health plan meets minimum value if it covers at least 60 percent of the total allowed costs of benefits provided under the plan. To determine whether other coverage meets minimum value, please contact us for assistance.

 

Note: All plans in the Marketplace meet minimum value, so any coverage offered through the SHOP Marketplace should qualify.

 

Excise Tax on High Cost Employer-Sponsored Insurance

 

Effective in 2018, a 40 percent excise tax indexed for inflation will be imposed on employers with insurance plans where the annual premium exceeds $10,200 (individual) or $27,500 (family). For retirees age 55 and older, the premium levels are higher, $11,850 for individuals and $30,950 for families.

 

Excise Tax on Medical Devices

 

Effective January 1, 2014, a 2.3 percent tax will be levied on manufacturers and importers on the sale of certain medical devices.

 

Indoor Tanning Services

 

A 10 percent excise tax on indoor tanning services went into effect on July 1, 2010. The tax doesn't apply to phototherapy services performed by a licensed medical professional on his or her premises. There's also an exception for certain physical fitness facilities that offer tanning as an incidental service to members without a separately identifiable fee.

Don't hesitate to call us at (301) 657-8080 if you need assistance navigating the complexities of the Affordable Care Act. We're here for you!

 


 

    Financial Services at Sullivan & Company, CPAs

Paul Sullivan leads our Financial Services Division and is here to help you navigate your financial future. As an Investment Advisor Representative, he is able to provide an independent opinion on the investments you already own or are considering buying.

 

We can structure a portfolio based on your risk tolerance or we can help you decide how to invest in your company 401(k) plan. We work with each client to identify their concerns and to provide solutions according to their situation.

Paul is also experienced in company retirement plans. If you own a business that does not have a plan; we can discuss your options and set up a plan that fits your company.

 

If your business already has a plan; we offer a free evaluation of the plan to ensure that it is up to date and working well for you and your employees.

Our goal is to provide personal, unbiased and independent advice to help you make well-informed decisions about your financial life and investments.

Contact Paul Sullivan or Jordana Para to set up a free initial consultation (301) 657-8080.

And as always if you have any questions about accounting or investments and how they effect you or your business, please give us a call. We can help guide you in the right direction.

 


 

Remember you can call our offices if you have any questions about these or any other accounting, tax, financial planning or insurance related issues, at 301-657-8080. 

 

Regards, Paul Sullivan, CPA

President, Sullivan & Company

 

 

 

 

Sullivan & Company, CPAs | 4709 Montgomery Lane | Bethesda, MD 20814 www.eSullivan.net | email: pSullivan@eSullivan.net | Connect With Me on Linkedin

Direct: 240-316-3531 | Main no.: 301-657-8080 Ext 102 | Fax: 301-657-9055