Ten Tips for Taxpayers Making Charitable Donations

Did you make a donation to a charity this year? If so, you may be able to take a deduction for it on your 2010 tax return.


Here are the top 10 things the IRS wants every taxpayer to know before deducting charitable donations.


1. Charitable contributions must be made to qualified organizations to be deductible. You can ask any organization whether it is a qualified organization and most will be able to tell you. You can also check IRS Publication 78, Cumulative List of Organizations, which lists most qualified organizations. IRS Publication 78 is available at IRS.gov.


2. Charitable contributions are deductible only if you itemize deductions using Form 1040, Schedule A.


3. You generally can deduct your cash contributions and the fair market value of most property you donate to a qualified organization. Special rules apply to several types of donated property, including clothing or household items, cars and boats.


4. If your contribution entitles you to receive merchandise, goods, or services in return – such as admission to a charity banquet or sporting event – you can deduct only the amount that exceeds the fair market value of the benefit received.


5. Be sure to keep good records of any contribution you make, regardless of the amount. For any contribution made in cash, you must maintain a record of the contribution such as a bank record – including a cancelled check or a bank or credit card statement – a written record from the charity containing the date and amount of the contribution and the name of the organization, or a payroll deduction record.


6. Only contributions actually made during the tax year are deductible. For example, if you pledged $500 in September but paid the charity only $200 by Dec. 31, your deduction would be $200.


7. Include credit card charges and payments by check in the year they are given to the charity, even though you may not pay the credit card bill or have your bank account debited until the next year.


8. For any contribution of $250 or more, you must have written acknowledgment from the organization to substantiate your donation. This written proof must include the amount of cash and a description and good faith estimate of value of any property you contributed, and whether the organization provided any goods or services in exchange for the gift.


9. To deduct charitable contributions of items valued at $500 or more you must complete a Form 8283, Noncash Charitable Contributions, and attached the form to your return.


10. An appraisal generally must be obtained if you claim a deduction for a contribution of noncash property worth more than $5,000. In that case, you must also fill out Section B of Form 8283 and attach the form to your return.

Keeping Good Records Reduces Stress at Tax Time

You may not be thinking about your tax return right now, but summer is a great time to start planning for next year and to make sure your records are organized. Maintaining good records now can make filing your return a lot easier and it will help you remember transactions you made during the year.


Here are a few things the IRS wants you to know about recordkeeping.


Keeping well-organized records also ensures you can answer questions if your return is selected for examination or prepare a response if you receive an IRS notice. In most cases, the IRS does not require you to keep records in any special manner. Generally speaking, you should keep any and all documents that may have an impact on your federal tax return.


Individual taxpayers should usually keep the following records supporting items on their tax returns for at least three years:


• Bills


• Credit card and other receipts


• Invoices


• Mileage logs


• Canceled, imaged or substitute checks or any other proof of payment


• Any other records to support deductions or credits you claim on your return


You should normally keep records relating to property until at least three years after you sell or otherwise dispose of the property. Examples include:


• A home purchase or improvement


• Stocks and other investments


• Individual Retirement Arrangement transactions


• Rental property records


If you are a small business owner, you must keep all your employment tax records for at least four years after the tax becomes due or is paid, whichever is later. Examples of important documents business owners should keep Include:


• Gross receipts: Cash register tapes, bank deposit slips, receipt books, invoices, credit card charge slips and Forms 1099-MISC


• Proof of purchases: Canceled checks, cash register tape receipts, credit card sales slips and invoices


• Expense documents: Canceled checks, cash register tapes, account statements, credit card sales slips, invoices and petty cash slips for small cash payments


• Documents to verify your assets: Purchase and sales invoices, real estate closing statements and canceled checks

Call for a FREE 1 hour consultation and estimate
 
Checked and Balanced Accounting
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New Ideas to Make Money in This Struggling Economy

Many small business owners are struggling to keep their heads above water in today's economy. Even though large corporations are faring reasonably well, small businesses are suffering in the downturn from which America is just beginning to recover. Recent legislation provides hundreds of millions of dollars for Small Business Administration loan guarantees, but entrepreneurs can't plan to expand unless their revenues recover.

To that end, what can a small business owner do to avoid seeing red in the reports generated by his financial software? Three key tactics can help entrepreneurs make it through today's downturn and come out stronger on the other side.

Tactic 1: Be Mindful of Appearance

Small business owners offer either a product or service, and keeping appearances in mind can benefit both types of owner. Companies that provide products should be most concerned with the image that their product conveys. It's likely that a product provider is already cognizant of his goods' attributes and has optimized their appeal.

A small business owner can always focus on his own appearance, however. A financial planner (for example) who wears casual clothes may want to seem relaxed and laid-back, and in better times that may have been a workable branding strategy. But people are scared; they want an authoritative expert to help them with their finances. Suits or jackets are more appropriate, and sartorial trends have been moving this way in the corporate world, too.

Retailers are another group of small business owners who can benefit from increased attention to appearance. Stores should be clean and inviting; products should be logically displayed. Now is a good time to make long-delayed cosmetic upgrades, as long as they don't break the bank: contractors are widely available and ready to do business.

Tactic 2: Expand a Business' Presence

Low-margin small businesses have used fairs and markets as a revenue source for decades. It's unlikely that organic farming would be viable without farmers' markets. But a small business owner doesn't need to be a purveyor of candlesticks or vegetables to have a presence at farmers' markets and other community gatherings.

A restaurateur can showcase his cooking at a holiday event. An office supply store owner can sell products at a market. Private practice lawyers or other service providers can have a presence at community events; handing out business cards or promotional items can lead to increased revenue in the future.

Small businesses are a popular media topic at the moment. Business owners can contact local reporters to express interest in interviewing for a future story; if the reporter agrees, free publicity is a guaranteed result.

Yet another way to expand brand awareness and earn goodwill is to offer seminars to community groups. Many local colleges offer small business courses; contacting the schools to see if they need another speaker or panelist can lead to raised awareness of a business within the community.

Tactic 3: Look for Synergism on the Community Level


It's likely that an entrepreneur's community has many small businesses. Chambers of commerce hold networking events, as do some business owners themselves. An entrepreneur shouldn't miss an opportunity to network locally, especially with the economy in its current state.

Networking can lead to both more business and better business opportunities. By discussing a company's activities or prospects with other small business owners, the chances of creating new revenue streams are increased. A coffee shop proprietor may find that he can collaborate with an art dealer to hang artwork for sale in the coffee shop. Alternately, the art gallery could use the coffee shop for catering services at an opening.


Similarly, a calligrapher can work with the owner of a stationery shop to create personalized paper goods. A bait-and-tackle expert can pursue collaboration with the proprietor of a marina to offer fishing supplies to boaters.

Synergistic opportunities are endless, but, as they say, it takes two to tango. Unless a small business owner puts himself out there and appears willing to collaborate with fellow business owners, he cannot expect to see revenue growth via synergy.


In Conclusion:


America is recovering from the worst recession since the 1930s, and many small businesses are barely scraping by. Not every small business can survive today's economic situation, but creative and resourceful small business owners significantly improve their firms' chances.


If desperate times call for desperate measures, the state of the economy calls for unconventional measures. The economy is projected to improve in 2010 - Dean Maki, Barclays Capital's historically accurate forecaster, expects 3.5 percent growth - but until consumer spending rebounds, businesses large and small will have to think unconventionally.

Save hundreds per month on your Business Bookkeeping!

Did you know that an independent bookkeeper can save you hundreds of dollarsper month on Payroll Taxes, Workers Compensation and productive time lost? Hiring even a part-time bookkeeper and placing them on your payroll is not always the most cost saving way of getting your books done. I would like the opportunity to show you how I can save you time and money doing your business bookkeeping.

Whether you are using QuickBooks® or need to be computerized to streamline your business finances, my experience and expertise in helping small businesses organize their books is a great asset to any company.  Let me be your in-house Bookkeeper without the in-house cost!

Don’t wait too long! Tax time likes to sneak up before you know it!


Call me today and I will include one free hour of consultation. You can reach me at (562) 420-0043 or (562)-544-7202 (cell) and I would be happy to schedule a time to meet with you.


                                 

checkedandbalanced.vpweb.com

Small Biz CAN Compete With "The Big Boys"

Small business has often been mentioned as the "little guy." The one who has to compete with giant retailers like Target, Wal-Mart, and others that are based locally. They have the marketing budget and the advertising dollars to drive the smaller competition out of business. Some small businesses have managed to compete with the Wal-Mart's of the world, and one has even rebuffed offers to sell products through the mega chain.


The truth is, small businesses everywhere are finding ways to compete with bigger competition and in some cases are winning the battle. How they are winning is what tells a compelling story. While none of it is rocket science, the cumulative effects of these efforts mean better relationships with customers and the area they serve, loyalty, and more business.



One such case was highlighted in a recent case study in the New York Times. Pamela Ryckman writes about how a local Kansas City dry cleaning business, Hangers, is competing with a Tide dry cleaning chain that moved into town. An excerpt from the story shows how different thinking can give you a competitive advantage and put you on top:





"Hangers continued to cultivate its offbeat image. "We have a personality in a business devoid of it," Mr. Runyan said. "We can't out-price or out-spend our big competitor, but we can be genuine, funny and edgy."

"He worked to create a tight-knit culture of service and accountability. If a garment was damaged, a store representative would call the customer immediately and offer to replace it. He held a St. Patrick's Day tailgate party for 60 people in a Hangers parking lot and financed a float in the local parade. "Maybe it's goofy and old-fashioned," he said, "but it seems to be resonating with the folks in K.C. Who would expect people to party with their dry cleaner?"

"He initiated partnerships with corporations, nonprofit organizations and community groups, and he can quantify the patrons gained from each. He also contacted schools and donates 10 percent of the proceeds from parents' dry cleaning back to each school."

The moral of the story is that small businesses are the cornerstone of the U.S. economy, and many have to compete with big national chains on a day-to-day basis. It's how they distinguish themselves from the bigger chains that shows their innovation, creative thinking, and marketing know how. Oftentimes, small businesses are better at reaching local customers than the higher financed competition, because they have to be more tactical and thoughtful about where their dollars are being spent. So think outside the box, take some lessons from other businesses, and find a way to stand out from the crowd.


Have you had to compete with a bigger business? How did you stand out, and are you succeeding? Adding personalized service to your business gives your customers something they're not getting for "The Big Boys". At Checked and Balanced I go out of my way to make sure I cater your bookkeeping needs to fit your business needs. Call now for a Free 1 Hour Consultation!

CheckedandBalanced.vpweb.com

Goldilock Approach to E-mail Marketing

What does a classic fable have to do with modern email marketing?


Do you remember when little Goldilocks was sampling the bears’ porridge (‘this one is too hot…this one is too cold…”) then laying in their beds (“this one is too hard, this one is too soft…”)? In both cases, she was looking for the one that was “just right.”

When it comes to email marketing – what you send and how often you send it – your customers also want the ‘just right’ version. Blast them too often and they will probably unsubscribe. Not often enough and they will forget about you. If the content is right on target every time they will be happy – but two ‘boring’ articles in a row may be all it takes for them to lose interest.

How can small business owners get it ‘just right’ in such an ‘information overload’ era? There is one, and only one way. Fortunately, it’s remarkably simple: ask.


Ask your customers how often they want to receive updates. Ask them what kind of updates they want to receive (stand-alone announcements or more comprehensive newsletters?). And ask which topics they would like to hear about.


Some of your clients might not mind receiving an email every day. To me, that’s remarkable. But it’s true. Others will want to receive only weekly or even monthly updates, with occasional ‘special announcement’ pieces if you have something really unique going on.

To maximize your open rate, grow your list and keep your readers engaged, you need a content strategy and a segmentation plan.

Content strategy is about the kind of information that people want to receive. They won’t all be interested in the same things, so it’s unwise to assume that a one-size fits all email policy will work. The best approach is to identify different interest areas and create content that is relevant to each one – then make sure you deliver only the content that your readers have expressed desire for.

Segmentation is about content and frequency. Once you know what I want to hear about, for example, you also need to know how often I want to hear it. This example may help:

If you own a landscaping business you might be an expert and service provider in several different areas such as:

Mowing


Botanicals (which plants, shrubs and trees are ideal for your customers environment)


Irrigation


Lighting


Masonry/hardscapes


Off-season service such as fall clean up and winter snow removal


Commercial/residential


Can you see how the interests of someone living in a standalone housing residential area might be significantly different from the needs of your commercial customers?

Once someone opts into your list, you’ll want to use a survey tool (like SurveyMonkey, which is free) to better understand his or her needs. Simply ask which services they would like to hear about, and how frequently, then drop your subscribers into unique groups such as those who want information about basic services such as mowing, snow removal and fall clean-up, others who want only hardscaping alternatives, and those who want everything. Sort by frequency as well. This approach means that you will have to do some work up front, but you can use auto-responders (which I’ll cover in my next post) to automate a lot of it. It’s worth it, as you will see right away when your targeted approach leads to increased open rates.

Once your marketing strategies start to pay off, please consider me for your bookkeeping needs.

Protect your business against bad payers

How to avoid unpleasant tasks and protect your company against bad payers


You are not responsible for a new customer's creditworthiness, right?

But if they don't pay, who is told to "look into it"? Who is asked "did we get the check?" When the answer is no, who is told to "take care of it"?


And when the check does not come-who gets yelled at?

As an entrepreneur the answer to these questions would be "YOU".

Providing references does not make a prospect creditworthy. Following up on credit references is not insulting. Asking creditors for key data is not nosy.



WHAT TO ASK EACH CREDIT REFERENCE

See that your credit application or other signed document gives you permission to contact references. Then ask each reference these 3 key questions:


1. "How recent was your latest transaction with this firm?" If it wasn't within the last 4 months, the information may not be of great value because your customer's financial position may have changed materially.



2."Are you related to the prospect in any way?" This may be difficult to assess, since people may lie. Use your instincts to decide how accurate the answer is and whether to probe further.


3, "Would you consider this firm a good, slow, or bad payer?" Talking to a few references now can save you months of stonewalling down the road.






An organized billing/credit and collection procedure ensures that you will be paid before others. In this economic climate it is critical to retain good client relationships. Let me help you put that in place. 1 Hour free consultation