Returning Value Blog

The rules for reporting leasing transactions are changing. Though these changes have been delayed until 2021 for private companies (and nonprofits), it’s important to know the possible effects on your financial statements as you renew leases or enter into new lease contracts. In some cases, you might decide to modify lease terms to avoid having to report leasing liabilities on your balance sheet. Or you might opt to buy (rather than lease) property to sidestep being subject to the complex disclosure requirements.

Alabama is one of several states that does require employers to use a federal program designed to stop them from hiring people in the U.S. illegally.  The Alabama legislature passed in both houses legislation prohibiting employers from knowingly employing unauthorized aliens. The law is known as the Beason-Hammon Alabama Taxpayer and Citizen Protection Act. The law requires all employers to enroll in and utilize E-Verify. 

If you’re self-employed and work out of an office in your home, you may be entitled to home office deductions. However, you must satisfy strict rules. 

Accounts receivables are classified under current assets on the balance sheet if you expect to collect them within a year or within the operating cycle, whichever is longer. However, unless your company sells goods or services exclusively for cash, some of its receivables inevitably will be uncollectible. That’s why it’s important to record an allowance for doubtful accounts (also known as “bad debts”). These allowances are subjective, especially in uncertain economic times.

If you’re a business owner, be aware that a recent tax law extended a credit for hiring individuals from one or more targeted groups. Employers can qualify for a valuable tax credit known as the Work Opportunity Tax Credit (WOTC). 

Roughly half of CFOs believe an economic recession will hit by the end of 2020, and about three-quarters expect a recession by mid-2021, according to the 2019 year-end Duke University/CFO Global Business Outlook survey. In light of these bearish predictions, many businesses are currently planning for the next recession. Are you? Here are four steps to help your company strengthen its balance sheet against a possible downturn.

Do you conduct your business as a sole proprietorship or as a wholly-owned limited liability company (LLC)? If so, you’re subject to both income tax and self-employment tax. There may be a way to cut your tax bill by using an S corporation.

Auditors use various procedures to verify the amounts reported on your financial statements. In addition to reviewing original source documents and comparing trends from prior years, they may reach out to third parties — such as customers and lenders — to confirm that outstanding balances and estimates agree with their records. Here are answers to questions you may have about audit confirmations.

Contingent liabilities reflect amounts that your business might owe if a specific “triggering” event happens in the future. Sometimes companies are unclear when they’re required to report a contingent liability on their financial statements under U.S. Generally Accepted Accounting Principles (GAAP). Here are the basics.

Tax season is here and so are the fraudsters. Tax ID fraudsters are using stolen Social Security numbers to file phony tax returns and steal tax refunds.