February, 2010:

January, 2010: Happy New Year!

• Not all the forms are finished. Some forms haven’t yet been created by the IRS.
• Electronic Filing isn’t ready yet. They plan to activate the new E-file process on January 18th.
• The IRS isn’t processing returns yet.

• There has been an increase in “refundable” tax credits – These are tax credits that can earn you a refund even if you don't paid taxes. By now many of you are familiar with this concept, but for those who are not, I’ll reiterate:
  If you pay, and owe -0- taxes in withholdings, estimates, etc.; you could still get a tax refund via refundable tax credits - “Free” money from the government. This has been going on for years, but many people don’t know about it. Even some who benefit from Refundable Credits don’t realize what’s going on.
• The Hope credit has been renamed and expanded: It’s now called the American Opportunity Credit, it benefits those whose family income is less than $180,000, and it’s partially refundable.
• Residential Energy Property Credit is back. The form is not finished yet, but it’s expected to include improvements to insulation, exterior windows, heating and air conditioning. You now need a certificate to prove that the expense qualifies for the credit. You should have received a certificate when you made a qualifying purchase.
• You get a deduction for taxes paid on new vehicles purchased in 2009. If it’s an electric vehicle, you could get a tax credit as well.
• Earned Income Credit has been expanded. You could be eligible for the Earned Income Credit if your family earns less than $50,000. This is a refundable credit.
• The Alternative Minimum Tax exemption amounts for 2009 are a little higher than 2008, but AMT could still be an issue if your income is above $100,000 and you have itemized deductions.
  Basically; AMT refigures your taxable income by taking away your itemized deductions, exemptions, municipal bond exclusion*, etc.. You’re then given one exemption, and taxes are calculated on income earned above that exemption:
  • $46,700 for single and head of household filers,
  • $70,950 for married people filing jointly and for qualifying widows or widowers, and
  • $35,475 for married people filing separately.
  Unlike the ordinary tax rates, the AMT has only two tax brackets. The AMT tax rate is assessed only on AMT income over the exemption amount. The AMT tax rates are:
  • 26% on the first $175,000 of AMT taxable income, and
  • 28% on the remainder of AMT taxable income
    For married people filing separately, the 26% bracket ends at $87,500.
  When AMT becomes an issue, it makes the tax preparation process take a little longer.

November, 2009:

• Tax notices are on the increase, and the IRS is less likely to abate penalties and interest. A number of colleagues have complained about the increase in tax notices this year.
• Energy credits are back! I think there will be further changes; but for now I understand that (purchases qualifying for an energy credit) have to be certified as eligible. IE: an energy-efficient window doesn’t count unless you get a certificate of eligibility. Some also speculate that the credit for a refrigerator purchase will be taken away if you don’t turn your old refrigerator in.
• The 2009 standard mileage rate is still 55 cents per mile. Please refer to our chart for a complete listing of mileage rates for 2009 and many previous years as well. www.projectedfinancialstatements.com/pages/mileage.asp

• The expense report was improved. Just enter odometer readings and mileage cost is calculated for you. The report also writes a proposed journal entry to help you enter information in your accounting system.
  
  
• A loan refinancing analysis tool was added to one of the Loan Schedules. Get an objective look at whether a refinance deal is going to save money for your unique situation.
  
  
• A Sample Chart of accounts was added. This chart is designed for a Corporation. We plan to add templates for LLCs and S-Corps before the end of the year.
  
  
• Some changes were made to the entity planning guide.
  
  
• Tax planning tools were added. Single-owner companies can now do their own tax planning and tax estimate calculations using our tools available online. (The same tools we use to prepare tax plans for S-Corps, C-Corps, and LLCs) have been developed into a user-friendly format and made available for a very low fee.
  
  
• We added a Sales Tax Calculation Tool! The simple sales tax calculation is available, but we also included a second category with an algorithm that segregates gross collections into two categories: Gross Sales and Sales Tax Collected. Some vendors don’t collect sales tax separately on their taxable sales – especially at trade shows, etc.. The sales tax tool will be very helpful in cases like this!
  
  
• We added a few helpful features to our Projection Software!
  I won’t elaborate on the details, but we haven’t made this many changes to our Projections since our first attempt to re-tool them as a do-it-yourself product! Feel free to check out our August Announcements if you would like more details. I may be biased, but I don’t think you’ll find a better financial modeling template anywhere!

October, 2009:

September, 2009:

August, 2009:

• A 'Cash-Basis' option was added to the Revenue Collection Formula!
  You've always had the option of changing the collections formula to match your company's expected collections activity. Now you can over-ride the formula and treat collections as if they were Cash-Basis. This is helpful for certain industries, and for small companies who don't extend credit terms to their customers.
• We added an "I" to all page tabs that contain input cells.
  Input page tabs have always been shaded yellow (input cells are also shaded yellow for convenience). We have recently become aware that some spreadsheet programs don't allow their page tabs to be shaded, so we added the (I) as further indication of where input cells are located. This should make the program that much easier to use, especially for those who are not using Excel.
• Depreciation and Interest Expense is rounded to the nearest thousands for years 2 and 3.
  We had been rounding Interest and Depreciation up 4 decimal places in the second and third year, but we moved it down to 3. Our goal is to be accurate without reflecting an misleading level of precision.

June, 24 2009 - More growing pains!

June, 2009.

March, 2009.

February, 2009.

Why are we using Project Wonderful?
• We can target ads to thousands of customers - We're advertising on their site as well as allowing ad space on our sites.
• The ads are based on a daily auction, rather than pay-per-click. If someone really wants to advertize on a certain site (on a certain day), they only have to out-bid the competition.
• There is a large network of companies affiliated with them.
• There's no initiation fee or large deposit requirement to advertize with them. That make is easy on the budget!

January, 2008.

• Distributions are taxable in the year made. Distributions are now on the cash-basis like most taxpayers, which makes things simpler.
• If the plan fails and a company makes the correction prior to March 15th, there’s no penalty on the distribution! Plan failures are expensive enough due to the extra administrative work required to address them. The penalty has always been salt in the wound.
  Point of fact: The excess distribution penalty is paid by the company, not the employees. Premature distribution penalties are paid by employees.
• If your company has automatic enrollment / automatic contribution provisions, you have till June 30th to make the distributions without threat of a 10% penalty. This gives you additional time to re-test the plan! I’m not a big fan of Auto-enrollment plans, this new provision notwithstanding. Hopefully, this later deadline will apply to all 401k plans in the future.

December, 2008.

November, 2008.