15 Dec 2022
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Worker Classification 101: Employee or Independent Contractor

Roger Rossmeisl, CPA
Small Business Tax Briefs
Worker Classification 101: Employee or Independent Contractor

As posted to IRS.gov as Tax Tip 2022-117 on 8/2/2022 A business might pay an independent contractor and an employee for the same or similar work, but there are key legal differences between the two. It is critical for business owners to correctly determine whether the people providing services are employees or independent contractors. An employee is generally considered anyone who performs services, if the business can control what will be done and how it will be done. What matters is that the business has the right to control the details of how the worker's services are performed. Independent contractors are normally people in an independent trade, business or profession in which they offer their services to the public. Independent contractor vs. employee Whether a worker is an independent...

11 Dec 2022
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Impact of OTA Updates on Dealership Fixed Ops

Roger Rossmeisl, CPA
Automotive
Impact of OTA Updates on Dealership Fixed Ops

As posted to the Bellavia Blatt YouTube Channel on 11/18/22, and the Fixed Ops Roundtable YouTube Channel on 11/18/22 (Run Time: 14 min, 59 sec) As EVs continue to represent a greater percentage of total new vehicle sales, ongoing challenges continue to present themselves forcing automobile dealers to combat the continued erosion of their profits. In this clip, automotive attorney Len Bellavia sits down virtually with Ted Ings at the "Fixed Ops Roundtable" to discuss a number of current issues impacting dealers.  On the subject of over-the-air (OTA) updates, Len reports that GM and Stellantis have announced that the transition to OTAs will cost manufacturers $25 billion per year in lost revenues which will be "coming out of the hides of the fixed ops department of these dealerships". ...

20 Nov 2022
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The Disruption of Transportation

Roger Rossmeisl, CPA
Automotive, Technology
The Disruption of Transportation

The Great Transformation (Part 2) - The Disruption of Transportation As posted to the Tony Seba YouTube Channel on 10/31/2022 (Run Time 18 min, 23 sec) Part 2 of Tony Seba’s latest presentation on what he calls "The Great Transformation", discusses the disruption of transportation by autonomous, electric, fleet vehicles: Transportation as a Service. "The Great Transformation" is a deep dive into the key technologies that are converging in the 2020s and how they will disrupt the five foundational sectors of the economy: Information, Food, Energy, Transportation and Materials.   Seba’s work focuses on the complex patterns and dynamics of change, disruption, and transformation at all scales. He is the author of Clean Disruption of Energy and Transportation, and co-author of Rethinking Humanity. The rest of the presentation can be seen here: The...

13 Nov 2022
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Providing Fringe Benefits to Employees with No Tax Strings Attached

Roger Rossmeisl, CPA
Small Business Tax Briefs
Providing Fringe Benefits to Employees with No Tax Strings Attached

Businesses can provide benefits to employees that don’t cost them much or anything at all. However, in some cases, employees may have to pay tax on the value of these benefits. Here are examples of two types of benefits which employees generally can exclude from income: A no-additional-cost benefit. This involves a service provided to employees that doesn’t impose any substantial additional cost on the employer. These services often occur in industries with excess capacity. For example, a hotel might allow employees to stay in vacant rooms or a golf course may allow employees to play during slow times. A de minimis fringe benefit. This includes property or a service, provided infrequently by an employer to employees, with a value so small that accounting for it...

13 Nov 2022
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Preventing “Privileged User” Fraud and Abuse

Roger Rossmeisl, CPA
Fraud Briefs
Preventing Privileged User Fraud and Abuse

In most companies, employees need a user identity to access work-related hardware and software. Privileges to use certain applications or open certain files usually are provided to workers based on their department, role and level of authority. Over their tenure, employees might accumulate various privileges they no longer need. For example, someone who once worked in accounting might retain the ability to make journal entries even after transferring to the legal department. Unfortunately, dishonest employees could use their privileges for nefarious purposes. Best practices Privileged users sometimes use their access to perpetrate fraud, intellectual property theft or sabotage. And they don’t always act alone. Third parties, such as competitors, could try to recruit privileged users to steal trade secrets. Or employees could collude with hackers to compromise...

13 Nov 2022
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Worried About an IRS Audit? Prepare in Advance

Roger Rossmeisl, CPA
Small Business Tax Briefs
Worried About an IRS Audit? Prepare in Advance

IRS audit rates are historically low, according to a recent Government Accountability Office (GAO) report, but that’s little consolation if your return is among those selected to be examined. Plus, the IRS recently received additional funding in the Inflation Reduction Act to improve customer service, upgrade technology and increase audits of high-income taxpayers. But with proper preparation and planning, you should fare well. From tax years 2010 to 2019, audit rates of individual tax returns decreased for all income levels, according to the GAO. On average, the audit rate for all returns decreased from 0.9% to 0.25%. IRS officials attribute this to reduced staffing as a result of decreased funding. Businesses, large corporations and high-income individuals are more likely to be audited but, overall, all types...

09 Nov 2022
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Work Opportunity Tax Credit Provides Help to Employers

Roger Rossmeisl, CPA
Small Business Tax Briefs
Work Opportunity Tax Credit Provides Help to Employers

In today’s tough job market and economy, the Work Opportunity Tax Credit (WOTC) may help employers. Many business owners are hiring and should be aware that the WOTC is available to employers that hire workers from targeted groups who face significant barriers to employment. The credit is worth as much as $2,400 for each eligible employee ($4,800, $5,600 and $9,600 for certain veterans and $9,000 for “long-term family assistance recipients”). It’s generally limited to eligible employees who begin work for the employer before January 1, 2026. The IRS recently issued some updated information on the pre-screening and certification processes. To satisfy a requirement to pre-screen a job applicant, a pre-screening notice must be completed by the job applicant and the employer on or before the day...

23 Oct 2022
0

The Future of the Dealer Franchise

Roger Rossmeisl, CPA
Automotive
Legal Protections Franchise Dealers Have Against Direct Manufacturere Sales

As posted to the Bellavia Blatt YouTube Channel on 9/30/22, and the Fixed Ops Roundtable YouTube Channel on 10/8/22 (Run Time: 17 min, 52 sec) With automakers speeding toward electrification, many are more than hinting at a new distribution model for those electrified vehicles involving customers ordering vehicles online.  Are dealers at risk of being cut out of the sales process? In this clip, automotive attorney Len Bellavia sits down virtually with Ted Ings at the "Fixed Ops Roundtable" to discuss the future of the franchised dealership network model. Len's position is that the real risk is whether or not dealers are going to invoke their rights under their respective states' franchise laws which have been on the books for decades, designed to protect against this very subject. "State Dealer...

25 Sep 2022
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IRS Announces the “Dirty Dozen” Tax Scams for 2022

Roger Rossmeisl, CPA
Current Events, Fraud Briefs
IRS Announces Dirty Dozen Tax Scams for 2022

The IRS has compiled the annual Dirty Dozen list for more than 20 years as a way of alerting taxpayers and the tax professional community about scams and schemes. The list is not a legal document or a literal listing of agency enforcement priorities. It is designed to raise awareness among a variety of audiences that may not always be aware of developments involving tax administration. #1-4 - POTENTIALLY ABUSIVE ARRANGEMENTS (Source: IR-2022-113, June 1, 2022)   The potentially abusive arrangements in this series focus on four transactions that are wrongfully promoted and will likely attract additional agency compliance efforts in the future. Those four abusive transactions involve charitable remainder annuity trusts, Maltese individual retirement arrangements, foreign captive insurance, and monetized installment sales.   "Taxpayers should stop and think twice before...

25 Sep 2022
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Separating Your Business From Its Real Estate

Roger Rossmeisl, CPA
Small Business Tax Briefs
Separating Your Business from its Real Estate

Does your business need real estate to conduct operations? Or does it otherwise hold property and put the title in the name of the business? You may want to rethink this approach. Any short-term benefits may be outweighed by the tax, liability and estate planning advantages of separating real estate ownership from the business. Tax implications Businesses that are formed as C corporations treat real estate assets as they do equipment, inventory and other business assets. Any expenses related to owning the assets appear as ordinary expenses on their income statements and are generally tax deductible in the year they’re incurred. However, when the business sells the real estate, the profits are taxed twice — at the corporate level and at the owner’s individual level when a distribution...

ROGER ROSSMEISL, CPA

Kho & Patel CPAs
160 E. Arrow Highway
San Dimas, CA 91773

(714) 325-0442
roger@khopatel.com

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