Small Businesses Lifting Off!

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We recently celebrated the fourth of July, the birth of America's independence.  We continue to be grateful and honor all of the men and women who have sacrificed much for us.  A sincere thanks to all of our veterans and troops for their committment to fighting for our country's freedom. 

In reflecting on our nation and its' progress, we can also reflect on our economy's recent progress.   Intuit has recently released June's small business indexes.  Their positive trends are a glimmer of light as they reflect positive trends for employment, employee compensation and employee hours worked for our nation's small businesses.  Even small monthly growth will help us progress to a full economic recovery.  Read more at http://index.intuit.com/.  CPA Practice Advisor has published their analysis at
 http://www.cpapracticeadvisor.com/news/10736742/intuit-small-business-indexes-show-strong-employment-growth-decrease-in-revenue?cmpid=email_CCSN120628002&utm_source=CPA+Weekly+Advisor+Newsletter&utm_medium=email&utm_campaign=CCSN120628002

July 2012 Tax Due Dates

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July 10	Employees Who Work for Tips - If you received $20 or more in tips during June, report them to your employer. You can use Form 4070.
July 16	Employers - Nonpayroll withholding. If the monthly deposit rule applies, deposit the tax for payments in June.Employers - Social Security, Medicare, and withheld income tax. If the monthly deposit rule applies, deposit the tax for payments in June.
July 31	Employers - Social Security, Medicare, and withheld income tax. File Form 941 for the second quarter of 2012. Deposit any undeposited tax. (If your tax liability is less than $2,500, you can pay it in full with a timely filed return.) If you deposited the tax for the quarter in full and on time, you have until August 10 to file the return.Employers - Federal unemployment tax. Deposit the tax owed through June if more than $500.Employers - If you maintain an employee benefit plan, such as a pension, profit sharing, or stock bonus plan, file Form 5500 or 5500-EZ for calendar year 2011. If you use a fiscal year as your plan year, file the form by the last day of the seventh month after the plan year ends.Certain Small Employers - Deposit any undeposited tax if your tax liability is $2,500 or more for 2012 but less than $2,500 for the second quarter.

Discover Your Pot o' Gold...in Your Tax Deductible Vacation!

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Dublin, Ireland 


Tim, who owns his own business, decided he wanted to take a two-week trip around the US. So he did--and was able to legally deduct every dime that he spent on his "vacation". Here's how he did it.

1. Make all your business appointments before you leave for your trip.
Most people believe that they can go on vacation and simply hand out their business cards in order to make the trip deductible.
Wrong.
You must have at least one business appointment before you leave in order to establish the "prior set business purpose" required by the IRS. Keeping this in mind, before he left for his trip, Tim set up appointments with business colleagues in the various cities that he planned to visit.
Let's say Tim is a manufacturer of green office products looking to expand his business and distribute more product. One possible way to establish business contacts--if he doesn't already have them--is to place advertisements looking for distributors in newspapers in each location he plans to visit. He could then interview those who respond when he gets to the business destination.

Example: Tim wants to vacation in Hawaii. If he places several advertisements for distributors, or contacts some of his downline distributors to perform a presentation, then the IRS would accept his trip for business.

Tip: It would be vital for Tim to document this business purpose by keeping a copy of the advertisement and all correspondence along with noting what appointments he will have in his diary.

2. Make Sure your Trip is All "Business Travel."
In order to deduct all of your on-the-road business expenses, you must be traveling on business. The IRS states that travel expenses are 100% deductible as long as your trip is business related and you are traveling away from your regular place of business longer than an ordinary day's work and you need to sleep or rest to meet the demands of your work while away from home.

Example: Tim wanted to go to a regional meeting in Boston, which is only a one-hour drive from his home. If he were to sleep in the hotel where the meeting will be held (in order to avoid possible automobile and traffic problems), his overnight stay qualifies as business travel in the eyes of the IRS.

Tip: Remember: You don't need to live far away to be on business travel. If you have a good reason for sleeping at your destination, you could live a couple of miles away and still be on travel status.

3. Make sure that you deduct all of your on-the-road -expenses for each day you're away.
For every day you are on business travel, you can deduct 100% of lodging, tips, car rentals, and 50% of your food. Tim spends three days meeting with potential distributors. If he spends $50 a day for food, he can deduct 50% of this amount, or $25.

Tip:The IRS doesn't require receipts for travel expense under $75 per expense--except for lodging.

Example: If Tim pays $6 for drinks an the plane, $6.95 for breakfast, $12.00 for lunch, $50 for dinner, he does not need receipts for anything since each item was under $75.

Tip: He would, however, need to document these items in your diary. A good tax diary is essential in order to audit-proof your records. Adequate documentation shall consist of amount, date, place and business reason for the expense.

Example: If, however, Tim stays in the Bates Motel and spends $22 on lodging, will he need a receipt? The answer is yes. You need receipts for all paid lodging.

Tip: Not only are your on-the-road expenses deductible from your trip, but also all laundry, shoe shines, manicures, and dry-cleaning costs for clothes worn on the trip. Thus, your first dry cleaning bill that you incur when you get home will be fully deductible. Make sure that you keep the dry cleaning receipt and have your clothing dry cleaned within a day or two of getting home.

4. Sandwich weekends between business days.
If you have a business day on Friday and another one on Monday, you can deduct all on-the-road expenses during the weekend.

Example: Tim makes business appointments in Florida on Friday and one on the following Monday. Even though he has no business on Saturday and Sunday, he may deduct on-the-road business expenses incurred during the weekend.

5. Make the majority of your trip days business days.
The IRS says that you can deduct transportation expenses if business is the primary purpose of the trip. A majority of days in the trip must be for business activities, otherwise, you cannot make any transportation deductions.

Example: Tim spends six days in San Diego. He leaves early on Thursday morning. He had a seminar on Friday and meets with distributors on Monday and flies home on Tuesday, taking the last flight of the day home after playing a complete round of golf. How many days are considered business days?

All of them. Thursday is a business day, since it includes traveling - even if the rest of the day is spent at the beach. Friday is a business day because he had a seminar. Monday is a business day because he met with prospects and distributors in pre-arranged appointments. Saturday and Sunday are sandwiched between business days, so they count, and Tuesday is a travel day.
Since Tim accrued six business days, he could spend another five days having fun and still deduct all his transportation to San Diego. The reason is that the majority of the days were business days (six out of eleven). However, he can only deduct six days worth of lodging, dry cleaning, shoe shines, and tips. The important point is that Tim would be spending money on lodging, airfare, and food, but now most of his expenses will become deductible.
Consult us before you plan your next trip. We'll show you the right way to legally deduct your vacation when you combine it with business. Bon Voyage!
Tim, who owns his own business, decided he wanted to take a two-week trip around the US. So he did--and was able to legally deduct every dime that he spent on his "vacation". Here's how he did it.

1. Make all your business appointments before you leave for your trip.
Most people believe that they can go on vacation and simply hand out their business cards in order to make the trip deductible.
Wrong.
You must have at least one business appointment before you leave in order to establish the "prior set business purpose" required by the IRS. Keeping this in mind, before he left for his trip, Tim set up appointments with business colleagues in the various cities that he planned to visit.
Let's say Tim is a manufacturer of green office products looking to expand his business and distribute more product. One possible way to establish business contacts--if he doesn't already have them--is to place advertisements looking for distributors in newspapers in each location he plans to visit. He could then interview those who respond when he gets to the business destination.

Example: Tim wants to vacation in Hawaii. If he places several advertisements for distributors, or contacts some of his downline distributors to perform a presentation, then the IRS would accept his trip for business.

Tip: It would be vital for Tim to document this business purpose by keeping a copy of the advertisement and all correspondence along with noting what appointments he will have in his diary.

2. Make Sure your Trip is All "Business Travel."
In order to deduct all of your on-the-road business expenses, you must be traveling on business. The IRS states that travel expenses are 100% deductible as long as your trip is business related and you are traveling away from your regular place of business longer than an ordinary day's work and you need to sleep or rest to meet the demands of your work while away from home.

Example: Tim wanted to go to a regional meeting in Boston, which is only a one-hour drive from his home. If he were to sleep in the hotel where the meeting will be held (in order to avoid possible automobile and traffic problems), his overnight stay qualifies as business travel in the eyes of the IRS.

Tip: Remember: You don't need to live far away to be on business travel. If you have a good reason for sleeping at your destination, you could live a couple of miles away and still be on travel status.

3. Make sure that you deduct all of your on-the-road -expenses for each day you're away.
For every day you are on business travel, you can deduct 100% of lodging, tips, car rentals, and 50% of your food. Tim spends three days meeting with potential distributors. If he spends $50 a day for food, he can deduct 50% of this amount, or $25.

Tip:The IRS doesn't require receipts for travel expense under $75 per expense--except for lodging.

Example: If Tim pays $6 for drinks an the plane, $6.95 for breakfast, $12.00 for lunch, $50 for dinner, he does not need receipts for anything since each item was under $75.

Tip: He would, however, need to document these items in your diary. A good tax diary is essential in order to audit-proof your records. Adequate documentation shall consist of amount, date, place and business reason for the expense.

Example: If, however, Tim stays in the Bates Motel and spends $22 on lodging, will he need a receipt? The answer is yes. You need receipts for all paid lodging.

Tip: Not only are your on-the-road expenses deductible from your trip, but also all laundry, shoe shines, manicures, and dry-cleaning costs for clothes worn on the trip. Thus, your first dry cleaning bill that you incur when you get home will be fully deductible. Make sure that you keep the dry cleaning receipt and have your clothing dry cleaned within a day or two of getting home.

4. Sandwich weekends between business days.
If you have a business day on Friday and another one on Monday, you can deduct all on-the-road expenses during the weekend.

Example: Tim makes business appointments in Florida on Friday and one on the following Monday. Even though he has no business on Saturday and Sunday, he may deduct on-the-road business expenses incurred during the weekend.

5. Make the majority of your trip days business days.
The IRS says that you can deduct transportation expenses if business is the primary purpose of the trip. A majority of days in the trip must be for business activities, otherwise, you cannot make any transportation deductions.

Example: Tim spends six days in San Diego. He leaves early on Thursday morning. He had a seminar on Friday and meets with distributors on Monday and flies home on Tuesday, taking the last flight of the day home after playing a complete round of golf. How many days are considered business days?

All of them. Thursday is a business day, since it includes traveling - even if the rest of the day is spent at the beach. Friday is a business day because he had a seminar. Monday is a business day because he met with prospects and distributors in pre-arranged appointments. Saturday and Sunday are sandwiched between business days, so they count, and Tuesday is a travel day.
Since Tim accrued six business days, he could spend another five days having fun and still deduct all his transportation to San Diego. The reason is that the majority of the days were business days (six out of eleven). However, he can only deduct six days worth of lodging, dry cleaning, shoe shines, and tips. The important point is that Tim would be spending money on lodging, airfare, and food, but now most of his expenses will become deductible.
Consult us before you plan your next trip. We'll show you the right way to legally deduct your vacation when you combine it with business. Bon Voyage!

Potential income tax rate, long-term capital gain & dividend rate increases. How might your financial picture be affected?

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There are less than two weeks left until November 6^th, Election Day, when our votes will have been cast and we’ll anxiously await to see whether Mr. Obama or Mr. Romney will be leading our country.  We are hopeful that America will move towards an end to the recession and an on to an era of a robust economic recovery!  However, as prudent taxpayers, we should keep in mind that the Economic Growth and Tax Relief Reconciliation Act of 2001 (EGTRRA), more commonly referred to as the “Bush Tax Cuts” are set to expire shortly.    Previously, in 2010, the EGTRRA was to expire and Congress elected to extend most of its’ original provisions until December 31, 2012.  No matter which President will be leading us, it isn’t certain whether our current tax laws will change or whether Congress will extend them yet again, while working on possible tax code reform.

With this current state of uncertainty, the best way to manage our own tax situation is to be aware of how tax laws may change if the EGTRRA is not extended.  There are potential changes to numerous tax provisions that could impact your financial situation, including:  income tax rates, long-term capital gain rates, dividend rates, Medicare rates, limits on personal exemptions and itemized deductions, the marriage penalty, education benefits, and estate taxes.  For simplicity’s sake, the topic of this blog is limited to possible changes to income tax rates, as well as, long-term capital gain and dividend rate changes.

 INCOME TAX RATES

ORDINARY INCOME MARRIED FILING JOINTLY	ORDINARY INCOME SINGLE FILER	2012 RATES	2013 RATES
$0 - $17,400	$0 - $8,700	10%	15%
$17,400 - $70,700	$8,700 - $35,350	15%	15%
$70,700 - $142,700	$35,350 - $85,000	25%	28%
$142,700 - $217,450	$85,000 - $178,650	28%	31%
$217,450 - $388,350	$178,650 - $388,350	33%	36%
Over $388,350	Over $388,350	35%	39.6%

 The new 2013 tax rate structure would eliminate the 10% bracket, while all of the remaining brackets above 15% will be increasing at least 3%.  Since the brackets don’t take into account the rate of inflation, it’s wise to consider your personal financial situation and whether the rate change may affect your overall financial picture.

 LONG-TERM CAPITAL GAINS RATES

	2012 Rates	2013 Rates
Income less than $70,700	0%	10%
Income more than $70,700	15%	20%

 If Congress doesn’t act quickly after the election, the 0% tax rate on long-term capital gains will rise to 10% while those with income greater than $70,700 will see their rate on gains jump to 20%.

DIVIDEND RATES                                            

	2012 Rates	2013 Rates
Ordinary Dividends	Ordinary Income Tax Rates	Ordinary Income Tax Rates
Qualified Dividends	Long-term Capital Gains Rates	Ordinary Income Tax Rates

Like ordinary dividend tax rates, qualified dividends will no longer be taxed at the more favorable long-term capital gains rates.  Similarly, they will also be taxed at ordinary income tax rates.  As a result, the 0% qualified dividend rate will be eliminated and most investors will see an increase in their qualified dividend tax rate, equivalent to the above 2013 ordinary income tax rates.  Therefore, to be a prudent investor and taxpayer, you may want to take a review of your current portfolio and investment strategy and consider whether you should sell certain stocks to realize capital gain income in 2012 rather than in 2013.   

For more information regarding the provisions of the Bush Tax cuts and the possible implications on taxpayers in 2013 if they are not extended, read The Library of Congress’s Congressional Research Service article by Margot L. Crandall-Hollick, entitled, “An Overview of Tax Provisions Expiring in 2012.” at this link http://www.fas.org/sgp/crs/misc/R42485.pdf.

Please revisit our blog for information regarding potential tax rate increases related to the various other provisions of the EGTRRA which may be expiring in December 2012. In the meantime, feel free to contact Holdsworth & Co.’s knowledgeable CPAs if you have any questions regarding possible changes to your tax situation in the upcoming year and …BE SURE TO LET YOUR VOICE BE HEARD & VOTE BY NOVEMBER 6TH!

Athens: Social Meltdown

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Text from original site

Dr Dimitris Dalakoglou explains the social meltdown which took place in Greece between May 2010 & June 2012 that is on going. This film contains videos and photos shot on the streets, often containing violence and paints a portrait of widespread economic hardship endured by a cities inhabitants. This film is part of an ongoing research project, which looks at the rapid structural changes which Greece is undergoing.
Produced & Directed by Ross Domoney
Interview: Dimitris Dalakoglou
Filmed, Photographed & Edited by Ross Domoney

My personal comment is that you have to notice that the policemen are dressed for combat. Also, they concistently throw military grade tear gases that are not allowed even for war and they are they same kind that the Israel army uses. Additionally, most of the people they fight with molotof are govorment funded units  (some them being the police itself) with a role to provoke and in the aftermath destroy every demonstration in violence. All the above have been going on for years now with incremental increase of violence towards unsuspected people, young and old people.
Greece doesn't have a demogratic regime for too long. However believes otherwise he doesn't understand that in a democracy first and foremost, the goverment fears the people and not the other way around. 

Update: Major Trends in New Jobless Claims

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Today, we're updating our ongoing statistical analysis of the major trends in the weekly number of new jobless benefit claims in the U.S. since the end of 2005.

The big change is that since our last major update in April 2012, we've seen the end of one primary trend, gone through another, and have now started a third. Goodbye Trend I. Sayonara Trend J. Hello, Trend K!

The table below summarizes each of the periods identified with letters of the alphabet in our updated chart showing each of the major trends over the period from January 2006 through the present:

Timing and Events of Major Shifts in Layoffs of U.S. Employees
Period	Starting Date	Ending Date	Likely Event(s) Triggering New Trend (Occurs 2 to 3 Weeks Prior to New Trend Taking Effect)
A	7 January 2006	22 April 2006	This period of time marks a short term event in which layoff activity briefly dipped as the U.S. housing bubble reached its peak. Builders kept their employees busy as they raced to "beat the clock" to capitalize on high housing demand and prices.
B	29 April 2006	17 November 2007	The calm before the storm. U.S. layoff activity is remarkably stable as solid economic growth is recorded during this period, even though the housing and credit bubbles have begun their deflation phase.
C	24 November 2007	26 July 2008	Federal Reserve acts to slash interest rates for the first time in 4 1/2 years as it begins to respond to the growing housing and credit crisis, which coincides with a spike in the TED spread. Negative change in future outlook for economy leads U.S. businesses to begin increasing the rate of layoffs on a small scale, as the beginning of a recession looms in the month ahead.
D	2 August 2008	21 March 2009	Oil prices spike toward inflation-adjusted all-time highs (over $140 per barrel in 2008 U.S. dollars.) Negative change in future outlook for economy leads businesses to sharply accelerate the rate of employee layoffs.
E	28 March 2009	7 November 2009	Stock market bottoms as future outlook for U.S. economy improves, as rate at which the U.S. economic situation is worsening stops increasing and begins to decelerate instead. U.S. businesses react to the positive change in their outlook by significantly slowing the pace of their layoffs, as the Chinese government announced how it would spend its massive economic stimulus effort, which stood to directly benefit U.S.-based exporters of capital goods and raw materials. By contrast, the U.S. stimulus effort that passed into law over a week earlier had no impact upon U.S. business employee retention decisions, as the measure was perceived to be excessively wasteful in generating new and sustainable economic activity.
F	14 November 2009	11 September 2010	Introduction of HR 3962 (Affordable Health Care for America Act) derails improving picture for employees of U.S. businesses, as the measure (and corresponding legislation introduced in the U.S. Senate) is likely to increase the costs to businesses of retaining employees in the future. Employers react to the negative change in their business outlook by slowing the rate of improvement in layoff activity.
G	18 September 2010	2 April 2011	Possible multiple causes. Political polling indicates Republican party could reasonably win both the U.S. House and Senate, preventing the Democratic party from being able to continue cramming unpopular and economically destructive legislation into law, bringing relief to distressed U.S. businesses. Fed Chairman Ben Bernanke announces Federal Reserve will act if economy worsens, potentially restoring some employer confidence. The White House announces there will be no big new stimulus plan, eliminating the possibility that more wasteful economic activity directed by the federal government would continue to crowd out the economic activity of U.S. businesses.
H	9 April 2011	26 November 2011	Rising oil and gasoline prices exceed the critical $3.50-$3.60 per gallon range (in 2011 U.S. dollars), forcing numerous small businesses to act to reduce staff to offset rising costs in order to prevent losses. The trend ends when average motor gasoline prices in the U.S. fall back below the $3.50 level in the week between 5 November 2011 and 12 November 2011 - the corresponding improvement in business outlook shows up in the data with the next full pay cycle (2-3 weeks later, or rather, the week ending 26 November 2011!)
I	3 December 2011	11 February 2012	With average gasoline prices in the U.S. having fallen below the critical $3.50 per gallon level, employers respond to the improving business outlook by reducing the number weekly layoffs at a faster rate, as both businesses and consumers benefit from lower transporation and fuel costs, while consumers gain more disposable income. Trend I ended shortly after gasoline prices rose back above the $3.50 per gallon mark in late January 2012.
J	18 February 2012	23 June 2012	With average gasoline prices continuing to be a high levels through the spring and summer, the pace of layoffs in the U.S. steadily increased until June 2012, when the national average price of gasoline in the U.S. finally dropped back below the $3.50 per gallon mark.
K	30 June 2012	Present	Trend K began with a sudden shift downward in the number of new jobless claims as gasoline prices fell below the $3.50 per gallon mark in June 2012, and although the average price of gasoline in the U.S. has since risen back above that level, there has been no sudden upward shift in new jobless claims. Instead, the number of initial unemployment insurance benefit claims filed in the weeks since has been rising at a faster rate than at any time since on the onset of the 2007 recession.

We can see that faster rate of increase in our close-up view of the residual distribution of the four most recent primary trends, covering the period of time since 26 March 2011:

In determining the primary trend for Trend K, we should note that we have omitted the data for the weeks ending 7 July 2012 and 14 July 2012. Both weeks were suspected to be atypical given the delay in the timing of annual automotive industry plant holidays in 2012, which was not compensated for in the BLS' seasonal adjustments. As it happens, the data for 7 July 2012 appears to be right in line with the primary trend we determined using all the weekly data reported in the period since 21 July 2012, while the data for 14 July 2012 appears as an outlier.

We also note that the data for the most recent week ending 8 September 2012 also includes roughly 9,000 additional layoffs due to the effect of Hurricane Isaac. In the context of our statistical analysis, the effect of the hurricane appears to be consistent with typical natural variation in the data.

Finally, we observe that new jobless claims in the U.S. appear to be rising at the fastest rate recorded since the onset of the 2007 recession. As such, this measure indicates that the health of the U.S. job market is currently declining, although we continue to anticipate stronger economic growth in 2012-Q3 than occurred in 2012-Q2.

What's Your Income Percentile?

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Where do you rank in the U.S. income spectrum?

Now that the U.S. Census has released its total money income data it collected as part of its 2012 Annual Social and Economic Supplement survey, we can tell you almost exactly where you rank among American individuals, men (if you're a man), women (if you're a woman). Or, once you consider the combined income for your family or the members of your household, we can determine your percentile rank among each of those kinds of groupings!

It all starts below! Just enter your personal income, your family's income, which includes the incomes of your spouse and any dependents you might have, regardless of whether they live with you or not, and also the combined income of just the people who live within the same four walls of the household that you do and we'll tell you where you rank (if you're accessing this article through a site that republishes our RSS feed, click here to access the tool on our site.) And if you live outside the United States, be sure to convert your income into U.S. dollars first!

Income Data
Input Data	Values
Your Personal Total Money Income
Your Family's Combined Total Money Income
Your Household's Combined Total Money Income

	Your Income Percentile
	Individuals
	- Men
	- Women
	Families
	Households

The default data we've presented in the tool above represents the average total money income of U.S. individuals, families and households in 2011.

In the tool above, your percentile ranking indicates the percentage of Americans who either share your income or earn less than you do. As such, it tells you what percentage of the population you're above in the income earning food chain.

For example, a percentile ranking of zero would indicate that you are at the very bottom end of the American income spectrum, while a percentile ranking of 100 indicates that you are effectively at the very top end. A percentile rank of 50.0 would indicate that you're within spitting range of being the middle of all Americans (our tool should be able to place most people within 0.2% of their actual percentile ranking.)

In considering your percentile ranking, here's how many income-earning people, families and households there were in 2011:

• Individuals: 214,559,000
• Men: 106,228,000
• Women: 108,332,000
• Families: 80,529,000
• Households: 121,084,000

And here are our charts showing the cumulative distribution for U.S. families (left) and households (right). Click the images for larger versions:

The U.S. Census will report the data it collects for income earned in 2012 sometime in September 2013.