Tuesday, November 13, 2018

Here’s how to avoid disaster recovery scams

Here’s how to avoid disaster recovery scams

By Linda McMahon, SBA Administrator

Administrator McMahon visits Florida communities recovering from Hurricane Michael.Last week, I visited Florida communities recovering from the devastation caused by Hurricane Michael.  The SBA’s disaster assistance team is working long hours at local recovery centers, helping homeowners, renters and businesses navigate the challenges that come with financing the rebuilding of one’s home or business.

Sadly, after every major disaster, scam artists prey on people at the most vulnerable points in their lives.  During my visit, disaster survivors told me stories about unscrupulous building contractors who convince people to give away their insurance proceeds without doing any construction work.

Here are a few tips from our disaster recovery partners at FEMA to keep in mind so you can protect yourself from becoming a victim of fraud:

Government employees don’t charge for recovery assistance 

Federal and state workers never ask for or accept money and always carry identification badges.  There is NO FEE required to apply for or to get disaster assistance from FEMA, the U.S. Small Business Administration or the state

Watch out for Price Gouging

Price gouging occurs when a supplier marks up the price of an item more than is justified by the actual costs.  Disaster survivors are particularly susceptible because their needs are immediate and they have few alternatives to choose from.   Notify your state’s Office of the Attorney General if you suspect a vendor of price gouging.

Dealing with Contractors

Individuals and business owners should take steps to protect themselves and avoid fraud when hiring contractors to clean property, remove debris or make repairs.
Here are a few tips:
  • Don’t pay a contractor in full before work begins or is finished, and do not be pressured to endorse your insurance claim check to a contractor for repairs. Make final payments only after the work is completed and use a verified payment source (check, credit card, etc.).
  • Only use contractors licensed by your state.
  • Get the estimate in writing and review several contractors before deciding.
  • Demand and check references and get any guarantees in writing.
  • Any builders you hire should have their own general contractor liability insurance — ask to see proof. The insurance should cover any bodily injury or property damage the firm accidentally causes to you, your family, and your property.
  • Insist on a written contract. Don’t sign a contract with blank spaces.
The best way to avoid fraud is to arm yourself against it by having a checklist to remind yourselves of your specific rebuilding needs and what you need to demand when hiring a contractor.

For information on how to apply for SBA disaster assistance, location of recovery centers, visit www.sba.gov/disaster

About the Author:

Linda McMahon
Linda McMahon
SBA Administrator
Linda McMahon serves as the 25th Administrator of the U.S. Small Business Administration (SBA). As a member of President Trump’s cabinet, she advocates on behalf of the 30 million small businesses in America, which employ nearly half of all American workers and account for 56.8 million jobs.

Saturday, November 3, 2018

Being a Notary Public is a Great Asset

Why Become a Notary
Want to enhance your resume?  Why not become a Notary Public. Most employers expect their paralegals to be notaries and trust they know what they are doing!  Being a Notary Public is definitely an asset.

According to the National Notary Association, here are the top five reasons why you should consider becoming a Notary Public:


Make Additional Income
While Notaries are appointed by their states and serve as public officials, they charge their clients directly and the revenue is theirs to keep. That’s why tens of thousands of people hit the streets as “mobile Notaries” in their communities. Most states regulate how much a Notary can charge for an individual notarization (for example, $10 in California and Florida), but many clients often need more than one signature notarized. You’re also allowed to charge additional fees for items such as travel, supplies and other expenses.

Become a Notary Signing Agent
If you like the idea of being a Notary to make additional income, becoming a Notary Signing Agent  (NSA) is right up your alley. An NSA is a trained and certified professional who handles the notarization of loan documents in real estate closings. For the mortgage finance industry, NSAs serve as the critical final link between the banks and the borrower to complete the loan. They are hired directly by title companies and signing services as independent contractors to ensure that real estate loan documents are signed by the borrower, notarized, and returned for processing. Notaries make a considerable amount of extra income from this line of mortgage finance work, in addition to their work as a mobile Notary.

Improve Your Resume/Skill Set
Notaries are in high demand in a variety of industries, including banking, finance, medical, legal, government, insurance, technology … the list goes on. In fact, just about every industry uses the services of Notaries, so becoming one will add to your marketable skill sets, improve your resume and increase your value as an employee. In the workplace, Notaries serve two general functions: Notarizing documents in the back office for co-workers and bosses, or notarizing for customers in a bank or their local photocopy and shipping shop. Many employers value employees with Notary skills to handle their document authentication needs and provide customers with top-notch service.

Enjoy a Flexible Schedule
If you choose the mobile Notary/Notary Signing Agent route, you will have the flexibility to set your own hours. It’s a perfect line of work for home-based entrepreneurs, moonlighters, stay-at-home parents (who can do mobile notarizations in the evening) or anyone looking to make some additional income. Many people who need notarizations request them after normal business hours, so you can make the most of your evenings, or arrange a time that’s right for you.

Help Your Community 
America’s Notaries are known for their spirit of helping those in need. If you are the type of person who enjoys giving back to your community, being a Notary is a great way to support that passion. Many types of people need notarization services but cannot afford them, like the elderly, homeless, disabled and college students. These groups typically need notarizations for powers of attorney, residency affidavits, advance medical directives, college transcripts and enrollment verifications. Notaries often hold events at community centers, retirement homes and campuses to provide free or low-cost notarizations. It’s also a great way to network and market yourself for paying clients.

Requirements to Become a New York Notary
  • 18 years of age.
  • State resident or have an office or place of business in New York.
  • Must read, write and understand English.
  • Be of good moral character.
  • Must have the equivalent of "common school education".
  • No conviction of a felony or certain misdemeanors unless an executive pardon or a parole board certificate of good conduct has been received.

The Chamber Coalition (NACC, AAICC and HAICC) has partnered with the Law Firm of Figeroux & Associates to offer a 3-hour Notary Public Training Program. This seminar, which is open to students, alumni, and the general public, covers everything you need to become and serve as a Notary Public for the State of New York.  The Training Program is presented by Brian Figeroux, Esq., Senior Partner of the Law Firm of Figeroux & Associates. To register for the Chambers’ notary training program visit www.nacc.nyc or call 718-722-9217.

Sunday, October 28, 2018

5 Key Questions to Ask Yourself if You Plan to Start a Business

5 Key Questions to Ask Yourself if You Plan to Start a Business

By Marco Carbajo, SBA Guest Blogger

Starting a business takes planning, making important financial decisions, and completing a series of legal activities. You will need to set goals, put plans into action, assess your progress, make necessary adjustments and grow your business.
   There are plenty of things that every business needs to do to get off the ground. So, here are five key questions to ask yourself as you plan to start a business.

1) Do I have what it takes to make it as a business owner?
Before you start a business, you should be able to answer a few very important questions. What product or service are you offering? What makes your product or service different from everyone else? Who is your ideal customer? How does your product benefit them? Answering these key questions will help define your business identity.
   Once you identify your business identity it’s important to remember, success in business requires passion, a lot of hard work, staying power and drive. According to Elizabeth Wilson of Entrepreneur Magazine, while some 40 million businesses are started each year, only 350,000 break out of the pack and begin growing and making money.

2) What is my niche and who is my target customer?
Before you start a business it’s key to know who your paying customer is going to be. You may have a great product idea that people need, but that is not enough to break through. You need to solve a problem that people want a solution for, and more importantly are willing to pay for.
   Don’t get trapped into the mindset that if you don’t offer everything, you’ll miss out on customers. Offering everything doesn’t mean that every person will buy your products or services.
   Find your niche and identify your target market. A niche is a specialized product or service you offer to your ideal customer. Your target market is the ideal client looking for what you have to offer.

3) Who will be on my team to help with my new business?
Starting and growing a business requires more than going at it alone. It takes a team to build a successful business and it’s just as important as developing your product. Even if you plan to be a sole proprietor, you can benefit incredibly from creating an outside support team to keep you focused and on track.
   You’ll also need to pull together a team of people as you set up and launch your business. These will be people that are needed to set up and run a business such as a lawyer, accountant, sales rep, web developer, marketing agency, etc.
   Each of these people on your team brings something different to the table, it’s essential that you listen to their advice on what needs to be done. Having a team you can trust is crucial to the success of your business. Getting the right advice can save you from making costly mistakes now and in the future.

4) What amount of funding do I need to start?
Starting a new business doesn’t have to require a great deal of funding if you decide to bootstrap. However, it will involve some initial investment to cover startup costs.  The key here is to work through your options and determine how much business funding you will need to cover not only your startup costs but also ongoing expenses before you are generating a profit.
   Once you have an estimate in mind, there are a number of ways you can fund your startup, including business credit cards, lines of credit, vendor credit, a business loan, etc. You may find that a combination of these sources listed may work best.

5) What business structure should I choose?
The business entity you select will impact various factors from your business name, to your liability, to how you file your taxes. It’s essential to choose the right business structure when starting a business. Once you choose your business structure, you’ll also need to get a tax identification number and file for the necessary licenses and permits.
Sign up for the Chamber's Small Business Boot Camp Series presented in partnership with the SBA. Visit: https://bit.ly/2E1oM02

Tuesday, October 16, 2018

3 Ways the New Tax Law Will Impact Your Taxes

3 Ways the New Tax Law Will Impact Your Taxes … and When They Take Effect

By Brooke Preston, Manta Contributor

Freelancers and independent contractors will see changes to tax rates and deductions next year, with some mandates still in effect now.

The Tax Cuts and Jobs Act was signed into law by President Trump in December, bringing significant changes to U.S. tax law. However, these changes will be rolled out at different times: While some, like changes to payroll withholding, may already be in motion, others won’t affect your tax return or total bill until next year.
Here are three key ways that freelancers and independent contractors will be impacted by the new tax bill, and when each will take effect.


Pass-Through Income Deduction  

A new pass-through benefit will reduce the business income you pay taxes on by up to 20% — starting with tax year 2018. If you’re a partnership, S corporation or sole proprietorship (freelancers are usually considered the latter), your business income is likely to qualify for the new deduction on “pass-through” business income.
While this change was designed to help small businesses, it will also benefit freelancers and independent contractors in many fields. You can take it even if you also take the standard deduction.
However, high-earning self-employed professionals in “service fields” (like healthcare, accounting and law) who earn more than $157,500 single or $315,000 couple from all income sources will see the benefit phase down after those thresholds. Dividends and interest from personal investments like stocks and bonds also aren’t eligible.
Still, most self-employed professionals could see significant savings when they file their taxes next year. Sadly, there will be no change in the tax burden on this year’s returns.


Lower Rates & Higher Deductions

Your tax rate may be lower and standard deductions higher — starting with tax year 2018. The new tax law will change tax brackets (what percent of your income you owe in federal taxes, based on your income level). All brackets will remain the same or become lower than previous years, so you should avoid any increase regardless of your income.
However, changes to tax brackets and the standard allowed deduction per person do not apply to the 2017 tax year; they’ll factor in for the first time when you file next year.


Health Coverage Requirements Remain

Affordable Care Act mandates are still in place — for this year’s filing. The future of the Affordable Care Act is uncertain. The individual mandate is scheduled to be repealed in time for next year’s tax filing. However, if control of Congress changes following November’s midterm elections, that requirement could be further amended. For filing 2017’s taxes, however, nothing has changed.

Monday, July 2, 2018

Tax Consequences of Crowdfunding

Crowdfunding websites such as Kickstarter, GoFundMe, Indiegogo, and Lending Club have become increasingly popular for both individual fundraising and small business owners looking for start-up capital or funding for creative ventures. The upside is that it's often possible to raise the cash you need but the downside is that the IRS considers that money taxable income. Here's what you need to know.

What is Crowdfunding?
Crowdfunding is the practice of funding a project by gathering online contributions from a large group of backers. Crowdfunding was initially used by musicians, filmmakers, and other creative types to raise small sums of money for projects that were unlikely to turn a profit. Now it is used to fund a variety of projects, events, and products and in some cases, has become an alternative to venture capital.

There are three types of crowdfunding: donation-based, reward-based, and equity-based. Donation-based crowdfunding is when people donate to a cause, project, or event. GoFundMe is the most well-known example of donation-based crowdfunding with pages typically set up by a friend or family member ("the agent") such as to help someone ("the beneficiary") pay for medical expenses, tuition, or natural disaster recovery. Reward-based crowdfunding involves an exchange of goods and services for a monetary donation, whereas, in equity-based crowdfunding, donors receive equity for their contribution.

Are Crowdfunding Donations Taxable?
This is where it can get tricky. As the agent, or person who set up the crowdfunding account, the money goes directly to you; however, you may or may not be the beneficiary of the funds. If you are both the agent and the beneficiary you would be responsible for reporting this income. If you are acting as "the agent", and establish that you are indeed, acting as an agent for a beneficiary who is not yourself, the funds will be taxable to the beneficiary when paid--not to you, the agent. An easy way to circumvent this issue is to make sure when you are setting up a crowdfunding account such as GoFundMe you clearly designate whether you are setting up the campaign for yourself or someone else. 

Again, as noted above, as the beneficiary, all income you receive, regardless of the source, is considered taxable income in the eyes of the IRS--including crowdfunding dollars. However, money donated or pledged without receiving something in return may be considered a "gift." As such the recipient does not pay any tax. Up to $15,000 per year per recipient may be given by the "gift giver." 
Let's look at an example of reward-based crowdfunding. Say you develop a prototype for a product that looks promising. You run a Kickstarter campaign to raise additional funding, setting a goal of $15,000 and offer a small gift in the form of a t-shirt, cup with a logo or a bumper sticker to your donors. Your campaign is more successful than you anticipated it would be and you raise $35,000--more than twice your goal. 

Taxable sale. Because you offered something (a gift or reward) in return for a payment pledge it is considered a sale. As such, it may be subject to sales and use tax. Taxable income. Since you raised $35,000, that amount is considered taxable income. But even if you only raised $15,000 and offered no gift, the $15,000 is still considered taxable income and should be reported as such on your tax return--even though you did not receive a Form 1099-K from a third party payment processor (more about this below). 

Generally, crowdfunding revenues are included in income as long as they are not:
Loans that must be repaid; Capital contributed to an entity in exchange for an equity interest in the entity; or Gifts made out of detached generosity and without any "quid pro quo." However, a voluntary transfer without a "quid pro quo" isn't necessarily a gift for federal income tax purposes.
Income offset by business expenses. You may not owe taxes however, if your crowdfunding campaign is deemed a trade or active business (and not a hobby) your business expenses may offset your tax liability. 

Factors affecting which expenses could be deductible against crowdfunding income include whether the business is a start-up and which accounting method (cash vs. accrual) you use for your funds. For example, if your business is a startup you may qualify for additional tax benefits such as deducting startup costs or applying part or all of the research and development credit against payroll tax liability instead of income tax liability. 

Timing of the crowdfunding campaign, receipt of funds, and when expenses are incurred also affect whether business expenses will offset taxable income in a given tax year. For instance, if your crowdfunding campaign ends in October but the project is delayed until January of the following year it is likely that there will be few business expenses to offset the income received from the crowdfunding campaign since most expenses are incurred during or after project completion. 

How do I Report Funds on my Tax Return?
Typically, companies that issue third-party payment transactions such as Amazon if you use Kickstarter, PayPal if you use Indiegogo, or WePay if you use GoFundMe) are required to report payments that exceed a threshold amount of $20,000 and 200 transactions to the IRS using Form 1099-K, Payment Card and Third Party Network Transactions. The minimum reporting thresholds of greater than $20,000 and more than 200 transactions apply only to payments settled through a third-party network; there is no threshold for payment card transactions.

Form 1099-K includes the gross amount of all reportable payment transactions and is sent to the taxpayer by January 31 if payments were received in the prior calendar year. Include the amount found on your Form 1099-K when figuring your income on your tax return, generally, Schedule C, Profit or Loss from Business for most small business owners. 

Again, tax law is not clear on this when it comes to crowdfunding donations. Some third-party payment processors may deem these donations as gifts and do not issue a 1099-K. This is why it is important to keep good records of transactions relating to your crowdfunding campaign including a screenshot of the crowdfunding campaign (it could be several years before the IRS “catches up†) and documentation of any money transfers.

Don't Get Caught Short. 
If you're thinking of crowdfunding to raise money for your small business or startup or for a personal cause, consult a tax and accounting professional first. Don't make the mistake of using all of your crowdfunding dollars on your project and then discovering you owe tax and have no money with which to pay it. 

Saturday, June 30, 2018

Tax Breaks for Businesses Hiring New Employee

If you're thinking about hiring new employees this year you won't want to miss out on tax breaks available to businesses with employees.

1. Payroll Tax Deduction for Startups
As part of the Research & Development Tax Credit, for tax years 2016 and beyond, startup businesses (C-corps and S-corps) with little to no revenue that qualify for the research and development tax credit can apply the credit against employer-paid Social Security taxes instead of income tax owed. Sole proprietorships, as well as Partnerships, C-corps and S-corps with gross receipts of less than $5 million for the current year and with no gross receipts for the previous year, can take advantage of the credit. Up to $250,000 in payroll costs can be offset by the credit. 

2. Work Opportunity Credit
The Work Opportunity Tax Credit (WOTC) is a federal tax credit for employers that hire employees from the following targeted groups of individuals: 
A member of a family that is a Qualified Food Stamp Recipient
A member of a family that is a Qualified Aid to Families with Dependent Children (AFDC) Recipient
Qualified Veterans
Qualified Ex-Felons, Pardoned, Paroled or Work Release Individuals
Vocational Rehabilitation Referrals
Qualified Summer Youths
Qualified Supplemental Security Income (SSI) Recipients
Qualified Individuals living within an Empowerment Zone or Rural Renewal Community
Long Term Family Assistance Recipient (TANF) (formerly known as Welfare to Work)
The tax credit (a maximum of $9,600) is taken as a general business credit (Form 3800, General Business Credit), and is applied against tax liability on business income. It is limited to the amount of the business income tax liability or social security tax owed. Normal carryback and carryforward rules apply. 

For qualified tax-exempt organizations, the credit is limited to the amount of employer social security tax owed on wages paid to all employees for the period the credit is claimed.
Also, an employer must obtain certification that an individual is a member of the targeted group before the employer may claim the credit.

Note: The Protecting Americans from Tax Hikes Act of 2015 (the PATH Act) retroactively allows eligible employers to claim the Work Opportunity Tax Credit (WOTC) for all targeted group employee categories that were in effect prior to the enactment of the PATH Act, if the individual began or begins work for the employer after December 31, 2014 and before January 1, 2020. 

For tax-exempt employers, the PATH Act retroactively allows them to claim the WOTC for qualified veterans who begin work for the employer after December 31, 2014, and before January 1, 2020. 

3. Disabled Access Credit
Employers that hire disabled workers might also be able to take advantage of two additional tax credits in addition to the WOTC.
The Disabled Access Credit is a non-refundable credit for small businesses that incur expenditures for the purpose of providing access to persons with disabilities. An eligible small business is one that earned $1 million or less or had no more than 30 full-time employees in the previous year; they may take the credit each, and every year they incur access expenditures. Eligible expenditures include amounts paid or incurred to: 

1. Remove barriers that prevent a business from being accessible to or usable by individuals with disabilities;

2. Provide qualified interpreters or other methods of making audio materials available to hearing-impaired individuals;
3. Provide qualified readers, taped texts, and other methods of making visual materials available to individuals with visual impairments; or
4. Acquire or modify equipment or devices for individuals with disabilities. 

4. Architectural Barrier Removal Tax Deduction 
The Architectural Barrier Removal Tax Deduction encourages businesses of any size to remove architectural and transportation barriers to the mobility of persons with disabilities and the elderly. Businesses may claim a deduction of up to $15,000 a year for qualified expenses for items that normally must be capitalized. Businesses claim the deduction by listing it as a separate expense on their income tax return. 
Businesses may use the Disabled Tax Credit and the Architectural/Transportation Tax Deduction together in the same tax year if the expenses meet the requirements of both sections. To use both, the deduction is equal to the difference between the total expenditures and the amount of the credit claimed.

5. State Tax Credits
Many states use tax credits and deductions as incentives for hiring and job growth. Employers are eligible for these credits and deductions when they create new jobs and hire employees that meet certain requirements. Examples include the New Employment Credit (NEC) in California, the Kentucky Small Business Tax Credit, and Empire Zone Tax Credits in New York. 

6. FICA Tip Tax Credit
Certain food and beverage establishments can claim a credit for social security and Medicare taxes paid or incurred by the employer on certain employees' tips. The credit is part of the general business credit. To take advantage of this credit, restaurant managers must complete IRS Form 8846, Credit for Employer Social Security and Medicare Taxes Paid on Certain Employee Tips. If the restaurant employs more than 10 tipped employees, then IRS Form 8027, Employer's Annual Information Return of Tip Income and Allocated Tips is used to report tips and determine allocated tips for tipped employees. The credit is not refundable (there must be taxable income); however, unused FICA credits may be carried back one year or carried forward up to 20 years.

If you're a business owner and are wondering what tax breaks your business qualifies for, don't hesitate to call the office and speak to a tax and accounting professional you can trust. 

Monday, February 26, 2018

Building Wealth & Creating Legacies

The New American Chamber of Commerce
Will Host Its First Annual Business, Real Estate & Wealth Building Expo

BROOKLYN, February 26, 2018 B The Chamber Coalition ─ New American Chamber of Commerce (NACC), the African-American International Chamber of Commerce (AAICC) and the Hispanic-American International Chamber of Commerce (HAICC) ─ in partnership with Equity Smart Realty, Inc., is proud to present its first Annual Business, Real Estate & Wealth Building Expo on Saturday, March 24, 2018, at the Sheraton Brooklyn Hotel, 228 Duffield Street, Brooklyn, NY 11201. This is the ideal expo for the novice, information‑seeker, prospective and current home owners, realtors, investors, entrepreneurs, marketing and salespersons to come together and learn how to create, keep and build wealth.

The Business, Real Estate & Wealth Building Expo promises to be high‑energy and impactful. The day starts with a Welcome VIP Breakfast B Be Equity Smart, and continues with empowering seminars, an exhibiting hall of businesses and a Real Estate Investing Luncheon.

Brian Figeroux, Esq., Founder of NACC, said that the “American Dream is twofold: that of starting a business and owning a business. At the New American Chamber of Commerce we seek to empower our members and the wider community to achieve those goals. That’s why we are having our Annual Business, Real Estate and Wealth Building Expo. The theme of the Expo is ‘building wealth and creating legacies’ and that is, what it is all about. How are we going to pass wealth from one generation to another? How are we going to create a legacy? By owning a home, starting a business and investing in property.

“According to the NYC Comptroller’s Office, ‘working New Yorkers are struggling through an affordability crisis. With rents rising and wages stagnant, the very people who helped build their communities up…well, they’re being priced out.’ Almost every minority community is facing gentrification. How do we fight gentrification? What is the solution? Answer: Home ownership.

“Also, the unemployment rate is highest in the minority community. How do we bring it down? Again what is the solution? Answer: Starting a business. Guess what? In addition to family and friends, one has a tendency to hire those who look and sound like them.

“Save the date: March 24, 2018. It’s a day of opportunity and we invite all to come. Lao Tzu said that ‘The journey of a thousand miles, begins with one step.’ The path to building wealth and creating legacies starts on Saturday, March 24, 2018. It's that first, one step. Don’t miss it.”

Victoria Falk, CEO of Passionate Travel Inc., Vice-President of AAICC and President of BlackCEO NY Chapter, says
"I highly recommend that if you are in business, or seriously thinking about starting a business, that you attend the upcoming Business, Real Estate &Wealth Building Expo. In this age of high technology, connecting with people on a personal level is still very important.  We do business with people we know, like and trust.  There's no better way to establish initial rapport with a potential client or business partner than at the Expo.  So bring your business cards, a positive attitude, and be prepared to network with other professional people who want to meet you.  Attend the seminars and learn from people who have quality information to help you get to your next level. Personally, I have gained new customers and business partners, as well as valuable information that have put me ahead of my competition at previous expos presented by the New American Chamber of Commerce.  So mark your calendar and prepare to attend the Business, Real Estate & Wealth Building Expo on Saturday, March 24, 2018.”

To learn more or register now, visit www.businessexponyc.com