Barry W James Attends Rootworks Winter Conference

December 11th through the 13th Barry W James of BW James LLP attended the exclusive Rootworks Winter Conference in Sarasota, Florida.  The event was held at The Ritz-Carlton of Sarasota and featured special keynote speakers, discussion sessions, open roundtables, and tax season preparation including preparing for the 2013 tax changes as a result of the Affordable Care Act.

As a member of Rootworks, the associates at BW James have the opportunity to stay ahead of changes to the tax code, make use of new technologies, and all things related to the accounting profession, thus enabling them to provide superior service to their clients.

There is no substitute for face-to-face interaction with fellow Rootworks Academy Members to exchange ideas and broaden the scope of the services BW James CPA’s can provide.  For more information about the professionals at BW James visit http://www.bwjames.com

Monthly Sales Tax Due

This is a friendly reminder from the professionals at BW James LLP, that the Sales and Use Tax deadline is December 20, 2013 for those filing monthly.

Texas’ monthly sales-tax collections have seen regular growth, even growing a full 2.8 percent in the month of November, making it the 44th consecutive month to see growth.  Revenues from sectors such as wholesale trade, service industries, and restaurants contributed largely to the most recent increase.

The steady increase of sales tax collections is largely a good sign for the local and state economy moving forward.

Be sure to have your monthly Sales and Use Tax return forms filed by Friday, December 20th in order to avoid interest and penalty charges.  Even if you don’t owe any taxes because you have no sales or only nontaxable sales for the month, you still must file the tax return form by Friday.

For more information about the professionals at BW James visit http://www.bwjames.com

IRS Announces 2014 Standard Mileage Rates

The cost of fueling up has gone down and with it so are the standard mileage rates for 2014.  This past weekend the IRS announced that the standard mileage rates for business, charitable, medical, or moving expenses will decrease 0.5 cents per mile.  The new mileage is as follows:

56 cents per mile for business miles driven

23.5 cents per mile driven for medical or moving purposes

14 cents per mile driven in service of charitable organizations

The rate for charitable expenses remain the same as they were in 2013 – as they have been since the 90’s, while the rates for business, medical and moving expenses are adjusted each year, the rate for charitable expenses is fixed by statute and can only be changed by Congress.

The rates for business miles traveled are applicable on owned or leased vehicles (including vans, pickups, or panel trucks) and can also be used by employers to reimburse tax-free under an accountable plan employees who supply their own autos for business use, and to value personal use of certain low-cost employer-provided vehicles.

The standard mileage rates are used to easily calculate the amount of a deductible business, moving, medical or charitable expense.  Taxpayers also have the option of deducting their actual costs rather than using the standard mileage rates, but no matter which option you choose, be sure to keep good records.

The new rates begin to take effect on January 1st, 2014 and will be on your 2014 returns filed in 2015.


For more information about the professionals at BW James and professional tax and financial planning services visit http://www.bwjames.com

Big Changes Coming to Tax Code 179

An expanding and strengthening economy may mean the end of the line of December 31, 2013 for some stimulus-type tax breaks.  The overall code Sec. 179 expensing limit is slated for a drastic reduction next year.

Therefore small businesses planning to purchase a vehicle, machinery, equipment, or invest in eligible real estate assets at the beginning of 2015 may want to consider pushing up their purchase plans.  This year will be the last year you are able to deduct as an expense, rather than to depreciate, up to a specified amount of the cost of a new or used vehicle placed in service.

The 2013 Tax Year has a dollar limitation on the expensing deduction of $500,000 and the investment-based reduction in the dollar limitation starts to take effect when property placed in service in 2013 exceeds $2,000,000.

For tax years beginning after 2013, the maximum expensing limit is scheduled to drop to $25,000.  While it’s not likely Congress will allow the expensing limit and investment ceiling limit to drop this drastically, it is likely to legislate a reduction in 2013’s generous limits.

Bottom line is if it makes fiscal sense to accelerate purchases to be within 2013 you will likely save money on your tax returns. 

For more information about the professionals at BW James visit http://www.bwjames.com 

Christmas on Texas Avenue

The 16th annual holiday festival, Christmas on Texas Avenue will take place this Saturday, December 7th.  The longstanding family fun event in Baytown takes place between Commerce and Jones Streets from 10 a.m. thru 6 p.m.

J.R. Austin, deejay from KSHN will be providing music, martial arts groups will put on displays, bounce houses for kids, and much more will be able to be enjoyed.  It’s truly fun for the whole family.

The event was initiated 15 years ago in an effort to revitalize the historic shopping district, Goose Creek.  The event now has a great cache of volunteers, vendors, and craft displays.

On behalf of everyone at BW James we hope to see you all there to kick-off the Christmas season in Baytown!  

For more information about the professionals at BW James visit http://www.bwjames.com 

Essential Money Tips for New College Graduates

Congratulations!  You’re a college graduate, that’s an impressive achievement and you deserve recognition for all of your hard work.  The most common question new college grads have is, “Now what?”

Making a financial plan now can get you the head start in life you need.  Courtesy of the professionals at BW James, here are some essential tips for new college graduates to put their best foot forward:

Pick up a book or two on money basics

We know reading a book is probably the last thing you want to do after conquering that reading list from college, but you know better than anyone there’s nothing like an education so it is a good idea to educate yourself on the basics of budgeting and financial planning.

Make a budget

After you get a few months of work under your belt you’ll be used to the amount of take-home pay you’re earning.  That’s when it is time to figure out how much money you can afford to spend each month.  Mapping out your budget is a great way to quickly uncover whether you’re on the rocky road to spending more than you make – as many college graduates start out doing.

Cut the housing costs

Don’t jump to quickly into having your own place, whether you are able to stay at your parents for a year or two or getting a roommate to split that apartment bill, lowering your rent costs as much as possible will allow you to use that extra money to start slashing into those looming student loans.

Steer clear of debt

You’re likely to be bombarded with credit card offers, and while they may be tempting, do everything you can to keep them in the trash.  Acquiring more debt than you already have can be a dream killer.  Debt will prevent you from taking a job you might love because the salary won’t be high enough to meet your monthly obligations.

It can even shut the door on a job offer altogether, because an increasing number of employers are checking prospective employees credit reports as part of their due diligence.

Top Priority: Emergency Fund

Start building your rainy day money immediately.  The rule of thumb is to set aside the equivalent of three to six months’ worth of living expenses.  A year is ideal, but that can take time to build, but you should make this a personal goal.  

A money market mutual fund or a separate bank savings account are smart places to put this rainy day money.

These are just a few smart ways to start saving for your life today.  A head-start is invaluable and goes a long way to a long, happy, and stress-free life.  For more information about financial planning and the professionals at BW James visit http://www.bwjames.com 

How to Teach Kids About Money in Today’s World

One thing parents are routinely worried about is their child’s understanding (or lack of) financial responsibility.  And rightfully so, surveys show that half of Americans between the ages of 18 to 34 couldn’t come up with $2,000 for an emergency, and only 14.6% of college students with a credit card know their interest rate.

Scary to think that many young adults display a clear misunderstanding or lack of competence when it comes to even the most basic financial planning skills.  Very few states have comprehensive personal finance as part of public school curriculum, so it is essential that you start teaching your children about money from an early age.

When it comes to getting your kids to care about money, actions speak louder than words.  An October overview study that will be published in Management Science looked at 201 studies of financial literacy education programs and found that they are in general, worthless.  A student who takes a financial literacy course is not significantly more likely to make good financial decisions than a kid who skips the class.

When it comes to money for young people focus on modeling behavior.  If you ask a young student what they learned from their personal finance teacher they will probably look at you blankly, but ask them what they learned by watching their parents and you will find that the connections are very real, vivid, and emotional.  So what are some ways you can teach those youngsters about money that will be effective into their adult lives?  Courtesy of the professionals at BW James, here’s some tips:

Age Progression Software

Seems a little weird, but downloading a virtual reality experience that uses age progression software to project a child’s virtual self into the future gives them a better understanding that they will eventually grow up.  And studies show that children who are exposed to age progression software no longer have a dissociative view of their future self and on average allocate twice as much to their retirement accounts as children who did not use the software.

Incentives

Explaining to your children how compound interest works is basically a waste of breath.  Instead teach them how to save, and when they save their money, reward them by giving them more and less when they don’t.  One of the rules for a weekly allowance should be that they have to save part of it and this will instill a saving attitude.

Let The Mistakes Happen

You’re teenager or young adult is fixing to make a mistake financially, what do you do?  When the stakes are low enough, instead of talking them out of it, let them make the mistake and suffer the consequences.  When you see your teen about to spend their money on something they’ll later regret, let them, learning through mistakes is part of everyone’s life and allowing it to happen early in life versus later is the best policy.

Be Honest About Your Mistakes

It might be hard to admit to your kid when you screwup, but the lessons you learned from it are just as valuable to them, if not more so.  And discussing even the most mundane elements of financial planning can get them thinking about the trade-offs that come with every financial decision.

These are just a few ways you can help your children get a jump start in the real world.  For more information about financial planning and the professionals at BW James visit http://www.bwjames.com

Avoiding Big Tax Surprises

This is a friendly note from Bob Martin, USN veteran with BW James LLP to inform you that if you had a significant change in your finances this year, such as a fluctuation of income or a major purchase, then it is best to make an appointment with you tax professional right now.

If there are changes in your life currently you should definitely review the impact it will have on you taxes to determine if you will owe more or less on your 2013 tax return.  After all, no one likes a big surprise on April 15th.

A higher-than-expected tax liability that you cannot immediately pay isn’t just costly, it can also be stressful.  Avoid those headaches now by visiting one of the tax professionals at BW James during the slow season so we can easily help you to accommodate and plan.  Getting a head start can allow you to begin a savings program or adjusting your payroll withholdings to prepare for the liability.  So avoid those April blues and start off strong today!

For more information about the professionals at BW James visit http://www.bwjames.com

Don’t Let the Delayed Tax Season Stop You from Being Prepared

The IRS recently announced that, for the second year in a row, it will delay the start of tax season. However, the April 15 filing deadline, which is set by statute, remains in place. Last year it was the fiscal cliff negotiations that pushed back the start of the tax filing period. This year, of course, it is the 16-day government shutdown that put the IRS approximately one to two weeks behind in preparing for the 2014 filing season.

According to an IRS news release, the government entity is “exploring options to shorten the expected delay and will announce a final decision on the start of the 2014 filing season in December.”  The original start date of the 2014 filing season was January 21, so with a one- to two-week delay, the IRS will potentially start accepting and processing 2013 individual tax returns no earlier than Jan. 28 and no later than Feb. 4.

Although the IRS is behind schedule, we encourage our clients to start preparing now in order to be prepared for filing as soon as the opening date of tax season arrives. Start organizing your tax documents and don’t hesitate to contact our office if you need tax planning advice or have questions about this tax season.

For more information about the professionals at BW James visit http://www.bwjames.com

Keep Your Home Warm for Less

It is winter time in Texas, recently the temperature has dropped and people are turning on the heaters for the first time this year.  Courtesy of BW James here are a few tips you can use to reduce the cost of your heating bill during these cold months.

Turn Down the Thermostat

This one is kind of a “duh” tip, but you’d be surprised how many people forget to do it.  Turning down the thermostat when you head off to work and when you go to bed can add up to at least 16 hours a day and save you about 14% on your heating bill.  In fact the rule of thumb is that you save about 3% on your heating bill for every degree that you set back on your thermostat full time.

Watch Those Fans

In just one hour, a hard-working bathroom or kitchen fan can completely expel a houseful of warm air.  Use them when you need to and shut them off when the job is done.

Close the Fireplace Damper

Heat rises, and an open damper is essentially a hole in the roof.  In fact you should limit the use of your fireplace, since fires actually suck the heat from a room.  Light it when you want the ambience they provide, but really they aren’t viable for heating the house in conjunction with central heat.

Turn Down the Water Heater

Reducing the temperature of the water in the water heater to 115-120 degrees reduces the power use without a noticeable difference when you take that morning shower.

Open the Curtains

When the sun is up, let it in.  Opening curtains and shades on south-facing windows during the day allows solar radiation to warm a living space, just remember to close them at night to reduce the heat from escaping.

These are some cost-free ways to reduce that heating bill.  We hope everyone stays warm this winter, and hopefully these tips can allow you to do so for less.  

For more information about the professionals at BW James visit http://www.bwjames.com 

How to Save During the Holidays

The leaves are falling, the temperature dropping, and the people are shopping.  The holidays are nigh and Christmas is just around the corner.  Tis the season for giving, but with a little planning you can give and save at the same time.  Courtesy of the professionals at BW James, here are some money-saving Holiday tips.

Budget, Budget, and Budget

Since your holiday budget is likely to be similar to what you’ve spent in the past few years, it’s relatively easy to come up with a budget and have an idea of what you’re going to be spending.  Advanced planning will take away quite a bit of stress come December and if you list out everyone you need to buy for and how much you would like to spend now you’ll save money in the long run.  Waiting until the week or two before Christmas will make you more likely to spend more on a gift just to get it over with.

Bring a Lunch

If you’re in the habit of going out to lunch everyday now is the time to start packing a sandwich.  It may not seem like much at first, but if you take $8 a day and put it back instead of spending it on grub for the next 30 days, you’ll still have over two weeks until Christmas and a cool $240 to cross some names off the gift list.

Be Creative

Do you normally buy for co-workers, neighbors, or other non-relatives?  You can save money by simply being creative.  For the crafty people you can find out things they really enjoy and make a cross-stitch or a painting or something like that.  Or perhaps you can simply find out their favorite dessert and bake it for them.  These type of gifts are easier on the wallet and because they’re thoughtful, go a much longer way than an overpriced generic gift at the department store.

Be Prepared

Make a list of everything you’ll need during the holidays, whether it be plenty of napkins for that Christmas meal, batteries, drinks, etc.  Stock up on everything you’ll need.  This will save you more stress than money, but stocking up on supplies at the grocery store is a lot cheaper than realizing you need something Christmas day and buying it at a convenience store.

Hopefully these few tips will save you some stress and money during the holidays.  For more information about financial planning and the professionals at BW James visit http://www.bwjames.com

BW James Supports Our Veterans

Many people will be enjoying a three-day weekend due to many government offices and other businesses closing on Monday, November 11th.  We hope everyone who gets to enjoy the extra time off has fun and is safe, or just gets some much needed pre-holiday R&R.  However, it is important that we take the time to remember why this upcoming Monday is a celebrated holiday, Veterans Day.

Veterans Day is a holiday which serves to honor all people who have served in armed service.  The reason for Veterans Day being celebrated on November 11th is to mark the anniversary of the end of World War I, major hostilities of World War I were formally ended at the 11th hour of the 11th day of the 11th month of 1918, when the Armistice with Germany went into effect.  U.S. President Woodrow Wilson first proclaimed the observance of November 11th as a holiday in 1919.

So no matter what you’re doing over the weekend, we encourage you to show your support for our troops anyway you can, even with a simple “Thank You” to the veterans in your life.  Without their selfless, brave, and hard-working efforts we wouldn’t be able to enjoy the country we know and love today.

On behalf of everyone at BW James LLP we would like to say Thank You to all of our veterans, we greatly appreciate all that you have done for us and it is because of you we are able to walk the streets as free men and women.  Thank you.

Texas Franchise Tax Returns Due November 15

This is a friendly reminder from the professionals at BW James that all Texas Franchise Tax Return Forms are due on Friday, November 15, 2013.

The Texas Franchise tax is a privilege tax imposed on each taxable entity formed or organized in Texas or doing business in Texas.  Any corporation doing business within the state of Texas will be required to pay franchise tax.  This includes corporations, banking corporations and association, limited liability companies and S-corporations.  In Texas, sole proprietorships and some non-profit companies may be exempt.  To determine if your corporation, association or limited liability company is required to pay franchise tax, BW James is available for consulting.

For more information about the professionals at BW James visit http://www.bwjames.com

Election Day is November 5, 2013

This is a friendly reminder from the professionals at BW James that tomorrow is Election Day!  Voters will be able to cast ballots for the November 5th election which involves nine proposed amendments to the Texas Constitution.

Texans can cast ballots at any voting location in the same county as their registration and it is the first statewide election with photo identification requirements for in-person voting, with seven forms of ID accepted.  Common forms include a Texas driver’s license, a U.S. military identification card, or a passport.  So don’t forget to bring your identification in order to comply with the new Voter ID law.  If you don’t have an ID, the state is offering free election ID certificates so you can still cast your ballot.

For those of you inside the City of Houston, there are some important races on the ballot, including a race for mayor and several city council positions.  The cities of Baytown, Bellaire, Friendswood, Pasadena, and West University place are also holding city-wide elections.  Voters will also decide on passing bonds to renovate the Astrodome.

No matter what box you tick, be sure to make your voice heard by showing up at the polls!

For more information about the professionals at BW James visit http://www.bwjames.com 

Happy Halloween from BW James LLP!

It’s the spookiest day of the year…well maybe besides April 15th.  It’s Halloween and all the ghouls and goblins will be out tonight.  It’s the time of year when everyone can be creative and pretend to be someone else.  We look forward to seeing all of the unique costumes out and about.

Everything from superheroes to zombies, witches, ghosts, and apparently even Walter White from Breaking Bad are among the most popular costumes this year!

No matter whether you’re taking the kids trick r’ treating, going to a costume party, or just handing out candy and watching a scary movie at home, we hope you all have a very safe and Happy Halloween!
 
For more information about the professionals at BW James visit http://www.bwjames.com

You Get What You Give: Tips for Motivating Your Employees Through the Holidays

Halloween is just around the corner and in a couple of days the calendar will flip to “November 1st” – the unofficial beginning to the winter holiday season that can seriously reduce employee productivity.  After all, who has time to put in a solid eight hours a day at the office when there is seasonal shopping, schmoozing, and socializing to be done?

Many business owner have a love-hate relationship with this time of year, due to the fact that employees are less focused on their work.  However, there are some easy ways to help stave off the holiday slump and keep your employees as energized about their jobs as they are about maximizing their holiday festivities.  Courtesy of the professionals at BW James here are a few ideas:


1) Acknowledge that the holidays are happening. Since many of your employees are likely to celebrate a holiday of some kind over the next couple of months, be up front about how your business will handle the holidays. Let your team know the date by which they need to request time-off and which days, if any, holidays will be observed or shorter work hours will be implemented. Don’t forget that a little bit of leeway around leaving early to accommodate holiday gatherings or other seasonal obligations can go a long way toward preserving employee morale and motivation.

2) Provide a few special perks. Even if your company doesn’t have an end-of-the-year bonus plan or pay out holiday bonuses, you can still provide some low-cost perks to help promote employee productivity at the holidays. Everyone likes to feel appreciated for their hard work, so consider offering your team members a few hours away from the office on a selected day to finish holiday errands or to help at a community event. Bringing in some healthy snacks to keep your staff energized as they do their work is also a great idea. These small gestures show that you care about your staff, which tends to motivate employees to work harder in return.


3) Celebrate as a team. While few people expect that work will be fun every day, investing time to build camaraderie, especially around the holidays, is a great way to help employees feel more engaged and enthusiastic all year long. Consider hosting a holiday breakfast or lunch during the workday instead of an after-hours party. Your employees will thank you for not adding another event to their already busy personal schedule! To help reduce the budget burden, you can even make your get-together a potluck where everyone brings their favorite seasonal dish. This can help to keep the celebration inclusive of all holidays that are recognized at this time of year.

With a little bit of thought and advance preparation, you can help to keep your employees engaged and productive through the holiday season – and beyond.  You may even establish a new company tradition and a spirit of teamwork that will last well into the New Year!

For more information about the professionals at BW James visit http://www.bwjames.com 

Payroll Tax Reports Deadline

This is a friendly reminder from the professionals at BW James LLP that all payroll tax reports are due on October 31, 2013 for the 3rd Quarter.

The quarterly form is Form 941 and is due the month following the end of each quarter and is used to pay federal withholding, employee and employer social security tax, and employee and employer Medicare tax.

Your state unemployment tax is also due quarterly to the Texas Workforce Commission on the same date.  If you are a monthly depositor, then the Form 941 will account for your deposits and there will usually be no additional taxes due.

The Texas Workforce Commission collects your state unemployment tax and is determined by the number of claims for unemployment benefits your past employees have made.  The fewer the claims, the lower the rate.

BW James LLP is available to ensure you have all forms you need and to make sure these are filed completely and on time, October 31st.  For more information about the professionals at BW James visit http://www.bwjames.com 

Government Shutdown Will Delay Tax Filing Season

One of the many unfortunate side effects of the 16 day Government Shutdown is the likely delay of tax refunds for millions of early filers by 1-2 weeks.

The IRS announced Tuesday that they won’t be able to start processing tax returns until at least January 28 and possibly as late as February 4th.  Under normal circumstances the processing would begin on January 21st.  And with congress set to return to budget talks in early January, the possibility of a January Government shutdown could delay refunds even longer.

Despite the Government shutdown and possible processing delay, taxpayers are still required to file their returns by April 15th and companies must still send all W-2’s and other tax forms on schedule.  

The IRS stated the extra time is needed to program and test tax-processing systems which will be used during the 2014 filing season.

Roughly 90% of the IRS was idle during the shutdown, putting the Internal Revenue Service around three weeks behind in preparations.  

The IRS will announce the date it will begin accepting returns in December and stated there won’t be any advantage to filing before that date.  Each year sees many new tax changes and laws, all of which have to be updated in the IRS computers.  There will be a lot of fingers crossed that there aren’t any additional problems between now and January, in order to limit the delays to the current estimate of one or two weeks.

BW James LLP has you covered when it comes to staying up to date on all tax updates and can help keep you prepared for the normal tax deadlines.  For more information about the professionals at BW James visit http://www.bwjames.com 

LLC or S-Corp? 4 Questions to Ask Your CPA

When registering a business as a corporation, you are faced with a tough choice: registering it as an LLC (Limited Liability Corporation) or as an S-corporation. These 2 options are great options for small businesses because registering as a traditional C corporation can be overkill for most businesses that are just getting started. Are you wondering which between the 2 options you should choose? The experts at BW James present 4 things you must ask your CPA to help with your decision-making.

Which system provides a more structured system? – A structured system is necessary for businesses that are on the rise. Generally speaking, an LLC has a more free-willing system when it comes to task delegations while an S-corporation has compliance requirements such as a board of directors, shareholder meetings, annual reports, and the like.

What are the limits when it comes to shareholder jurisdiction? – Each of these corporations holds particular rules when it comes to delegating power between shareholders. For example, one crucial restriction for S-corporations is that only US citizens can be shareholders in an S-corporation. On the other hand, LLC owners are not allowed to use their company or stocks for personal affairs.

How are income and wages allocated to stockholders and employees? – There are crucial differences between an LLC and an S-corporation when it comes to income. For example, the dividing of income shares between shareholders of an LLC is based on the pro-rated shares of each shareholder. How money is distributed is something you must ask your CPA about.

How are taxes paid?  - Understanding how taxes work for each arrangement can be a complicated task to handle. This is where your CPA can come into the picture. For example, stockholders of LLC corporations are required to pay self-employment tax as part of their income while stockholders of S-corporations are required to pay additional state taxes.

For more information about the professionals at BW James visit http://www.bwjames.com

Sales and Use Tax Deadline

This is a friendly reminder from the professionals at BW James LLP, that the Sales and Use Tax deadline is October 21, 2013 for everyone filing monthly or quarterly.

State Sales and Use Tax is imposed on all retail sales, leases, and rentals of most goods, as well as taxable services.

Texas cities, counties, transit authorities and special purpose districts have the option of imposing an additional local sales tax for a combined total of state and local taxes of 8 ¼% (.0825).

Due to a change in law effective September 1, 2013, snack foods are exempt from sales tax, unless they are sold through a vending machine or in individual-sized portions.

Be sure to have all Sales and Use Tax return forms filed by Monday, October 21st in order to avoid interest and penalty charges.  Even if you don’t owe any taxes because you have no sales or only nontaxable sales for this quarter you still must file your tax return form by Monday.

For more information contact BW James at 281-420-1040 or visit http://www.bwjames.com