CPA Blog

The simple truth about annual performance reviews

Details

Published: Monday, 02 December 2019 08:36

Written by Phillip Strickler, CPA.CITP

There are many ways for employers to conduct annual performance reviews. So many, in fact, that owners of small to midsize businesses may find the prospect of implementing a state-of-the-art review process overwhelming.

The simple truth is that smaller companies may not need to exert a lot of effort on a complex approach. Sometimes a simple conversation between supervisor and employee — or even owner and employee — can do the job, as long as mutual understanding is achieved and clear objectives are set.

Remember why it matters

If your commitment to this often-stressful ritual ever starts to falter, remind yourself of why it matters. A well-designed performance review process is valuable because it can:

• Provide feedback and counseling to employees about how the company perceives their respective job performances,
• Set objectives for the upcoming year and assist in determining any developmental needs, and
• Create a written record of performance and assist in allocating rewards and opportunities, as well as justifying disciplinary actions or termination.

Read more ...

Selling your home? Consider these tax implications

Details

Published: Monday, 02 December 2019 08:33

Written by Phillip Strickler, CPA.CITP

Sellers can exclude some gain

If you’re selling your principal residence, and you meet certain requirements, you can exclude up to $250,000 ($500,000 for joint filers) of gain. Gain that qualifies for the exclusion is also excluded from the 3.8% net investment income tax.

To qualify for the exclusion, you must meet these tests:

1. The ownership test. You must have owned the property for at least two years during the five-year period ending on the sale date.
2. The use test. You must have used the property as a principal residence for at least two years during the same five-year period. (Periods of ownership and use don’t need to overlap.)

In addition, you can’t use the exclusion more than once every two years.

Read more ...

Buy vs. lease: Business equipment edition

Details

Published: Monday, 02 December 2019 08:28

Written by Phillip Strickler, CPA.CITP

Life presents us with many choices: paper or plastic, chocolate or vanilla, regular or decaf. For businesses, a common conundrum is buy or lease. You’ve probably faced this decision when considering office space or a location for your company’s production facilities. But the buy vs. lease quandary also comes into play with equipment.

Pride of ownership

Some business owners approach buying equipment like purchasing a car: “It’s mine; I’m committed to it and I’m going to do everything I can to familiarize myself with this asset and keep it in tip-top shape.” Yes, pride of ownership is still a thing.

If this is your philosophy, work to pass along that pride to employees. When you get staff members to buy in to the idea that this is your equipment and the success of the company depends on using and maintaining each asset properly, the business can obtain a great deal of long-term value from assets that are bought and paid for.

Read more ...

Fun fact: Tacking vacation days onto a deductible business trip.

Details

Published: Monday, 02 December 2019 08:14

Written by Phillip Strickler, CPA.CITP