CPA Blog

Succession planning and estate planning must go hand in hand

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Published: Monday, 23 January 2017 10:17

Written by Phillip Strickler, CPA.CITP

As the saying goes, nothing lasts forever — and that goes for most companies. Then again, with the right succession plan in place, you can do your part to ensure your business continues down a path of success for at least another generation. From there, it will be your successor’s job to propel it further into perpetuity.

Some business owners make the mistake of largely ignoring succession planning under the assumption that it’s taken care of within their estate plans. Others create a succession plan but fail to adequately integrate it into their estate plan. To avoid these mistakes, it’s important to recognize the difference between succession planning and estate planning.

Similar, but different

Essentially, succession planning is the careful identification and training of those who will not only take over the day-to-day operations of your company, but also lead it forward to future growth. Your family members and other heirs will likely be affected here. But many others will be as well — including your named successor (whether or not a family member), business partners, employees, vendors and customers.

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Help prevent tax identity theft by filing early

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Published: Monday, 16 January 2017 08:41

Written by Phillip Strickler, CPA.CITP

If you’re like many Americans, you might not start thinking about filing your tax return until close to this year’s April 18 deadline. You might even want to file for an extension so you don’t have to send your return to the IRS until October 16.

But there’s another date you should keep in mind: January 23. That’s the date the IRS will begin accepting 2016 returns, and filing as close to that date as possible could protect you from tax identity theft.

Why early filing helps

In an increasingly common scam, thieves use victims’ personal information to file fraudulent tax returns electronically and claim bogus refunds. This is usually done early in the tax filing season. When the real taxpayers file, they’re notified that they’re attempting to file duplicate returns.

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Identify all of your company’s retirement plan fiduciaries

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Published: Monday, 16 January 2017 08:29

Written by Phillip Strickler, CPA.CITP

Your company probably offers its employees a retirement plan. If so, can you identify all of your plan fiduciaries? From a risk management perspective, it’s critical for business owners to know who has fiduciary status — and the associated liability. Here are some common, though in some cases overlooked, plan fiduciaries:

Named fiduciaries. The Employee Retirement Income Security Act (ERISA) requires a plan to have named fiduciaries. The plan document identifies the corporate entity or individual serving as the named fiduciary. If they aren’t immediately identified, the plan document will set the requirements for naming them.

Plan trustees. These are people who have exclusive authority and discretion to manage and control the plan assets. The trustee can be subject to the direction of a named fiduciary. These plan fiduciaries have a broad scope of responsibility.

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Setting sail into the global marketplace

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Published: Monday, 09 January 2017 09:24

Written by Phillip Strickler, CPA.CITP

For many of today’s companies, going global seems like a quick and trouble-free growth strategy. Technological advances and expansive supply chains make doing so easier than ever. But business owners who make this move impetuously may soon find themselves on stormy seas, taking on waves of debt and unanticipated expenses.

Chart your course carefully

Globalization strategies are typically based on two objectives: 1) selling to a new market overseas, or 2) lowering production or administrative costs with foreign supply chain partners. (Some companies try to do both.)

If you plan to sell to foreign businesses or consumers, consider conducting a market feasibility study in key target areas to gauge demand on a smaller scale. Also, learn regulations, customs and tax rules to determine whether you can actually turn a profit.

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