Newport Beach CPA Accountants

3 Tasks Entrepreneurs are Better Outsourcing

OutsourceAs a business owner, it can be difficult to delegate important tasks. When you complete them yourself, you know they will be done correctly and in a timely manner. Even so, if you want your business to grow, and keep expenses low, there are three tasks that you should consider outsourcing.

 

Website and Graphic Design

By outsourcing your website and graphic design, you will have access to an expert in the field, on demand. The person or company you outsource to will have the equipment, experience, training and knowledge to provide you with design concepts that would otherwise be beyond your reach.

You will also receive a professional product which is doubly important as your website is your online business card. This is one area that you want and need a professional’s assistance.

Payroll

As your company grows, the complexities of your payroll grow as well. In addition to saving time and money, payroll is one area of your business that the government takes great interest in. Payroll specialists make it their job to stay current in government regulations which means they will keep you and your company compliant.

In addition, payroll companies can provide you and your employees with an added layer of security. This can reduce the risk of embezzlement, identity theft, and interference, by an employee, with company records for financial gain.

Accounting and Tax Returns

Much like payroll, your accounting and tax returns are not an area of your business where you can afford errors. Without specialized tax knowledge, you run the risk of missing deductions leading to paying higher taxes than necessary or to making errors that result in penalties.

One of the main benefits of outsourcing any task is that while you may pay more per hour for the task to be completed, you will save much more money, in the long run, than if you hired a full-time employee when you take into consideration salary, benefits, taxes, health insurance, as well as the overhead to provide space for the employee to work. In the end, outsourcing can be a cost efficient way to expand your business.

 

If you are interested in outsourcing payroll and/or outsourced accounting, then call 949-759-5626 and ask for Jerry Morey.  Our initial consultation is free.

 

Morey and Associates is an Orange County California CPA Accounting Firm.  We service small businesses and high net worth individuals throughout Orange County and have convenient offices in Newport Beach and San Clemente.

Online Gambling – Do I Need to Report What I Win?

PokerGambling, in one form or another, is certainly nothing new. For some people gambling is nothing more than an occasional form of entertainment while for others it is a profitable way to make a living. Over the last decade, recreational gambling has increased noticeably, due in large part to the rapid growth of online gambling websites. Legal gambling once required a player to make a trip to a casino; however, in today’s electronic age a player need only sign onto the internet. One thing that has not changed, however, is the tax treatment of gambling winnings. Whether your winnings came from an actual casino or from and online website, gambling winnings are always taxable.

According to the Internal Revenue Code, gambling winnings include, but are not limited to, cash or prizes won from lotteries or raffles, horse or dog races, or casinos. Whether the winnings came from a brick and mortar casino or an online casino is irrelevant to the Internal Revenue Service (IRS). If the winnings were other than cash the fair market value of the prize is also considered income and, therefore, is taxable.

A taxpayer with gambling winnings to report may not file a 1040A or 1040EZ. Instead, all winnings must be reported on line 21 of Form 1040. Sometimes, a payor will provide a winner with a Form W-2G “Certain Gambling Winnings.” Form W-2G is much like a Form 1099-Misc. in that it provides a payee with a record of the amount paid out to the payee during the year. It will also indicate whether or not federal income tax was withheld by the payor. As a general rule, only large winnings are reported on a Form W-2G, making it unreliable as a method of keeping track of gambling winnings.

The good news is that if you itemize deductions you may also deduct gambling losses; however, gambling losses are only deductible up to the amount of gambling winnings. As with other deductions, the IRS requires a taxpayer to be able to provide receipts, tickets, or other tangible documentation of the losses if claimed as a deduction. 

 

Why Having a Will Is So Important

Last WillDespite knowing the importance of creating one, over half of all Americans do not have a valid Last Will and Testament in place. Often, the reason given for not executing at least a basic Will is the belief that one is not necessary. Consider the following five reasons why executing a Will is important.

  1. A Will allows you to control who inherits from your estate. When a decedent dies intestate, or without a valid Will in place, the state intestate succession laws govern what happens to the decedent’s estate assets. Intestate succession laws vary somewhat from one state to the next; however, they all share a common theme in that only a spouse and/or close relatives inherit from a decedent’s estate. Typically, a spouse and children inherit first, followed by parents and siblings. Close friends, distant relatives such as a favorite niece, and charities that are close to your heart will receive nothing from your estate.
  2. A Will allows you to decide how much people inherit from your estate. State intestate succession laws also dictate what percentage of your estate each heir inherits. Assets intended for children from a previous marriage, for example, might be given to a current spouse. The only way to control how much of your estate is given to each beneficiary is to create a Will.
  3. A Will allows you to determine what assets people inherit from your estate. Specific gifts can only be made in a Will. Intestate succession laws will not acknowledge, much less honor, promises made by you to gift specific items, such as family heirlooms or sentimental personal items, to anyone.
  4. A Will prevents the sale of estate assets. Often, estate assets must be sold to create the funds necessary to divide the estate according to state intestate succession laws. Your home, family heirlooms, and other assets may be forever lost unless you execute a Will.
  5. A Will is your only opportunity to nominate a guardian for minor children. If you have minor children the only opportunity you have to tell a judge who you would choose to be their guardian should one be needed is in your Last Will and Testament.

For clients of our firm, we often help them organize their estate decisions to preserve wealth and minimize the tax consequences.  Failing to deal proactively can have significant tax consequences later for your loved ones and family members.

Morey and Associates CPA is a California licensed firm.  Our Newport Beach and San Clemente offices are conveniently located to service clients throughout Orange County.