Richey,
May & Co. Small Business Products
|
||
Richey,
May & Co. Small Business Products
|
||
 |
||||||
| Small Business Products Depreciation Method Review A complete review of a business' books and tax cost basis differences, methods of tax depreciation, and methods of alternative minimum tax depreciation. There are two reasons for a depreciation method review. First, in the current age of frequent acquisitions and mergers, tax depreciation can become an unruly task. This engagement reviews the client's methods to report any risks that may be present. In some cases, the client depreciation schedules have to be reconstructed from previous history. The second reason for this engagement is tax savings. Many times, clients experience depreciating assets by using the wrong method of depreciation for tax. A change in the method of depreciating these assets will bring significant tax savings. Clients that have just purchased or constructed commercial, residential, or retail buildings should seek to review the allocation of the purchase price and the depreciation methods used to recover the costs. Many times, taxpayers incorrectly or inaccurately allocate the purchase price and lose valuable tax savings. Taxpayers with existing properties may have the opportunity to remedy old or inaccurate methods and receive large tax savings instantly. Business Tax Identity The form of business organization you choose determines whether your business income is taxed at the corporate entity level or at the business owner level. In most states, you can establish your business as a sole proprietorship, a partnership, a C or S corporation, or a limited liability company (LLC). For tax purposes, the income that results from a sole proprietorship or a partnership is reported on the tax return(s) of the individual owner(s) and is taxed at the owner's individual tax rates. In a corporation, income is generally subject to two levels of taxation – at the corporate level when income is earned, and at the shareholder level, when dividends are paid. In a corporation that elects S corporation status, the income of the business is passed through the corporation to its shareholders and taxed at their individual rates, whether or not the income is actually distributed. In the limited liability company (LLC), income is usually taxable to LLC members at their individual rates. Our staff consults with the client to recommend the best choice of entity to form their business for tax, financial and business reasons. The choice of entity will take into consideration the type of business, the type of compensation the owner or promoter will receive, retirement planning, and many other factors. Choosing the correct entity for your business is one of the most important ingredients for success. Once an owner chooses an entity, it can be very costly and difficult to change. Tax Accounting Methods Review This is an engagement to review all of the tax methods of accounting currently used by a company to uncover any potential tax savings benefits or potential incorrect methods of accounting. This engagement is a detailed review of all of a company's methods of accounting presented on their tax returns, and it advises the company of their potential risk and accuracy. If it is unnecessary to review all of the methods of accounting, the following are areas of particularly complex tax law that may be beneficial for a taxpayer to review (this list is not all-inclusive):
Our engagement team is trained to review returns prepared by other accountants to review for potential errors, omissions or incorrect interpretations of the law. Many reviews lead to changes in tax accounting policies that will save the taxpayer money and allow them to rest assured that their tax returns are in compliance with all the current tax laws. Fixed Asset and Inventory Management Our staff assists the client in selecting the best fixed asset or inventory software to fit there particular needs, implementing physical tracking procedures for fixed asset or inventory control, and assists the client in importing and setting up the fixed asset or inventory program. For any client that has significant assets that are not properly tracked or depreciated on a software package that fits their needs, this engagement will save them both time and money. In addition, it will provide a foundation for complete and accurate financial and tax records. There is no time like the present to solve your fixed asset and inventory problems. For growing companies the problem only compounds as the company grows. If an investment is made in constructing the proper policies and purchasing the proper software while a business is small and growing, the rewards and savings will benefit a company well into the future. Companies that have an exit plan in place should look to remedy any problems prior to marketing their business. Business Valuations Business valuations are needed for a variety of reasons. This service adds value to a client’s business in the most tax advantageous and financially beneficial manner. Our engagement team will act as an advocate of the client and will determine the most accurate valuation from the client's perspective. RMC will aid the client in negotiations and settlements, reviewing opposing views, and consulting the client on their best tax and financial positions. The following are some of the tax and financial reasons that a business valuation could be advantageous or necessary:
|
||||||
|