There’s good news for you and your employees if you offer a high-deductible health plan (HDHP) and health savings accounts (HSAs). In one of the largest jumps in recent years (7.8%), the HSA contribution limits for 2024 will rise to $4,150 (from $3,850 in 2023) for employees with single health plan coverage and to $8,300 (from $7,750) for those with family coverage. Workers aged 55 and older can contribute an extra $1,000 (unchanged from 2023). So an older married couple will be able to contribute $10,300 in 2024.
Your high deductible health care plan will qualify if the 2024 annual deductible is at least $1,600 for self-coverage or $3,200 for family coverage.
Employee out-of-pocket expenses (deductibles, copayments, coinsurance, and some uncovered services) cannot exceed $8,050 (self-only) or $16,100 for family coverage.
Our engineering firm could use new office furniture. Is now a good time to buy?
ANSWER:
The third quarter of the year isn’t the best time to purchase office furniture if you’re watching costs. Generally, the furniture industry releases new models twice a year – in the spring and fall. It would be best to buy new furniture in the off-season to get your best deals. Some better times:
January: Vendors may discount 2023 furniture to make way for 2024 models.
April-May: For furniture retailers, Memorial Day sales rival Black Friday sales.
August: Back-to-school shopping deals can expand to include furniture.
Okay, so you’ve decided to sell your business and retire (or for another well-throught-out reason). You’ve discussed it with your family, and everyone is on board. You don’t want any family glitches to delay and possibly torpedo a sales deal you work out. So, what’s next?
Put together your sales team: your accountant, an attorney experienced in business transactions, and a business broker
Have your business evaluated.
Develop an exit plan if you haven’t already.
Come up with an idea of your “perfect” buyer and share it with your broker before you sign the legally binding contract to list the business for sale.
Provide the broker with detailed information about the business: history, product/service mix, organizational chart, growth opportunities, and anything else you think is of value to potential buyers.
Prepare for due diligence: gather your past three years financials, contracts, and licenses and prepare a disclosure statement. Your professional advisors can help with other items that may be needed.
Do any maintenance, painting, cleaning, and other sprucing up to improve the physical appearance of your business.
The Taylor brothers have enjoyed the good fortune of seeing their family heating and cooling business grow steadily. But that growth has sparked concerns about being liable for alternative minimum tax (AMT) in 2023.
Small businesses that qualify for small-business corporation status avoid the AMT’s potential liability and the administrative burden of calculating the tax. The Taylors can use the following gross-receipts test to see if their business qualifies. A small-business corporation is defined as having a three-year average annual gross receipts not exceeding $5 million for its first tax year and not having three-year average annual gross receipts exceeding $7.5 million for any later year.
More simply, the Taylors don’t need to worry about being liable for AMT as long as their business’s average gross receipts for all three tax-year periods ending before the current tax year are $7.5 million or less. For additional details or questions, they should contact their professional advisor.
Client Profile is based on a hypothetical situation. The solutions discussed may or may not be appropriate for you.
With new hires, you want to be confident that they will become loyal, productive, and valuable long-time employees. One way to achieve this goal is to have a well-thought-out employee benefit program that serves your needs. To see if your program has gaps you may want to consider what competitors offer and what employees look for.
According to a recent study*, business owners are offering benefits at the highest rates since 2008. What benefits are owners ramping up? The percentage of employers offering comprehensive health insurance, health savings accounts, wellness solutions, and employee assistance programs (EAPs) increased from 2022 to 2023. As for qualified retirement plans, the popularity of 401(k) and Simple IRA plans increased among employers, while other plans were offered at about the same rate as last year. For supplementary key employee benefits, both disability income insurance and deferred compensation dropped in popularity among employers while other benefits remained steady.
Still, affordability remains businesses’ top priority where benefits are concerned, ahead of attracting and retaining qualified employees and staff productivity. Your goal in reviewing your benefits program should be working with your professional advisor to achieve quality benefits at a reasonable cost to your business.
On that note, some of the “benefits” employees are looking for can be provided at little or no cost. Another study** found that most workers judge whether a job is good by the pay, boss, health and retirement benefits, vacation time, friendliness of co-workers, whether they’re helping people or society, remote work options, and opportunities for advancement. Pay was the top consideration at 45% of employees, followed by a good boss at 14%. People ages 27 to 34 are more likely to say promotion opportunities and advancement are important than older employees. And they place less emphasis on health insurance, retirement, and vacation benefits.
* 2023 Report on Employer Firms: Findings from the 2022 Small Business Credit Survey ** Washington Post-Ipso Poll, 2023
Average tuition and fees of degree-granting institutions for first-time, full time undergraduate students, by level and control of institution. Academic years 2010-11 and 2020-21.
Noncash charitable deductions allow taxpayers to deduct the fair market value of donated items on their tax returns. These steps can help ensure your charitable deductions are adequately substantiated and accepted by the IRS.
RECEIPTS EVERY TIME
Regardless of the value, you should have a receipt from the charity for any noncash donation. This document should include the charity’s name, the date and location of the contribution, and a reasonably detailed description of the donated property. Consider taking photos of donated items to document their condition.
HIGHER VALUE ITEMS
If the value of your noncash donations is over $500 for the tax year, you must also include IRS Form 8283 with your tax return. For each item or group of similar items valued over $500, you must provide additional details including when you acquired the item and its original cost.
GET AN APPRAISAL
If you’re donating an item or a group of similar items worth more than $5,000, you’ll generally need a qualified appraisal of the item’s fair market value, and you must also complete Section B of Form 8283. There are exceptions for publicly traded securities, vehicles, and intellectual property.
What’s the difference between high-yield savings and money market accounts?
ANSWER:
High-yield savings and money market accounts offer higher interest rates compared to traditional savings accounts.
A high-yield savings account is best for funds you don’t need to access frequently. There might be limits on the number of transactions allowed per month. You can find this account at banks.
Money market accounts often come with check-writing privileges and debit cards, offering more liquidity. However, they may require higher minimum balances to avoid fees and some money market investments are not FDIC insured.
These accounts are a good place to park cash or an emergency fund. Place long-term investments in vehicles that generally offer higher rates of return. Wherever you put your money, check the financial health of the institution.
Creating a Paid Time Off (PTO) policy is essential to a company’s benefits package. As an employer, you have the flexibility to design a policy that suits your business and meets the needs of your employees.
LEGALLY SPEAKING
Ensure your policy adheres to applicable laws. Some states mandate specific types of paid leave, such as sick leave.
CHOOSE TYPES
Decide the types of leave to include, such as vacation, personal days, and sick leave. Some companies opt for a “bank” system where all kinds of leave are lumped together, giving employees more flexibility.
DEFINITIONS MATTER
Your policy should define how PTO is accrued. Is it based on hours worked or a set amount per year? Will unused PTO roll over to the next year? You must also outline how PTO requests should be made and approved, ensuring fairness and transparency.
COMMUNICATION
Finally, communicate the policy to your employees. A well-structured PTO policy can enhance employee satisfaction, productivity, and retention. Review and adjust the policy periodically to keep it relevant and effective.
