Category Archives: Uncategorized

Two NC Budgets Passed!

by Rachel Owens

It’s the beginning of summer in NC.  That means that the two chambers of our General Assembly are hard at work trying to agree on a state-wide budget.

The House of Representatives passed the Health and Human ServicesNC health news budget a few weeks ago.  The Senate just passed theirs.  As always there are similarities and differences in each department; each of which, have very “hot topics” that are addressed.  Thanks to NC Health News for a comparison chart to show the differences between the two.

If you have additional questions about the budget decisions and how they affect your organization, contact our office.  We’ll be happy to give you some insight on what these choices mean for you.

Rachel ([email protected]) is a Senior in the Cost Report department at Langdon & Company LLP.  She works with various healthcare companies, several of which, from the audit all the way through their state reporting compliance.

Stress Relieving Tips

by Brittany Spraginsrelaxing

As a mom and accountant, I sometimes come home from work tired only to find more work at home in the form of a rambunctious child, loads of unwashed laundry, and a hungry husband.  So I use some of these stress relieving tricks.  I hope you find these helpful too.

  1. For a limited amount of time, talk about your day. When I get home, I often want to talk with my husband about the highs and lows of my day.  This helps to release the burden I feel like I am under and allows me to feel appreciated by him for my efforts.  This being said, we have a time limit for “work talk” and after that I am not allowed to talk about it again.  This allows you to say what you need or want to, but prevents you from focusing your whole life on work.
  2. Enjoy the company of those around you. If you walk in from work only to see the undone chores around your house, then you are missing the best part.  When I come home, I make it a point to greet my husband and son.  The greatest stress reliever that I have experienced is the love that they have to offer.
  3. Go exercise. Exercise does not have to be a 3 mile run, just a stroll around the block will work.  The important thing to remember is that when you exercise, your body releases endorphins, which is a neurotransmitter from your brain that helps to decrease stress and increase happiness.  This is where the “runner’s high” comes from.  A little bit of movement can go a long way in stress reduction.
  4. Think of some corny jokes or turn on your favorite radio comedian and just laugh for a few minutes.
  5. Take a few minutes for yourself. Sometimes I have to put myself into time out.  It may be a bad time for you to step out, but sometimes it will be worse if you stay put, so remove yourself from a stressful situation for a few minutes so you do not say something you will regret later.
  6. Take a bath. Soaking in water provides you with that weightless and relaxed feeling.  This may help you refocus on the important priorities in your life.
  7. Finally, if all else fails… eat dark chocolate! It’s delicious!

Langdon & Company LLP may not be able to draw your bath, however, we will do what we can to take the stress off of you.  Call our office to get additional information about ways in which, we can help.

Brittany [email protected] is a staff member of the tax department working on various projects from individuals to organizations’ tax return preparation.

US DOL Announces Overtime Changes

by Rachel Owens

The U.S. Department of Labor recently issued its final rule regarding overtime, at President Obama’s instruction.  Overall, the rule is expected to cover 4.2 million more Americans, and boost wages by $12 billion in the next 10 years. One of the most significant changes is that it doubles the salary threshold—from $23,660 to $47,476 per year—under which most salaried workers are guaranteed overtime (hourly workers are generally guaranteed overtime pay regardless of their earnings level). The final rule takes effect on December 1, 2016.

More information about this rule can be found in the links below.

To learn more about how you or your organization are affected, contact our office.

 

Tax Provisions of the “Protecting Americans from Tax Hikes (PATH) Act of 2015

taxesIn recent years, the $500,000 limit and some other favorable aspects of the election have been extended for a year or two at a time, but sometimes these provisions weren’t extended until December, leaving many taxpayers uncertain for most of a tax year as to whether the higher expensing limit and other favorable provisions would be extended. What’s worse, the $500,000 limit and other favorable provisions expired again at the end of 2014. Most dramatically, on Jan. 1, 2015, the limit reverted to its old level of $25,000 and the other favorable provisions also lapsed, once again plunging taxpayers into uncertainty.

The recently enacted “Protecting Americans from Tax Hikes Act of 2015” (i.e., the 2015 PATH Act) makes permanent the $500,000 Section 179 expensing limit, thus enabling a small business to elect to expense up to $500,000 of investment in new equipment and other qualifying property instead of having to depreciate the cost over a number of years.

To provide a bit more detail, the new law, retroactive so as to not leave out tax years beginning in calendar year 2015:

  • makes permanent the expensing of up to $500,000 annually of the cost of qualifying property; as was true for earlier years for which the $500,000 limit was in place, the amount of expensing allowed is subject to gradual reduction (down to zero) once the total qualifying property placed in service during the year exceeds $2 million;
  • makes permanent the eligibility for expensing of most computer software;
  • makes permanent the eligibility for expensing of qualified real property (certain leasehold building improvements, retail building improvements and restaurant property); and
  • makes permanent the ability to revoke an election, or change its specifics, without IRS consent.

And, for tax years beginning after calendar year 2015 (post-2016 years), the new law:

  • indexes both the $500,000 and $2 million limits for inflation;
  • ends the exclusion from expensing of air conditioning and heating units; and
  • removes the $250,000 cap on qualified real property expensing; the capped expensing nevertheless also had to be applied against the $500,000 limit.

The PATH Act also extends and modifies the rules pertaining to bonus depreciation. The applicable bonus depreciation percentage will be 50% for property placed in service during 2015, 2016 and 2017. The applicable bonus depreciation percentage will be 40% for property placed in service in 2018, and 30% for property placed in service in 2019. The PATH Act also continues to allow taxpayers to accelerate alternative minimum tax credits rather than use bonus depreciation. For the 2016 taxable year, the PATH Act modifies the rules relating to the use of alternative minimum tax credits in lieu of bonus depreciation by increasing the amount of unused tax credits that can be claimed instead of bonus depreciation.

The Act has numerous other individual and business tax provisions.  L&C’s tax professionals routinely provide tax advice to individuals and businesses. If you would like more details about these changes or any other aspect of the new law, please do not hesitate to contact our office.

2015 Blog Roundup

2015 produced a range of interesting and informative blogs from the Langdon & Company, LLP staff. Here we will look back on some of the highlights from the year.blog round up

January 2015

January brought us the introduction of the upcoming changes in Revenue Recognition. Audit Manager, Lee Byrd, shared with us a summary on the proposed standard in her blog On the Horizon: Revenue Recognition. This blog summarized the five-step model of ASU 2014-09. In September 2015, Audit Senior, Rebecca Lunn, provided an update on the standard while discussing the delay of the effective date by FASB.

February 2015

An audit committee is essential to the fiduciary oversight of a nonprofit organization. Meagan Bulloch, Audit Manager, discussed just this in her blog The Why, Who, What and How of an effective audit committee for nonprofit organizations. Visit the link to read frequently asked questions and answers on this topic.

March 2015

In March, Staff Accountant, Brittany Spragins, touched on a topic that is sometimes difficult to consider but necessary to ensure the protection of our loved ones. In her blog The “Legacy Drawer”, she discusses the most important documents to have in place in preparation of our final days such as a Last Will and Testament, insurance documents, and funeral instructions.

April 2015

April was the time for spring cleaning! This extended to the office in our April 2015 blog Spring Cleaning: Document Retention Policies for Non-Profits by Brittany Powell, Audit Senior. Check out this blog for guidelines on how long to keep those important documents.

May 2015

Have you or your organization ever been the victim of a cyber-attack? While technology is a wonderful tool, it can also make us vulnerable to cyber-attacks in ways we wouldn’t even consider. In May 2015, after news of data breaches at major retailers in the US, Meagan Bulloch, Audit Manager, provided us with great ways to protect ourselves and our organizations against cyber threats. View her blog to find out what you should be doing to protect yourself!

June 2015

In June we considered a different kind of threat. Tax Manager, Susan Dean, walked us through the Taxpayer Guide to Identity Theft posted by the IRS. Her blog provided a host of information on when to recognize and how to protect ourselves against tax identity theft which will be sometime to watch for during the upcoming tax season.

July 2015

In July 2015, Rachel Owens, Senior Accountant, gave us an update on the reporting requirements for NC Adult Care Homes. Cost reports are due December 31, 2015!

August 2015

There’s an App for that! In August, Dwayne Murphy, Audit Senior, summarized the most useful apps available for tracking travel expenses. Hopefully, these apps will make the pesky task of tracking and reporting expenses a little easier.

September 2015

Don’t be surprised at the end of the year by taxes due! Cody Taylor, Staff Accountant, explains how payroll tax withholdings affects your total tax due at the end of the year and how to calculate the proper withholding amounts using the IRS Withholding Calculator. Find the information in Cody’s blog, Are You Withholding Enough?.

October 2015

Ever wonder if you should hire a CPA? In her blog, Why Hire a CPA?, Brittany Spragins, Staff Accountant, provides the reader with numerous reasons that hiring someone with the CPA title can be advantageous to your organization.

November 2015

Ever received a phone call that you thought was from the Internal Revenue Service but later found out it was a scam? If so, you are not alone! In her blog, Have you been scammed?, Susan Dean, Tax Manager, walks you through examples of phone scams and helpful tips on how to recognize and report potential scams.

December 2015

This month, Eric Murphy, Tax Senior, gave us an Update on Increase of Deduction for Purchase of Tangible Property which increased the threshold for capitalization from $500 to $2,500.

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Have you been scammed?

by Susan DeanGranny on phone

Have you received a phone call that you thought was from the Internal Revenue Service (IRS)? If so, you are not alone. Many people have been a victim of these recent phone scams. Criminals pose to be an IRS representative in order to gain personal information, receive money or even steal your identity. Below are several examples of phone scams and helpful tips the IRS released in the recent article, IRS Urges Public to Stay Alert for Scam Phone Calls.

  • Scammers make unsolicited calls. Thieves call taxpayers claiming to be IRS officials. They demand that the victim pay a bogus tax bill. They con the victim into sending cash, usually through a prepaid debit card or wire transfer. They may also leave “urgent” callback requests through phone “robo-calls,” or via phishing email.
  • Callers try to scare their victims. Many phone scams use threats to intimidate and bully a victim into paying. They may even threaten to arrest, deport or revoke the license of their victim if they don’t get the money.
  • Scams use caller ID spoofing. Scammers often alter caller ID to make it look like the IRS or another agency is calling. The callers use IRS titles and fake badge numbers to appear legitimate. They may use the victim’s name, address and other personal information to make the call sound official.
  • Cons try new tricks all the time.  Some schemes provide an actual IRS address where they tell the victim to mail a receipt for the payment they make. Others use emails that contain a fake IRS document with a phone number or an email address for a reply. These scams often use official IRS letterhead in emails or regular mail that they send to their victims. They try these ploys to make the ruse look official.
  • Scams cost victims over $23 million. The Treasury Inspector General for Tax Administration, or TIGTA, has received reports of about 736,000 scam contacts since October 2013. Nearly 4,550 victims have collectively paid over $23 million as a result of the scam.

The IRS will not:

  • Call you to demand immediate payment. The IRS will not call you if you owe taxes without first sending you a bill in the mail.
  • Demand that you pay taxes and not allow you to question or appeal the amount you owe.
  • Require that you pay your taxes a certain way. For instance, require that you pay with a prepaid debit card.
  • Ask for your credit or debit card numbers over the phone.
  • Threaten to bring in police or other agencies to arrest you for not paying.

If you don’t owe taxes, or have no reason to think that you do:

  • Do not give out any information. Hang up immediately.
  • Contact TIGTA to report the call. Use their “IRS Impersonation Scam Reporting” web page. You can also call 800-366-4484.
  • Report it to the Federal Trade Commission. Use the “FTC Complaint Assistant” on FTC.gov. Please add “IRS Telephone Scam” in the notes.

If you know you owe, or think you may owe tax:

  • Call the IRS at 800-829-1040. IRS workers can help you.

Phone scams first tried to sting older people, new immigrants to the U.S. and those who speak English as a second language. Now the crooks try to swindle just about anyone. And they’ve ripped-off people in every state in the nation.

Stay alert to scams that use the IRS as a lure. Tax scams can happen any time of year, not just at tax time. For more, visit “Tax Scams and Consumer Alerts” on IRS.gov.

Each and every taxpayer has a set of fundamental rights they should be aware of when dealing with the IRS. These are your Taxpayer Bill of Rights. Explore your rights and our obligations to protect them on IRS.gov.  If you have questions about your rights, or any other tax issue, give Langdon & Company LLP a call.  We’d be happy to help!

Susan Dean ([email protected]) is an Enrolled Agent with Langdon & Company LLP’s tax practice.  She focuses on corporate tax and closely-held family businesses.

10 Frighteningly Simple Ways to Improve Fraud Prevention

by Josh Bryantpumpkin

 

Fall has finally arrived!

With the departure of summer, the hot and humid days are gone, and one of the most widely celebrated holidays among America’s youth- Halloween, quickly approaches.  Soon enough ghouls and goblins will be aimlessly wondering the streets in search of sugary-sweets.

However scary, nothing is more frightening to both consumers and business-owners alike than fraud. Forget running to your local costume emporium for disguises, leave the garlic and silver bullets, this shadowy presence is constantly lurking and has no home-remedies for expulsion.

  • Understanding why and how fraud is perpetrated in the minds of those around you is the first and most imperative step. One simple way is to keep the Fraud Triangle in mind. The Fraud Triangle presents the three elements every person has in common when perpetrating fraud: (1) Pressure– Financial or Career Pressure, for example, (2) Rationalization– a way for the person to rationalize their action as being okay, and (3) Opportunity– the ability or perceived ability to commit and hide fraud.
  • Communication: by clearly stating, both orally and in a written statement, employees within your organization have a clear understanding of expectations.
  • “Tone at the top,” or Modeling: first and foremost, executives in an organization must be constantly aware of how they portray the importance of honesty and character.
  • Segregation of duties: in order to stop fraudulent transactions before they happen- having the proper organizational duties prescribed to each individual in the hierarchy is paramount. For example, those who write checks should not be able to book the entry into accounts payable (more on this topic here).
  • Effective security, both physical and logical access safeguards to protect information or tangible assets.
  • Thorough background checks on employees.
  • Keep adequate documentation for an audit trail to catch those that get through the system.
  • Hire a CPA to conduct internal audits regularly.
  • Have a consistent review process for all employees.
  • Stay on your toes, the threat is constantly lurking!josh's cartoon

Josh ([email protected]) is a staff auditor who works primarily on non-profit organizations.  Please contact our office if we can be of service to you!

Time Management

by Brittany Spragins

As a working mother, I set out on a quest to find a better method of time management.  Trying to balance cooking, cleaning, child rearing, work, time with my husband, and some alone time has proven difficult; especially when the nagging voice in the back of my head tells me to keep pushing for career advancement.  I was about to resign myself to the thought that I would have to choose one, either wife and mother, or a career woman, when I stumbled across a book by Laura Vanderkam entitled “I Know How She Does It.”

This book looks at the lives of 143 women who make at least $100,000 a year and have at least 1 child under the age of 18 living at home.  The biggest secret for them is their ability to manage time.  Ms. Vanderkam explains that when you look at life a week at a time, rather than day by day, you can plan better.  For example, most women want the same routine every day, but cannot make time for working out 7 days a week.  What about having the same weekly routine where you work out 4 days a week, but different times of the day depending on the schedule of other activities?  To enable you to mentally change and accept this life changing structure, she recommends keeping a time log.  On it, you have your week broken down into 168 hours and you record your time in 30 minute increments.  After a week or two of collecting data, look at your time log and decide if this is how you would like to spend your time.  Prioritize the time with the essentials and then plan around that accordingly. She recommends looking for areas that you can combine, like working out and watching TV, or engaging in “functional fitness” where you exercise in your everyday activities like taking a brisk walk to your business meeting instead of driving to it.

As you start to learn your tendencies and consolidate overlapping activities, you can plan a week that will enable you to maximize your time with family, be more productive at work, and still enjoy some time for yourself.  Once you have a handle on your average week, start dreaming big to see where you can go with all of your extra time.

Think this sounds interesting?  Call Langdon & Company LLP today for additional perspective on how to better manage your time and other planning suggestions.  Check out more at Laura Vanderkam’s website http://lauravanderkam.com/.

Brittany ([email protected]) is an staff accountant serving in both our tax and audit departments.  She focuses on a variety of specific projects that are beneficial to the firm.

ABLE (Achieving a Better Life Experience) Act – A new way to save for children with disabilities

by Meagan Bulloch

The ABLE Act amends Section 529 of the IRS Code of 1986 to create tax-advantage savings accounts for individuals with disabilities.  The ABLE Act will provide individuals with disabilities the same types of flexible savings tools that all other American have through college savings accounts, health savings accounts and individual retirement accounts.  Most importantly this Act will prevent money saved through 529-ABLE accounts from counting against an individual’s eligibility for federal benefits programs.

As of December 19, 2014 this was signed into law by President Barack Obama. o-SAVINGS-ACCOUNT-facebook

What you should know (Adapted from NDSS):

  1. 529-ABLE accounts are “tax-advantage” savings accounts for individuals with disabilities and their families.  Income earned by these accounts will not be taxed.  Also the money will not be considered an asset when determining eligibility for government supported benefits.
  2. Who is eligible – Any individual with significant disabilities with an age of onset before 26 years of age is eligible.  Eligible individuals can be over the age of 26, but must have documentation of disability that indicates age of onset before the age of 26.  
  3. How much money can be saved – Under current tax law, an individual can contribute a maximum of $14,000 into an ABLE account and not be subject to gift taxes.  The total limit over time that can be made into an ABLE account will be subject to the individual state and their limit for education-related 529 savings accounts.  The first $100,000 in ABLE accounts will be exempt from the SSI $2,000 individual resource limit.  If the ABLE account exceeds $100,000, the beneficiary would be suspended from eligibility for SSI benefits, but would continue to be eligible for Medicaid.    
  4. What expenses qualify – A “qualified disability expense” is considered an expense incurred as a result of the beneficiary living with their disability.  These would include education, housing, transportation, employment training and support, assistive technology, personal support services, health care expenses, financial management and administrative services and other expenses which will be developed in 2015 by the Treasury Department.   
  5. Can I have more than one ABLE account – No, the Act limits the opportunity to one ABLE account per eligible individual. 
  6. How is an ABLE account different from other options – ABLE accounts allow more choice and control for the beneficiary and their families.  The cost of opening an account will be considerably less than setting up either a Special Needs Trust or Pooled Income Trust.  The ABLE account will also be less complicated to set up and owners will have the ability to control their funds.  This new approach also offers individuals living with a disability the ability to work and contribute to their own support and save for their own future with fear of losing necessary support and services.

Meagan Bulloch ([email protected]) is an audit manager at Langdon & Company LLP focused primarily on non-profit clients.

 

The “Legacy Drawer”

by Brittany Spragins

While it is extremely hard to think about, someday you will pass away.  What will happen to your spouse, kids, grandkids, and other loved ones?  Have you heard of the “Legacy Drawer?”  Here is what it contains: 

  • Cover Letter – this will explain the purpose and organizational system of the drawer.
  • A Last Will and Testament (a “will”) – Make sure to have an updated copy of your will.  Without one, the government divides your assets as they see fit; your own wishes are irrelevant.  If you have children, the government also picks their guardian.
  • Make sure that the will is updated after major life events such as marriage or divorce, birth or adoption of a child, or moving to a new state.
  • Make sure that this contains the names of the executor and Power of Attorney for the estate.
  • Financial Information – anything involving money
  • Include account names, numbers, and approximate balances
  • Credit cards accounts and online login information
  • Loan Documents
  • Safe Deposit Box location and information
  • Insurance Provider Information – include a summary page of all types of insurance
  • Policy type
  • Policy Numbers
  • Provider Contact Information
  • Funeral Instructions – Include as much as you can to ease the burden on your family.  Your family will already be grieving your loss, so if you have songs or locations picked out, let them know.
  • Legal Documents – copies of birth certificate, marriage license, car titles, house deeds, social security card, etc. If you think it may be needed to help settle your estate, and then include it in here.
  • A letter to your loved ones- They will be missing you and a personalized letter from you reminding them of your love will be a special gift for them.  You can leave remaining pearls of wisdom, or just the opportunity for them to hear your words in a lasting legacy.

Update the information periodically, if you get a new bank account or pay off a loan, then just add or remove the file accordingly.

I realize that there are a lot of items to include, and it will take some time to locate and organize these, but stick to it.  If it would take time to do now, imagine the stress on your loved ones if they are doing it because you are gone.  This is one way that you can ease the burden on your family and remind them how much you love them.
Outline provided by Dave Ramsey http://www.daveramsey.com/article/legacy-drawer-keep-your-family-prepared/lifeandmoney_relationshipsandmoney/.
Brittany Spragins ([email protected]) is a staff accountant with Langdon & Company LLP and works with our healthcare consulting and tax departments.