Postponing Retirement?

According to a recent survey of workers age 60 and older:
60% of the workers said they delayed retirement because of recent losses in the financial markets
About 73% think it will take them up to six years of additional work to recoup lost savings
24% feel they can make back their money by working just an extra year or two

2011 mileage rates increase

The IRS recently announced that the standard mileage tax rate used by business drivers increased to 51 cents per business mile (up from 50 cents per business mile in 2010) plus any business-related tolls and parking fees.

While the standard mileage rate is usually more convenient to use than tracking actual expenses, the actual expense method (when available) may produce a bigger overall tax deduction.

Seven Tips for Small Business

As the economy begins to recover, now is the time for small business owners to position themselves and their business for success. Small business start-up expert Susan L. Reid recommends these tips to help you reap the benefits. 
1. Invest in education – Attend seminars online and in person, read books and trade magazines and pay attention to what’s on the cutting edge in your industry.
2. Pay off debt – If you can pay off debt, the time is now. Taking on debt in a recession is common, but now that the economy is bouncing back, don’t add to it. Pay for as much as you can with cash.
3. Go “Zen” with extras – Resist the urge to splurge on extras you don’t need. Think twice about adding all the “bells and whistles” to your phone or investing in the latest technology.  Even those daily lattes add up.
4. Follow the market – Read the papers, watch the news. Know what’s happening and stay on top of it.
5. Renew contracts – Have new clients sign long-term contracts and have current clients renew or extend their contracts with you.
6. Hang on to your property – It may seem like a good time to sell, but it’s not.  You won’t get top dollar and may actually end up losing money.  Instead, invest in projects that will increase the value (and eventual selling price) of your property.
7. Don’t cut prices – It’s common to think that lowering prices will help attract more clients and customers. Don’t do it! Keep your prices steady while offering your clients a rewards program or coupon for staying with you.

Growth Industries 2011

According to data from market research firm IBISWorld, these are the top ten industries expected to experience growth this year:
1. Investment Banking and Securities Dealing
2. Car & Automobile Manufacturing
3. Commodity Dealing and Brokerage
4. Iron Ore Mining
5. Aluminum Manufacturing
6. Oil Drilling & Gas Extraction
7. Petroleum Refining
8. Recreational Vehicle Dealers
9. Gasoline & Petroleum Wholesaling
10. Gasoline & Petroleum Bulk Stations

SBA Offers Commercial Mortgage Refinancing

In an attempt to mitigate the effects of lower real estate values on small business, the United States Small Business Administration (SBA) is accepting applications for a commercial mortgage refinancing program. The program runs February 28, 2011 through September 27, 2012.

Part of the Small Business Jobs Act passed in September 2010, the program is aimed at small businesses that are doing well and making payments on time but are facing mortgage refinancing troubles because of declines in real estate value. Initially only businesses with balloon payments due before Dec. 31, 2012, will be eligible.  Although terms of the loan are similar to the 504 loans commonly offered through the SBA, an expansion of the business is not required to qualify. For more information, visit the SBA website at www.sba.gov.

IRS Offers Second Opportunity for Voluntary Disclosure

The IRS is conducting a voluntary disclosure initiative to allow people with undisclosed income from hidden offshore accounts to get current with their taxes. The new federal voluntary disclosure initiative will be available through August 31, 2011.

The 2011 Offshore Voluntary Disclosure Initiative (OVDI) includes several changes from the initial 2009 Offshore Voluntary Disclosure Program (OVDP). Though the overall penalty structure for 2011 is higher, the new initiative does add new features and modifications:
• A new penalty framework that requires individuals to pay a penalty of 25 percent of the amount in the foreign bank accounts in the year with the highest aggregate account balance covering the 2003 to 2010 time period. Some taxpayers will be eligible for 5 or 12.5 percent penalties. Participants also must pay back-taxes and interest for up to eight years as well as paying accuracy-related and/or delinquency penalties
• Taxpayers must file all original and amended tax returns and include payment for taxes, interest and accuracy-related penalties by the August 31 deadline
• Participants face a 25 percent penalty, but taxpayers in limited situations can qualify for a 5 percent penalty
• A new penalty category of 12.5 percent has been created for treating smaller offshore accounts. People whose offshore accounts or assets did not surpass $75,000 in any calendar year covered by the 2011 initiative will qualify for this lower rate
If you have a foreign account and have compliance concerns, consult with your trusted tax adviser.

Rehmann Principal Elected MACPA President

John Pridnia, CPA, principal at Rehmann, has been elected to serve as the President of the Michigan Association of CPAs (MACPA) for 2011-2012.

John is a graduate of Central Michigan University and has been practicing public accounting since 1985.  He has extensive experience in the areas of tax and accounting for corporate enterprises and high net worth individuals.  He has a passion to serve and has dedicated much of his time to numerous charities in West Michigan, including the American Red Cross and West Shore Symphony Orchestra.

MACPA is a member-driven organization that provides continuing education opportunities and keeps members apprised of developments in the profession.
MACPA boasts nearly 18,000 members around the state of Michigan.
MACPA is an active member in the public policy-process and encourages its members to contribute to their communities through community service.