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Friday, November 06, 2009
Q: I formed an LLC and need to know how much it can pay for my mortgage, electricity, and other personal expenses. I would rather the LLC write a check for these rather than pay me a salary.
A: It is a bad business practice to pay any of your personal bills out of your LLC business account. Even by doing so, you will still have to declare those amounts as income.
No matter how the LLC distributes money to you (such as paying your personal expenses), it's going to be considered earnings. And the only deductions the business can ...
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Thursday, November 05, 2009
Q: Some time ago I received a survey from the Department of Labor. I didn't complete the survey and am now getting calls almost weekly wanting the survey information. Am I obligated to participate in this program?
A: There are two types of government surveys, mandatory and voluntary.
For mandatory surveys, you're required to provide the information, and a government agency has the ability to assess penalties if you don't comply.
If you still have the survey, it will indicate whether it is mandatory or voluntary. If you don't have the survey, ask the person calling whether it is mandatory ...
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Friday, October 30, 2009
Q: I have a real estate-related business and want to offer referral fees to professionals for sending me business. I want to create a disclaimer stating that they will not receive referral fees until the final financial transactions are completed. What is the best way to do this, and should I promote it on my marketing materials?
A: You don’t need a formal disclaimer. And you shouldn’t publish specific information about your referral program in your marketing collateral.
Licensed real estate professionals should check their state regulations before making any type of referral payments. But if you’re not a licensed ...
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Wednesday, October 28, 2009
Q: We want to rent out our vacation property to generate additional income. How do we find a management company to handle everything for us?
A: If your property is located in a destination resort community, check with your property management firm or your homeowners’ association to find out if the management firm has a rental program.
If there is no on-site rental management program, and you are in a resort area, check for property management agencies in the area. Full-service agencies take care of everything, including marketing the property, collecting rental fees, cleaning and maintenance. For their services, they ...
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Friday, October 23, 2009
Q: Is it necessary for me to have a separate bank account for my business? If so, what is the process for setting up a business checking account?
A: If your business is a legal entity, such as an LLC or a corporation, or if you operate the business under DBA (doing business as) name, it's absolutely necessary to have a separate business checking account.
If you operate as a sole proprietorship under your own name, a separate business account isn't required. But, it is a good business practice.
The process for opening an account depends on the legal structure ...
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Wednesday, October 21, 2009
Q: I'm a single-member LLC. Am I eligible to establish a health reimbursement account (HRA)?
A:Eligibility for the NASE HRA 105 program isn't determined by your being a limited liability corporation (LLC). The determination is based on which tax structure the LLC chooses.
As a single-member LLC, you're automatically considered a sole proprietor unless you elect to be recognized as a corporation. If you elect to be taxed as a sole proprietor filing a Schedule C, then you must be married and hire your spouse as an employee to qualify for the HRA. If the LLC elects to be taxed ...
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Friday, October 16, 2009
Q: We're starting a day care and are required to do background checks on all employees and volunteers. What's the best way to do background checks?
A: My first suggestion is to use one of your NASE benefits: e-Check Online.
E-Check provides background screening services, including criminal history, Social Security verification and more. Go to www.NASE.org, log in and enter "e-Check" in the Quick Link box.
You can also check with your state day care licensing agency. It may provide a list of background screening companies in your state.
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Wednesday, October 14, 2009
Q: I own a sub shop and have problems with employees not being ready to work at their shift start time. In my employee handbook can I state that employees must arrive at least five minutes before their start time?
A: While you can require employees to arrive at least five minutes early, you would likely have to pay them, since that would be their required starting time.
While states differ in their specific regulations, it's just good practice to pay an employee from the moment they start performing on behalf of the business. As a general statement, what you ...
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Wednesday, April 08, 2009
Q. I'm tired of slow-paying customers and want to start
charging interest on late payments. How do I do it, and how much can I
charge? A. There's nothing wrong with charging interest
to late-paying customers -- but don't think it will be a miraculous solution for
getting paid on time. If you don't have a good credit and collections policy to
start with, charging interest will only add to the amount customers owe you. First, determine the maximum legal rate for your state; your banker should be
able to tell you. The most common rate charged for outstanding invoices is 18
percent annually (1.5 percent per ...
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Saturday, April 04, 2009
Q: One of my customers owes me several hundred dollars and
is telling me he filed bankruptcy. Is there anything I can do to get my
money? A: If you haven't received a notice from the
Federal Bankruptcy Court, verify the filing by calling the bankruptcy court in
the customer's city. If your customer was incorporated, the bankruptcy will be
under the corporate name. Sole propretors would file under the owner's name with
a DBA in the business name. Find out if the filing was made under a Chapter 11 (business reorganization),
Chapter 13 (personal reorganization) or Chapter 7 (liquidation). Once a bankruptcy is filed, there isn't ...