I found this really great report that should be on every entrepreneur's list to review both for their industry and also for their customers. Growth is great, especially those businesses that are recovering from the pandemic, BUT as we should know better now, not all businesses face the same risk. If a specific industry is at more risk, are you blindly going to walk back into it and hope, or is there more you can do to protect your business?
These are the Top 200 industries primed for growth (with risks) using the projected Compound Annual Growth Rate (CAGR) from 2021-2026.
In addition to the CAGR numbers, this data can be sorted and filtered by total industry revenue, number of businesses, growth trajectory and risk score to explore possible industries that could be in need of additional accounting and advisory services due to continued growth yet elevated risk.
To download the information please follow this link where you can submit your information and get the report.
In very simple terms, a like-kind exchange is a tax-deferred transaction that allows one asset to be swapped with another, similar asset without generating a capital gains tax liability from the sale of the first asset.
Prior to the Tax Cuts and Jobs Act of 2017 (TCJA), the IRS permitted the exchange of certain personal property, intellectual property and intangible property as long as that property was then exchanged for other personal property. The TCJA narrowed the scope of Internal Revenue Code Section 1031 like-kind exchanges to the exchange of real property that is of the same nature and character, even if it differs in grade or quality. It defined real property as "land and improvements to land, unsevered natural products of land, and water and air space superjacent to land."
Primary residences, inventory, corporation common stock and indebtedness or notes are specifically excluded from Section 1031 like-kind exchanges. In addition, exchanges of machinery, equipment, intellectual property, intangible business assets, etc., generally do not qualify as real property exchanges. Exceptions to this rule include certain exchanges of stock in mutual ditch, reservoir or irrigation companies.
The result is that any personal property transferred in a Section 1031 like-kind exchange is treated as if it were bought and sold in separate transactions, and any capital gains on the sale cannot be deferred. Practically speaking, this means every distinct asset included in the exchange must be analyzed separately from every other asset to determine whether it meets this definition.
As might be expected, the rules are complex. A qualifying exchange must adhere to the following rules:
Section 1031 like-kind exchanges can be an excellent way to discharge appreciated property that would generate a high capital gains tax if it were sold. It may also be the best choice in other circumstances, such as if the property would otherwise have been sold at a loss.
This is just of summary of a series of complex provisions. If you think a Section 1031 like-kind exchange is right for you, be sure to get professional advice from the start.
like kind exchange
In COVID Tax Tip 2021-123, the IRS clarifies some of the confusion surrounding the powerful but complex Employee Retention Credit.
The IRS is addressing changes made by the American Rescue Plan Act of 2021 that apply to the third and fourth quarters of 2021.
These changes include:
For business managers who had questions and needed authoritative answers, the IRS is answering various questions about the credit for tax years 2020 and 2021, including:
Eligible employers will report their total qualified wages and the related health insurance costs for each quarter on their employment tax returns, generally, Form 941 Employer's Quarterly Federal Tax Return, for the applicable period. If a reduction in the employer's employment tax deposits is not sufficient to cover the credit, certain employers may receive an advance payment from the IRS by submitting Form 7200, Advance Payment of Employer Credits Due to COVID-19.
This is just a summary of a series of detailed and technical provisions. The IRS has provided all the details in Notice 2021-49. Managers should consult with a qualified tax professional to make sure they get all the benefits they're entitled to without inadvertently violating the provisions.
employee retention credit
American Rescue Plan
COVID Tax Tip
The big question is whether people are more or less productive when working from home. Many external factors go into this evaluation, such as home-based working conditions and reliable access to company systems and programs. Perhaps the most critical issue is the disconnect between managers who expected the virtual environment to mimic the office environment and actually managing remote employees. Some managers felt they had to micromanage staff to make sure they were working, which turned into a workday filled with videoconferencing and messaging on various platforms. That strategy turned out to be distracting.
But as the virtual environment evolved, best practices emerged from the chaos. Managers began to understand how important it is to institute policies incorporating these 10 areas:
In my opinion it's a pretty big failure considering that only 36.3% of applications were funded, and only 39.6% of the funds requested making it to those who needed it most.
The Child and Dependent Care Tax Credit is available to parents and caregivers who are either working or looking for work and who claim dependents on their tax return. The credit is available to those who care for children under age 13 or a spouse or dependent of any age who is physically or mentally incapable of caring for himself or herself.
The CTC was created in 1997 and has been expanded several times since, most recently in 2020. The COVID-19 pandemic profoundly affected how, where and when people work. The incredible disruption this caused affected people's incomes and livelihoods, and the federal government responded by approving pandemic relief legislation that included changes to the child care tax credit.
The latest of these changes were mandated by the American Rescue Plan Act (ARPA), which increased the maximum amount of eligible expenses as well as the maximum percentage of eligible expenses for which the credit may be taken. ARPA also modified how the credit is phased out for higher earners.
Perhaps the most important changes for eligible taxpayers planning to claim this credit for 2021 is that
Who Can Claim the Credit?
To be eligible to claim the enhanced child care credit, taxpayers must meet all these requirements:
How the advance child tax credit work
Eligible taxpayers will receive 50% of their credit in equal monthly installments starting in July 2021. The remaining 50% will be applied on their 2021 taxes after they file next year.
The advance credit is phased out or eliminated completely for taxpayers whose AGI is above $150,000 for married taxpayers filing jointly and qualifying widows or widowers, $112,500 for those who file as head of household, and $75,000 for single filers or married taxpayers filing separately.
The IRS will make the advance payments automatically for July, August, September, October, November and December. Eligible taxpayers do not have to enroll.
Taxpayers who do not wish to receive advance payments because they are close to the income-eligibility limits, pay estimated taxes or expect to owe taxes with their 2021 tax return can opt out by using the Child Tax Credit Update Portal on the IRS website and clicking on "Unenroll from Advance Payments." However, as of now, taxpayers cannot choose to opt out and then change their minds and opt in.
The specific rules relating to this credit, such as the definition of a work-related expense, are complex. Make sure to consult with a tax adviser to discuss your specific situation.
Like every business owner, you want to remain relevant and competitive in your marketplace. And you know that to have a sustainable business, you constantly need new ideas to satisfy the evolving demands of consumers. However, you also know that sometimes new ideas fail because you haven't done adequate market research.
Market research gives you access to insights. These insights can optimize your current and future product offerings and assist in connecting your brand to the right customers. That's why investing in insight generation is the right way to drive informed and effective decision-making. It was W. Edwards Deming who said, "Without data, you're just another person with an opinion."
There are many types of research. Exploratory research is open-ended and qualitative. It helps you identify trends that you're currently not aware of. Setting up a Google Alert for a keyword that your team doesn't know much about is exploratory research, and so is a survey with open-ended questions. But its key characteristic is that it is flexible; changes of plan and even changes of format are expected. Some businesspeople consider exploratory research an important starting point for innovation.
Specific research is more precise and focused on solving a particular problem or testing a new idea. Specific research can help you drill down deeper into an outcome of exploratory research. This is probably what you think of when you think of market research: detailed surveys, focus groups, customer interviews and studies.
Both exploratory and specific research are types of primary research. Secondary research is the study of research that already has been published by others. Reading reports compiled by the government, trade associations or other businesses is secondary research.
Research provides you with a lens with which you can look at your company's current performance and its past trends. Knowing more about what your customers want and what else is going on in your industry can help you understand what's happening to your own sales. That in turn can help you understand what you need to do to better serve your customers.
Here are some tips on how to apply market insights to your company's strategy:
Just as you wouldn't go on a vacation without making any plans, you shouldn't design marketing strategies without backing them up with research and data. Market research takes a lot of time and money, but if you're venturing into a new market, it's vital.
Problems, business environments and trends are constantly changing, so your research will never really be over. The more you know about your buyer personas, industry and company, the more successful your marketing efforts will be.