Employee Benefit Plan Services

On March 29, 2011, the government agencies who are enforcing the Dodd-Frank Act’s provisions relating to financial institutions (including but not limited to the SEC, OCC, FDIC, OTS and NCUA) issued a further proposed rule relating to incentive compensation programs offered to employees of financial institutions with over $1 billion in assets. While echoing many parts of their February 4, 2011 proposal (click here for more information), the gist of these proposals is that incentive compensation...

Although employers who maintain tax-qualified retirement plans are well aware of the requirement to file an annual information return (Internal Revenue Service (IRS) Form 5500), many employers appear unaware of their responsibility to file a similar return for other employee benefit programs.  If the IRS discovers that required filings have not been made, penalties are severe.  This article will discuss what types of plans need to file, potential penalties and a program that can minimize the...

This month's Special Delivery E-Newsletter includes the following articles:

• Tax Relief, Unemployment Insurance Reauthorization, and Job Creation Act of 2010
• Year-End Tax Planning Letter for Individuals
• Year-End Tax Planning Letter for Businesses
• What Are the Benefits of Buy-sell Agreements?
• Don't Miss Out on Above-the-line Deductions
• Keeping Records for Your Business Car
• Aurum Capital Markets Summary
• R&D Tax Credit Extended for 2010 and 2011 Calendar-year Expenses
• IRS Increases Business Mileage Rate to...

Part 3 of 3

Hiring Unemployed Workers: Hire a worker who has been unemployed for at least 60 days before year-end if you are thinking of adding to payroll soon. Your business will be exempt from paying the employer's 6.2% share of the Social Security payroll tax on the formerly unemployed new-hire for the remainder of 2010. Plus, if you keep that formerly unemployed new-hire on the payroll for a continuous 52 weeks, your business will be eligible for a nonrefundable tax credit of...

This month's Special Delivery E-Newsletter includes the following articles:

• Skoda Minotti Expands its Compensation and Benefits Advisory Services Group
• Own Rental Property? New Law May Affect You
• Capital Gain Exclusion on Small Business Stock
• One Last Chance to Repair Deferred Compensation Plan Issues
• Common Benefits of a Business Plan
• Home-office Deductions: Terms of Tax Endearment
• Cutting the "Kiddie Tax" Down to Size
• Aurum Capital Markets Summary
• Skoda Minotti Only Company Recognized at Inc....

One Last Chance to Repair Deferred Compensation Plan Issues

December 31, 2010 marks the closing of a window offered by the IRS to self-correct non-qualified deferred compensation programs (NQDC) for failure to comply with Internal Revenue Code Section 409A (409A).  Although many employers have reviewed their programs for 409A compliance, some have not and should do so.  Let's briefly look at the issue and what should be done before year end.

Click here to read more about section 409A and the...

2010: The Right Time to Convert to a Roth?

2010 offers a unique opportunity for high-income individuals to convert their 401k to a Roth IRA.

As you may know, Distributions from a traditional IRA are generally taxed at ordinary income rates currently reaching as high as 35%. (Future tax rates are currently scheduled to rise.) The taxable portion includes earnings within the tax-deferred account and amounts attributable to deductible contributions.

Conversely, "qualified distributions" from a Roth...

This month's issue of Valuation & Litigation Advisory Insights includes the following articles:

• FAQs About Business Valuations
• Measuring the Intangible: Valuation Issues in Health Care Transactions
• Single Price Quote Supports $10 Million Lost Profits Award
• Skoda Minotti Employee Recognized For Outstanding Report Writing

FAQs About Business Valuations

From business acquisitions to estate planning to shareholder transactions, executives often run into situations in which performing a business valuation...

Situation/Opportunity

After being in business for about five years, a local roofing contractor contacted us because they felt they had outgrown their current CPA. They were doing well and wanted to take their business to the next level. In order for the Company to realize its maximum potential, management concluded that they needed to surround themselves with an advisory team to assist them in understanding all of the financial factors that impact operations.

Skoda Minotti Solution

Many departments...

Reform to the health insurance systems will offer an immediate benefit to small businesses via tax credits starting this year, rather than burden them with continually rising health insurance premiums. 

• In 2010, small business owners will be receiving up to 35 percent of the employee premiums they pay. 
• In 2014, the maximum tax credit will increase to 50 percent.  This will allow small business owners to seek plans through health insurance exchanges.  These exchanges are a marketplace where small...

When selling your home, it is common to use an agent to list, promote and show the property. In exchange, you pay a portion of the sales price as a commission to the agent. The benefits of using an agent include: 1) the listing of your home in a database so that homebuyers can access information about it; 2) the agent acting as your middleman during the negotiation process; and 3) the incentive it gives the agent to sell your home quickly (so that her or she can earn their commission). 

Some peop...

Details

The Internal Revenue Service has announced that its Employee Plans Compliance Unit (“EPCU”) will be mailing out a letter and instructions to a random sample of 1,200 employers that sponsor 401(k) plans asking them to complete a “401(k) Compliance Check Questionnaire.”

Background

The Service is well aware that 401(k) plans have far surpassed defined benefit plans as the preferred retirement vehicle for the majority of employers. A recent IRS Employee Plans Examination Study of 79 market...

Good retirement plans are often hallmarks of great employers, but finding a good one and setting it up can be a complex endeavor. There is a plan out there for every company, though. It may take some time and effort to find one, but once you do, it can be well worth the effort.

Creating and maintaining a retirement plan benefits both the business owners and the employees. Following are tips on determining what type of retirement plan is right for your company:

How does creating and maintaining a...

This issue of the Nonprofit Organization Update includes the following articles:

• Moving Toward Clarity - IRS Releases 2009 Form 990 Changes
• Foreign Accounting Reporting - More IRS Guidance is Here!
• SFAS 157 Fair Value Measurements - Additional NFP Perspectives
• Effective Policies - Building the Foundation of Your Organization
• Employee Benefits Security Administration's (EBSA) 2010 Priorities
• FIN 48 Update for Nonprofit Organizations

Moving Toward Clarity - IRS Releases 2009 Form 990 Changes
By Joyce...

Advisor Insights

This month, our monthly Advisor Insights column in Smart Business Cleveland Magazine takes a look at lessons learned from the real estate industry.

Having a finite resource as your business's main asset has proved challenging for real estate companies, but it also has necessitated some creative problem solving.

Click here to read the full article, "Lessons learned from the Real Estate Industry."

Administration Outlines 2011 Tax Proposals 

On February 1, 2010, the Treasury...

SFAS 157 – A Not-for-Profit Perspective
By Dick Larkin

Nonprofit organizations use fair value accounting when they are:
(1) required by certain accounting standards to use fair value for certain transactions and balances, and
(2) permitted by certain other accounting standards to use fair value for certain other transactions and balances.

Click here for more of this story.

Endowment Funds and FSP 117-1
By Dick Larkin

A question has come up as to just what constitutes an endowment fund for purposes of...

When completing Form 990 for your nonprofit organization, it is important to report the correct number in the governing body.  By definition, the governing body is the group of persons authorized under state law to make decisions on behalf of the organization.  The governing body is, generally speaking, the board of directors or trustees.  All of the directors or trustees must maintain independence in order to participate in the decision-making process.

The number of directors to be reported on...

With the end of the year approaching many companies are asking questions related to their business, such as "How can we cut costs?" How can we save time?" and "How can we add value to our processes?" These same questions also apply to a company’s employee benefit plan. Many companies don’t take the time throughout the year to evaluate their plan and any changes that should be made to it. The end of the year is a great time to analyze the plan for any changes that can take place during the next...

The Internal Revenue Service recently issued substantial guidance designed to boost retirement savings, including:

• Changes to automatic retirement plan contributions;
• Contributions of unused paid time off to be contributed to a retirement plan; and
• A detailed explanation of tax-free rollover options.

The guidance is found in several rulings identified below. You can access the rulings by following this link.

Summary of Changes

1. Automatic Contribution Increases under Automatic...