Category Archives: Hiring

SMALL BUSINESS OPTIMISM CONTINUES TO GROW

smallbusinessownerby Isaac M. O’Bannon, CPA Practice Advisor, August 13, 2014

More small business owners say their company’s current financial situation is good, yet their outlook for the next year has not changed significantly, according to a new survey.

The latest Wells Fargo/Gallup Small Business Index score increased slightly to positive 49 (+49) in July, up two points from positive 47 (+47) in April. The score, which measures small business optimism, has increased six of the last seven quarters. Small business optimism is now at its highest point in more than six years, however it remains well below pre-recession levels.

The present situation – how business owners rate current conditions for their businesses – is the main contributor to increased optimism in the latest survey. The present situation score is now at a positive 18 (+18), up four points since the April survey and 14 points from the same period a year ago. Specific factors that contribute to the improvement include:

  • Small business owners are feeling better about their current business financial situation, with 62 percent rating it as very or somewhat good, up from 57 percent in the second quarter 2014.
  • More business owners report their company’s revenues have increased, with 43 percent indicating revenues are up in the past 12 months compared with 36 percent in April.
  • Cash flow over the past 12 months also is at a six-year high. In the survey, 55 percent of business owners report their cash flow has been very or somewhat good over the past year, up from 50 percent in the second quarter of 2014.
  • Ease of obtaining credit in the past 12 months is up significantly – 32 percent of small business owners say that it has been very or somewhat easy to obtain credit in the past 12 months.

At the same time, the future outlook for business owners in the July survey was relatively unchanged, down two points to positive 31 (+31) from positive 33 (+33) in the second quarter. In three surveys conducted in 2014, the percent of business owners who think their businesses’ cash flow, financial situation and revenue would improve over the next 12 months has not moved significantly. The percent of business owners who expect to increase capital spending in the year ahead is the same as those who plan to decrease (25 percent).

“The latest Index scores show small businesses have made gradual progress since the economic downturn –with modest improvement in the economy, healthier small businesses are growing revenue and have stronger cash flow today,” said Lisa Stevens, head of Small Business for Wells Fargo. “However, we know many businesses still face challenges in the marketplace and it’s reflected in the survey results. Many continue to wait for more improvement in their businesses and the economy before they express confidence in the year ahead.”

Business owners report that the biggest challenge they face is attracting customers and finding business (13 percent), followed closely by government regulations (11 percent), financial stability of their business (11 percent) and the economy (11 percent).

When it comes to generating new business, small business owners said the toughest part is marketing and advertising (14 percent), and competition (13 percent). Ten percent of business owners said the costs of running a business make it difficult to attract customers and grow. Another 10 percent said making product improvements or having the latest products is the biggest challenge to growing sales.

STARTING A NEW BUSINESS? THREE THINGS THAT YOU MUST KNOW

newbusinessStarting a new business is a very exciting and busy time. There is so much to be done and so little time to do it in. If you expect to have employees, there are a variety of Federal and state forms and applications that will need to be completed to get your business up and running. Here are three things that every new business owner should know. We can help you with all of these.

1. Employer Identification Number (EIN) 
Securing an Employer Identification Number (also known as a Federal Tax Identification Number) is the first thing that needs to be done, since many other forms require it. EINs are issued by the IRS to employers, sole proprietors, corporations, partnerships, nonprofit associations, trusts, estates, government agencies, certain individuals, and other business entities for tax filing and reporting purposes.

The fastest way to apply for an EIN is online through the IRS website or by telephone. Applying by fax and mail generally takes one to two weeks. Please note that as of May 21, 2012 you can only apply for one EIN per day. The previous limit was 5.

2. State Withholding, Unemployment, and Sales Tax
Once you have your EIN, you need to fill out forms to establish an account with the State for payroll tax withholding, Unemployment Insurance Registration, and sales tax collections (if applicable).

3. Payroll Recordkeeping
Payroll reporting and record keeping can be very time consuming and costly, especially if it isn’t handled correctly. Also keep in mind, that almost all employers are required to transmit federal payroll tax deposits electronically. Personnel files should be kept for each employee and include an employee’s employment application as well as the following:

Form W-4 is completed by the employee and used to calculate their Federal income tax withholding. This form also includes necessary information such as address and social security number.

Form I-9 must be completed by you, the employer, to verify that employees are legally permitted to work in the U.S.

If you need help setting up the paperwork for your business, please call our office today at (727) 391-7373.  We can handle this part of your business so you can focus on running your business.