Category: CPA Services

Like-Kind Exchange Basics

February 23, 2023  |  Barton Walter and Krier

Buying and selling makes the business world go ’round. This is true for products, services, and even real estate. But be aware that selling property for a significant financial gain often means you’re paying a substantial amount of taxes. Reinvesting those profits can help defer tax payments on qualifying property sales. Let’s look at like-kind exchange basics and how this strategy can benefit you. Defining Like-Kind Exchanges If you make money from the sale of a business or investment property, you’re required to pay capital gains tax on the profit. Capital gains tax rates depend on the time frame of the sale and its profits —short-term at 10-37 percent, or long-term between 10-20 percent. Internal Revenue Code Section 1031 allows a seller to postpone paying capital gains tax by reinvesting the profit in a qualifying like-kind exchange (or 1031 exchange). However, to avoid a tax liability, keep in mind that: • The property being sold cannot be a principal residence• Property purchased with the profits must be similar to the property being sold• The properties must be exchanged and not sold directly• Properties must be within the U.S. to qualify• The property for purchase must be identified as a like-kind exchange within 45 days and purchased within 180 days of the sale In […]

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An ERISA Fundamentals Review

February 9, 2023  |  Barton Walter and Krier

The Employee Retirement Income Security Act (ERISA) oversees and manages benefit plans provided to employees by their employers. Since its inception, some guidelines have been amended, but the basic principles remain the same. At Barton, Walter & Krier, we wanted to present an ERISA fundamentals review and offer our services to businesses on this retirement plan protection. ERISA Explained In 1974, the ERISA federal tax and labor law established regulations on employee benefits plans. The goal was to protect participants’ retirement savings from potential misconduct. The safeguards set forth by ERISA protect current employees and their beneficiaries as well as retirees. Employer-sponsored plans covered under ERISA include 401(k)s and 403(b)s, pensions, and profit-sharing plans. Specified non-retirement plans such as FSAs, disability and life insurance, and HMOs are also covered by ERISA. Updates to ERISA While the initial act incorporated the minimum standards for benefits plans, the laws have been updated over the decades to reflect healthcare legislation and workers’ ever-evolving needs. Some of the most important modifications to ERISA include: Eligibility and Obligations Requirements for ERISA apply equally to private-sector businesses of all sizes. Plans that provide benefits to businesses with at least one employee are covered, as are S-corps and C-corps, partnerships, and LLCs. At the minimum, employers are required to act […]

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Preparing Your Business for the Long Term

November 20, 2022  |  Barton Walter and Krier

Running a business is more than a 9-to-5 job. And with day-to-day elements to juggle in the present, it can be difficult to think about the future. But preparing your business for the long term is something to consider right now. Keep reading to learn what you should be doing and to uncover hints for succession planning. Succession Planning Rundown When it comes to business, no one can predict what will happen next week — or even tomorrow. That’s why it’s important to have a plan in place for if or when things change. Key players may retire, become ill and unable to work, or find new positions with other companies. With succession planning, you can prepare for the unexpected. The idea behind succession planning is to ensure your company has the right people in place, ready to fill certain roles should they become vacant. If a change occurs, you and your current staff can quickly adapt and keep operations running smoothly. The Benefits of Having a Plan Planning ahead for something that may or may not happen can seem like a hefty undertaking. But being proactive will help ensure the consistent pace of your business and help streamline any shifts in responsibility. When time is money, having a plan in place provides […]

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