Check out our March newsletter!
Smart Money Monthly
March 2024
(502) 426-0000 ∙ www.Roberts.cpa
TUNE IN AND TIDY UP Declutter Your Space and Sharpen Your Listening Skill After the cold has finally died down, the warm winds of spring are finally upon us. It’s the time of year when we dust, scrub, and vacuum all the dirty corners we’ve forgotten.
mindset. There’s a whole year ahead of us — why not face it with better habits? One of the most common habits is poor listening. March is Listening Awareness Month, making it the perfect time to work on your listening skills. Listening is half of communication. We learn, empathize, and relate to people we listen to. Actively engaging with others lets them know you care about them, building stronger relationships. Next, it ensures you don’t miss crucial information, both at home and in the workplace. If you don’t listen to an important conversation with your boss, you may get into trouble later. For these reasons and more, listening is a vital but rare skill. "Besides throwing away tax records and dusting shelves, clean out those bad habits. There’s no time like the present to start working to improve your mindset." While listening is essential, most people don’t know how to listen properly. One study found that people only remember 10% of what they hear. While listening is a crucial part of most careers, it’s not usually considered a subject in and of itself. By taking the time to acknowledge the importance of actively tuning in, we have an opportunity to improve those crucial communication skills. Are you interested in sharpening your own listening skills? The key is to be more mindful about it. If you feel your mind wandering, pull it back and pay attention. Be present and make eye contact. It’s more difficult than it sounds, but you’ll become a better listener over time. At Roberts CPA Group, much of our craft is listening.
Make sure to throw out outdated records. There are too many file cabinets stuffed with ancient financial documents to the point of bursting. The maximum you’d need to keep records is seven years for payroll purposes. Bank statements and everything else can be thrown away after five years. Financial records tend to have important information on them, such as Social Security and bank account numbers. It’s unsafe to throw away financial documents where people can find them. Unscrupulous individuals root through trash and recycling bins to find such documents and steal identities. Shredding is the best way to dispose of records. It’s easy, cost-effective, and secure. Shipping companies like UPS offer in-store shredding for a fee, on average around $1 per pound. This is the ideal method if you don’t want to shred often; if you do plan on doing it often, buy your own machine. It’s more convenient and may pay for itself over enough shreds. It’s also highly satisfying. Besides throwing away tax records and dusting shelves, clean out those bad habits. There’s no time like the present to start working to improve your
Everyone’s tax situation is unique, so a complete understanding of a client’s tax history is essential for us to do a top-notch job and provide the services our clients deserve. Listening Awareness Month lasts all year for us; we always keep our skills in check by remaining aware of our listening. —Kevin Roberts
(502) 426-0000 ∙ 1
Published by Newsletter Pro • www.NewsletterPro.com
ESG: The Present and Future of Ethical Investment How Investors Rank Ethical Business Practices
Investment and ethics can sometimes be at odds with one another. Historically, investors haven’t prioritized the moral implications of giving money to companies with dubious business practices. Today, some people hesitate to invest in companies that compromise their values, but with ESG, they can have a clear conscience. Environmental, social, and corporate governance (ESG) is a new investment approach that gives investors a real voice. What does ESG mean?
factors to determine ESG scores. They use a 1–100 scale; the higher the number, the better their ESG ranking. How do I invest in ESG? There are several methods to find and invest in ESG-conscious companies. Financial advisors specializing in ethical investing can lead you in the right direction, showing you companies with solid returns while following sustainable business practices. Some prefer to put their money in ESG mutual funds. Experienced brokers and managers invest for you, picking organizations that show promise in growth and ethical impact. Some focus on specific parts of ESG, especially environmental investment. ESG is about Investing in your values. ESG investment is a revolution in ethical investing, streamlining the process to help ethically conscious companies. But it’s not an accident: A network of research firms, funds, and brokerages work to support this new method of ethical investing. You shouldn’t have to sell your soul to make money on your investments. The bottom line is to be smart about your investments. Do your homework before making any investment decisions so you can earn the best returns in a way most compatible with your values and financial goals.
E is the environmental category and refers to companies following sustainable business practices or creating products that combat climate change, deforestation, and other environmental concerns. S is for social, which emphasizes human rights and community relationships — for example, fair trade certification, which warrants that producers of a product are fairly compensated for their work. This would be absolutely necessary for investors in social-oriented organizations. G gives investors a standard for corporate governance to ensure companies have equitable compensation for employees.
Who determines what companies are ESG-conscious? Research firms like Bloomberg compile stats on a wide variety of companies to ensure investors know where they’re putting their money. Researchers look at annual reports, company structure, and other
Asset Appraisals Are Vital to Retirement Planning KNOW YOUR FUTURE
you report them accurately. Here are a few cases where it's essential to hire an appraiser. Retirement Everyone has a unique lifestyle, and making a retirement plan that allows you to keep it is vital. Since you won't be working, this is primarily determined by your savings, passive income, and assets. A comprehensive understanding of your assets' true worth allows you to better prepare for the future. You'll want to know if an asset can pay for part or all of your retirement needs and wants. Estate Planning You need an appraisal to leave the best legacy for your loved ones. First, it's easier to split assets if you know their value. If you want to give out equal parts of your estate, accurately assessing your assets protects your family from turmoil. Nobody likes to feel left out, and estate disputes are a common source of family division.
Furthermore, the sum total of your assets determines whether or not you're subject to estate taxes. Most people don't have to pay an estate tax — the federal estate tax only affects those with more than $13 million in assets. If you wonder if you're in that category, find an appraiser today. Selling Property If you're selling property, you must know how much it's worth. Property value changes over time for several reasons, including the neighborhood's desirability and the overall economy. Only an appraiser can accurately estimate the value of a property. An appraisal is essential for anyone who wants to retire with peace of mind, create an accurate estate plan, or sell a property. Most people fall into these categories and should get an appraisal. If you count yourself among them, give us a call today.
We accumulate myriad assets throughout life, from rare books to motorcycles to outsider art. It isn't easy to keep up with the total value of your assets, which you will need to know during estate planning. And the only accurate way to do that is through an appraisal. A professional appraiser can accurately assess the market value of your assets, ensuring that
2 ∙ www.Roberts.cpa
Published by Newsletter Pro • www.NewsletterPro.com
Irish Pancakes Inspired by TheKitchyKitchen.com Start your March mornings off with a seasonal flair by making these traditional Irish pancakes! Thick yet crispy, these pancakes are a sweet way to fuel your day. • 2 cups all-purpose flour • 1/2 tsp baking soda • 1/2 tsp kosher salt • 1 tbsp white sugar INGREDIENTS
LEGAL SHIELD, FINANCIAL FREEDOM Understanding the Strengths of LLCs Many small businesses with sole proprietorship form a limited liability company (LLC). LLCs are structured as a hybrid between corporations and partnerships to protect the proprietor while reducing taxes. They have several benefits and are an excellent option for those interested in starting their own business. Personal Asset Protection Like corporations, LLC owners — called “members” — aren’t usually liable for the business’s debts. They can run their company knowing they’re protected from its creditors, reducing the risk of starting and running a small business. LLCs are much more secure than partnerships, another company classification that holds members personally liable for the company and subject to its creditors. An LLC can lose its liability protection in some circumstances. The government can revoke liability protection if a member uses business assets for personal use and vice versa. LLCs must publicly announce their LLC status and possess adequate documentation. While LLCs can be owned by one person, they’re not sole proprietorships, so they shouldn’t be treated as such. Pass-Through Taxes The IRS treats LLCs as partnerships for tax purposes. They aren’t subject to entity-level taxes; instead, they use individual returns through “pass- through taxation.” They are only taxed once, which streamlines the process and potentially reduces taxes. Some people choose to be classified as a corporation rather than an individual, creating an S corp. Those come with their own advantages and disadvantages. Many LLC tax deductions depend on qualified business income (QBI), which reduces up to 20% of QBI classified income. QBIs have limitations for larger companies. Claim Cost and Loss Another pro of LLCs is that you can claim business expenses and losses on your personal tax return, so long as you’re actively managing the company. Doing so shelters you and — if you’re married — your spouse from other sources of income. Forming an LLC is an exceptional option for many small businesses. They can save substantial money on taxes while protecting members from debts. So long as members operate with good faith and best practices, an LLC is the perfect classification. Are you interested in starting an LLC? A CPA can help advise you through the process.
• 1 large egg, beaten • 1 cup buttermilk • 2 tbsp unsalted butter, divided
DIRECTIONS
1. In a bowl, sift the dry ingredients together. Set aside. 2. In a skillet, brown 1 tbsp of butter. 3. In a separate bowl, mix the beaten egg, buttermilk, and browned butter. 4. In a constant stream, add the wet mixture to the dry ingredients while stirring. Do not overbeat! 5. Heat a skillet over medium-low heat. Add 1 tbsp of butter, stir until the skillet is coated, and then add a few large dollops of batter (about 3 inches wide) to the pan. Do not overcrowd. 6. Cook 4–5 minutes a side, until golden brown and cooked through. Serve with butter, jam, and syrup.
SUDOKU
(502) 426-0000 ∙ 3
Published by Newsletter Pro • www.NewsletterPro.com
PRSRT STD US POSTAGE PAID BOISE, ID PERMIT 411
201 Townepark Circle, Ste B-1 Louisville, KY 40243 FOLLOW US!
INSIDE THIS ISSUE 1 Spring Cleaning Your Home and Listening Habits 2 The Ins and Outs of ESG Investment The Power of Professional Asset Appraisals 3 How LLCs Provide a Strong Foundation for Small Businesses Irish Pancakes 4 Ensure Your Assets Are Distributed Wisely
Asset Distribution Done Right Know Your Options to Help Protect Beneficiaries
Discussions about inheritances are often delicate. However, the goal is to consider the unique circumstances of your children or other beneficiaries. You want to provide for loved ones without offending anyone in the process, yet some are more responsible with money than others, and you want to help them make the most of their inheritance. Here are a few suggestions to set your family up for success after you pass.
time while you’re still around. You can set up a few different ways for the successor trustee to distribute assets from the trust, depending on your family circumstances: outright distributions, staggered, or discretionary. An outright distribution means beneficiaries receive assets without any protections — but an irresponsible recipient might squander the inheritance very quickly. The staggered distribution allows you to set the rules about how and when funds will be distributed or if any triggering events will play a role (turning 18, marriage, etc.). The last option is to give your successor trustee discretionary power to distribute assets — they will decide when and what a beneficiary will receive. Choosing the Right Trustee Whichever distribution option you choose, selecting the right person or entity to be your trustee (an individual, a private fiduciary, or a bank) is crucial. They should be trustworthy and fair, especially if you grant them discretionary power. They’ll be in charge of making sure your assets are distributed according to your wishes — and their best judgment. Being firm in your care for others won’t make you the villain. Thankfully, you can share your legacy and assets according to your best judgment and discretion. You have several options and tools — just remember, you know your children best.
No-Contest Clauses Employing a no-contest clause in your will can eliminate any potential in-fighting or contention to break away from your wishes. It automatically disinherits any contentious family members. If you know your kids enjoy bickering, then adding this no-contest clause puts them on notice to leave their bickering aside, especially in court. Preventing a long, drawn-out court mess is a surefire way to take care of your family. It’s an easily added clause; you just have to choose to include it. A Living Trust Establishing a living trust is one way to delineate how you want your assets to be distributed after you pass, and you can revoke or change it at any
4 ∙ www.Roberts.cpa
Published by Newsletter Pro • www.NewsletterPro.com
Page 1 Page 2 Page 3 Page 4Made with FlippingBook Ebook Creator