Concierge CPA's online newsletter for May 2018
May 2018
8221 Brecksville Rd, STE 205 Brecksville, OH 44141
Borbala@ConciergeCPAs.com
(440) 340-1030
ConciergeCPAs.com
My Camera Broke … And Taught Me a Lesson How Shooting With Film Has Given Me a New Perspective
My office walls are decorated with pictures I’ve taken over the past few years. In reality, my office is the only “gallery” that would exhibit these pieces of art, so I’m planning on keeping my CPA license active for now. It has become a tradition of mine to go on a road trip every year after tax season to explore a different part of the country. So far, the Southwest is one of my favorite destinations. Embracing the weirdness of Burning Man in Nevada, driving through the vast open spaces of New Mexico, hiking up to the Arches in Utah, or spending an afternoon exploring Antelope Canyon in Arizona just fills me with wonder. Taking pictures is really just an excuse to stop and hang around in one place for a while. It also forces me to look at my environment from different points of view and notice things that I would just walk by otherwise. This year, I plan on visiting Maine to take pictures of the lighthouses along the shore. For me, planning is half the fun — I’ve already ordered a couple of books about the region and familiarized myself with the history of the lighthouses and the surrounding fishing towns. Of course, I’ll have to visit the local restaurants where the best “lobstah” is served as well. Unfortunately, my camera broke a few months ago, so I’ve been looking to buy a new one. There are so many new cameras on the market with great new features that it is almost impossible to choose one. I recently heard a quote that stuck with me: “Every famous photograph was made with a camera less advanced than the one you are using now.”This statement might be an exaggeration, but it made me think. Rather than buying the latest and greatest gear available, I ended up purchasing an old film camera from the ‘70s. Not the exact model I had when I was a child, but something similar. When I was growing up, my father had a small darkroom set up in the corner of the utility room. It was a tiny space, but it felt like a magical place to me. I remember curiously
Downtown Cleveland (photo by Laszlo Szilagyi)
watching the photo paper as it was submerged in the developer and a faint picture started to appear.
Filled with nostalgia, I started my journey into shooting film. I was surprised by the fact that most retail places like Walmart and CVS still develop film, but unfortunately, they only provide low-quality digital scans, and they don’t return the original film. This arrangement wasn’t acceptable to me, so I kept exploring my options. I thought about developingmy own film, mostly because the how-to videos onYouTube made the process seem so easy. After several failed attempts, I can confirm that watching a few videos on the internet doesn’t make one an expert. What’s most important is that I’ve been enjoying this journey, and I even managed to produce some pictures along the way. Even though I’ll end up buying a new digital camera eventually, the lessons I’ve learned from using this older technology will stay with me.
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1 (440) 340-1030
BORBALA’S SCHEDULE
Weekly Live Roundtable Calls
SEMINARS and EVENTS
Register at BeyondTheNumbers.Club Thursdays at 2 p.m. EDT:
May 8: GKIC Cleveland/Akron Elite Mastermind with Dan Cricks May 9–10: EOA (Entrepreneur Organization Accelerator) Learning Days, Geneva on the Lake, OH May 12: Seminar held for the Chinese Chamber of Commerce, Independence, OH May 17: Women’s Business Center event, Cleveland, OH May 23: Cleveland Metropolitan Bar Association, solo and small law firm section, CLE May 31–June 11: Business trip to Beijing and Shanghai, China June 13: GKIC Cleveland/Akron Elite Mastermind with Dan Cricks June 14: EOA meeting and accountability group, Independence, OH June 21-24: Renegade CPA Superconference, Atlanta, GA June 28: Presentation at WBC’s Think Tank Thursday, Cleveland, OH
• May 17 • May 24
• June 24 • July 5 Client Advising and Coaching Days
• May 16 • May 22 • May 29
• June 13 • June 19 • June 27
Schedule at Borbala.AcuityScheduling.com Prospective client inquiries: Borbala@ConciergeCPAs.com
CLIENTS OF THE MONTH: THE BURL FAMILY
I have the privilege of introducing you to the Burl family: May, Michael, and their kids, Elizabeth and David. I’ve known the Burls for more than a decade now and love seeing them each year! The family moved to the U.S. from the U.K. and settled in northeastern Ohio. Michael is a scientist and has worked for a number of high-profile companies. May, who is originally from France, went back to school to earn a bachelor’s degree in accounting, all while working as a staff accountant and raising two beautiful, smart, well-adjusted kids! Both kids attended Ohio University on scholarships and graduated with engineering degrees. David got a prestigious job offer from IBM right out of college. Liz held hard-to-get internships with Google while in college, and was offered and accepted a job with them in San Francisco right after graduation. This past fall, David also got a job offer from Google and moved out west. My first in-person meeting with Liz was right after she graduated and was about to start working for Google. She asked her mom to drive her to my office to meet me in person — she felt she needed a CPA now that she had graduated and was working full time! How responsible and proactive is that? We talked about how we could
work together remotely, what
record-keeping she needed to do, and what tax-saving opportunities were out there for a young professional holding a W-2 job. I love how down- to-earth, kind, and hardworking the Burls are! They have smiles on their faces
each time we see each other, they come to their tax appointments prepared, and I get to hear stories about Liz and David’s exciting life at Google.
Michael, May, Liz, and David, thank you for being such good clients! I wish all four of you a great summer. See you next year!
–Borbala Banto, CPA
2 ConciergeCPAs.com
How New Tax Laws Affect Meal Write-Offs Under the new tax law, dining, meals, food in the office, food while traveling, eating with employees, and eating with partners or clients all have one thing in common: They’re confusing! • Meals to hold a required lunch meeting on the business premises with your employees (not with your business partners or clients). ... Continued from page 4
• Meals to hold a required business meeting with your employees at an off-site location that passes the definition of a business premises (think hotel, not restaurant).
Yes, most of it is still a write-off, but what percentage and how to stay out of hot water with the IRS, well … that’s a whole other question.
First, let’s examine the types of meals. I’ll try to“set the table”with four main options to consider and what you should be tracking in your books. Type 1: DiningWith a Prospect or Important Client This is the most common meal expense we have all relied on and utilized in our businesses for years. It’s typically deductible at 50 percent, and we hope that continues to be the case. Regrettably, there is a growing debate and sharp divide among CPAs and tax professionals who believe that meals out with a client, prospect, or business partner are not deductible. The argument is that when the entertainment expense was completely repealed under the Tax Cuts and Jobs Act (TCJA), it grabbed the meals expense under its umbrella by default. However, it appears that a majority of tax professionals expect IRS regulations or further congressional guidance to“clarify”the issue. Specifically, we are expecting that meals unrelated to any entertainment experience will still be deductible. Thus, we are directing our clients to track these expenses in 2018 but to not deduct them until further guidance from Congress or the IRS is provided.
• Food in the office for employees’and your convenience, such as bagels, doughnuts, coffee makers, and watercoolers.
• Meetings that include a lunch fee; for example, at the chamber of commerce or bar association.
Type 4: Marketing Presentations, COGS Food Expenses, and Year-End Parties for Employees Yes, some types of food expenses survived and are still 100 percent deductible! These are items where food is paid for in a nonentertainment venue for the general public at a marketing presentation or“open house.”Moreover, you can deduct the food and costs for a team-building event or year-end party exclusively for employees (not the owners of the business or certain highly compensated employees). Consider this an experience for your rank- and-file employees. SubstantiatingYour Expenses In light of these more complicated— and confusing— rules, it’s more critical than ever to track your expenses carefully in order to allocate and deduct them in the proper manner come next spring. Bookkeeping Is More Important Than Ever We are highly recommending our clients create bookkeeping categories/expenses in QuickBooks for these four types of meal expenses. This way, at the end of the year, you can better strategize, substantiate your expenses, and make sure you take the proper percentage write-off for the right type of expense.
Type 2: DiningWhile Traveling Good news here —no changes.
Type 3: MealsWith Employees, AssociationMeetings, and Food for Employees Under the new tax law, these expenses are now limited to 50 percent. Here are a few examples of these expenses:
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what I wanted . I had to practice anticipating the future and focus on something I wanted to happen rather than on something already in front of me. I had to be ready before the moment happened. I’m not a pro photographer; it is only a hobby that helps me relax. But the lessons I’m learning can easily be translated to other areas of business and life in general.
My biggest takeaway so far is this: Limitations are not my enemy — my lack of practice and ingenuity is.
For example, I only have 36 shots on a roll of film. This is a serious restriction, especially when I think about the fact that my phone can take thousands of high-resolution pictures and 4K video. But having this limitation puts me in a different frame of mind. I look around twice before choosing what to take a picture of and I double- and triple-check my settings. Only then do I take the picture. Shooting with film also takes more time to manually set the exposure and focus each image. This is particularly annoying when the subject is moving. Last week, I walked around downtown Cleveland and wanted to take a picture of the light rail car as it turned a corner. I missed the shot a few times, but I eventually got
• We’ll never be able to get rid of all limitations, so being able to find a way around them is more important.
–Laszlo Szilagyi, CPA • It takes practice to focus on the future and anticipate what will happen, but sometimes it is required to take advantage of a new opportunity.
3 (440) 340-1030
8221 Brecksville Rd, STE 205 Brecksville, OH 44141
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(440) 340-1030
INSIDE Life Lessons My Camera Taught Me Page 1
ConciergeCPAs.com
Borbala@ConciergeCPAs.com
Borbala’s Schedule Page 2
Clients of the Month: The Burl Family Page 2 Deducting Meals in 2018? Read This First Page 4
DINING EXPENSES BUTCHERED IN 2018
The Tax Cuts and Jobs Act contains massive changes that have an impact on many aspects of our lives. The new law affects individuals, businesses, tax-exempt organizations, estate and gift taxes, and international taxes. We’ll look at the new law piece by piece to find opportunities that can benefit you and to help you avoid some potential pitfalls. As with most new laws, not every detail is clearly defined yet, so I’ll keep an eye out for updates and will let you know if something changes. Under the new tax law, the way you write off meals and food expenses in your business has changed.
with employees, and eating with partners or clients all have one thing in common: They’re confusing! Yes, most of it is still a write-off, but what percentage and how to stay out of hot water with the IRS, well … that’s a whole other question. First, let’s examine the types of meals. I’ll try to “set the table”with four main options to consider and what you should be tracking in your books.
Type 1: DiningWith a Prospect or Important Client
Type 4: Marketing Presentations, COGS Food Expenses, and Year-End Parties for Employees
Type 2: DiningWhile Traveling
Type 3: MealsWith Employees, Association Meetings, and Food for Employees
Under the new tax law, dining, meals, food in the office, food while traveling, eating
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