Financial: Starting 2014 the right way

HomeColumnsFinancialFinancial: Starting 2014 the right way

January 20/27, 2014; Volume 27/Number 19

By Bart Basi

So far, the consensus is that the economy will be relatively stable in 2014. With an average of 140,000 jobs being created each month last year and most economic indicators showing positives, this year should be better than last. Too often, businesspeople wait until late in the year to do their strategic planning. While there are some actions that can be taken at that point, those who work proactively throughout the year implementing business and tax strategies perform far better than those who put off planning to the last minute. There is plenty of business and tax planning that should be executed throughout the year.

According to the latest Beige Book report, the overall United States economy is continuing modest or moderate growth. Given this, businesses should work hard to increase revenue and look to hire additional staff. As of late, there has been a trend toward businesses hiring temporary staff ahead of full-time employees. While many businesses have never explored this option, it is worth developing a relationship with temporary labor organizations. It is expected that business will continue to build and stabilize during 2014, so now is the appropriate time to ramp up labor and inventories.

Investments

Companies tend to instinctively cut investments when business is slow. Ordinarily, purchasing less in leaner times would be appropriate. However, given Internal Revenue Code Section 179, there is still an incentive to make additional investments. So far in 2014, the deduction has fallen to $25,000 and Congress has not reenacted the higher amounts. Given the importance of advanced depreciation, it is likely the limit will once again be increased to $250,000-$500,000. We will have to monitor legislation to stay updated.

Financing

The past economic downturn also brought lower financing rates that are currently remaining in the recovery. Financing of buildings and equipment may be eligible for lower refinancing rates. Check with your bank to see if your loans can be refinanced. Just be sure to check the fees and costs before committing.

Estate planning

Many businesspeople have complex estates, and the average net worth of a businessperson is substantially higher than an employee. The 2014 estate tax exemption is $5,340,000. It is best to begin estate planning early so issues can be resolved throughout the year and the can have time to be implemented. Please review your total estate value and start the process of a complete estate planning process now.

Succession planning

For those who own businesses, business succession planning is an additional item that needs to be addressed. Business succession planning is not as simple as drafting a will, but, when done properly, it provides a smooth transition for the succeeding generation. The process includes the valuation of the business and the creation of legal documents, such as a buy/sell agreement, which is the most important legal document a business owner can have. When succession planning is not done or completed improperly, it usually means the loss of the business and therefore the loss of your lifetime of hard work. Don’t procrastinate; start the process now!

Too often people approach financial, tax, and business planning as an afterthought of running the operations of their businesses. Running a business without a plan to exit and retire is similar to driving a vehicle with no destination in mind. Proper planning and implementation of an exit, succession and tax strategy allows you to keep more of your hard earned wealth and offers a better retirement when the time comes. If you are not sure where or how to start, please contact the experts at the Center for Financial, Legal & Tax Planning, to assist you in your exit, succession and tax planning strategies.

Must Read

Mohawk kicks off National Karastan Month campaign

Calhoun, Ga.—For over 30 years, Mohawk has hosted National Karastan Month for the critical spring selling season. The "Journey Into Savings" event, running until...

FS Builder Resources acquires Leedo Cabinets

The Colony, Texas—FS Builder Resources, a family-owned flooring and interior finishes company, acquired Leedo Cabinets, an American cabinet manufacturer. FS Builder Resources’ acquisition of...

Daltile launches Artefino collection

Dallas, Texas—Daltile recently launched its brand-new porcelain tile collection, Artefino, with three unique sub-collections: Jewel, Vintage and Element. "Professional designers and consumers are expecting the...

Companies ramp up moisture testing tools

When Charity Adeoti first became a flooring installer, she said she didn’t realize how crucial moisture testing was until she experienced it firsthand. “We did...

MSI renovates Atlanta showroom

Austell, Ga.—MSI, a leading supplier of flooring, countertops, wall tile and hardscaping products in North America, has renovated its MSI Atlanta Showroom, located here....

Bjelin launches high-tech wood flooring

Viken, Sweden—Bjelin unveiled its new Slate Collection, a high-tech wood flooring solution. With deep textures and natural color variations, it delivers a cool yet...

As seen in

Volume 27/Number 19

DOWNLOAD
Some text some message..
X