Most small businesses hire an expert to handle their accounting, as taxes are sometimes challenging to understand. Small business owners should educate themselves regarding the basics of the TCJA as its changes to the federal tax code have a profound impact on their businesses. Here is what you should know.
What Is the Tax Cuts and Jobs Act?
The code lowered the income tax rates of C corporations from 35% to 21%. Other changes introduced by the TCJA affect S corporations, sole proprietorships, and partnerships, and the changes reduced the maximum tax rate for certain taxpayers. Such numbers may suggest that the TCJA has various benefits for your business as lower tax rates theoretically allow you to keep more revenue, increasing your profitability. However, the changes brought by the TCJA does more harm than good for small businesses.
What the TCJA Means for Small Businesses
The TCJA affects small businesses in various ways. These changes may feel concerning and surprising, but you are not alone in this. The 2018 tax year was the first year to be affected by the TCJA.
Smaller Net Operating Loss Deductions
You could forward unused losses for 20 years or back for two years. The TCJA limits the deduction to 80% of the net operating loss, and you are not allowed to carry unused losses back. There is no limit on how long you may carry them forward, but the overall effect results in a smaller deduction, which results in higher tax rates.
Smaller Business Interest Deductions
Before the TCJA was implemented, investors could deduct the interest accrued or paid on certain business debts. The TCJA has capped the deduction at 30% of your company’s accrued or paid interest. The maximum deduction would be the sum of 30% of your adjusted taxable income and the business interest income.
Lower Tax Payments
The TCJA indicates that C corporations owe 14% less yearly taxes. If your business is an S corporation, sole proprietorship, or partnership, it could owe less in annual taxes. However, surveys done by investors indicate that the deductions the TCJA eliminates have always resulted in higher tax payments.
Due to the many changes brought by the TCJA, small business owners may feel uneasy, especially when tax time approaches. However, online tax software platforms are updated regularly to reflect the latest tax codes. Contact a small business accountant from Dorra Financial Group to calculate and file your taxes to minimize your future tax liabilities.
Thinking of running a food truck? There are many compelling reasons to invest in the food service industry, and a food truck provides a platform that can be adapted to a variety of business endeavors. If you want to grow your food truck business, consider the following tips for success:
Do your homework. It is necessary to perform quite-expansive research into the market to see what consumers in your region do- and do not- patronize. Find the trends and jump on board.
This leads to choosing what you offer carefully. You don’t want to invest in foods that don’t make sense for a truck- after all, is this the right venue for those choices? Choose the food based on your market research and revenue potential.
Make an exhaustive list of what you need to get started. Figure out how much money you will need to ask for- if borrowing- to keep your truck running smoothly for at least a year.
Do not go to all this effort with a truck that is doomed from the start. Make sure that you have a fully functioning and safe food truck to begin with. After all, it is the cornerstone of your new business.
If you will be requesting funding, set a budget and stick to it. This will also make it easier to measure gains and losses during operation.
Get creative about marketing your truck and make sure to take advantage of social media platforms. This will be a great way to let your patrons know where you will be parked so they can come and find you with ease.
Start now identifying high-traffic locations where you will park your truck. Begin pre-planning a route, but try to remain flexible, too.
Be sure to address and respond to any comments or reviews, particularly if there is a concern or complaint. Reply promptly in a courteous manner.
Want to grow or expand your small business? Talk to the money professionals at Dorra Financial Group. They can shed new light on your funding options, investment potential, and revenue streams that may help your business thrive and prosper. Call or visit today to learn more.
If you’re looking to gain and retain more customers (and who isn’t?), invest in website personalization. Your online business can be better than ever by catering directly to visitors of your online store.
Sales teams tire out when spending the bulk of their time searching for qualified leads. Create a website marketing campaign that segments your audience into personalized funnels. The strategy can arm your sales department to problem-solve for customers with the perfect products. Salespeople get to the best prospects quickly and spend less time closing a deal.
Targeted Product Recommendations
Your site can collect valuable data to discern precisely what item a shopper is looking for. More than ever, customers want to comparison shop and investigate. Use software to personalize and recommend comparable items on the page. You also can upsell with add-ons and warranties related to the item once they purchase. Link to onsite product reviews and send emails with news on price changes and deals to entice them back to the site.
More Time on the Website
Let the visit history and cookies to deliver value to customers. Blogs with product reviews, demonstrations and instructions keep customers on your site longer. Build your site in a way that welcomes visitors back and lets them pick up right where they left off.
Shoppers want to sense a personality behind the brand. Online shopping can be just like making a digital visit to their favorite brick-and-mortar shop. Make the shopping experience as seamless as possible, and customers will stick to you, even if other brands offer lower prices and other unique selling propositions.
A loyalty program is an excellent way to gain repeat business, but a poorly-tailored loyalty system becomes a sore spot among customers. Customers keep returning to the comfort of your site with that personal touch.
Better Conversion for CTAs
Customers typically need the motivation to take the final step, and when it feels like a trusted friend is guiding them, they’re more likely to heed the call. Avoid repeating the same CTAs to returning visitors. For example, if you repeatedly ask an email subscriber to subscribe to your mailing list, you can annoy clients and lose their business. Presenting fresh offerings builds anticipation and engagement.
Website personalization pays off by earning you a strong repeat customer base that promotes your shopping experience over competitors. Take advantage of user data to benefit your customers and build your brand.
Due to the busy life of most parents, preschool-aged children often receive some form of child care. Most of the kids are cared for by babysitters, nannies, and other family members, and nearly 1 in 4 children under the age of five is taken to an organized daycare center for childcare services. Below is a list of steps to starting a daycare center, even if you have no prior experience.
Research About Daycare Licensing Requirements
You may have started as a nanny or babysitter but must meet the required licensing requirements when creating a daycare business. That way, you can offer childcare services without running into legal trouble. You may start by contacting the state’s Department of Children and Family Services (DCFS) to learn more about specific regulations for childcare service providers. You must have CPR certification, a clean driving record, and documents proving you are committed to providing quality child care. Ask your local agency questions to ensure you satisfy all the requirements.
Create a Daycare Business Plan
Have a business plan that defines your daycare’s operations and procedures, a mission statement, budget, and staffing. The business plan helps to keep you on track and guides you through the startup process. It would be best if you also researched the costs of launching a profitable childcare services business. You may fund your daycare startup with your own money, daycare grants, or a small business loan.
Find a Location for Your Daycare
Whether you are planning to rent an already existing daycare, start an in-home daycare, or start a daycare from scratch, you must find a conducive location for your daycare business. Ensure you check the childcare licensing guidelines and the city’s zoning laws to ensure the daycare business complies with the guidelines.
All daycare centers require various insurance types to protect children and businesses. Insurance policies include property, liability, business insurance, and workers’ compensation. You have to check with the local childcare provider’s licensing requirements for guidance.
Hire Staff to Run Your Daycare
A daycare with qualified staff is highly sought after by most parents. Childcare staff are subjected to fingerprinting and background checks for further background investigation.
Starting a daycare business is challenging but also rewarding in the long run. You must have a general roadmap for how to get started and contact an expert from Dorra Financial Group to know how you can secure funds to run your daycare.
If you run a business and have a cash-flow concern, the first thing that may come to mind is to apply for a loan? But, there are many kinds of loans. There are other options as well. Which one is best for you?
Loans in a Nutshell
A loan is fairly easy to understand. Once approved, you receive a lump sum of capital from a bank, credit union, or financial agency. In return, you must pay the principal amount back with interest over a set amount of time, usually in monthly installments. The interest rate may is fixed at the time the loan is created, or it may vary over time.
Types of Small Business Loans
After determining that your business needs a bit of additional capital, these are choices to be made. In actuality, there are several types of loans as well as other funding options to consider. Here are a few loan types that might be useful for your business:
- SBA Loan. Guaranteed by the federal government
- Working Capital Loan. Used to fund everyday business expenses like payroll, rent, and operational costs
- Franchise Startup Loan. Specifically designed for new franchise owners
Then, there are alternative forms of funding to consider. These include but by no means are limited to:
- Invoice Factoring. An elegant process by which you sell outstanding invoices to a financing agent
- Merchant Cash Advance. An infusion of capital taken against your future credit card sales
- Equipment Financing. Specially designed for purchase or rental, and often not needed collateral
Partner with Dorra Financial Group
Here at Dorra Financial, we provide useful solutions for business funding needs. We’d love to be your financial partner. Give us a call today to explore the options that would best fit your particular business situation, whether it is a loan or another form of alternative financing.