Toph CPA - November 2020

Toph CPA - November 2020

NOVEMBER 2020 VOLUME 4, ISSUE 11

T O P H ’ S TAX RESOLUT ION T I M E S

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START SETTING REALISTIC EXPECTATIONS AS YOU PLAN FOR THE FUTURE Keep It Real

When I first started my business, I was navigating my own debt issues. I could see the light at the end of the tunnel, and I knew if I dedicated myself to my new business, I would find success. I thought I was setting realistic expectations. However, as I quickly learned, it’s easier to say you have realistic expectations than it is to actually have them. The truth is that while I told myself I would take it one day at a time and would follow my plan, I wanted immediate success. We’ve all been drawn in by the idea of quick success and instant gratification. However, when it comes to things like creating or growing a business — or maintaining a business through a pandemic — instant gratification simply doesn’t exist. Earlier this year, as the pandemic started to make its way into our community, I knew we would have to make changes to our business. Just about every business was in this same boat. The business model that worked in 2019 wasn’t going to work in 2020. No matter how much I wanted to adapt my business to changing circumstances due to the pandemic, I knew it wasn’t going to happen immediately. Anything I wanted to implement needed careful planning, along with consistency, commitment, and persistence. I had to make sure nothing fell through the cracks and that all of my clients were taken care of. If you don’t give yourself time to carefully plan, and then implement, major changes to your business — and set realistic expectations — you likely won’t be happy with the results. Here’s another common example from the last several months. As the pandemic took hold, many businesses abruptly stopped their marketing initiatives. They were afraid that the costs related to marketing would be too high in the pandemic climate. They expected the costs of marketing plus the potential loss of customers to be overwhelming. They decided they needed that money in other parts of their business. The problem is that they took their business off the radar. Customers and potential customers weren’t seeing the name of that business anymore, whether it’s in online ads or in print.

This doesn’t mean you shouldn’t reallocate funds, but you first need to manage expectations. Don’t automatically expect that you need to stop doing any marketing in order to better manage expenses. Instead, expect that your marketing needs to be adapted. Many businesses jumped the gun. Instead of planning for a changing environment and adapting their marketing, they shut off the valve completely, which may have done more harm than good. When it comes to managing expectations for any small business or self- employed individual, start by looking at where you are right now . Then, look at where you want to be. Make a plan and give yourself time to get where you need to go. Careful planning — along with reining yourself in — can go a long way in setting realistic expectations for yourself and the future of your business.

–Toph Sheldon

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WHEN THE IRS COMES KNOCKIN’ ... LET US ANSWER THE DOOR!

‘Dare to Lead’

It’s an election year! Thankfully, by the time you read this edition of the newsletter, the election will be over. But we’re not here to talk about politics or the president. We’re here to talk about taxes! While there are many questions on the minds of small-business owners and those who are self-employed, there’s one question a lot of people are asking: How will the pandemic impact my future taxes? There are a few things to keep in mind. Billions of dollars were spent on stimulating the economy. The fact is that the government must find a way to pay for everything they spent in the process. This means the IRS is likely to be more persistent and aggressive in the coming years as they work to collect what is owed, which will result in a significant rise in collection actions, once the pandemic subsides. People collected unemployment this year at a record rate. While the extra $600 per week was beneficial for people who were out of work during the early months of the pandemic (and the extra $300 in the later months), this money counts as taxable income. Anyone who collected this money will owe the IRS, and if they did not plan for this, they may be in for a big surprise next year. Be sure to check your withholding. If you experienced any changes in your income, your family, or business, or anything else that may impact your taxes, check your withholding to ensure it is accurate and appropriate for your situation. In 2020, some government programs also let companies change withholding amounts on the back end, including medical and tax withholdings. 3 Things to Keep in Mind The Pandemic and Your Taxes

Learn and Grow With a Professional Association

How many leaders do you know who will admit to their mistakes openly and honestly to their team? How many leaders have you heard ask their team for direction? How many leaders are willing to step aside so someone else can shine? Chances are if you know that leader — or if you are that leader — then you understand the future of leadership, according to author, researcher, and teacher Brené Brown, Ph.D., author of “Dare to Lead: Brave Work. Tough

Conversations. Whole Hearts.” In this book, Brown details her seven years researching and gaining a better understanding of leadership. She interviewed business leaders at both small and large companies, asking questions that revealed what great leadership looks like. Together with her research team, she learned why certain workspaces thrive and grow while others, with seemingly just as powerful of ideas, wither and die. And it all boiled down to one thing, Brown says: courage. In “Dare to Lead,” Brown examines the four pillars of courageous leadership and how business leaders today can practice and perfect it. Brown teaches the four pillars through her consulting work and has seen radical changes in organizations that practice courageous leadership. Brown offers examples — from well-known CEOs and within her own business — to walk readers through real-life applications of courage and how to create stronger teams through vulnerability. Brown exposes how business cultures that don’t practice vulnerability are ineffective as a result. She theorizes that often, these workspaces are filled with fear, uncertainty, and scarcity. To remove these negative traits, Brown offers leaders a road map to build their courage while practicing vulnerability and creating happier work environments. Brown has spent the past two decades researching and breaking down emotional concepts into tangible goals for her readers and followers. She is the owner of The Daring Way, a consulting firm that helps businesses develop vulnerability in leadership and the workplace. She is also the host of the podcast “Unlocking Us” and has one of the most-watched videos of all time, “The Power of Vulnerability.” You can learn more about Brown’s work and find “Dare to Lead” at BreneBrown.com.

To compensate, they may double withholding over the 2021 tax year. This is

all the more reason to make sure you know the status of your withholding.

If you have questions about your taxes as

2020 comes to an end, don’t hesitate to give us a call at

(513) 342-4000 . We’re here to answer your tax questions and make sure you’re informed for whatever

happens next!

–Toph Sheldon

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Parenting in a Pandemic

If there’s one thing I can say about our kids, it’s that they are adaptable! Over the past several months, they have handled the pandemic like champs. I’d go as far to say they are handling it better than the adults!

Every once and a while, they’ll mention that they miss their friends and we’ll set up a small play date. This way, they still get social interaction, and we don’t have to worry about them running around with large groups of kids.

Thankfully, we only have one kid actually going to school this year, so that helps a lot. Our oldest, Mac, started in-person kindergarten. He wears his mask and sits in his assigned, socially distant spot. And he doesn’t say a word about it. He hasn’t complained at all! Of course, this is his first year of school, so his expectations are different than those of kids who have already gone to school. Mac goes to school and he’s just excited to be there, no matter the circumstances. He talks about his day as if everything is normal. There’s something very refreshing about that.

For the most part, however, our kids are content just playing with each other. I have noticed that they’re playing less with toys and simply using their imaginations. Whenever we go on walks near our house, they spend their time running around, looking for bugs, and just making stuff up. As a parent, I couldn’t ask for anything better. I’m glad they haven’t discovered video games yet — and we won’t be introducing that anytime soon. When they’re happy with their imaginations (and a few of their favorite toys), you can be sure we’re going to make the most of it!

The big difference for Mac, and all of our kids, is they don’t get to go to any indoor play areas. Instead, we spend a lot of our free time playing outdoors. This is great considering we have three kids who can all play together, while the baby and I keep an eye on things.

– Ashley Sheldon

Zesty Orange Cranberry Sauce

TAKE A BREAK

Skip the can-shaped cranberry sauce this year and bring a jar of homemade sauce to Thanksgiving instead. This easy recipe can be made ahead of the big event and keeps for 10 days in the fridge.

Ingredients

•

1/2 cup orange juice, freshly squeezed

•

1/2 cup water

•

3/4 cup plus 2 tbsp sugar

•

12 oz fresh cranberries

•

2 tsp orange zest

•

Salt to taste

Directions

1.

In a medium saucepan, heat the orange juice, water, and sugar to a boil. Add other ingredients, then bring mixture back to boiling. Reduce the heat to medium and cook gently for 10–12 minutes, until the cranberries burst.

3.

Transfer the sauce to a bowl or jar, cover, and refrigerate until serving.

2.

Solution on Page 4

Inspired by OnceUponAChef.com

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Cincinnati Tax Resolution Powered by Toph Sheldon 9200 Montgomery Rd., Ste. 7B Cincinnati, OH 45242

PRST STD US POSTAGE PAID BOISE, ID PERMIT 411

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INSIDE 1

Are You Setting Realistic Expectations?

2

Researcher Brené Brown Helps Leaders Find Their Vulernability — and Succeed

How Will the Pandemic Impact Taxpayers?

3

Raising Kids in the Middle of a Pandemic

Zesty Orange Cranberry Sauce

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The IRS Has to Pay a Taxpayer $862,000!

Toph’s Tax Nightmares

The IRS Loses! A Normal Case Turns Into Something Much Bigger William Berroyer was a fairly prominent New York businessman. In 2008, the IRS hit him with a $60,000 bill and an audit, neither of which he was expecting. Startled by the bill and audit, he decided to meet with the IRS directly at one of their New York offices. His intention was to renegotiate the $60,000 and hopefully avoid the audit.

According to the AMA Journal, the publication put out by the American Bar Association, Berroyer’s meeting with the IRS was working in his favor. It seemed that the IRS was willing to work out a deal with the businessman to reclaim some of what he owed and ease his financial burden. Then, the meeting took a turn for the worse — for both Berroyer and the IRS. As the meeting came to an end and Berroyer stood up to leave, he tripped over an office phone cord. He went down, hitting a file cabinet and landing on his shoulder. Though he was able to leave the IRS office on his own, by the time he reached the parking lot, Berroyer says he wasn’t feeling so well. Court documents say he called the IRS auditor to inform them he had lost feeling in his lower leg and his shoulder was in pain.

IRS attorneys were quick to say Berroyer’s injuries were not nearly as bad as he claimed, but a judge disagreed. While Berroyer didn’t receive the $10 million, he was awarded $862,000 for pain and suffering. To add a small twist of irony, the IRS cannot collect taxes on Berroyer’s award — and Berroyer’s initial tax bill of $60,000 was waived.

Following the incident, Berroyer spent 17 days in the hospital and had to go to physical therapy after that. So, he sued the IRS for $10 million.

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WHEN THE IRS COMES KNOCKIN’ ... LET US ANSWER THE DOOR!