Richard A. Lindsey, CPA

Lindsey & Waldo, LLC – Certified Public Accountants

  • Aug 19

    Don’t you just love Congressional tricks?

    One of my personal “favorites” is when they cram a bunch of unrelated business into their bills.

    Which is just what happened about a year ago, and it could affect you…

    H.R. 3236, popularly known as “The Surface Transportation and Veterans Health Care Choice Improvement Act of 2015” (yes, that’s how these things are named) brought some tax-law-related changes.

    Individual tax returns are still due on April 15th — and a six month extension period is still available. But …

    * Partnership tax returns are due March 15, NOT April 15 as in the past. If your partnership isn’t on a calendar year, the return is due on the 15th day of the third month following the close of your tax year.

    * C corporation tax returns are due April 15, NOT March 15. For non-calendar years, it is due on the 15th day of the fourth month following the close of the tax year.

    * S corporation tax returns remain unchanged–they are still due March 15, or the third month following the close of the taxable year.

    On TOP of that, another doozy: audits can get you for six years now, instead of three. Without going into all of the details, essentially if you withhold reporting of 25% or more of your income, the IRS has six years to figure it out. They’ve always had unlimited time for fraud or criminality … but there was some wiggle room for underreporting in the past. No longer.

    All this (and MORE!) in one measly highway bill.

    So, it pays even more to work with a pro, yes?

    These sort of issues are what we specialize in worrying all about — so you don’t have to. Because YOU have to keep your head in a bigger picture.

    Entrepreneurs know that hard work and a great idea don’t guarantee success. Fortunately, most of them also know that failure isn’t final — almost every successful business owner client of mine has crashed and burned at least once in his/her career.

    One of the best ways to pick yourself, or your business, back up off the ground is to take a fresh look at things that you “thought” were set in stone. Here are some strategies I compiled for you to possibly give your business a fresh lease on life, come fall, or into 2017…

    Re-target your market. In the heat of start-up passion, entrepreneurs frequently try to interest too broad a market: “Everyone will want to buy this!” The result: getting lost in the crowd. The more closely you define your market, the more success you will experience.

    Re-examine your price. Price is obviously supremely important. See how you can lower your overhead or cut production costs. Perhaps there’s a new way to package your products, so that your average transaction value can go up?

    Identify and push your best product. Focus on what works. If your hot product is coffee cups, look for ways to highlight and expand that niche instead of veering into new territory. How about different colors and holders for those cups?

    Make your marketing materials more memorable. Emphasize the benefits — SPECIFICALLY how features of your product or service will improve business or the quality of life for your customer. And scrutinize your advertising. Using big media is not always the answer, especially when you have narrowed your market. Don’t overlook narrowly-targeted marketing efforts or joint promotions.

    Keep promoting! Make sure your message sinks in. Find affordable ways to reach your target market, and use these avenues as often as you can. Try social advertising!

    These ideas are to get you started. There may be longer conversations to be had. If so, that’s what we’re here for.

  • Jul 8

    I recently read about a show on CNBC that was described as a cross between Shark Tank and Top Chef. (Seriously… Can’t you see that producer walking into a meeting with CNBC and pitching it exactly that way.) The show was called Restaurant Startup and I just had to check it out.

    The setup is that there are two teams of restaurant owners who approach the “sharks” with their concepts. In one episode there was a married couple who ran a Lebanese-themed deli in Oklahoma City that wanted to expand into a sit down restaurant, and the pair of good ol’ boys with a southern comfort food joint in Kingsport, Tennessee who wanted to open a second location in Knoxville. The sharks sample some dishes and quiz the competitors on their operations. They pick one and give them 36 hours and $7,500 to show off their food and their skills. After that “opening night,” they decide whether to invest their own money in the concept.

    Early in the show, the good ol’ boys serve the sharks some dishes prepared from the owner’s grandma’s recipe book. And the shrimp and grits did look mighty tasty. One shark asked the chef how much the owner currently charges for it in Kingsport, and learned it was $12. Then he asked how much the average check was, and learned it was just $13. “This is a $20 dish in Knoxville,” he said, pointing down at the grits. “You need a $35 average check to make it work there.”

    The chef did not want to hear that he had to raise prices, and much wailing and gnashing of teeth ensued. He objected that diners in his town wouldn’t pay that much for the food. His grandmother who came up with the recipe wouldn’t want him charging that much for the food. And he wanted everybody to be able to afford to eat at his restaurant and enjoy his grandmother’s great dishes.

    (Does any of this sound familiar? I can just hear some of you saying “my customers won’t pay any more!”)

    The sharks agreed that it would be a big jump to raise prices to those levels, but they insisted that the point of running a restaurant isn’t just to share grandma’s southern comfort. It is to make money—and making money, in this case, would require higher prices.

    The sharks chose the good ol’ boys for the test kitchen, and set them up with a local consultant to help walk them through the process. Once again, pricing came up. The owner said flat out “I don’t want to serve a $19 piece of fish.” The consultant explained the restaurant isn’t just serving a piece of fish, it’s serving an experience— then proceeded to show the owner how he could garnish and plate the fish to look like it’s worth the price he had to ask diners to pay.

    At that point you could almost see the light bulb go on over his head. He readily agreed to raise his prices, and the pop-up restaurant opened for business. Diners who filed in that night loved the food. Unfortunately for our good ol’ boys, service and management weren’t as good as they should have been and the sharks declined to fund the concept. It was a hard lesson for them to take home to Tennessee.

    And here’s our lesson for the day. If you’re like most small business owners I know, you at least profess to want to run your business to make money. You may think your customers won’t pay more— but you’re probably wrong. You may think that your mentor, or the person you bought your business from (who didn’t charge enough himself) would disapprove— but it’s your business, not theirs. And you may really want everyone in town to be able to enjoy your great product or service—but can you really make the kind of money you deserve if you price yourself into bankruptcy?

  • Jan 8

    There are seven critical areas of marketing every business must have in place to be balanced. These seven spokes must be in place for the “wheel” of your business to run smoother, be less stressful, and less time consuming.

    Successful and wealthy business owners consistently have each of these seven critical marketing areas working at their maximum potential. These seven spokes on the marketing wheel are:

    1. A market that is hungry to consume your message… and able to pay for your product or service.
    2. A marketing message that grabs your prospects and draws them into your ad, sales letter, emails, or other marketing pieces.
    3. A system for increasing the lifetime customer value of each customer, client, or patient.
    4. A system for reaching more affluent customers who don’t make purchasing decisions based on price.
    5. A lead generation machine that works so smoothly you never have to wonder where your next customer is coming from.
    6. Strategies for getting your marketing message in front of your customers offline.
    7. Strategies for siphoning more leads to your business online.

    Take a minute to rate yourself on each spoke of your marketing wheel – with 1 being non-existent and 5 being outstanding. This will help you determine where you are the weakest and need the most improvement. It will also show you if you are balanced. As an example, if you rate yourself a 5 on offline strategies but a 1 on online strategies, it’s tough to have a thriving business.

    Make all of your spokes strong in each of these seven areas, and you will have a thriving business that provides you with the income that allows you the freedom from worry.

  • Dec 21

    I know what it’s like to think that the lifestyle I want is out of reach. Just a few years ago, I would lie on my bed in my tiny 400-square-foot studio apartment and flip through magazines, wishing I could have the luxurious lifestyles I read about.

    Despite that negative, nagging voice in my head that reminded me I could barely afford rent, I’m now living a beautiful life I created for myself from scratch. Instead of moping around an apartment I can barely afford, I now have the means to travel and to inspire others. Last year I took a solo retreat to Maui, and this year I vacationed at an exclusive beach resort in Cabo San Lucas.

    How do I do it? By deciding not to settle for being average and thinking BIG. Changing your mindset can be a challenge, but the rewards are well worth the cost. Here’s how you get started…

    1. Eliminate negativity. This includes negative self-talk, too. Why would the universe bring you a better life if you don’t appreciate what you already have? Show gratitude for everything in your life now. The seemingly bad days happen for a reason, so whenever you find yourself thinking, “I can’t do this” or “that’s impossible,” reframe it as the opposite. “I can do that, that is possible…” you owe it to yourself to give yourself the love and support you need to succeed.
    1. Document your dreams. Earlier this year I wanted to manifest a new house, so I listed all the qualities in my dream home: a 3-car garage, workout room, walk-in closets. (Don’t censor yourself! Anything is possible, even if it seems silly now.) I also bought some real estate magazines, cut out pictures of homes I love, and created a collage. I’m constantly updating my “dream board,” which is now proudly displayed in my new house!
    1. Surround yourself only with supportive people. I only shared my house dream with my friends and family I knew would support my decision. (NOT those prone to phrases like “Are you crazy? Who do you think you are? Ms. Trump?”) Your true friends and family will be happy to share in your dream. If you don’t have anyone else to support you, then it’s time to make new friends-join a networking group or a mastermind.
    1. Decide, believe, and watch for clues. It’s not enough to make a decision to work towards your dreams. You must also truly believe in them! Don’t worry about HOW your dreams will manifest themselves. Watch for clues, and HOW will find you, perhaps in the form of a new business partner or a new client. But remember that the dream comes before the HOW.
    1. ACT on opportunities when they appear. Action involves risk. You might have to hire more people to help with a new client. You need time to research that prospective business partner. Or figure out how to hire that amazing new mentor. But it’s up to YOU to take action when the path is revealed the universe is supporting you, and each step will bring you closer to your dreams.

    Named the “Entrepreneurial Guru for Women” by Business News Daily, Ali Brown provides business coaching and advice to over 250,000 followers via AliBrown.com, her social media channels, and her Glambition® radio show. If you’re ready to jumpstart your marketing, make more money, and have more fun in your small business, get your free tips now at www.AliBrown.com. Copyright © 2009 Alexandria Brown International, Inc.

  • Nov 30

    It’s likely you’ve been bombarded with investment advice from every direction. Whether it’s “financial experts” from the media or on a commercial, it seems everyone is offering an opinion regarding your financial future. Regardless of these “expert” opinions, as your advisor I understand your unique financial situation, and can offer a recommendation that will truly benefit you.

    First things first. In order to avoid some of the bumps and pot holes along the way, let me lead you through a conversation to zero in on your unique needs. This will allow me to create an investment strategy designed to meet those specific areas, rather than sifting through the latest trends and investment hype. I can achieve this level of personalization by considering your:

     

    • Investment goals
    • Comfort level
    • Expectations
    • Tax implications
    • Risk analysis
    • Income needs
    • Family dynamics
    • Time horizon

     

    Leveling the Investment Playing Field

    Providing a sound wealth management roadmap begins with understanding your cash flow. It’s impossible to make any sound investment recommendations without having a clear picture of how your money is being spent. While cash flow is a critical component to any plan, there’s also another telling indicator to review – debt. Gaining a pulse on how you managed debt will help me devise a plan that factors in your credit history and overall financial decision-making preferences.

    By evaluating how you spend your money each month, I may be able to identify opportunities for improving your cash flow. This may include simple tax strategies and debt management solutions such as refining, debt consolidation, or changing tax withholdings. You may discover there’s more money to invest toward your financial goals than you originally thought.

    Establishing a Comprehensive Plan

    One thing is for sure – life is filled with a series of unexpected events. That’s why it’s important to help you consider potential risks when devising a financial plan. Even the most well-intentioned plans can crumble in a second when faced with a sudden death, disability, or long-term care need. Part of providing you with a comprehensive plan means knowing the possibilities that could threaten your financial future.

    Learning more about your situation enables me to identify potential risks and establish plans that will meet your needs now, and into the future. While you may believe your current insurance policy will provide ample security, it may not be enough. By taking a closer look, I will be able to provide you with insights as to whether your current plan is appropriate or needs modifications. This approach will be invaluable in protecting your most important asset – your family.

  • Oct 2

    A tax return is nothing more than a report about what happened last year. After the year is over, there’s generally not much you can do to change what happened. Tax planning though, is looking forward. What can we do differently from this point forward to save on taxes?

    Like Benjamin Franklin said: “An ounce of prevention is worth a pound of cure.” — it’s always better to be prepared BEFORE you hit the deadline. In the tax world, this relates to tax planning (which reminds me: have you come in to see us yet, before the end of the year, so you can do that? Call 251-633-4070 to set up an appointment, if not).

    But in larger cases, the best kind of preparation takes more than just taxes into account.

    Many well meaning people think that estate plans are for someone else, not them. (Our tax clients hopefully know different.) They may rationalize that they are too young, or don’t have enough money to reap the tax benefits of a plan. But as the following list makes clear, estate planning is for everyone, regardless of age or net worth.

    Here are my NINE reasons why you should consider this right now…

     

    1. Loss of capacity. What if you become incompetent and unable to manage your own affairs? Without a plan, the courts will select the person to manage your affairs. With a plan, you pick that person (through a power of attorney).
    2. Minor children. Who will raise your children if you die? Without a plan, a court will make that decision. With a plan, you are able to nominate the guardian of your choice.
    3. Dying without a will. Who will inherit your assets? Without a plan, your assets pass to your heirs according to your state’s laws of intestacy (dying without a will). Your family members (and perhaps not the ones you would choose) will receive your assets without the benefit of your direction, or of trust protection. With a plan, you decide who gets your assets, and when and how they receive them.
    4. Blended families. What if your family is the result of multiple marriages? Without a plan, children from different marriages may not be treated as you would wish. With a plan, you determine what goes to your current spouse, and to the children from a prior marriage or marriages.
    5. Children with special needs. Without a plan, a child with special needs risks being disqualified from receiving Medicaid or SSI benefits, and may have to use his or her inheritance to pay for care. With a plan, you can set up a Supplemental Needs Trust that will allow the child to remain eligible for government benefits while using the trust assets to pay for non-covered expenses.
    6. Keeping assets in the family. Would you prefer that your assets stay in your own family? Without a plan, your child’s spouse may wind up with your money if your child passes away prematurely. If your child divorces his or her current spouse, half of your assets could go to the spouse. With a plan, you can set up a trust that ensures that your assets will stay in your family and, for example, pass to your grandchildren.
    7. Financial security. Will your spouse and children be able to survive financially? Without a plan and the income replacement provided by life insurance, your family may be unable to maintain its current living standard. With a plan, life insurance can mean that your family will enjoy financial security.
    8. Retirement accounts. Do you have an IRA or similar retirement account? Without a plan, your designated beneficiary for the retirement account funds may not reflect your current wishes, and may result in burdensome tax consequences for your heirs (although the rules regarding the designation of a beneficiary have been eased considerably). With a plan, you can choose the optimal beneficiary.
    9. Avoiding probate. Without a plan, your estate may be subject to delays and excess fees (depending on the state), and your assets will be a matter of public record. With a plan, you can structure things so that probate can be avoided entirely.
  • May 29

    Any road will take you there,” according to the Cheshire Cat in Lewis Carroll’s Alice’s Adventures in Wonderland.

    Imagine going up to the airline ticket counter and telling the ticket agent you would like to purchase a ticket to go on a wonderful vacation, but you aren’t sure where or when you want to go. What do you think her response would be? Maybe something like “Well, when you figure out where and when you want to go, come back and I’ll help you. Now, please step aside so I can help the other 14 people in line.”

    Perhaps the biggest unanswered question of business owners is, “Where do you want your business to be and when do you want it to be there?”

    Often the answers sound like: “I want to make more money” or “I want to grow my business.”

    But those answers are vague, hazy, nonspecific and non-measurable. Consequently, there is no way to ever achieve them. Before you are able to figure out how, you must be able to understand the where and the why. Otherwise you’re like a dog chasing its tail.

    This is a process. To begin, you must spend some time developing a blueprint for your future.

    Start by thinking of how you would like to be spending your time. Of all the kinds of work you could be doing, what do you want to do the most? How many hours do you want to work each week, and how would you like to divide up your working time? Then, think about what kind of people you would like to interact with. Who are your ideal clients, customers, colleagues and employees? Next, imagine the physical environment in which you would like your business to operate. What would it look like? What would it feel like? How large a space would you want? What level of business would you have? How much revenue and profits? How many clients, billable hours, etc. would you have? What would be the mix of clients or services that you would provide?

    Write your answers in the present tense. Don’t worry if your picture is a little fuzzy or you can’t answer all of the questions. You are striving for process not perfection. This process will help you develop the focus necessary to achieve your heart’s desire. It takes a lot of time and effort, and some deep soul-searching. It is not easy. That is why only 3% of people will do it. You have a choice. You can consciously choose to be one of the 3% that pursues personal excellence, or by default you will become part of the 97% mass of humanity to spend their lives in mediocrity. I hope you choose to become one of the 3%.

  • Jun 1

    2012 is nearly half gone. How are you progressing with your goals? You do have goals, right?

    It is easy to get distracted by life’s daily activities. Many set goals, few follow through.

    When it comes to the economy, there are those predicting better times ahead and there are those predicting horrible doom and gloom. As always. Now I certainly pay attention to what some of the experts say, but I try not to rely on any one expert too heavily, preferring to listen to the counsel of a mastermind group that I meet with regularly. After all, you should…

    Beware of expert pundits…

     

    “The Americans have need of the telephone, but we do not. We have plenty of messenger boys.” — Sir William Preece, chief engineer at the British Post Office, 1878.

    “Who the hell wants to hear actors talk?” —H. M. Warner, Warner Bros., 1927.

    “I think there is a world market for maybe five computers.” —Tom Watson, chairman of IBM, 1943.

    “Television won’t be able to hold on to any market it captures after the first six months. People will soon get tired of staring at a plywood box every night.” —Darryl Zunuck, 20th Century Fox, 1946.

    “The world potential market for copying machines is 5,000 at most.” —IBM executives to the eventual founders of Xerox, 1959.

    “There is no reason anyone would want a computer in their home.”—Ken Olsen, founder of main-frame-producer Digital Equipment Corp., 1977.

    “No one will need more than 637 kb of memory for a personal computer – 640K ought to be enough for anybody.” —Bill Gates, Microsoft, 1981.

    “Next Christmas the iPod will be dead, finished, gone, kaput.” —Sir Alan Sugar, British entrepreneur, 2005.

    As computer scientist Alan Kay said, “The best way to predict the future is to invent it.”

     

    And I fully agree — but with this adjustment: the best way to predict the future for YOUR business is to set measurable goals and with quantifiable actions attached to those goals. Don’t be distracted by the rush of technology, the clamor of the marketplace or the drum banging of the naysayers. Focus on what YOU will do during the rest of the year to make 2012 your best year ever.