5-Time Inc. 5000 Honoree

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Coming in at #3267 on the list with a 120% 3 year growth rate, LBA Haynes Strand has made the Inc. 5000 list for fastest-growing private companies in America for the 5th time in a row! We are proud of our team and this great accomplishment.

List Details

The list represents a unique look at the most successful companies within the American economy’s most dynamic segment—its independent small businesses. Microsoft, Dell, Domino’s Pizza, Pandora, Timberland, LinkedIn, Yelp, Zillow, and many other well-known names gained their first national exposure as honorees on the Inc. 5000.

“Making the Inc. 5000 for the fifth year in a row demonstrates the forward thinking ideas and growth strategies our firm continues to implement year after year,” says John Bly, Principal and CEO at LBA Haynes Strand.  “Our team continues to focus on our growth oriented core value and it can be seen through this accomplishment. We know how hard it is to be recognized on this list and are proud to be a 5-time honoree.”

Not only have the companies on the 2018 Inc. 5000  been very competitive within their markets, but the list as a whole shows staggering growth compared with prior lists. The 2018 Inc. 5000 achieved an astounding three-year average growth of 538.2 percent, and a median rate of 171.8 percent. The Inc. 5000’s aggregate revenue was $206.1 billion in 2017, accounting for 664,095 jobs over the past three years. Complete results of the Inc. 5000, including company profiles and an interactive database that can be sorted by industry, region, and other criteria, can be found on INC.

“If your company is on the Inc. 5000, it’s unparalleled recognition of your years of hard work and sacrifice,” says Inc. editor in chief James Ledbetter. “The lines of business may come and go, or come and stay. What doesn’t change is the way entrepreneurs create and accelerate the forces that shape our lives.”

Methodology

The 2018 Inc. 5000 is ranked according to percentage revenue growth when comparing 2014 and 2018. To qualify, companies must have been founded and generating revenue by March 31, 2014. They had to be U.S.-based, privately held, for profit, and independent—not subsidiaries or divisions of other companies—as of December 31, 2017. (Since then, a number of companies on the list have gone public or been acquired.) The minimum revenue required for 2014 is $100,000; the minimum for 2017 is $2 million. As always, Inc. reserves the right to decline applicants for subjective reasons. Companies on the Inc. 500 are featured in Inc.’s September issue. They represent the top tier of the Inc. 5000, which can be found on INC’s website.

Dental Practice Lifecycle: Start Up & Acquisition

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Every dental Practice follows its own unique lifecycle, however, there are a few main phases it will pass through as it continues to grow and evolve that we’d like to focus on:

  • Start Up & Acquisition
  • Growth & Maintenance
  • Sale of Practice & Retirement

Before you enter any phase, we highly encourage any future Practice owner to seek out professionals who specialize in the dental industry.  There are many pain points that can be avoided by working with a CPA, attorney, banker, etc. who specialize in the dental industry and can guide you in the right direction from step one.  Once you have your Practice advisory team in place, it’s time to look at the next big questions: Do I want to start from scratch or purchase an existing Practice? And where will my funding come from?

Our dental team works with doctors on both sides of the start-up. With future Practice owners looking to start from scratch we develop a business plan to help obtain bank financing for the next steps in the ownership process. This document gathers and presents information related to many aspects of your future Practice: demographics of your proposed location, expected revenues and expenses, and a breakdown of desired loan funding just to name a few. Your business plan is what provides information to banks to show your Practice is a worthy investment. More importantly, it gives you a guideline and stepping stone to launch your Practice with confidence.

If you’d prefer to purchase an established Practice, our dental team works with you to find purchase options and review these options through our Practice Scorecard Analysis and due diligence process. Much like the Due Diligence period of buying a house, this is where you have a chance to review various aspects of the Practice and determine if it’s right for you. Many items are looked at during this but we help our clients to focus on what the historical financial data of the Practice shows and how it will apply to you, your future ownership of the Practice and if this coincides with your ownership goals.

Do you have your specialized team in place? From start-up services to exiting your practice, our team serves as strategic business advisors that are there with you every step of the way.

Next week, we will be discussing Phase 2: Growth and Maintenance.

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Tax, Investment, & Planning Opportunities in 2018

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LBA Haynes Strand works with our partners at HK Financial Services to provide wealth management planning strategies for our clients. Last week, LBA Haynes Strand and HKFS presented an economic update webinar. We understand that life and schedules are extremely busy, so we wanted to provide a copy of the webinar for our clients and friends who may have missed the live showing.

In the video, our speakers, John Bly, Principal and CEO at LBA Haynes Strand, Ann McCorkindale, Partner Emeritus at HKFS, and Suzanne Tudor, Director of Financial Planning at HKFS, discuss volatility and opportunities in the global synchronized expansion.

They also review financial and estate planning under the new estate tax law.

Tax, Investment, and Planning Opportunities in 2018

We hope you found this video helpful. Please feel free to contact us with any follow-up questions that you may have. Our partners and financial advisors are ready to meet with you!

Dental Practice Lifecycle: Introduction

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Over the next few weeks our dental team here at LBA Haynes Strand will be presenting a series of blog posts related to the lifecycle of a dental Practice. Items we will be highlighting include:

  • An overview and introduction to the stages within the dental Practice lifecycle
  • Key questions to ask when buying a dental Practice
  • Selling your dental Practice

As we move through these topics we will strive to provide up to date, informative and helpful information for today’s dental Practice owner whether you are in the first stages of starting your Practice or looking at retirement.

In the meantime, we would like to provide some additional information about a few members of our dental team here at LBA Haynes Strand:

Brad McKeiver, CPA, MBA, is a principal with our firm and leader of our Dental niche. He works extensively with dental professionals and Practices as a strategic business advisor to help our clients prosper. His name may sound familiar as Brad is active in the community through speaking and networking events. Through Brad’s leadership, our team has been able to lessen the tax and accounting burdens for our dental clients so that they can get back to focusing on their patients and their Practice.

Carrie Culpepper works as the lead dental accountant within our team. Using her extensive experience with QuickBooks Online she works alongside our clients to produce meaningful, reliable reporting to assist in business decisions and other areas of dental Practice ownership. Carrie relies on her background in theatre to help clients use their numbers and reporting to “tell the story” of their business and their success.

Katie Sabin is the newest member to our dental team. Katie focuses on ensuring the accuracy and completeness of the financial statements for all of our dental clients. She primarily concentrates on preparing monthly reports for clients in order to deliver them the most precise and up to date information for their business. Her enthusiasm and eagerness to expand her knowledge on the dental industry makes her a great addition to our team!

We look forward to sharing our knowledge with you as we work through the lifecycle of a dental Practice.

If you are interested in automatically receiving updates such as this, please subscribe to our blog.

LBAHS Day 2018: Out of the Garden Project

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“I firmly believe the greatest responsibility we have as a firm is to serve our clients, our people and our community. Working with the Out of the Garden Project is one of the most fulfilling efforts in our year.”- Dave Recchion, Office Managing Partner, LBAHS Greensboro Office.

This year, LBA Haynes Strand got the amazing opportunity to go back to the Out of the Garden Project (OOTGP) to help out for a second year. Our LBAHS Day is an annual community service day where we close our office doors and focus on giving back.

Why Out of the Garden?

The Greensboro and High Point area is ranked #9 in the nation for food insecurity. Over 48,000 students in this area receive reduced price or free breakfast and lunches at school. Many do not know where their next meal is coming from after school and on the weekends. This is how founders, Kristy and Don Milholin, got the idea to start the Out of the Garden Project. They noticed children experiencing food insecurity at their children’s elementary school and felt called to make a difference.

OOTGP started as a small weekend initiative supplying 10 bags to families in the Piedmont Triad area. It has grown into a program now supplying over 1250 bags of food each weekend and operating 22 mobile food pantries.

The LBAHS staff jumped right in – cleaning the warehouse, sorting donated food, and packing bags for families. The atmosphere was filled with love and support as each team member realized the impact they were making in this community.

We are fortunate to have played a small part in this company’s great mission, “to provide tangible signs of love so that no child goes to bed hungry.”- OOTGP

To learn more about Out of The Garden Project and how you can help, CLICK HERE! We were featured in News & Record– “Day of service project helps food program”

South Dakota v. Wayfair, Inc. Tax Implications

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On Thursday June 21, 2018, the Supreme Court issued its much anticipated opinion in the landmark case of South Dakota v. Wayfair, Inc., fundamentally changing the sales tax landscape in the United States.

The Case

South Dakota enacted a law requiring out-of-state sellers to collect and remit sales tax as if the seller had a physical presence in the state. The law only applied to sellers who, on an annual basis, delivered more than $100,000 of goods or services into the state or engaged in more than 200 separate transactions for the delivery of goods or services into the state.

South Dakota sought to enforce the law against Wayfair, Inc. and other online retailers who exceeded the limits of the law. Each of the retailers had no employees in the state and owned no real estate in the state.

Based on prior precedents (National Bellas Hess, Inc. v. Department of Revenue of Ill., 386 U.S. 753, and Quill Corp. v. North Dakota, 504 U.S. 29), the lower courts ruled that the law was not enforceable due to the lack of substantial nexus* with the state under the “Physical Presence” test outlined in these cases.  That test allowed states to require retailers to collect and remit sales tax if the retailer had a physical presence (e.g., employees or operating an office) in that state. The mere shipment of goods into the state did not satisfy the physical presence test.

The Result

In a 5-4 verdict, the Supreme Court explicitly overruled the prior cases and held that, while physical presence provided substantial nexus, such nexus also included a certain level of business (delivery of goods or services) conducted within the state.

The Court found that, in this case, the nexus is clearly sufficient based on both the economic and virtual contacts the retailers have with South Dakota. The state law applies only to sellers that deliver more than $100,000 of goods or services into South Dakota or engage in 200 or more separate transactions for the delivery of goods and services into the state on an annual basis.  This quantity of business could not have occurred unless the seller availed itself of the substantial privilege of carrying on business in South Dakota.  The retailers are large, national companies that undoubtedly maintain an extensive virtual presence.  Thus, the substantial nexus requirement is satisfied.

The Implications

Will you now be required to collect and remit sales taxes in states to which you deliver goods or services?

South Dakota v. Wayfair, Inc. allows all states to enact laws requiring out-of-state sellers to collect and remit sales taxes on sales to customers in that state provided the law applies a safe harbor to those who transact only limited business in the state.  While South Dakota chose an annual $100,000/200 transaction limit that the Court found sufficient, the Court created a level of uncertainty by leaving it up to the states to decide what safe harbors might be sufficient.  We expect we will see a great deal of activity as various states make their statutes consistent with the court’s ruling so nexus can be asserted.  For states that already have similar statutes in place, it is unclear whether they will set a future date for enforcement or take the position that the statute has been enforceable since it was put in place.

*Nexus – When referring to sales tax, means that a company is connected to a state and because of that connection, a company must collect tax, fill out a tax return, and send the collected tax to a state.

Given that sales tax laws are established on a state-by-state basis, all businesses making sales of goods or services to customers in multiple states should evaluate the impact of the Court’s holding. 

This ruling is just the beginning of the process and over the coming months we will be monitoring which states are adopting these types of nexus rules and when they will become effective. If you would like more information on how this may impact your business, contact us today.

The Impact of Increased Take Home Pay on Your Tax Return

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What could increased take-home pay mean for your 2018 tax return?

The recent tax reform has instituted a variety of changes in both individual taxes and business taxes starting in 2018. Many Americans can expect a decrease in tax, and with the new federal withholding tables released earlier this year, an increase in take home pay. Less tax and more pay, what’s not to like?

The goal of this change in federal withholding tables was to adjust for the new changes that will impact individual taxpayers. Some of the major changes include a decrease in tax rates, an increase in the standard deduction, and a repeal of personal exemptions.

However, we have found that the change in withholding may not be enough to cover tax liability in many cases. In the past, many relied on Form W-4 without much extra thought to get them close to the amount needed to pay their tax. This year, we suggest analyzing it a little further. Taxpayers may get less of a refund than they are used to or even owe tax in April 2019, even though their tax rate is lower.

Example: Vince is single, has no dependents, and earns $50,000 in wages in 2017. He is paid on a bi-weekly basis. The result is $296 in federal income tax being withheld from each paycheck or $7,707 withheld for the year. Vince’s actual tax liability, including the 2017 standard deduction of $6,350 and exemption of $4,050, is $5,645. This gives Vince a refund of $2,062.

Under the new tax law, assuming the same income, the 2018 standard deduction of $12,000 and no personal exemption, Vince’s tax liability will be $4,370. Due to the withholding changes implemented in February, Vince’s federal income tax being withheld for the year will be $6,247 (The above $296 for two pay periods and the new rate of $236 for twenty-four pay periods). This gives Vince a refund of $1,877.

As you can see above, although Vince’s tax liability decreased $1,275 from 2017 to 2018, he receives less of a refund. This example does not take into account any extraneous circumstances such as investment income, itemized deductions or dependents that many taxpayers have. If Vince has other sources of income and got a smaller refund for 2017, he could owe tax for 2018.

Luckily, the IRS has released a tax calculator to help check how much you should be withholding in 2018. If you are not familiar with how to use the calculator, this video will demonstrate how.

If you identify a needed change in your withholding, please contact your employer to fill out a new Form W-4. LBA Haynes Strand can also provide additional analysis and answer any other questions you might have about this subject.

When to Hire a CFO

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As your company grows, both in size and revenue, it becomes necessary to have a leader who can manage and think strategically about financial decisions. While CPAs are critical to the success of the organization, they may not have the time to dive in and focus on the financial future of the company. When you hire a CFO you have the opportunity to add value through a variety of resources and collaboration.

Here are a few indicators that it is time for you to hire a CFO:
  • CEO is working more “in” instead of “on” the business
  • Complexity of the business begins to erodes profits
  • Business decisions are hindered by lack of timely financial data
  • An early warning system would have prepared the business for significant up or downturn
  • Lack of planning unexpectedly interrupted cash flow
  • Lead bank is concerned over quality and timeliness of financial reporting
  • The business growth plans include an acquisition strategy
  • Company experiences higher than expected tax liabilities due to lack of tax strategy

The resources the CFO provides can add value to and enhance the strategic direction of the company.

If you are interested in learning more or would like to hire a CFO, contact us today!

Fraud Alert: Identity Theft Fraudsters Targeting Small Businesses

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In recent years, we have seen a marked increase in the amount of identity theft cases due to our increased use of the internet. Generally, as tax professionals we mainly see the impact on individuals from these schemes. However, there is an surge of small businesses being targeted now.

The Journal of Accountancy recently posted an article regarding this increase. The article highlights signs that you may have been a victim of identity theft and provides information on the ways both the IRS and state tax agencies are working to combat these fraud schemes. To read the full article click here.

LBA Haynes Strand is dedicated to alerting the public on any scam or fraudulous attempt to steal identities or gain access to important financial information. If you are interested learning more, contact us today.

The Role of the CFO

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Over time, the role of the CFO has evolved from transaction oversight to one of strategic importance. The CFO has become a true business advisor which both business owners and senior leaders rely on.

Typically, the CFO will model the owner and leader’s vision into a financial pro-forma to evaluate whether they can and will make the necessary investments (primarily financial and cultural) to achieve their goals.

Business owners need an in-house counselor, who is invested in the financial future of the company, to aid in decision making. The CFO provides resources needed to help make these decisions and “monetize” the company’s vision.

Resources the CFO provides:

Business Planning

  • Provide your business plan with financial rigor

Financial Projections

  • Create a bottom-up forecast and detailed budget with spending plans by department

Rolling Cash Forecasts

  • Enable you to respond, in real time, to emerging business conditions

Annual Operating Budgets

  • Help you keep track of maintenance operations, salaries, and interest payments

3 and 5 Year Plans

  • Forecast expenditures and revenue for three and five year periods
  • Create corresponding strategic goals

Monthly Management Reports

  • Create reports with previous and current financial data

Pricing

  • Build a financial model to set price

Managing Debt

  • Establish company budget and payment schedule to repay and keep debt low

Mergers and Acquisitions

  • Advise on M&A initiatives
  • Complete business valuation

Equity and Debt Negotiations

  • Restructure your debt to improve liquidity

Liquidations

  • Ensure proper redistribution of your company’s assets and property

With the resources they provide, the CFO is vital to driving business improvement initiatives. Not only do they want to sustain your accounting function, they want to improve it. To learn more about how our CFO Services can help you and your accounting department reach the next level, contact us today!

Scam Alert: QuickBooks & Intuit Phishing Emails

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Recently there has been a rise in the number of phishing emails that appear to be sent by QuickBooks and Intuit. These messages state that the customer has a payment due on an open invoice. The balance due on the fake email is a higher amount than the typical cost of the software and any subscriptions offered by Intuit.

3 Common Methods for Phishing:

  • Spoofed Email Address – We have seen fake email addresses such as intuit@hmrsss.com and quickbooks@bostonsat.com.
  • Fake Link – Never click on a link in a suspicious email. These links may take you to a site that asks you to log in, providing hackers with your account information. Use your mouse and hover over the link to see if you can spot a hidden web address that is different than the one on the surface. An example of a message that would be included with a fake link:

       “This invoice notification is being delivered to you by Intuit Invoice Services on behalf of Veri Facts Inc. Click the link above to find an invoice.”

  • Forged Website – Fake websites may appear like real sites by using company logos and images. When visiting financial sites, enter the known address into the browser field manually.

Phishing was listed as one of the top tax scams of 2017 and continues to be an issue.

If you receive these emails – do not click any links! Forward the email to spoof@intuit.com immediately. For more information and to learn steps to protect yourself from a phishing attack, see the Intuit forum article here.

LBA Haynes Strand is dedicated to alerting the public on any scam or fraudulous attempt to steal identities or gain access to important financial information.  If you are interested in automatically receiving updates such as this, please subscribe to our blog.

Protect Yourself Against The New Tax Refund Scam

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The IRS has reported that the number of potential victims impacted by a tax scam has increased from a few hundred to several thousand in just a few days. Putting a new twist on an old scam, criminals are taking taxpayer information, filing fraudulent returns, and depositing erroneous refunds into real taxpayers’ bank accounts. The criminals then contact the victim and use a variety of tactics to attempt to claim the refund.

The scam appears to have originated from tax preparers’ offices, where computers that have been infected with malware provided criminals with access to thousands of consumers’ return data.

“Speed is critical,” the agency said in its advisory. “If reported quickly, the IRS can take steps to block fraudulent returns in a preparer’s clients’ names.”

As tax preparers increase their security settings to protect client tax and financial files, it is important that consumers also protect themselves by knowing identity theft warning signs.

Top Indicators of Tax-Related Identity Theft
  • More than one tax return was filed using your Social Security Number 
  • IRS records indicate you received wages from an establishment at which you never worked
  • You owe additional tax, receive a refund offset notice, or have had collection actions taken against you for a year you did not file a tax return
If you become a victim and notice an erroneous deposit in your account, take the following steps:
  • Contact your tax preparer immediately.
  • Contact the Automated Clearing House (ACH) department of the bank/financial institution where the direct deposit was received and have them return the refund to the IRS.
  • Call the IRS toll-free at 800-829-1040 (individual) or 800-829-4933 (business) to explain why the direct deposit is being returned.
  • Be aware that interest may accrue on the erroneous refund.
  • Communicate with your financial institution and be prepared to close your account, since the information has been accessed by criminals.

You can also access the steps for returning your erroneous refund directly on the IRS website.

Remember: The IRS does not initiate contact with taxpayers by email, text, or social media, or phone calls to discuss your account. If you receive a message, be suspicious!

LBA Haynes Strand is dedicated to alerting the public on any scam or fraudulous attempt to steal identities or gain access to important financial information. If you are interested in automatically receiving updates such as this, please subscribe to our blog.