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Business Tip of the Month

Need financing for your small business? Look into an SBA loan

If you're a small business owner whose company needs an infusion of cash, the Small Business Administration (SBA) may be able to help. A federal agency charged with assisting small businesses, the SBA provides most of its assistance by loan guarantees to lenders. Such guarantees encourage private institutions (mostly banks and credit unions) to lend money to new or struggling businesses. SBA-backed loans, which can run from a few thousand dollars to hundreds of thousands, are very flexible. They can be used to finance working capital, equipment, furniture, buildings, and a variety of other business needs.

The most common type of SBA loan is offered through the 7(a) Loan Program. Under this program, a business applies directly to a private lender and the SBA insures or "guarantees" a percentage of the loan. If you, as the borrower, default on the payments, the lender will recover a portion of the outstanding loan balance. By reducing the lender's risk, the SBA emboldens otherwise reluctant lenders to provide funds to risky businesses. (Be aware, however, that SBA loan guarantees do not mitigate your responsibility for making loan payments.)

To be eligible for an SBA loan, your business must meet certain eligibility requirements. Obviously, you must plan to make a profit. (Charitable groups and other not-for-profit organizations need not apply). Because the SBA mandate includes strengthening the American economy, your firm must also do business (or propose to do business) in the United States. You'll also be asked whether you have funds available from other sources. So be prepared to divulge the nitty-gritty details of your personal, as well as your business, finances.

Of course, any legitimate lender will also scrutinize your ability to pay back the loan. (If your credit history indicates that unpaid bills are your stock in trade, don't expect an easy ride.) The lender will likely review the assumptions behind your company's cash flow projections. So come prepared to explain your financial forecasts (also known as pro forma statements). In addition, lenders will want to know that your company has a committed and competent management team. To this end, they may delve into your work experience, education, and history with prior business ventures. Time to spruce up your resume and fine tune your business plan.

The SBA also offers programs targeting veterans, underserved communities, and businesses affected by natural disasters. If you're considering an SBA loan, give Dye and Whitcomb a call.

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Weekly Tax Tips by Ft Collins accountants Dye and Whitcomb

Tax Tip of The Week Updated Feb 1st 2010

What's your status?

While gathering information to complete your income tax return, you may give little thought to your filing status. But there's a reason "filing status" choices appear at the beginning of tax forms: They're important.
Fort Collins CPA's Dye and Whitcomb

 

Why? Because filing status can impact exemptions, reportable income, deductions, credits, tax rates, liability, the type of form you file, and whether you need to file at all. In addition, some states require that you use the status reported on your federal return, which can affect the amount of state tax you pay.

Here are facts to consider when determining filing status.

1.Your status generally depends on whether you're married or single on the last day of your taxable year (typically December 31). In cases of divorce or separate maintenance decrees, the laws of your state determine whether you're considered married or single. Same-sex marriages are not recognized for federal income tax purposes.

 

2.As a married couple, you can choose joint or separate returns. When you file separately, you can change your mind later and amend your return to file jointly. However, you can't switch from joint status to married filing separately after the due date of the original return.

3.If you were widowed during the year and have not remarried, you have the option of filing jointly with your late spouse. When you're widowed and have dependent children, you can continue to use joint tax rates for two additional years following the year your spouse died.

4.Head of household status is intended for single taxpayers with dependent children. It may also be available when you're single and maintaining a separate household for a parent — including one living in a nursing home.

Questions about your filing status? Please contact Dye and Whitcomb in Fort Collins for information.

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FORT COLLINS CO CPA TAXES ACCOUNTANT BOOKERKEEPER Fort Collins Colorado

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Colorado Certified Public Accountant and Taxes
Colorado Certified Public Accountant and Taxes

Phone  970-207-9724

"Tax Tips" are published weekly by Dye and Whitcomb to provide current tax information, tax-cutting suggestions, and tax reminders. If you would like more information on anything in "Tax Tips," or if you'd like to be on our mailing list to receive other tax information from time to time, please contact our Fort Collins CPA's office.
The tax information contained in this site is of a general nature and should not be acted upon in your specific situation without further details and/or professional assistance.
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Financial Tip of the Month

How to organize your finances

In our busy lives, it's sometimes tough to corral our financial records. Bills, paycheck stubs, tax returns, and bank statements can disappear into dusty attic corners and bulging desk drawers. Important insurance policies can hide out beneath bins of holiday ornaments and electrical supplies. Mortgage documents can sneak into old books or ensconce themselves in nooks and crannies throughout the house. The start of a new year is a great time to coax those papers out of hiding.

Here are four suggestions for getting organized.

1.Find a system that works for you. Many people use a computer program such as Intuit's Quicken or Microsoft's Money to track everyday spending and bank accounts. Others use pencil, paper, and a shoebox. Some people use hanging file folders, labeled for various expenses and accounts; others scan documents into a computer; others use storage bins. The key is to use whatever system makes sense to you and helps you maintain your finances with a reasonable amount of effort.

Fort Collins Colorado CPA's Dye and Whitcomb

2.Dedicate a space and a time. To ensure that bills are paid on time, bank statements are reconciled, and important documents are properly filed, set aside a specific location in your home for financial tasks. It may be a place where you keep a computer or filing cabinets or shoeboxes. Once that area's set aside, pick a time each week (or each day, if you're really zealous) to pay bills, enter financial information into check registers, and organize documents.

 

3.Keep the important stuff in a safe. Don't leave your only copies of wills, tax returns, stock certificates, or emergency contacts in a pile on the desk. Such documents should be tucked away in a safe deposit box or home safe. Ask your attorney or financial advisor to store the signed copy of your will in a secure location.

4.Don't keep documents forever. Many papers (such as bank statements and regular household bills) can be shredded soon after receipt. Other documents, such as those supporting the cost of investments and real estate, should be retained longer for tax purposes. A good general rule for tax returns (and documents that support the returns) is seven years. When it's time to discard those old pieces of paper, fire up the shredder.

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