Author: Janet Behm (130 articles found) - Clear Search


The Side Hustle Tax Trap

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“Before you talk, listen. Before you react, think. Before you spend, earn. Before you criticize, wait. Before you pray, forgive. Before you quit, try.” - Ernest Hemingway

Earning some extra cash from a side hustle is something many are doing these days. Here are some tax implications we want you to know about so you can hold onto as much of it as you can.

In most situations, you’ll be earning this extra income as an independent contractor, rather than as an employee. As a point of clarification, you may hear the following terms bandied about in relation to the gig economy

Independent contractor
Self-employee
Sole proprietor
Freelancer
Schedule C business
1099 contractor

Here’s the important part: All of these terms mean the exact same thing.
In other words, if you’re delivering for Doordash on the weekends, you’ve now become the self-employed owner of a Schedule C sole proprietorship business.
Now, let's prepare you for what this means in terms of your new tax situation and responsibilities.

You’re Responsible for More Taxes

When you work a regular job as an employee, your employer pays half of the legally requ
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What Business Owners Need to Know About Commercial Real Estate Mortgages

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"You just can't beat the person who won't give up." - Babe Ruth

For many people, the American dream includes a cozy home with a manicured lawn, and our home loan system is merrily set up to make this dream a reality for quite a few people.

But for entrepreneurs dreaming of owning their own store, shop, or office location, the dream is a lot murkier. There are quite a few differences between residential mortgages and commercial real estate mortgages, and you need to be sure you fully understand what you're getting into before taking the plunge into commercial property financing.

Commercial Differences from Residential Loans
The United States has some of the best home loan options in the world. The most common loan type, which you're probably familiar with, is a 30-year, fixed-rate loan. These residential loans are readily available, have low interest rates, fairly low fees, and carry no prepayment penalties.

Commercial real estate mortgages tend to be the polar opposite.

Commercial mortgages tend to be much shorter time periods. Five to ten years is a typical loan term. The monthly
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Planning For a 30-Year Retirement

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“The greater damage for most of us is not that our aim is too high and we miss it, but that it is too low and we reach it.” - Michelangelo


Your retirement savings – combined with any pensions you’ll receive plus Social Security – will ultimately dictate the lifestyle you’re able to live in retirement.


Looked at another way, knowing how much you’ll need to withdraw from your retirement portfolio every year can help you determine how much you need to save.


From either perspective, these are good numbers to know. As the old saying goes, failing to plan is planning to fail. So, how do we go about making these determinations?


Safe Withdrawal Rates
Back in 1998, three finance professors at Trinity University in San Antonio, TX published what has become one of the most influential research papers in the history of investing. The purpose of the study was to
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5 Cybersecurity Steps all Business Owners Should Take

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“You may have to fight a battle more than once to win it.” - Margaret Thatcher

Whether your business is in full-on work-from-home mode, or your business is such that this is a totally foreign concept, the reality is that cybersecurity steps are something you absolutely need to address.

Your office computers, employee laptops and tablets, cloud services (which can be accessed remotely), and even company cell phones all have an insane amount of information on them that hackers would love to get their digital hands on. Along with customer credit card numbers and employee SSN’s and DOB’s, your digital records contain a wealth of valuable information. Even something as seemingly innocuous as customer estimates and invoices can look like hidden treasure to the world’s digital pirates.

Taking basic cybersecurity steps is cheap protection against potentially embarrassing and expensive data breaches.

If you do have employees working remotely, it’s your responsibility to protect customer and employee data. Just like the IRS sets minimum requirements for us to protect YOUR private information, you should als
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Businesses Win That Are Controlling Costs

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“You may be disappointed if you fail, but you are doomed if you don’t try.”  - Beverly Sill

Depending on the type of business you run, you have a myriad of things you need to pay for to stay in business from rent to office supplies to payroll to inventory (not to mention all those pesky taxes).

When a business is brand new, most business owners go over the top controlling costs. But over time, they tend to loosen their grip on such things and inevitably experience “cost creep.” Sound familiar?

Every dollar you spend on a business expense means one less dollar in profit for your business (think renovations). So, it’s a good idea to periodically check in on your expenses to make sure you’re controlling costs where needed.

But where do you start?
Looking at your income statement may just give you a headache. Plus, that P&L is a summary of categorized expenses and doesn’t tell the full story about individual costs racked up throughout the year.

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Do You Owe The IRS For Past Years?

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Do You Owe The IRS For Past Years?

Utah REIA  members who owe back taxes will help the IRS meet  their payroll…when they catch you.

Every year, the IRS charges tax debtors a boat load of penalties.

Just how much? Take a look…

To put this in perspective, the IRS budget for 2021 is about $12 billion. That means the entirety of IRS operations could be funded this year with just the money they charge individuals or small businesses in penalties.

When you’re on the receiving end of these penalties, it can feel like the IRS is just pouring salt into the wound. When you can’t pay your taxes, the last thing you want to see is…more taxes. Fortunately, the IRS does provide several options for penalty relief.

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What You Need To Know About Healthcare Changes

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“To succeed in life, you need three things: a wishbone, a backbone, and a funny bone.” - Reba McEntire

Let's start with Premium Tax Credits (PTC).

These are the magic beans that help to reduce the cost of health insurance under the Affordable Care Act (ACA). When you buy health insurance through either a state exchange or the federal HealthCare.gov site, you may be eligible for help in paying your monthly insurance premiums. This assistance is actually an advance against the tax credit that you can claim when you file your 2021 income tax return in 2022.

While this arrangement does provide health insurance to millions of Americans that previously couldn't afford it, there is one significant hiccup to the whole setup. As your income goes up, the credit goes down. Once your modified adjusted gross income (MAGI) exceeds 400% of the federal poverty level, the tax credit vanishes entirely. This is generally referred to as the "ACA cliff."

The ACA cliff thresholds are based on family size. For 2021, the MAGI thresholds were:

  • One person: $51,250
  • Two people: $68,680
  • Three people: $86,880
  • Four people:
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Your Business Better Have Learned These Lessons (from COVID-19)...

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“Your talent determines what you can do. Your motivation determines how much you’re willing to do. Your attitude determines how well you do it.” - Lou Holtz

One year into this pandemic season and many pixels have been spilled by all of the think piece articles over it. There really are a few small business tips that you MUST come away with.

So, let's dive right into these lessons for any business from this wild season...

Small Business Tips #1 Establish and maintain a reserve of operating capital.

Just like every family needs an emergency fund of at least 3 months of living expenses, so too should every business have a working capital reserve. In my years of working with small businesses,  it's rare to see such reserves. When you operate on tight margins, it can be difficult to establish such a reserve, but as we saw at the start of the pandemic, it can make the difference between staying in business in try
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“American Rescue Plan” Is A Done Deal

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To our Utah REIA PEEPS, The “American Rescue Plan” Is A Done Deal. Act FAST and SLOW.

While I normally write weekly, there is information in this blog that you need to know about now that might even impact how you proceed in the following days.

As of this writing, Congress has agreed -- but this is so fresh off the presses that many of my industry colleagues are scrambling, and the research services are still compiling all the data. But I felt it important to get ahead of all of that on your behalf.

There is a lot to discuss, and I will have more to say early next week, but this is important for you to know about NOW. So, let's dive in...

Stimulus Payments 
(and how they might impact your tax paperwork)

These are different from previous stimulus programs: $1,400 dollars per taxpayer and dependent (with signific
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Janet Behm's Building Your Brand Update

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"A business has to be involving, it has to be fun, and it has to exercise your creative instincts." - Richard Branson

Unfortunately, many small businesses brainlessly ape big corporations with their marketing, by (wrongly) believing that "if these huge companies built their businesses by that kind of marketing, then it surely should work for us." Build the brand,” they say.

The thinking behind that kind of marketing is that you "get your name out there," and the clients and customers will pour in. "It's all about word of mouth," they say.

Well, if you choose to go down this road, far better is real word-of-mouth advertising.

And that is something that can actually be stimulated and stewarded. And one of the best companies to learn from about this is Disney, specifically about their parks.

(And this is still true in 2021, btw, with all
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