1099's W-9's and Certificate of Insurance....

This time of year is very busy for bookkeepers. We have until the end of January... or this year it's Feb. 2nd. because Jan. 31 falls on a Saturday, to print and mail W-2's to employees, and 1099's to sub-contractors.

If you're not certain if a worker is an employee or a sub-contractor, please refer to this IRS Link Subcontractor FAQ

To save yourself time, trouble and money this time of year, please get into the habit of asking your subcontractors for their W-9, Request for Taxpayer ID and for a certificate of insurance from them as well. This will really save you time and money once your Worker's Comp Audit rolls around.

Example, you need the type of help a subcontractor can provide, such as computer repair or help with a remodeling project. You find someone who's highly recommended, they do the job, you pay them and the two of you part ways. Now comes year-end and we need tax ID's and mailing addresses... whoops, you forgot to get that when you contracted them. You call, the phone number is no longer in service, or they've moved and not left a forwarding address. If you've paid them over $600 per year, you're responsible for issuing them a 1099 at the end of the year. Not doing so may result in a $50 fine per occurrence and disallowing the write-off. In other words, someone is going to pay income taxes on that money, if not them, then you will.

To add insult to injury, along comes your Insurance agent, it's time for your annual Worker's Comp Audit and you not only don't have their tax ID and contact information, but you also don't have their certificate of insurance. This results in you having to pay higher workers compensation insurance.

Bottom line... No one gets paid until they've provided you with a W-9 and certificate of insurance!

Beware Chemical Bank Bill Pay Policies!

Deliver By and Send On dates!

Old Northwest Bank customers were spoiled with their progressive adaptation of banking technologies. I loved the bill pay service that NW Bank offered. You simply setup your payees and told the bank how much and when to send a paper check in the mail. The funds cleared when your payee actually cashed the check.

Now Chemical Bank takes the funds out of your account on the "send on date" that the transaction is processed. Say they need a week to process a check. This means the funds are withdrawn from your account the day they process, "send on date", not the day the check mailed, "deliver by date" or is cashed by your payee. This can result in overdrafts. Chemical bank is holding your money hostage and messing with your cash flow!

Chemical bank also only allows transaction downloads from their ePersonal accounts in Quicken format. All of my accounts, business and personal, were converted to ePersonal and I had to go through a big deal to fill out a form to have my business account converted to eBusiness so that I could download my transactions in QuickBooks Web Connect format. I've spoken to them about this, they don't seem to understand that Quicken and QuickBooks are two different programs.

I brought NW Bank a lot of customers (my clients), and now we will be shopping for a new bank.

NW Bank to Chemical Bank

Mark your calendars!
Download transactions before Friday, November 7th at 5 pm

This is a reminder to everyone who uses Northwestern Bank in Northwest Michigan, if you use their transaction download feature, Friday Nov. 7th before 5 pm. will be the last time you will be able to download transactions from www.nwbank.com. Monday, Nov. 10th starts with new Chemical Bank accounts.

Start making a list now of all the automated bill paying you have setup. After Nov. 10th you'll have to update each one with your new account number and possibly a new bank routing number as well.

Minimum wage increase 9/1/2014

Here's the Michigan Minimum Wage Poster for download.

If you aren't already paying your employees at least $8.15 per hour, you will need to give them a raise Sept. 1st. $3.10 for tipped employees and $7.25 for minors 16 - 17 years old.

QuickBooks 2014 R6 Has Bugs!

QuickBooks 2014 R6 Has Bugs! We only have a few clients on 2014 now, and have not seen any of the bugs reported in this article. It's always a good idea to keep a close eye on any new release.

QuickBooks Online App Warning

An App You Use with QuickBooks Needs To Be Updated!

I've long felt that it's dangerous to base your software on the "shoulders" of another, yet that's the common practice in so many Add-on applications. You have no control over if/when the other company will be making a change that will "break" your application.

I've been advising my clients that QuickBooks Online is not yet ready for "Prime-Time", and I'm still not convinced that accounting "In the Cloud" is the safest thing to do with your financial data.

I'm still exploring options, but in the meantime, if you are still using QuickBooks 2011 AND processing payroll yourself, you have until May 31st. to upgrade the software. I'm happy to report that QuickBooks Pro/Premier 2014 will not require most businesses to upgrade their hardware this time. I believe we've finally tipped the scales where we can run our hardware until it wears out and aren't forced to upgrade hardware with our software every 3 years.

I need more clients like this!

Why the first person I hired was a bookkeeper