Virtual Bookkeeping Services

As long as I keep track of everything, it doesn’t matter how the books are sorted – it will all work out in the end.” This sort of relaxed attitude will not give you a clear financial picture or help you make informed business decisions. I have seen entrepreneurs create expense categories that drill down to each specific client, which can mushroom uncontrollably as the list grows. On the other hand, I have seen such general categories created like “Travel Expenses” with everything thrown in, when it should have been broken down by categories such as “Business Meals”, “Entertainment” and “Transportation”.

A standard structure of your accounts is paramount to insightful bookkeeping. Creating an industry and business specific chart of accounts will provide a solid framework for establishing financial control of your business. If you are unfamiliar with the chart of accounts you should be using, your best option is to hire a professional bookkeeper or accountant. A proper chart of accounts will easily answer these three questions:

1. What are your variable costs?
2. What are your fixed costs?
3. What is your breakeven point?

One of the keys to running a successful business is truly understanding where your income is coming from and where your expenses are going.  Getting your books set up properly from the start with the aid of a professional bookkeeper will eliminate future nightmares and helps you know the answers to how your business is doing right away.

1. Tell the story. Provide visuals, links to video and graphs of impact on your donation pages. Provide ongoing support materials to guide the donor through the process of gifting. Reassure the donor throughout this process, letting him or her know how a gift will be used and the impact it will make. Remember: These people are online and might not have experienced your work in person. Bring your work and mission to life through your website.
    
2. Highlight donors. Let existing donors tell stories about the organization and its work. Videos or testimonial statements that focus on donors’ support and explain the work of the organization will help prospective donors connect with the impact their gifts can make.
    
3. Make impact visual. Create visuals on your site that explain where the money goes and promote the transparency of gifts. Accompany these visuals with information about opportunities for donors to get involved in volunteer opportunities, advocacy work and more.
    
4. Define donor communication. On the donation page, tell donors how the organization will continue to communicate with them. For example, explain how they can find updates on programs via social media, describe the communication processes surrounding volunteer opportunities, and highlight specific communications for donors.
    
5. Be specific. Donors like specifics; provide them. Be creative and describe where a $500 gift will go and how it can be used. Provide links throughout the donation pages – including the transaction pages – that allow a donor to get an idea about what a $500 gift can do in each program. Extend this idea even further by having an existing $500 donor describe what his or her gift is doing for the organization. This form of peer modeling can influence the thinking about gifts.
    
6. Provide Updates. Create a section on your donation pages for ongoing – at least quarterly  – updates to donors on the use of gifts and the state of the cause. This form of stakeholder communication will keep existing and prospective donors aware of potential opportunities to continue their support.

• To see a copy of a vendor invoice that was paid with a particular check, just click the link on the check screen and it will open up.
  
  
• To see copies of checks that were included in a particular bank deposit, just click the link the deposit screen.

Okay, I understand most people don’t get a thrill out of keeping track of every penny of their business.  I have a successful bookkeeping business because of this and can keep track their financials accurately every month.  What concerns me as I sit here making estimated tax payments for many of our clients are the many businesses out there just pushing all that to the side and deciding to deal with it later.

Too many small businesses don’t do the sometimes tedious work of bookkeeping and record keeping, and then the owner ends up with a huge tax bill at year end.  Then they have to devise a payment plan with the IRS - and the interest rate for the IRS is significantly higher than bank interest.  We have one client who, before having us work on his bookkeeping, pushed it aside to deal with it all later.  He is still paying his business’s 2007, 2008, and 2009 tax bills.  With interest, he will pay about 135% of what was originally owed.  I know I would rather use that money for something else than paying the IRS.  Wouldn’t you?

It is always fun helping our clients save money.  Here is an example of one cost saving measure we have implemented with a new elder client.

The first month we began paying bills for Tom, his assigned accountant noticed he had talked more than 300 minutes more than his cell phone plan allowed which cost him $90.  She spoke to him about it and he said it was a fluke that he doesn’t usually talk that much.  The next month, he exceeded his allotted minutes by 380 costing him $114.  She took the time to look up available plans from his carrier and let him know that he could add an additional 500 minutes for $15 more per month.  He once again insisted that he doesn’t speak that much and he would be sure to keep it under the next month. 

Month three rolls around and he is again over (although only by 250 minutes costing him $75.)  The next meeting the accountant had with Tom, she sat down with him and together they made the phone call to increase his package.  He was so appreciative that she kept on him until he made the change because he should’ve done it months ago…he actually said he had been over by a “few minutes” for several months “or maybe it has been a couple of years.”  He also said that his son had been on him to change the plan, but he doesn’t like when his son tells him what to do.  He is such a hoot!

Elder care is the fastest growing division of our company, and yet most of our clients and friends don’t even know we offer the service.  I have vowed to do a better job of getting the word out because there is a huge need for bill payment and financial management services for our parents…and the staff loves working with them!

Jennifer Foster, President
Foster Results, LLC
www.fosterresults.com

WASHINGTON — The Internal Revenue Service will host a special nationwide Open House on Saturday May 15 to help small businesses and individuals solve tax problems.

Approximately 200 IRS offices, at least one in every state, will be open May 15 from 9 a.m. to 2 p.m. local time. IRS staff will be available on site or by telephone to help taxpayers work through their problems and walk out with solutions.

“Our goal is to resolve issues on the spot so small businesses and individuals can put any issues they have with the IRS behind them,” IRS Commissioner Doug Shulman said. “If you have a problem filing or paying your taxes or resolving a tough tax issue, we encourage you to come in and work with us.”

IRS locations will be equipped to handle issues involving notices and payments, return preparation, audits and a variety of other issues. At a previous IRS Open House on March 27, approximately two-thirds of taxpayers requested and received assistance with payments and notices.

So, for example, a taxpayer who cannot pay a tax balance due can discuss with an IRS professional whether an installment agreement is appropriate and, if so, fill out the paperwork then and there. Assistance with offers-in-compromise will also be available. Likewise, a taxpayer struggling to complete a certain IRS form or schedule can work directly with IRS staff to get the job done.

At the March 27 Open House, 88 percent of the taxpayers who came in for help had their issues resolved the same day.

Locations for the May 15 Open House are listed here. (opens in new window)

The Open House on May 15 is the first of three events scheduled through the end of June. The next two are planned for Saturday June 5 and Saturday June 26. Details regarding those events will be available soon.

If you have not filed a a form 990 for the last three years you may be in trouble. If you work with a nonprofit and have just asked yourself, “what is a 990?” read this and these, then come back. But since this is the Not-For-Profit Accounting blog devoted nonprofit accounting issues I’ll assume my readers know all about 990s. But there may be folks new to the sector out there, maybe you know a new board member, so please pass this information on to them.

As this press release from Guidestar says,

"The IRS will begin revoking exemptions on May 16, 2010, but will wait until 2011 to send revocation notices."

If you miss the first filing deadline for 2009 990s of May 15 2010 (the deadline for nonprofits who have calendar year fiscal years that end on December 31) the IRS will start pulling exceptions in six months or so. More about that from the IRS can be found here, and the details on filing thresholds so you know which form to file and dues dates for your returns can be found here.

Medical Equipment Fraud:

Equipment manufacturers offer "free" products to individuals. Insurers are then charged for products that were not needed and/or may not have been delivered.

"Rolling Lab" Schemes:

Unnecessary and sometimes fake tests are given to individuals at health clubs, retirement homes, or shopping malls and billed to insurance companies or Medicare.

Services Not Performed:

Customers or providers bill insurers for services never rendered by changing bills or submitting fake ones.

Medicare Fraud:

Medicare fraud can take the form of any of the health insurance frauds described above. Senior citizens are frequent targets of Medicare schemes, especially by medical equipment manufacturers who offer seniors free medical products in exchange for their Medicare numbers. Because a physician has to sign a form certifying that equipment or testing is needed before Medicare pays for it, con-artists fake signatures or bribe corrupt doctors to sign the forms. Once a signature is in place, the manufacturers bill Medicare for merchandise or service that was not needed or was not ordered.

Some Tips to Avoiding Health Insurance Frauds

• Never sign blank insurance claim forms.

• Never give blanket authorization to a medical provider to bill for services rendered.

• Ask your medical providers what they will charge and what you will be expected to pay out-of-pocket.

• Carefully review your insurer's explanation of the benefits statement. Call your insurer and provider if you have questions.

• Do not do business with door-to-door or telephone salespeople who tell you that services of medical equipment are free.

• Give your insurance/Medicare identification only to those who have provided you with medical services.

• Keep accurate records of all health care appointments.

• Know if your physician ordered equipment for you.
   

Some Tips to Avoiding Counterfeit Prescription Drugs

• Be mindful of appearance. Closely examine the packaging and lot numbers of prescription drugs and be alert of any changes from one prescription to the next.

• Consult your pharmacist or physician if your prescription drug looks suspicious.

• Alert your pharmacist and physician immediately if your medication causes adverse side effects or if your condition does not improve.

• Use caution when purchasing drugs on the Internet. Do not purchase medications from unlicensed online distributors or those who sell medications without a prescription. Reputable online pharmacies will have a seal of approval called the Verified Internet Pharmacy Practice Site (VIPPS), provided by the Association of Boards of Pharmacy in the United States .

• Product promotions or cost reductions and other "special deals" may be associated with counterfeit product promotion.
   

Some Tips to Avoiding Funeral and Cemetery Fraud

• Be an informed consumer. Take time to call and shop around before making a purchase. Take a friend with you who may offer some perspective to help make difficult decisions. Funeral homes are required to provide detailed general price lists over the phone or in writing.

• Educate yourself fully about caskets before you buy one and understand that caskets are not required for direct cremations.

• Understand the difference between funeral home basic fees for professional services and any fees for additional services.

• You should know that embalming rules are governed by state law and that embalming is not legally required for direct cremations.

• Carefully read all contracts and purchasing agreements before signing and make certain that all of your requirements have been put in writing.

• Make sure you understand all contract cancellation and refund terms, as well as your portability options for transferring your contract to other funeral homes.

• Before you consider prepaying, make sure you are well informed. When you do make a plan for yourself, share your specific wishes with those close to you.

• And, as a general rule governing all of your interactions as a consumer, do not allow yourself to be pressured by vendors into making purchases, signing contracts, or committing funds. These decisions are yours and yours alone.
   

Some Tips to Avoiding Fraudulent "Anti-Aging" Products

• If it sounds to good to be true, it probably is. Watch out for "Secret Formulas" or "Breakthroughs."

• Don't be afraid to ask questions about the product. Find out exactly what it should do for you and what it should not.

• Research a product thoroughly before buying it. Call the Better Business Bureau to find out if other people have complained about the product.

• Be wary of products that purport to cure a wide variety of illnesses (particularly serious ones) that don't appear to be related.

• Testimonials and/or celebrity endorsements are often misleading.

• Be very careful of products that are marketed as having no side effects.

• Products that are advertised as making visits to a physician unnecessary should be questioned.

• Always consult your doctor before taking any dietary or nutritional supplement.
   

Telemarketing Fraud

If you're age 60 or older, you may be a special target for people who sell bogus products and services by phone. Older women living alone are special targets of these scam artists. Telemarketing scams often involve offers of prizes, low-cost vitamins and health care products, and travel offers.

There are warning signs to these scams, including promises of "free" or "low cost" vacations and get rich quick schemes. If you hear these--or similar--"lines" from a telephone salesperson, just say "no thank you," and hang up the phone:

• "You must act 'now' or the offer won't be good."

• "You've won a 'free' gift, vacation, or prize." But you have to pay for "postage and handling" or other charges.

• "You must send money, give a credit card or bank account number, or have a check picked up by courier." You may hear this before you have had a chance to consider the offer carefully.

• "You don't need to check out the company with anyone." The callers say you do not need to speak to anyone including your family, lawyer, accountant, local Better Business Bureau, or consumer protection agency.

• "You don't need any written information about their company or their references."

• "You can't afford to miss this 'high-profit, no-risk' offer."

Remember, if you hear the lines above, or similar "lines" from a telephone salesperson, just say "no thank you," and hang up the phone.
 

Some Tips to Avoiding Telemarketing Fraud:

It's very difficult to get your money back if you've been cheated over the phone. Before you buy anything by telephone, remember:

• Don't buy from an unfamiliar company. Legitimate businesses understand that you want more information about their company and are happy to comply.

• Always ask for and wait until you receive written material about any offer or charity. If you get brochures about costly investments, ask someone whose financial advice you trust to review them. But, unfortunately, beware -- not everything written down is true.

• Always check out unfamiliar companies with your local consumer protection agency, Better Business Bureau, state Attorney General, the National Fraud Information Center , or other watchdog groups. Unfortunately, not all bad businesses can be identified through these organizations.

• Obtain a salesperson's name, business identity, telephone number, street address, mailing address, and business license number before you transact business. Some con artists give out false names, telephone numbers, addresses, and business license numbers. Verify the accuracy of these items.

• Before you give money to a charity or make an investment, find out what percentage of the money is paid in commissions and what percentage actually goes to the charity or investment.

• Before you send money, ask yourself a simple question. "What guarantee do I really have that this solicitor will use my money in the manner we agreed upon?"

You must not be asked to pay in advance for services. Pay services only after they are delivered.

• Some con artists will send a messenger to your home to pick up money, claiming it is part of their service to you. In reality, they are taking your money without leaving any trace of who they are or where they can be reached.

• Always take your time making a decision. Legitimate companies won't pressure you to make a snap decision.

Don't pay for a "free prize." If a caller tells you the payment is for taxes, he or she is violating federal law.

• Before you receive your next sales pitch, decide what your limits are -- the kinds of financial information you will and won't give out on the telephone.

• It's never rude to wait and think about an offer. Be sure to talk over big investments offered by telephone salespeople with a trusted friend, family member, or financial advisor.

• Never respond to an offer you don't understand thoroughly.

• Never send money or give out personal information such as credit card numbers and expiration dates, bank account numbers, dates of birth, or social security numbers to unfamiliar companies or unknown persons.

• Your personal information is often brokered to telemarketers through third parties.

• If you have been victimized once, be wary of persons who call offering to help you recover your losses for a fee paid in advance.

• If you have information about a fraud report it to state, local, or federal law enforcement agencies.
   

Internet Fraud

As Internet use among Senior Citizens increases, so does their chances to fall victim to Internet Fraud. Internet Fraud includes non-delivery of items ordered over the Internet and credit/debit card fraud. Please visit the FBI's "Internet Fraud" webpage for details about these crimes and tips to protect yourself.
 

Investment Schemes

Senior Citizens, as they plan for retirement, may fall victim to investment schemes. These may include Advance Fee Schemes, Prime Bank Note Schemes, Pyramid Schemes, and Nigerian Letter Fraud schemes. Please visit the "Common Fraud Schemes" webpage for more information about these crimes and tips for protection.
 

Reverse Mortgage Scams

The FBI and the U.S. Department of Housing and Urban Development Office of Inspector General (HUD-OIG) urge consumers, especially senior citizens, to be vigilant when seeking reverse mortgage products. Reverse mortgages, also known as Home Equity Conversion Mortgages (HECM), have increased more than 1,300 percent between 1999 and 2008, creating significant opportunities for fraud perpetrators.

Reverse mortgage scams are engineered by unscrupulous professionals in a multitude of real estate, financial services, and related entities to steal the equity from the property of unsuspecting senior citizens aged 62 or older or to use these seniors to unwittingly aid the fraudsters in stealing equity from a flipped property.

In many of the reported scams, victim seniors are offered free homes, investment opportunities, and foreclosure or refinance assistance; they are also used as straw buyers in property flipping scams. Seniors are frequently targeted for this fraud through local churches, investment seminars, and television, radio, billboard, and mailer advertisements.

A legitimate HECM loan product is insured by the Federal Housing Authority (FHA). It enables eligible homeowners to access the equity in their homes by providing funds without incurring a monthly payment. Eligible borrowers must be 62 years or older who occupy their property as their primary residence and who own their property or have a small mortgage balance. See the FBI/HUD Intelligence Bulletin for specific details on HECMs as well as other foreclosure rescue and investment schemes.

Seniors should consider the following:

• Do not respond to unsolicited advertisements.

• Be suspicious of anyone claiming that you can own a home with no down payment.

• Do not sign anything that you do not fully understand.

• Do not accept payment from individuals for a home you did not purchase.

• Seek out your own reverse mortgage counselor.

If you are a victim of this type of fraud and want to file a complaint, please submit information through our electronic tip line or through your local FBI office. You may also file a complaint with HUD-OIG at www.hud.gov/complaints/fraud_waste.cfm or by calling HUD's Hotline at 1-800-347-3735.
 

Resources:

• FBI/HUD Intelligence Bulletin

• Related Links: USA.gov for Seniors | United States Special Committee on Aging

The reverse mortgage program, designed by HUD to allow senior citizens to get cash for their home equity and then live payment free in their homes, has been popular with cash-strapped seniors. But, history teaches us that where senior citizens and cash are involved, scammers are not far behind. Two major fraud cases in recent weeks may be a signal that senior should be on guard.

Most of the focus and warnings have been to make seniors safer from what the FBI calls, “unscrupulous professionals in a multitude of real estate, financial services, and related entities.” But, the scammer may be just someone like a next door neighbor.

It has been the experience of the FBI that the elderly are targeted for fraud for several reasons:

1) Older American citizens are most likely to have a "nest egg," own their home and/or have excellent credit all of which the con-man will try to tap into. The fraudster will focus his/her efforts on the segment of the population most likely to be in a financial position to buy something.

2) Individuals who grew up in the 1930s, 1940s, and 1950s were generally raised to be polite and trusting. Two very important and positive personality traits, except when it comes to dealing with a con-man. The con-man will exploit these traits knowing that it is difficult or impossible for these individuals to say "no" or just hang up the phone.

3) Older Americans are less likely to report a fraud because they don't know who to report it to, are too ashamed at having been scammed, or do not know they have been scammed. In some cases, an elderly victim may not report the crime because he or she is concerned that relatives may come to the conclusion that the victim no longer has the mental capacity to take care of his or her own financial affairs.

4) When an elderly victim does report the crime, they often make poor witnesses. The con-man knows the effects of age on memory and he/she is counting on the fact that the elderly victim will not be able to supply enough detailed information to investigators such as: How many times did the fraudster call? What time of day did he/she call? Did he provide a call back number or address? Was it always the same person? Did you meet in person? What did the fraudster look like? Did he/she have any recognizable accent? Where did you send the money? What did you receive if anything and how was it delivered? What promises were made and when? Did you keep any notes of your conversations?

The victims' realization that they have been victimized may take weeks or, more likely, months after contact with the con-man. This extended time frame will test the memory of almost anyone.

5) Lastly, when it comes to products that promise increased cognitive function, virility, physical conditioning, anti-cancer properties and so on, older Americans make up the segment of the population most concerned about these issues. In a country where new cures and vaccinations for old diseases have given every American hope for a long and fruitful life, it is not so unbelievable that the products offered by these con-men can do what they say they can do.

In 2009, many tax credits were augmented and created. Tax credits can help you lower your total tax bill and increase your chances for a tax refund. Below are some of this year's most important tax credits. Some are new, some changed, and some became part of the American Recovery and Reinvestment Act (ARRA).

For those of you who are unsure of the difference between a tax credit and a tax deduction, a tax credit lowers your total tax bill directly, whereas a tax deduction lowers your taxable income (indirectly taxes dollar for dollar), sometimes placing you in a different income tax bracket.

Consumer Energy Tax Credit
This tax credit is a good one. If you have made repairs to your home (non-business) to improve energy efficiency you will be able to get up to 30% back from that investment but no more than $1,500. This would include better insulation through the installation of more efficient windows, doors, roofing and even the installation of water heaters, solar thermal technologies, natural and oil furnaces and so on. If you are unsure whether your recent energy efficiency investment qualifies, contact a CPA or the IRS directly.

American Opportunity Tax Credit
The old Hope Tax Credit was expanded for 2009 with the new American Opportunity Tax Credit. As a parent, for each student in college now, you can save up to $2,500 in taxes. There are income limitations with this credit though. Once you start to make over $80k as a single parent (or $160k for married couples), the credit begins to phase out. Realize though that you cannot claim the Hope Tax Credit and this credit in the same year for one student.

Home Buyer Tax Credit
This credit applies to new home buyers and even existing home buyers that meet certain guidelines. First time home buyers who purchased after January 1st, 2009 and before April 30th, 2010 can take up to $8,000 ($4,000 if married and filing separately) off of their tax bill. This tax credit is completely phased out once you make over $145k (individual) or $245k (for a married couple).

For existing home owners, who moved primary residences, the credit is $6,500 (individual) or $3,250 (if filing jointly) but you must have lived in the home for five consecutive years. Furthermore, it only applies for homes purchased after November 6th, 2009.

Making Work Pay Tax Credit
With this credit, you can claim up to 6.2% on earned income from wages but no more than $400 for individuals or $800 for married couples filing jointly. However, this really only applies to those that are self-employed as your employer should have reduced withholding for this during the year. Realize that does not apply to those receiving a pension, or unemployment.

Electric Motor Vehicle and Electric Plug-In Vehicle Tax Credits
These tax credits differ slightly in a few different ways if you went "green" in 2009.
* The Electric Motor Vehicle tax credit ranges from $2,500 to $15,000 depending on the capacity of the battery and how heavy the vehicle is.
* The Electric Plug-In Tax Credit is 10% of the vehicle cost capped out at $2,500. To take advantage of this your vehicle had to go into service after February 17th, 2009.

Adoption Tax Credit
This tax credit increased to $12,150 for 2009 but the tax credit is only applicable if the adoption expenses were paid this year (unless they are a special needs child).

Government Retiree Credit
This tax credit is $250 ($500 if filing jointly) for 2009 if you received a government pension payment or annuity in 2009. Realize though this credit becomes invalidated for you if you took an economic recovery payment.

Earned Income Tax Credit
This credit applies to low-wage earners and it had a few changes in 2009. One change is that the credit increased for individuals with 3 children or more and for married couples filing together. Also the income limit to qualify for this credit has increased as well.

For more details on any credit, visit IRS.gov.

Bonus: Use Your Tax Refund To Buy US Series I Savings Bonds
By utilizing some of these tax credits above you can increase your refund or your chances of getting a refund. Starting this year, the IRS is you purchase US Savings Bonds with your refund. Although these US bonds offer low rates of return during these economic times, they are great investments.

The IRS for this year's filing will allow you to take up to $5,000 of your tax refund to buy U.S. Series I Savings Bonds in multiples of $50 by selecting this on Form 8888.

If you purchase more than $250, the denominations of the bonds should get larger. Anything over $5k or that be divided by a multiple of $50 will need to be deposited into a savings/checking account. 

With the Federal government spending at all time highs, and with my belief that inflation is on the horizon, US savings bonds can be a very attractive hedge against inflation. Taxes on these bonds are due when redeemed but you will not be responsible for state or local taxes with these bonds. One drawback to these bonds is the fact that they cannot be redeemed until a year has passed from their issuance so be sure to check with your investment adviser.

This is a guest post by Manny Davis of Back Taxes Help.

Stereotypical accountants need not apply!

 We are looking for a FULL TIME staff accountant who has experience reviewing financial records, identifying problems and fixing them. 

 The following is required (if you don't have these, don't waste your time applying):

• Bachelors in accounting (or associates and comparable experience)
• Job costing
• General ledger
• Accounts payable
• Accounts receivable
• Bank/account reconciliation
• Payroll and payroll taxes (no using ADP doesn't count)
• Sales tax
• Property tax
• Month end closing and financial reporting
• QuickBooks experience
• Experience working with on-line banking
• Flexibility
• Ability to multitask
• Ability to work in sometimes chaotic environment
• Communication skills (training experience is a plus)
• Ability to work with various types of people
• Understanding that even though it's accounting, it's not always black and white
• MOST IMPORTANT - Positive attitude, desire to grow and develop and a sense of humor

 If you meet these requirements, please continue reading this ad.

 We are Foster Results (http://www.fosterresults.com/).  We provide bookkeeping services to small business, personal money management to individuals and families, QuickBooks training, and part-time Controller/CFO services.  We are a fast growing business in Westfield.

 PLEASE NOTE:  We do not currently offer insurance benefits or a 401(k) plan.  Position offers a competitive salary, bonus potential based on performance and paid time off.

 If you're interested in being a key member of a team that works hard, has ambitious goals, understands the importance of family and has fun, submit your resume to hr@fosterresults.com (in Word format please.)

WASHINGTON - Want to keep IRS auditors away? Keep your earnings under $200,000 and they won't bother you 99 percent of the time. IRS enforcement numbers, released last week, show that returns under that amount have a 1 percent chance of getting audited.

Returns showing income of $200,000 and above have a nearly 3 percent audit chance. The percentage jumps to more than 6 percent for returns showing earnings of $1 million or more. The percentages apply to both individual and joint returns.

The number of audits jumped 11 percent from 2008 to 2009 for returns with earnings of $200,000 or more, but rose 30 percent for returns showing earnings of $1 million or more. For those under $200,000 the number of audits remained steady.

 The IRS conducted 1.4 million audits in the financial year ended Sept. 30, with more than 1 million conducted through correspondence with the taxpayer. The others were conducted through face-to-face meetings with IRS auditors.

The IRS does not do random audits, but does conduct "research audits" that will test compliance in business tax categories. In 2010, the target will be payroll taxes, according to Steve Miller, deputy commissioner for enforcement.

By Larry Margasak, Associated Press 

BY THE NUMBERS: IRS AUDITS OF TAX RETURNS

- The number of audits jumped 11 percent from 2008 to 2009 for returns with earnings of $200,000 or more.
- The IRS conducted 1.4 million audits of individual returns in the financial year ended Sept 30.
- The total revenue collected from IRS enforcement actions, $48.9 billion in 2009, is a drop from $56.4 billion in 2008.

The IRS has released the 2010 optional standard mileage rates to be used by employees, self-employed individuals and other taxpayers to compute deductible costs of operating an automobile (including vans, pickups and panel trucks) for business, medical, moving and charitable purposes. The 2010 rates for business, medical and moving purposes are slightly lower than last year's rates, reflecting the generally lower transportation costs compared to a year ago.  The 2010 standard mileage rates will be:

• 50 cents per mile for business miles
• 16.5 cents per mile for medical or moving purposes
• 14 cents per mile for charitable purposes

QuickBooks Online Users beware: A recent notice from Intuit suggests that the phishing continues.

Intuit continues to receive reports of different versions of the phishing email we alerted you about on 11/12/ 09. They continue to investigate the fraudulent emails that were sent to some QuickBooks Online and Intuit Online Payroll users. The email requests users to download a plug-in or windows update to secure your data.

Intuit did not send this email and QuickBooks Online and Intuit Online Payroll will never use emails to request personal information or update security of our service.

What should you do?
To protect yourself from fraudulent emails and websites, here’s what you can do:
    •Do not click any links in a suspicious email.
    •Do not download any plug-ins or tools from an email
    •Be suspicious of any email that asks for personal information, requires you to download anything or 
     requests your authentication information to access your online account.
    •Delete any suspicious email from your inbox and your trash bin immediately.
    •You can report any incidents, see examples of phishing emails, get more security information and
     recommendations on securing your computer at http://security.intuit.com/.

If you think you’ve provided personal information such as your login name and password through a fraudulent website, or if you have recently downloaded the plug-in or windows update suggested in the mail below, here’s what you should do:
    •If you have downloaded the tool, please delete it. You should scan your system using an anti-virus
     program from a respected Security vendor, for example Trend Micro, McAfee, Symantec or Microsoft, to
     remove any viruses that may now be on your computer. Several of these vendors also offer free online
     security tools.
    •Change your password to prevent unauthorized users from logging into your account.

If you have any questions, please don’t hesitate to contact us.

Accounting outsourcing services performs a significant function in finance and accounting. Business managers are under incredible pressure to trim costs of finance and accounting departments to boost productivity, increase profitability and assign strategic value to it. Now there is enough demand in the market for accounting outsourcing services.

The enormous volume of workload on businesses has created a unique position for outsourcing. Outsourcing is becoming one of the most successful tools in solving business problems. To address the excess workload on maintenance of accounts, outsourcing has often been the direction taken. This then allows staffs to have more time to control and monitor accounts properly.

Most companies consider outsourcing as an adjunct to their business. One can definitely design a strategy for a company to outsource accounting activities at best prices. They will also be able to attain the desired quality in the work and turn-around time. Many companies have generated huge savings from this feature. And more and more companies are heading towards this service for their company's growth.

There are many companies who are geared up to meet companies' outsourcing requirements. They provide not only customized business solutions but also bring flexibility and cost-effectiveness to a company's business services thus helping it simplify resources and maximize time and money.
There are various services provided by these companies. Some are accounts payable / receivable services, bookkeeping outsourcing, tax return preparation services to accountants and accounting firms.

About the Author

Richard Eldridge is a well known and highly respected outsourcing specialist and consultant. He is the co-founder of Infinit-O, a boutique BPO company that specializes in assisting Small and Medium sized businesses realize the full benefits of outsourcing.

Intuit, makers of Quicken, QuickBooks and TurboTax, will shut down its free Quicken Online personal  finance site in six to nine months and put all its chips in with newly-bought Mint.com.

The company closed on its $170 million acquisition of Mint yesterday. That made Mint founder and CEO Aaron Patzer the new vice president and general manager of Intuit's Personal Finance Group, heading up Mint.com, Quicken Online and Quicken desktop products.

His first decision? Quicken Online must die.

"Over the next 6 to 9 months," he said to TechCrunch, "we will end-of-life Quicken Online and their customer's data will be migrated over to Mint."

That's a startling reversal for a company that bashed Mint before acquiring it. It's also a shock that a new Web 2.0 upstart so definitively trumped an established brand with far more customers.

But like the acquisition, the move is smart. Quicken and Mint couldn't coexist for too long because they serve the same purpose. Quicken has about 1.5 million users, but only 100,000 are active each month. In comparison, Mint's got 1.7 million users, and 700,000 are active each month.

So Quicken's throwing in the towel on its brand extension and going with the more engaging site.

The question remains how the company will manage two brands that are distinct from each other. Mint has a very glossy, light feel; Quicken's very red-and-gray, with style to match.

But it makes sense - Mint took off thanks to adoption by young professionals who weren't scared of putting financial data into the cloud. Quicken Online only bulked up after seeing Mint fly past it.

So what should users expect? Like Quicken Online, Intuit can cross-promote Mint from its Quicken desktop products and TurboTax software. But some customers still want their finances on their desktops, so Mint may explore how to store data locally for that group.

But leveraging the personal finance software with Intuit's tax software is where the move really shines: TurboTax may eventually suggest tax deductions to you based on what you've entered in Mint (401k, stocks, etc.).

Expect to see more moves on the mobile front, too. Mint's popular iPhone app will continue development, and perhaps we'll see desktop apps and mobile apps on other platforms. With Intuit's backing, there's also much more hope for international scaling, including Canada, which has been left out of Mint, much to Canadians' disappointment.

November 5th, 2009
Posted by Andrew Nusca @ 8:03 am http://blogs.zdnet.com/BTL/?p=26936

Lenders have a number of ratios and formulas they use to evaluate credit applications, to set ongoing debt covenants, and to review renewals.
 
I find two of them are most critical.  They are intertwined, and if you can meet them, the rest of the covenants and ratios tend to take care of themselves.
 
First ratio:  Debt to Earnings.  More specifically this formula would be total debt divided by earnings before interest taxes, depreciation and amortization (EBITDA). 
 
There are refinements to it.  For example, if the company routinely carries high cash balances, they can be used to offset the debt in the formula.  But, that's not usually an adjustment made for small and mid size companies, because cash balances are usually pretty thin.
 
Most mid market companies are either subchapter S or LLC companies under the tax code.  So, the company does not pay taxes.  But, the bankers will want some acknowledgment of the distributions necessary to the owners to pay their personal share of the taxes.
 
And, the earnings number in the denominator needs to be reduced for capital expenses (CAPX).  An easy assumption is that depreciation will equal CAPX, so no adjustment for either in the formula.  But, if CAPX is much different than historical depreciation, it needs to be recognized.
 
There are a few other tweaks that can be made to the ratio:  annual minimum property tax payments, rents, lease commitments, and some others, but the big ones are the debt, the projected earnings and depreciation.
 
What's the target?  One senior commercial lender recently told me his bank's range for this ratio was 3.0  to  3.5.  Meaning:  the ratio of debt to earnings should be no higher than 3.0 to one, but must not be higher than 3.5 to one.
 
Second ratio:  Fixed Charge Coverage.  This is EBITDA (same number as in the first ratio, so you can see how interrelated they are) divided by next year's fixed charges.  The fixed charges are interest, principal reductions on installment loans, and maturities.
 
Again, some adjustments to the fixed charges may be needed, like CAPX, minimum repairs above routine maintenance, taxes, leases, and so forth.  Each client is a bit different, depending on their business model.
 
Maturities in the next year can really cause this ratio to fall, especially lines of credit, so some adjustment is typically made to recognize that the routine lines of credit for receivables and inventory are rolled over. 
 
What's the target?  Same banker said 1.0 to 1.5.   So, the bank would like to see the ratio above 1.5, but it must be above 1.0.  As you can imagine, losses ruin both of these formulas.
 
An example:  Total debt $1,000,000.  EBITDA of $350,000.  Fixed charges (interest and principal maturities) of $180,000.  The debt ratio is thus 2.85 ($1 million divided by $350,000) and the fixed charge coverage is 1.94 ($350,000 divided by $180,000).  Targets met.  But, if you move the base numbers just a bit, you can see how quickly the ratios change and blow the targets.
 
From time to time, depending on credit conditions, banks move these targets around.  But, the interplay continues because interest and principal payments in the fixed charge ratio are driven by the debt balances, and both the debt ratio and the coverage ratio include earnings in the base.  To improve these ratios, earnings need to be higher, debt levels lower (typically meaning higher equity in the business) and interest rates lower.
 
They are two good ratios for any business to monitor.

Written by Randal Suttles CPA B2B CFO®

Employee theft is something that no business owner wants to experience. Unfortunately, the culprit is often a trusted employee who has never complained about working overtime and without vacations. If you notice a combination of the following warning signs, it will be well worth your while to start investigating.

• There is an unusual drop in your profits.
• Your records are disorganized.
• There are unexplained changes in your accounting records.
• There are unusually large or numerous credits to a particular customer.
• An employee works late, on the weekends and refuses to take vacations.
• An employee's standard of living changes to a degree that is inexplicable based on her salary.
• Documents are missing.
• Bank deposits delayed.
• Customers are complaining about having already paid a bill.
• There are too many increases in past due accounts receivable.
• Check amounts are altered.
• Duplicate payments are made.
• Bank reconciliations have too many outstanding checks.
• Too many payments are being made to individuals with the same name or address.
• Vendors' addresses are the same as an employee's address.
• Bank reconciliations are late.
• Accounts receivable and payable don't balance.
• The petty cash fund is disappearing.

Several of our largest clients utilize our service because they know they are protected.  In each of their cases, they had a trusted employee steal from them and they don't want to experience it again. 

Foster Results insures our customers against theft, as well as errors and omissions.  We want our clients to be secure in their business' financial health.

A truck driver who let his girlfriend stay at his house rent-free as long as she kept the books for his business is now suing her for embezzling $50,000.  Sioux Falls resident John S. Townsend, 44, who drives his own truck and operates as Townsend Transport, let 45-year-old Ramona Haase move in with him in September 2007, according to court documents.

The pair had an understanding that Haase would not pay rent but rather perform the bookkeeping duties associated with the business. In March of 2008, Townsend authorized Haase to draw checks on his business account to pay expenses.

When the relationship ended in August, Townsend hired a new bookkeeper who noticed a discrepancy of around $50,000.

The complaint filed last week in Minnehaha County also alleges that Haase failed to provide accurate, timely information to Townsend's accountant, an act that resulted in the late filing of his 2008 tax return.

The civil case asks for monetary damages and charges Haase with fraud, negligence and breach of contract.

No criminal charges have been filed against Haase.

Written by John Hult  October 21, 2009  ArgusLeader.com

At Foster Results, we take every precaution to ensure that your finances are protected.  In addition to extensive background checks for each employee, every bookkeeping client recieves a Certicate of Insurance up to $1 million dollars worth of loss. 

October 14, 2009 by The Wise One 

Business is composed of a set of interrelated systems that ensure the smooth flow of business processes and convert capital to revenue efficiently. It is important for a business owner to consider each component as if it is just the existing system inside the process. Thus, utmost importance and consideration must be given to each process component, which includes the accounting process.

That is why we have tax lawyers. That is why we have public accountants. That is why we have financial managers.

It is because of the accounting process.

It is the measurement and the disclosure of essential financial information that will help public accountants, financial managers, tax authorities, investors, and other decision-makers to effectively allocate their financial resources to each business process, thus maximizing the conversion of a business' working capital to huge revenues.

Accounting involves processes in which important financial information of a particular business is recorded, summarized, evaluated, and interpreted. Furthermore, since money is one of the biggest factors that may affect the existence of a business in a certain market, accounting is given utmost attention and consideration at all times.

In accounting alone, there are several aspects that a business owner must consider. There you have the cost accounting, the cash-basis accounting, financial accounting, internal fund accounting, management accounting, project accounting, and others.

And the list continues to expand.

In other words, you might conclude that accounting is a serious and a critical matter that must be handled by a group of people who have the technical expertise in dealing with the accounting as well as financial issues. Realizing this reality, more and more business organizations hand the accounting aspects of their business process to third-party organizations, or most commonly known as accounting outsourcing.

Accounting outsourcing is considered to be one of the more effective management tools, thus many companies often incorporate outsourcing as one of their strategies in business planning. As a matter of fact, the Outsourcing Institute reported that the concept of a CRO (Chief Resource Officer), a professional outsourcing executive manager, is widely-acceptable in larger corporate organizations.

However, you need not be a large corporation to benefit from accounting outsourcing. Even small and medium-sized enterprises can provide better service and produce high-quality products in a more cost-efficient way if they outsource their non-core business processes. This includes the accounting aspect.

By decreasing the demands on your administrative personnel, you will be able to free them from additional responsibilities and they will be able to support areas directly to your sales, clients, and to the marketing task of your business.

Accounting outsourcing firms can execute your accounting and bookkeeping tasks in all frequencies (monthly, quarterly, and annually) or can supplement your present administrative staff to lessen the responsibility. Here is a summary of the services you can acquire from outsourcing your company's accounting process:

- Preparing cash disbursement checks;
- Preparing input credits and bank deposits;
- Preparing company payroll;
- Preparing tax deposits and bank reconciliation;
- Preparing financial statements;
- Preparing payroll tax returns; and
- Evaluation and review of financial results on different frequencies.

With accounting outsourcing, you will be able to see the benefits of having a cost-efficient business operation. With your accounting process at the hands of outsourcing professionals, you can focus to the core of your business and convert every cent of your working capital into hundreds to thousands of dollars in generated revenues and profits.
Premier solution for outsource graphics, marketing and web services

Source:  http://www.wisdompost.com/2198/outsource-accounting-to-boost-your-bottom-line-5/

Monday, October 12, 2009 
Written by IBJ Staff

- The non-partisan Indiana Fiscal Policy Institute this morning released a new study exploring the ramifications of expanding the state's sales tax to include services.

In its last fiscal year, Indiana raised $5.7 billion from its 7-percent sales tax, which applies to the sales of most tangible goods, with exemptions for items such as prescription drugs, groceries and newspapers.

According to the IFPI study, Indiana could raise as much as another $6.76 billion annually if it extended its sales tax to include all service transactions. Even if Indiana exempted medical and legal services, Indiana could raise almost $4.5 billion from an expanded sales tax, according to IFPI.

Such figures are sure to appeal to legislators in Indiana's General Assembly, who struggled mightily over recession-driven spending cuts this spring. A special session of the Legislature was ultimately necessary to craft a two-year state budget.

Indiana government's economic picture hasn't improved much since then. On Oct. 8, Gov. Mitch Daniels revealed Indiana's revenue for the quarter ended Sept. 30 was $254 million less than previously predicted, despite the fact that Indiana's revenue forecast has been repeatedly revised downward.

New revenue could help fill such gaps. But an expansion of Indiana's sales tax has many potential drawbacks, which the IFPI study details.

For starters, Indiana's 7-percent state sales tax is already the highest in the Great Lakes region. Extending it might prompt Indiana residents to seek services elsewhere. Indiana is currently tied with Mississippi, New Jersey, Rhode Island and Tennessee for the second-highest sales tax in the nation. Only California's 7.25 percent tax is higher.

The IFPI study points out that the effective sales tax rate is actually higher in some regions because of local sales taxes tacked onto state sales taxes. Alabama, for example, has a 4-percent sales-tax rate, but certain localities there have their own 6-percent sales taxes, creating a 10-percent total tax.

Most states, including Indiana, already tax a few services, such as public utilities, hotel-room rentals and stadium admissions, according to IFPI. But only a handful, such as South Dakota, West Virginia, Hawaii, New Mexico, Delaware and Washington, tax more than a handful of services.

Indiana currently ranks 39th among states for the number of services it taxes, taxing 24 of 168 services surveyed by the Federation of Tax Administrators.

The logistics of expanding the sales tax to additional services would be challenging for some businesses. IFPI points out it could be difficult for many businesses to levy such a tax. Businesses that already sell some goods would have an easier time than pure-service providers. For example, a cosmetologist that now collects taxes on the shampoos and conditioners its sells while exempting styling services, would simply have to stop segregating taxable and nontaxable sales.

But other businesses that sell no tangible goods would find they suddenly must establish a relationship with the Indiana Department of Revenue and maintain a whole new type of record. The cost could be significant, IFPI points out, particularly for small businesses.

"Of the major sources of revenue available to the state, broad-based taxation of services is the only one yet to be tapped by the State of Indiana," wrote the IFPI report's author, Earl Ryan. "The revenue possibilities are great, and it would bring a degree of equity to the tax system. At the same time, defining the base would be difficult, both conceptually and politically, and the cost of collecting the tax on the part of both the state and the taxpayers would be significant.

Study: Taxing services could yield state $6.8B Peter Schnitzler   -  pschnitzler@ibj.com 

Many small business owners are so busy with the day-to-day operations of the business that they can’t see the forest for the trees. They are underutilizing information about how the business is doing financially and, hence, are missing opportunities to improve the financial performance of the business.

This financial information is analogous to gauges on an automobile: they tell you how well the underlying business processes are working. They should function as an early warning system of problems requiring remediation or as an affirmation improvement efforts are being successful.

Each business needs to develop indicators specific to its processes, but several are widely used. In this article we are going to share some examples of helpful measures. It is important to note that these metrics are not taken from B-school textbooks, but rather are “best practices” drawn from successful business people.

A typical financial statement is a snapshot in time of what is going on. Graphing trends over time in such areas as sales, gross margin and units produced is analogous to a video, and provide a much clearer picture of whether things are getting better or worse. A second helpful approach – but difficult to format – is to separate fixed and variable expenses. Certain expenses should fluctuate with levels of business activity and others should not. This exercise also will force you to address expenses that should be variable that are, in reality, fixed. Opportunities for improvement come with this epiphany.

Many people utilize certain ratios to help spot trends over several years. These are helpful because it’s hard to keep track of the cumulative impact of the changes made from one year to the next. Ratios such as sales/employee, unit production/ employee and overhead/employee are all helpful long-term benchmarks.

Many small business people let the cost accounting tail wag their pricing dog. They don’t put themselves in the shoes of a customer making a purchasing decision. A product or service ought to be priced to reflect value as perceived in the marketplace. Would someone discern a value difference proportionate to the price difference between your product and the others next to it? What is the competitive price point that will optimize your product’s take off the shelf? Value is a combination of price and quality. Most of the time as consumers, we make trade-offs between these two aspects but our purchasing motivation goes way up and we become raving fans when we get quality at a bargain price. The same is true of your customers.

Once you determine a price point, a projection of the net-before-tax profit of the product should be the basis of evaluating its contribution to the business.

Pricing based upon a mark-up over cost is commonly used because it is easier to determine and accountants are comfortable with it. But it completely misses the perceived competitive value of the product or service in the eyes of the customer. It is helpful – but hard – to develop profitability by customer and profitability by product or service lines. This information is always surprising the first time you do it and usually leads to some different ways of thinking.

Profitability should be calculated at the net-before-tax level to give a true picture of all the costs associated with the product or service line. Some people have difficulty fully allocating expenses but it is doable and follows easily once set up. Formatting information this way can also help reveal if increases or decreases in performance are due to take, costs, or volume.

Putting together these indicators can be time consuming at first but once in place can be easily updated and are invaluable to the health of your small business.
 

From The Collin County Business Press

So what’s new for Quickbooks users in 2010? Intuit says it has streamlined the install process from 15 screens to only six for small businesses with simple accounting needs. You will be able to edit multiple items in the lists of items/customers/vendors at one time in a spreadsheet-style screen, and data can be pasted into those lists from Excel. There are new form templates, and more form customization options, including decorative backgrounds. For more advanced customization, there is integrated access to design services. Quickbooks 2010 users will also have the ability to put their signature on their checks directly within the program without printing them.

Some of the more useful-sounding new features are the additions to the Company Snapshot screen that was introduced in Quickbooks 2009. This screen can now be personalized to display the data most relevant to the user’s particular business. If this works half as well as described it will be a great improvement to what was already one of my favorite features in the 2009 version. This is the most promising sounding of the newly announced features, but also reminds me of iPhone cut-and-paste: something that should have been there from the beginning.

Another promising area of improvement is in the reporting. According to Intuit, it’s been “radically redesigned” to make it easier to find reports. The redesign includes a carousel view, a list view, and a search function, as well as a favorites view to show your most frequently used reports. As a Quickbooks user who gets annoyed by having to wade through a massive library of irrelevant reports to get to the few that I use regularly, the ability to go directly to a favorites list of reports sounds very helpful.

The most common complaint about Quickbooks has long been its heavy-handed marketing of add-on services inside what is already an expensive software package. Unfortunately, most of the new features being advertised for Quickbooks 2010 appear to simply be an extension of Intuit’s philosophy of aggressively generating add-on sales. Popular personal finance management app Mint.com, recently purchased by Intuit, also operates under a business model based on selling add-on services through its software. But there is a major difference between Mint and Quickbooks: Mint is free.

The features that fall under what Intuit calls its “Connected Services Strategy” include:

• Document Management Services: These services allow attaching of documents to transactions, accounts or people in Quickbooks. The documents are stored online and can be accessed remotely and shared with others.
• Check Deposit Services: With Intuit Check Solutions for Quickbooks, users can deposit check payments into their bank account. For companies not already using Quickbooks merchant services, the check service starts at $19.95 per month plus per-transaction fees.
• Marketing Center: Quickbooks’ integrated email marketing service (currently in beta) offers customizable templates for creating email marketing campaigns and then allows for tracking the results of those campaigns through Quickbooks data.
• App Center: Everyone has to have apps these days, and Quickbooks is no exception. The App Center contains about 25 programs in four categories. The apps cover topics from task management to project management to online storage. Most are only peripherally related to the core accounting functions, and all but a few require a monthly subscription (although free trials are available).

Quickbooks Pro 2010 will have a single-user MSRP of $199.99, or $179.99 for an upgrade. Pre-order street price for the full version Quickbooks Accounting Pro on Amazon.com is currently $149.99. Quickbooks Premier 2010 will have a single-user MSRP of $399.99, or $349.99 for upgrade buyers. The pre-order street price on Amazon.com is $249.99 for the full version of that program.

If you bought Quickbooks 2009 in the 60 days before the 2010 product announcement on Sept. 28, you will likely be happy to know about the existence of a little-advertised “migration upgrade” program that provides free upgrades to the 2010 version. To get the upgrade if you qualify, make sure you have your 2009 product’s information and sales receipt and call 888-246-8848. Stay on the line after the menu options to reach customer service.

We will review your 2009 QuickBooks file for errors, discrepancies, and missing information.  We will present you with a report outlining our recommendations for corrections you need to make before your tax return can be prepared.

Benefits
- Save money on tax preparation
- File your taxes on time because your file is ready for your tax preparer (get your tax refund faster)
- More accurate tax return
- Accurate financials for the first three quarters of the year (you will have time to make changes and adjustments to your business to improve your profitability before Dec. 31, 2009

Limited time offer $100 
 
Offer expires October 31, 2009

Most QuickBooks^® Merchant Services customers will pay more to accept credit card payments as of October 1, 2009, it was announced today by agent relations for Intuit-owned Innovative Merchant Solutions.

According to the release, fee increases to take effect October 1, 2009 are as follows:

Existing IMS accounts and QuickBooks Merchant Service for PC accounts:

• Transaction fee Increased by $.04

New Intuit QuickBooks Merchant Service for PC Transaction Fee:

• Qualified and Mid Qualified: $0.27
• Non Qualified: $0.34

Written by Matthew S. Lewis

In Indiana, there are two (2) main ways a person can be legally given the authority to act on behalf of someone else.  They are a Guardianship proceeding or a Power of Attorney.

A Guardianship is a court proceeding in which an individual asks the court to appoint someone to be responsible for the physical and/or financial care of another (the ward).  Anyone with an interest in the matter must be notified (including the ward), and if people disagree during the proceeding, it can get ugly.  It is easy to imagine the fight a ward could give should he feel he did not need a guardian.  Of course, this is often why the proceeding is necessary.  A Guardian can be needed even when the ward does not think it necessary.  The downside of the proceeding is the ward's lack of choice as the guardian is appointed by a third party (the Court).  What if the ward wanted a different guardian?  Would the guardian know how to handle the wards finances or health care decisions?  The Court appoints the guardian and may or may not take the ward's opinions into account.

Unlike a Guardianship, a POA is a way to assist with decision making without depriving that person of his ability to choose.  In Indiana, the POA statute lists roughly twenty (20) broad powers an individual (the principal) can assign to someone else (the attorney-in-fact) to act on their behalf.  Powers included are the right to deal with banks and insurance companies, conduct business transactions, buy and sell real estate, make gifts, buy and sell stocks, and make health care decisions.  While these are the same types of powers a guardian has at his disposal, the difference is control.  In the POA, the principal chooses the attorney-in-fact, which gives the principal the ability to prospectively discuss his wishes with the attorney-in-fact.  Before writing a POA, a person should speak with his lawyer about possible consequences because the broad powers granted under the statute open the door to the possibility of abuse by the attorney-in-fact.  It is important for the principal to understand when the POA comes into affect, and the powers he is giving the attorney-in-fact. 

Obviously, these issues are far more complex than as presented in this article.  This was not written to provide specific legal advice or form an attorney-client relationship, so if you have questions about your situation, you should retain a licensed attorney of your choosing.

Matthew S. Lewis, attorney with J.D. Walls and Associates, P.C. in Carmel, Indiana
mslewis@jdwalls.com
http://www.jdwalls.com

• Many elderly do not retrieve their mail from their mail boxes on a daily basis.  Some reasons include: Illness, bad weather, lack of mobility, hospitalizations.
• They wait on a caregiver or neighbor to pick up their mail.
• Mail theft from home mailboxes is a common problem.
• Lost mail and the trouble/cost of following-up on check replacement is stressful and time-consuming.

• "Only 52 percent of caregivers receiving Social Security payments on behalf of the person they care for say they use direct deposit."
• "Last year alone, more than 480,000 Social Security checks were reported lost or stolen and had to be reissued, while $64 million in Treasury-issued checks were fraudulently endorsed."

• Sign up for direct deposit of Social Security, SSI or VA Compensation and Pension payments.  You can sign up online, by phone or though mail.
• If you have no checking account, you can choose to sign up for a  prepaid debit card to which your  Social Security and SSI payments will be credited.