Skip Lovette, CPA
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2014 was a big year for small business. More businesses were sold than ever, and small businesses added over a million workers last year. Even more changes are on the horizon this year; here are five to watch for:
In late December, Congress lengthened about 50 tax breaks or “extenders” through the end of the year. Some, like accelerated expensing of certain asset purchases, could be particularly helpful for small businesses. The IRS also has 13,000 less employees than it did at the end of the 2010 fiscal year, and they must absorb a $1.2 billion budget cut from last year. This means a 50% reduction in the level of customer service available, and lower audit pressure. There’s also a movement building in the Senate to allow the government to regulate tax preparers. A potential bill would subject them to mandatory tests and continuing education requirements – the cost of which might be passed on to clients.
Starting this year, companies with over 50 employees are required to offer insurance. The newly appointed chairman of the House Small Business Committee, Steve Chabot, plans to hold hearings this year to advocate for small businesses mostly focusing on the Affordable Care Act. The House also recently passed a bill to raise the requirement for employee coverage from 30 hours per week to 40 hours per week, essentially reducing the number of workers who need to be covered.
Taxation of Online Sales
To level the playing field between brick-and-mortar stores and online merchants, the Senate passed the Marketplace Fairness Act in May 2013. The act would have allowed states to collect sales tax on purchases made by its states residents, regardless of where the seller is located. The bill stalled in the 2014 session of Congress, but with such a high amount of tax revenue at stake, businesses might be hearing more from this bill in 2015.
Data Security and Online Privacy
Datamation predicts many changes in the way data is stored and protected this year. Cloud-data storage is becoming more popular, since it allows for better collaboration and automatic backups. The recent hack of Sony Pictures brought the threat of data insecurity to the public’s attention. President Obama has called for stronger regulation in this area, including a law that would require companies to notify customers within thirty days if their personal information had been exposed.
With the growing popularity of mobile payment and the increased frequency of large-scale data breaches, the movement toward greater payment security is inevitable. Small businesses should definitely consider making the accommodations to accept mobile payments to attract and retain the tech-savvy customer.
All of these changes can be hard to keep track of, and some have even said that the government should create a “Roadmap” website to aggregate local, state, and federal regulation changes. That way, businesses would be able to search by location and industry to see what regulations apply to them. Until then, though, keeping track of these five can help your business stay ahead in 2015.
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