Blackman & Sloop has recently registered to be a part of the 2012 Komen NC Triangle Race for the Cure on Saturday, June 9, at Meredith College. This event supports the NC Triangle Affiliate of Susan G. Komen for the Cure in its efforts to end breast cancer forever.

Please join us in support for this important project by supporting the Blackman & Sloop Team!

Consider making a contribution to the Susan G. Komen for the Cure NC Triangle Affiliate. It is faster and easier than ever to support this great cause – you can make your donation online by simply clicking on the link at the bottom of this message. Help us reach our team goal of $2,000.

Remember, one person can make a difference in the fight against breast cancer. Susan G. Komen for the Cure was founded by one sister making a promise to another sister. You can be a part of this worthwhile effort! Our promise of a world without breast cancer does not just rest in the hands of Susan G. Komen for the Cure. It is up to you, our community of survivors and co-survivors, to stand united with us until the promise is fulfilled and the cures are found.

Click here to view the team page for Blackman & Sloop, CPAs, P.A.

Today, many organizations receive significant revenue from sponsorships, so we thought it would be a good idea to go over the rules.

Qualified Sponsorship

IRC 513(i) provides that a tax-exempt organization’s solicitation or receipt of a “qualified sponsorship payment” (QSP) is not an unrelated trade or business. A “qualified sponsorship payment” is a payment made by a business where there is no “substantial return benefit” other than (1) acknowledgement of the sponsor or (2) certain insubstantial benefits. The safe harbor is not applicable to payments made where sponsors are acknowledged in periodicals (either print or electronic), nor is the QSP safe harbor applicable to trade shows.  Whether or not the sponsor deducts the payment as a charitable contribution or a business expense is not relevant as to how it is treated by the donor organization. The organization should report QSPs as contributions.

If a payment to an organization is dependent upon ratings or attendance at an event, it is not a qualified sponsorship payment under this provision. Even though a payment is not a qualified sponsorship payment it may be excluded from UBIT under other exceptions to UBIT, including for example, the rent, royalty or “not regularly carried on” exceptions.

Insubstantial Benefits

Benefits are disregarded in determining whether a payment results in UBIT if the annual fair market value of all the benefits to the sponsor in return for the sponsorship payment is not more than 2% of the amount of the payment to the tax-exempt organization. The burden of showing the fair market value of the benefits rests on the tax-exempt organization.
If the benefits the sponsor receives exceed 2% of the payment, then there is a substantial return benefit, the fair market value of which may be taxable to the organization if another exception to UBIT does not apply. Examples in the regulations describe a range of benefits that a sponsor could conceivably receive in return for a payment including, for example: advertising, tickets to events, free use of facilities, services or rights to use intangible assets such as the organization’s name, logo, patents, etc.

It is important that each element of the sponsorship contract is analyzed on its own. For example, if a sponsor of an event gets a certain number of “free” tickets in return for the sponsorship there may be a substantial return benefit. However, if the performance is in furtherance of the organization’s exempt function then the sale of the tickets would not create UBI and therefore the organization would not be subject to UBIT for the ticket sales income. On the other hand, if in addition to the “mere acknowledgement” in the event program the sponsor also receives a full page color ad in the organization’s periodical, then a determination must be made of the fair market value of the advertising and that amount will most likely be subject to UBIT.

Acknowledgement Or Advertising

A payment will typically be treated as a qualified sponsorship payment if the sponsor is merely acknowledged for making the payment. The regulations provide that the following will be considered acknowledgement and will not result in a substantial benefit being given to the sponsor:

Exclusive sponsorship arrangements;  logos and slogans that do not contain qualitative or comparative descriptions of the payor’s products, services, facilities or company; a list of the payor’s locations, telephone numbers or Internet address; value-neutral descriptions, including displays or visual depictions, of the payor’s product line or services; and the payor’s brand or trade names and product or service listings.

The regulations also contain examples  related to web-based sponsorships which are becoming increasingly popular. A hyperlink to the sponsor’s commercial website and posting of its name on the organization’s website are considered to be sponsor acknowledgement and not advertising. However, if the organization endorses the sponsor or its products, either on its own website or on the sponsor’s website, the sponsorship will be considered advertising.

On the other hand, advertising is a substantial return benefit. Advertising is defined as:
Any message or other programming material which is broadcast or otherwise transmitted, published, displayed or distributed, and which promotes or markets any trade or business, or any service, facility or product. Advertising includes messages containing qualitative or comparative language, price information or other indications of savings or value, an endorsement or an inducement to purchase, sell or use any company, service, facility or product.

The regulations provide that if a message contains both advertising and acknowledgement the entire message will be deemed to be advertising.

Conclusion

Sponsorships from businesses are a good source of funds for many tax-exempt organizations. Many companies are very willing to enter into sponsorship arrangements structured so that there is no advertising component. In order to report the amounts received properly it is necessary to look at the entire agreement between the sponsor and the organization and analyze each element of consideration. Although each element of a contract may not meet the qualified sponsorship payment safe harbor, there may be other exceptions available that exclude the payments from UBI.

Blackman & Sloop is a full-service CPA firm headquartered in Chapel Hill, North Carolina and is actively involved in auditing, taxation, management consulting, financial planning, and related services. The firm directs a large part of its services toward providing management with advice on budgeting, forecasts, projections, financing decisions, financial analysis, and tax developments. The firm also performs review and compilation services and prepares not-for-profit, corporate, individual, estate, retirement plan, and trust tax returns as well as technology consulting services regarding installation and training on QuickBooks. Blackman & Sloop provides services in Raleigh, Durham, Chapel Hill, RTP, Hillsborough, Pittsboro, Charlotte, and the rest of North Carolina. To find out more please visit http://www.blackmansloop.com

Contact: CPA cpa@blackmansloop.com

*This article originally appeared in BDO USA, LLP’s “Nonprofit Standard (March 2012)“. Written by Laura Kalick, BDO CPA. Copyright © 2012 BDO USA, LLP. All rights reserved. http://www.bdo.com

•    Tax filing rules
•    Tax credits
•    Adoption credit
•    Other things to consider

Tax Filing Rules

Dependency Exemption

A dependency exemption, a reduction in taxable income, of $3,800 for 2012, is allowed for the taxpayer and each child/dependent.  The full amount of the exemption is allowed regardless of when during the year the child was born.  The dependency deduction will save a taxpayer in the 25% tax bracket $950 in 2012.

If you are unmarried at the end of the year or filing married filing separately, the custodial parent would be the taxpayer allowed the dependency deduction.

Filing Status

Your marital status for tax filing purposes is set as of the last day of the year.  If you are unmarried at the end of the year, the custodial parent would have the ability to file using head of household status provided that they meet the following requirements:

•    You were unmarried or considered unmarried on December 31.  You are considered unmarried if your spouse did not live in your home during the last six months of the tax year.
•    You paid more than half the cost of keeping up a home for the year.
•    A child or other qualifying person lived with you in the home for more than half the year for which you or the other parent is entitled to claim the dependency exemption.

The head of household status provides a higher standard deduction and lower tax rates than a single taxpayer.

Medical Expenses

If you itemize your deductions on your tax return you may be eligible to deduct a portion of your medical expenses in determining your taxable income.  Deductible medical expenses are those that exceed 7.5% of the taxpayer’s adjusted gross income; 10% if you are in alternative minimum tax.  For example, if your adjusted gross income is $100,000, you would not be able to deduct the first $7,500 of your medical expenses. Deductible medical expenses related to the birth include:

•    Hospital and physician costs related to the birth and not covered by your medical insurance.
•    Physician office visit cost for both the mother and child.
•    Birthing classes.
•    Breast Pumps and Supplies and other Lactation Expenses
•    Fertility Enhancement
o    Procedures such as in vitro fertilization (including temporary storage of eggs or sperm).
o    Surgery, including an operation to reverse prior surgery that prevented the person operated on from having children.
•    Pregnancy Test Kits
•    Parking and mileage costs ($.14 a mile) to and from the hospital and doctor offices.
•    Lead-Based Paint Removal to prevent a child who has or had lead poisoning from eating the paint.

Expenses that are not allowed include:

•    Diaper Service
•    Baby Sitting, Childcare, and Nursing Services for a Normal, Healthy Baby

This list of deductible and nondeductible medical expenses relate only to expenses associated with the birth of a child.  There are many other deductible medical expenses that will affect the amount included on your tax return.

Tax Credits

Child and Dependent Care Credit

Working parents usually require a child care provider to look after the child when they are at work.  The child and dependent care credit is a nonrefundable credit that is based on the expenses you incur for child care for children that are under 13 years of age.

Generally, the credit is 20% of the cost of the care with a maximum expense limit of $3,000 for one child and $6,000 for two or more.  However, for lower-income taxpayers, the credit percentage can be as high as 35%.  The higher percentage is completely phased out at an adjusted gross income (AGI) of $43,000; therefore, taxpayers whose AGI is greater than $43,000 can claim a maximum credit of $600 for one child ($3,000 x 20%) or $1,200 for two or more children.

The expenses that are taken into account for the credit are limited to a taxpayer’s earned income, such as wages and self employment income, and must be reduced by the amount a taxpayer excludes from gross income under an employer-provided dependent care assistance plan.

For taxpayers who file joint returns, the expense is limited to the earned income of the lower paid spouse, so generally both parents must be working or looking for work.  Special rules allow a spouse who is disabled or a full-time student to qualify as having earnings when they otherwise have none, thus permitting the couple to claim some credit.

Child Tax Credit

A child tax credit of $1,000, for 2012 and $500 for years after 2012 is available for each qualifying child. The credit phases out at a rate of $50 for every $1,000 of modified adjusted gross income or fraction thereof exceeding $110,000 for joint filers, $55,000 for married filing separately, or $75,000 for single and head of household filers.

For taxpayers with one child, the credit completely phases out in 2012 when Modified Adjusted Gross Income (MAGI) exceeds $129,000 on a joint return, $74,000 for married filing separately (MFS), and $94,000 for unmarried taxpayers. For taxpayers with two children, the credit completely phases out in 2012 when MAGI exceeds $149,000 on a joint return, $94,000 for MFS and $114,000 for unmarried taxpayers. MAGI thresholds are not indexed for inflation.

A qualifying child is one that is under the age of 17 at the end of the year, is not self-supporting, who lived with the taxpayer over half the year and is a U.S. Citizen or national.   Children who were born during the year are treated as living with the taxpayer for over half the year even if born in the last half of the year.

If a person’s tax liability is reduced to zero with this and other tax credits, a portion of the unused child tax credit is refundable.  The amount refundable is the lesser of the unused credit or 15% of the taxpayer’s earned income in excess of $3,000.  For example if married taxpayers had earned income of $90,000 and an unused credit of $800, they would receive a refund of $800, determined as follows, $90,000 – $3,000 = $87,000 x 15% = $13,050.  The $800 is less than the calculated amount.

Adoption Credit

The adoption credit is a fairly generous credit.  The maximum credit is $12,650 for 2012, per child, with no limit on the number of children adopted.   The credit is based on the qualified adoption expenses incurred by the taxpayer and is a dollar for dollar credit; if your qualified adoption expenses are $10,000 you will be entitled to a $10,000 credit.

Qualified adoption expenses include; adoption fees, attorney fees, court costs, travel expenses (including meals and lodging) while away from home, and, re-adoption expenses relating to the adoption of a foreign child.

The credit is phased out for taxpayers with adjusted gross income in excess of $189,710 for 2012 and is completely phased out for taxpayers with adjusted gross income in excess of $229,710.  The phase-out is the same for each filing status except married filing separate, in which case a credit generally cannot be claimed.

The adoption credit can also be used with an employer provided adoption plan.  However, the expenses can only be used for either the employer plan or the adoption credit.  Under an employer provided adoption plan, the employer pays, as a nontaxable fringe benefit, a dollar amount defined under the plan towards the employee’s adoption expenses.  These payments are nontaxable to the employee.  If the total adoption expenses exceed the amount paid under the employer provided adoption plan, the taxpayer can use the excess expenses in determining the adoption credit.  For example, taxpayer incurs $15,000 in adoption expenses and the employer pays $5,000 of these expenses.  The taxpayer would then be eligible for an adoption credit of $10,000.

There are special rules for foreign adoptions, adoption of a child with special needs, attempted adoptions, and carry forward of prior years adoption credits.  You also need to file certain documents with your tax return.  Since there are required attachments you will not be able to file your tax return electronically if claiming the adoption credit.

Other Things to Consider

The birth or adoption is not only a wonderful time for new parents but a rather hectic time as well.  Following are several other things to consider and put on your to do list.

•    Update or get a will.  A will is one of the most important estate documents and is essential now for each spouse.
•    Review your life insurance and disability insurance coverage.
•    Update your beneficiary forms on all life insurance policies and retirement accounts.
•    Save for college tuition.  A 529 plan allows one to place money into an investment account with all growth “tax free” as long as monies are pulled out for college education expenses.  North Carolina allows for up to a $2,500 deduction for a single taxpayer and up to a $5,000 deduction for a joint tax return against your state taxable income when you make contributions to the North Carolina 529 Plan.
•    Review your medical insurance policy and work benefits program.  You will need to add your child to your medical coverage.  Also many companies offer cafeteria plans that allow for a pretax deduction for child care expenses.
•    Employment Taxes for Household Employees – If you pay someone to work in your home and care for your child you may be a household employer and subject to paying social security, Medicare, and state and federal unemployment taxes.

As you can see there are many tax and financial issues that need to be addressed.  Please contact us if you need any assistance or have any questions.

Blackman & Sloop is a full-service CPA firm headquartered in Chapel Hill, North Carolina and is actively involved in auditing, taxation, management consulting, financial planning, and related services. The firm directs a large part of its services toward providing management with advice on budgeting, forecasts, projections, financing decisions, financial analysis, and tax developments. The firm also performs review and compilation services and prepares not-for-profit, corporate, individual, estate, retirement plan, and trust tax returns as well as technology consulting services regarding installation and training on QuickBooks. Blackman & Sloop provides services in Raleigh, Durham, Chapel Hill, RTP, Hillsborough, Pittsboro, Charlotte, and the rest of North Carolina. To find out more please visit http://www.blackmansloop.com

Contact: CPA cpa@blackmansloop.com

It looks like the economy may finally be looking up. Still, this is no time to loosen the purse strings in terms of your business expenses. Rather, why not re-double your efforts to cut costs and boost your profitability?

Excessive expenses cause debt, which in itself can be very costly. So any money-saving actions you take will be doubly rewarding.

More Effective Money Management

To cut expenses significantly, poke into every corner of your company’s finances. Inventory is a good place to start. If you sell multiple units of the same item and reorder regularly, you should be using QuickBooks’ inventory-tracking tools. Go to Edit | Preferences | Items & Inventory | Company Preferences.

Figure 1; Make sure that these settings are correct. If you need advanced features like FIFO costing, serial number and lot-tracking or inventory management at multiple locations, contact us about upgrading to Enterprise Solutions.

You should be stocking your inventory to match the pace of sales. You don’t want to be caught short, nor do you want to be sitting on too much and tying up money unnecessarily. QuickBooks can help, but you’ll need to calculate the sweet spot for each item. Several built-in reports can help, including:

•    Inventory Valuation Summary. Displays the current asset and retail value of each item and inventory as a whole
•    Inventory Valuation Detail. Shows how individual transactions have affected the value of your inventory
•    Inventory Stock Status By Item. Helps you set up smart reordering procedures
•    Open Purchase Orders. Outlines each purchase order and its expected delivery date

Figure 2: To maintain profitable inventory levels and minimize expenses, you’ll need to study QuickBooks’ related reports regularly. When you’re making buying decisions, consider factors like reorder turnaround time and seasonal sales upticks.

Ratio reports, like profit over sales, can also be very telling. QuickBooks does not supply these, but we can help you create them in Excel.

Using Available Tools

The efforts you make toward reducing expenses in other ways can result in more savings than you might think. Here are some actions you can take that will accelerate your cash flow:

Use QuickBooks’ budgeting tools. This doesn’t need to be as onerous as you might expect – you can start by pulling in your real data from the previous year as a base. Build in line items for ongoing accounting support like QuickBooks maintenance. Click on Company | Planning & Budgeting | Set Up Budgets.

Figure 3: Selecting this option simplifies your task.

Minimize your April 15 obligation with year-round tax planning. Work with us throughout the year on the next year’s taxes to, for example, make smarter quarterly payments, and we’ll help you reduce your tax bill by making better decisions every day.

Get discounts by paying invoices early. Set up a custom field in vendor records to track this.

Figure 4: Get to know which vendors offer early discounts – and take advantage of them.

Analyze the cost-effectiveness of your transportation. Can you replace some in-person sales calls with web-based communication? Make sure that your delivery routes and sales call paths are efficient.

Change product/service prices to build in your own cost increases. Do it across the board, in small increments. It may not even be that noticeable to customers.

Talk to us about establishing a line of credit. We’ll help you determine if this is a viable option for emergencies. It’s cheaper than using credit cards.

Cross-train employees. Have employees train each other on their tasks where it makes sense. You can avoid costly temp help and relieve overworked departments.

Don’t try to change everything at once. Establishing these new procedures will require some extra work. And you may not notice a reduction in expenses immediately. But over time, you will see a positive change – one that will give you extra dollars and hours to invest in making your company flourish.

Blackman & Sloop is a full-service CPA firm headquartered in Chapel Hill, North Carolina and is actively involved in auditing, taxation, management consulting, financial planning, and related services. The firm directs a large part of its services toward providing management with advice on budgeting, forecasts, projections, financing decisions, financial analysis, and tax developments. The firm also performs review and compilation services and prepares not-for-profit, corporate, individual, estate, retirement plan, and trust tax returns as well as technology consulting services regarding installation and training on QuickBooks. Blackman & Sloop provides services in Raleigh, Durham, Chapel Hill, RTP, Hillsborough, Pittsboro, Charlotte, and the rest of North Carolina. To find out more please visit http://www.blackmansloop.com

Contact: CPA cpa@blackmansloop.com

The N.C. Children’s Promise exists solely to secure financial and community resources to provide comprehensive, family-centered health care for the children of North Carolina and surrounding states.

The N.C. Children’s Promise is a program of the Medical Foundation of NC, Inc., the charitable, tax-exempt organization supporting the overall goals of UNC Health Care and the UNC School of Medicine. All annual gifts in support of North Carolina Children’s Hospital are part of the N.C. Children’s Promise. Supporters include patient families, faculty and staff, community friends, corporations, foundations, and civic/student groups.

The Sixth Annual Run For The Promise Gala is a live broadcast of the 138th annual Kentucky Derby, with food, music, entertainment, lawn games, and a
silent auction

For more information, or to purchase tickets, go to https://medicalfoundationofnc.org/2012ChildrensPromiseGala

Some of the more significant clarifications made by the IRS are summarized below:

•    Organizations that have not yet filed exemption applications (Forms 1023 or 1024) with the IRS are still required to file the applicable Form 990-series form, as do those with applications pending.

•    The website address and principal officer information entered on page one should be current as of the date of filing the return.

•    The IRS clarifies that an organization should make reasonable efforts (see the full Glossary definition included in the IRS Form 990 instructions) to obtain information from third parties needed to complete the form.

•    Making the Form 990 available upon request does not satisfy the requirement for an organization to provide a complete copy of its Form 990 to all members of its governing body prior to filing the form.

•    Figuring out which position checkboxes to mark on Part VII for the governing body, officers and compensated individuals has been very confusing, especially for those not well versed in the definition of the different roles and their subsets. The IRS has clarified that only one position box should be checked for each person listed in the compensation table, unless the individual is both an officer and a director/trustee of the organization. This is not a change, but a clarification to eliminate ambiguity in the instructions and form.

•    The IRS clarifies that the value of housing provided by an employer does not have to be reported as compensation to the extent that such value is a working condition fringe. The IRS has also clarified that cell phones provided to employees primarily for business purposes are a working condition fringe and not reportable as compensation.

•    If a governing body delegates broad authority to an executive committee or similar committee, this must be explained in Schedule O.

•    Examples illustrating when board chair compensation is considered to compensate the board chair as an officer versus an employee of the organization have been added.

•    The IRS clarifies that net losses from uncollectible pledges, refunds of contributions and service revenue, or reversal of grant expenses should be reported as “Other changes in net assets or fund balances” on Part XI, line 5, and that these instances need to be explained in Schedule O.

•    For contributions made via a text message, the donor’s phone bill meets the section 170(f)(17) recordkeeping requirement of a reliable written record if it shows the name of the donee organization and the date and amount of the contribution made.

•    The IRS clarifies that contributions of conservation easements and other qualified conservation contributions that are received by the organization must be reported consistently with how the organization reports revenue from such contributions in its books, records and financial statements.

•    Although an organization reports revenue on the 990 under its appropriate accounting method under generally accepted accounting principles, the value of donated services or the use of donated materials, equipment or facilities which are valued and included in financial statement income may not be reported as income on Form 990.

•    Schedule N instructions provide new examples of situations that are not considered significant dispositions of net assets.

•    “Term endowment” is renamed “Temporarily restricted endowment” in the Glossary contained in the Form 990 instructions and includes not only endowment funds established by donor-restricted gifts for a specified period, but all other temporarily restricted net assets held in a donor-restricted endowment, including certain income from permanent endowments.

Notable changes to the Form 990 and required schedules are outlined below:

Compensation disclosures on Schedule J have been revised so an organization that is part of a related group of organizations will be required to provide a narrative description of any reliance by such organization on a related organization to establish the compensation of any of the reporting organization’s officers, directors, trustees or key employees. Also, additional narrative descriptions of severance/change-of-control payments and compensatory benefits are required to support Part I of Schedule J.

Hospitals should note that Schedule H underwent revision and requires significantly more disclosures. Part V now contains 21 questions requiring substantive disclosures in the form of written narratives relating to a community health needs assessment (optional for tax years beginning in 2011), financial assistance policies, billing and collections policies, and emergency medical care policies. For tax years beginning after March 23, 2012, however, hospital organizations will be required to take into account input from persons who represent the broad interests of the community served by the hospital facility in developing a Needs Assessment. Needs Assessments must be made widely available to the community, and each hospital facility will be required to conduct a Needs Assessment at least once every three years.

In a welcome, but challenging change, the IRS has clarified reporting of pass-through income. Financial information on Form 990, Parts VIII, IX and X now require organizations to report revenues, expenses and assets related to joint ventures and investment partnerships using amounts reported on Schedule K-1, rather than amounts derived from the organization’s books and records. This represents a significant departure from the reporting requirements under previous versions of Form 990, and may cause difficulties in the return preparation process.

Schedule F previously required an organization to list foreign investments only when income or expenses from any foreign source exceeded $10,000, but this has been revised to require the listing of foreign investment holdings when they are valued at more than $100,000 at any time during the tax year.

Schedule K, Tax-Exempt Bonds, now asks whether the organization has established written procedures to ensure timely identification and correction of violations of federal tax requirements.

Changes to Schedule L, Transactions with Interested Persons, provides that a business transaction between the organization and an entity more than 35% owned by current or former officers, directors, trustees or key employees is not reportable in Part IV if the entity is a 501(c)(3) organization, a 501(c) organization of the same subsection as the filing organization or a governmental unit; and eliminates the requirement that a business transaction between the organization and another entity must be reported simply because a current or former officer, director, trustee, or key employee of the organization was a key employee of the other entity.

Schedule R, Related Entities, provides that organizations should report related split-interest trusts in Part IV by type, but do not need to report the trust’s specific name, address, or EIN or complete Part IV, columns (f), (g) or (h) for such trusts.

A paid preparer’s taxpayer identification number (PTIN) must now be entered in the return signature section, which avoids the public disclosure of Social Security numbers; and paid preparers are permitted to sign returns by rubber stamp, mechanical device or computer software program. This change was made as a result of the new requirement that all paid preparers of tax returns must be registered with the IRS.

While not all-inclusive, the above summarizes some of the more significant clarifications and changes to the Form 990 for 2011, and provides a good indication of how the IRS intends to clarify guidance and communicate new rules to those involved in the preparation process. Most changes have been briefly summarized in the core Form 990 instructions, with further detail in the instructions for the individual schedules. See the IRS website at http://www.irs.gov/charities/article/0,,id=233830,00.html.

Billing for inventory parts is easy. Pick the items from a list and specify a quantity. Poof. Done.

Billing for costs, time or mileage is a little more complex. QuickBooks has built-in tools to help you do this, but it’s a bit of a process.

To simplify your workflow, do this groundwork first:

•    Go to Edit | Preferences | Time & Expenses | Company Preferences. Click the Yes button under Time tracking and indicate your choices under Invoicing options. If you plan to mark up some costs and want a default number, enter a percentage and account (these can be changed on individual invoices).

Figure 1: As you do with other QuickBooks processes, make sure that your Preferences are set correctly.

•    Add any billing items necessary by clicking Lists | Item List and then Item | New in the lower left corner.
•    If you plan to bill for mileage, go to Lists | Customer & Vendor Profile List | Vehicle List and enter information about every business vehicle.

Invoicing for Services

If you’re a service-oriented company, you bill for time frequently. This is easy. You’re probably already familiar with the Enter Time entry in the Employees menu. Whether you make individual time entries or complete a timesheet, it’s critical that you make the correct selections for each Customer: Job, Service Item and Payroll Item field, and check the Billable box.

When you create invoices, this box will open after you select a customer:

Figure 2: QuickBooks lets you know when there are time and costs to be billed for each customer.

You can let QuickBooks enter the time totals now, or add them later by clicking the Add Time/Costs button. Either way, the Choose Billable Time and Costs window opens. Add a checkmark next to each entry that should be billed, and click Options… to indicate whether you want one line for each time entry or would rather combine all similar service item types.

Figure 3: QuickBooks wants to know which entries should be invoiced.

More Complexity

If you’re done with billable expenses for this invoice, click OK. If there are other costs that you covered, click the Expenses tab to see all transactions that you earmarked for this client on a bill, check or credit card. You have the option here to mark up the cost by a percentage or amount (even if you established this in Preferences), and to specify an account.

Do the same for Mileage, which you would have entered previously – when it was incurred — at Company | Enter Vehicle Mileage. Then select any Items that you purchased for the customer. Your records should be correct – assuming that you were conscientious about assigning expenses to customers and jobs.

Figure 4: It’s easy to pull billable expenses into invoices if they’re documented carefully.

Turning expenses into invoices and then into income can be complicated. Let us know if we can help. We are your partner in building a successful business.

QuickBooks Tip

Here’s a cool little keyboard shortcut. Hit F2 while you’re in QuickBooks, and you’ll get the Product Information screen. It’ll tell you everything you want to know about your specific copy of QuickBooks, like your release and license number, the file size, number of users logged in, audit trail status and the total number of accounts, customers, employees, etc.

QuickBooks News

As of May 31, 2012, Intuit is discontinuing support for QuickBooks Pro, Premier and Simple Start 2009, QuickBooks for Mac 2009 and QuickBooks Enterprise Solutions 9. You can continue to use these solutions, of course, but live technical support and add-on services like payroll, credit card processing, online banking and bill-pay will not be accessible. Talk to us about upgrading if you’re using any of these products or services.

Blackman & Sloop is a full-service CPA firm headquartered in Chapel Hill, North Carolina and is actively involved in auditing, taxation, management consulting, financial planning, and related services. The firm directs a large part of its services toward providing management with advice on budgeting, forecasts, projections, financing decisions, financial analysis, and tax developments. The firm also performs review and compilation services and prepares not-for-profit, corporate, individual, estate, retirement plan, and trust tax returns as well as technology consulting services regarding installation and training on QuickBooks. Blackman & Sloop provides services in Raleigh, Durham, Chapel Hill, RTP, Hillsborough, Pittsboro, Charlotte, and the rest of North Carolina. To find out more please visit http://www.blackmansloop.com

Contact: CPA cpa@blackmansloop.com

Andrea Eason and Deetra Watson will be presenting at this years Blue Cross Blue Shield of North Carolina Foundation’s Healthy Community Institute. Their topic for this presentation is “We Have a Federal Grant, Now What?”

Healthy Community Institute for Nonprofit Excellence (HCI) is an organizational change process that is focused not only on the fundamentals of strategic planning including mission and vision, but also board development and engagement, fundraising and leveraging results to enhance your organization’s effectiveness.

The HCI program offers a two day onsite training April 4th and 5th for board members who are looking to achive these goals. The team-based approach is an essential component of the Institute, and is critical to the progress your team can make. Each team must include the Executive Director and a Board member from your executive committee, such as a Board Chair or Vice Chair. Other senior leaders and/or Board members are appropriate to attend. Teams must be made up of a minimum of 3 people and a maximum of 4 people. Each organization is highly encouraged to bring the maximum number of team members – especially Board members – with the “right” people in mind. Obtain the commitment from Board members who can benefit most from the principles taught and initiate the changes, drive the strategy and lead the action for the organization.

For more information, or if you and your board members would like to participate, go to http://www.bcbsncfoundation.org/community-impact/healthy-community-institute/

For more information, go to http://missnc.org/?p=1977

The Chapel Hill/Carrboro Chamber Of Commerce’s mission is to serve and advance the business interests of their members, and create a sustainable community where members can thrive. They host the Business After Hours sessions as a way to network within the member organizations/businesses.

This event is free for Chamber members. To join the Chapel Hill Chamber Of Commerce, and for more information, go to http://www.chambermaster.com/directory/jsp/events/EventPage.jsp?ccid=568&eventid=1885 or go to http://www.carolinachamber.org/