Don’t you love all my posts about all the things you *must* do, or there are dire consequences? This is another one of them (please note it is not legal advice, I am not an attorney, etc.):

In 2021 Congress passed the Corporate Transparency Act, aimed at reducing money laundering. It is a small business reporting requirement with enormous potential penalties — not reporting can include a fine and imprisonment.

Let me repeat — in the worst case scenario, failing to fill out this form is a potential felony with two years of prison time, plus a potential daily penalty of over $500.

If your entity is an LLC or corporation, including a single-member-LLC, you must fill out this form by the end of 2024. If you start a new business in 2024 or 2025, you must report within 90 days of formation.

The required information includes owners and, for new businesses formed in 2024, the company owner/applicants. To clarify, even if you have set up an LLC just for a specific film or rental property or other limited purpose, this form is required, and a separate filing and form is required for every single entity, whether an LLC, an S-corporation, or a C-corporation. Limited exemptions exist, primarily for larger companies and not-for-profit entities.

Initial Reporting: 

• New companies formed after 1/1/2024, within 90 days of formation.
• Existing companies formed before 1/1/2024 by 1/1/2025.

Annual reporting: 

None, assuming no changes in the five elements listed below.

If there are updates:

Within 30 days of change in beneficial ownership, name or address change.

Reporting is done with a special electronic filing with the Treasury Department’s Financial Crimes Enforcement Network (not the IRS). This must be done at https://www.fincen.gov/boi

To fill out the form you need the following information about BOTH the company and the owner(s):

For the Company or Entity: 

1. Full legal name according to the Secretary of State.
2. Any trade and “doing business as” names.
3. A complete current street address of the principal place of business (A P.O. Box or the address of a 3rd party agent does not comply with this requirement).
4. The state, tribal or foreign jurisdiction of formation.
5. The IRS Taxpayer Identification Number (TIN/EIN).

A change of any of these 5 items at any time must also be reported within 30 days to the Financial Crimes Enforcement Network, including an address or owner change.

For the Owners/Applicants:

For each owner of at least 25% of the entity (directly or indirectly), the reporting must include for each owner:

1. Legal name and date of birth,
2. Address,
3. Unique identifying number and the issuing jurisdiction from one of the following documents: (i) a non-expired passport issued to the individual by the United States government, (ii) or a non-expired identification document issued to the individual by a State, local government, or Indian tribe for the purpose of identifying the individual, (iii)or a non-expired driver’s license issued to the individual by a State, or (iv) a non-expired passport issued by a foreign government to the individual, if the individual does not possess any of the other documents described, and
4. An image of the document from which the unique identifying number (above #4) was obtained. Additionally, the rule requires that reporting companies created after January 1, 2024, provide the four pieces of information and document image for company applicants.

At the present time there are NO extensions available and you have less than a month left to fill in the form.

There are third party solicitors that apparently do this for you. Based the debacles with firms like these with ERTCs, and because of the incredible amount of confidential information that must be provided, I strongly recommend that you do NOT use one of these groups.

This is a confusing and urgent issue, and you are kind of on your own. It is not a form I can help you with, guide you through, or give you advice about, due to liability issues. If you have an attorney or software company who originally helped you set up your LLC or corporation, they should be able to.

If you know me, you know that loyalty is one of my strongest values (sometimes to my detriment). You also know that it takes a lot to push me over the end to switch. Sadly, I’ve gotten there with Intuit.

I’ve been running payroll through Intuit since it was Paycycle. I’ve run thousands and thousands of payrolls through them. I’ve deftly managed payrolls for 1 to 100 people. I have even cleaned up QuickBooks Online Payroll (QBOP) issues more times than I can count (shall I regale you with tales of how they messed up sending out 1099s last year?)

But some of the latest changes have sent me over the edge — tonight’s being a prime example, They sent out an  “Urgent Final Reminder” to me as an accountant, telling me that to avoid the usurious price of $4 per W-2 for QBOP to mail them out automatically, either I or the client has to do the following (I quote from the email):

What do I or my client need to do? To avoid paying the printing and mailing fees, you or your clients must change their W-2 settings on or before January 3, 2025.

To change the settings, go to Form W-2 printing in Payroll Settings of their QuickBooks Online Payroll account, and choose “I’ll print and mail W-2s to my employees”.

If you or your clients change these settings, they will need to download, print, and mail W-2s themselves, or ask their employees to consent to paperless W-2s in QuickBooks Workforce.**

What if I or my client does nothing? No problem. We’ll handle their W-2s by default and continue to print and mail your clients’ W-2s at the new price of $4 per employee. If you’re currently paying for QuickBooks Payroll for your clients, their W-2 printing and mailing fees will be added to your bill.

So I set aside some time tonight to do so, only to find that that is not actually an option. According to Intuit, only the employee can opt to do this. Each individual employee needs to log in to Workforce, and then find the place to choose to print their own W2 rather than have Intuit do it, and then the employer needs to somehow know that the employee opted for that. Which is to say, that whole thing is not going to happen.
And it was the proverbial straw. I’m officially moving all of my clients that I can over to Gusto. I resisted for a long time, but not anymore. Come join me there — I can get you great rates and service (no $4 W-2s over there!) through the partner program, or you can use my link for a referral bonus if you want to go it on your own: https://gusto.com/r/bethany4954f954

While I’m at it, I’ve been happy with the perks that come with the business American Express that replaced my Delta SkyMiles card. The fee is hefty, but it more than makes up for itself. If you’re interested in checking out, my referral link helps you out there as well: https://americanexpress.com/en-us/referral/delta-skymiles-platinum?ref=ELIZAGKRly&xl=cp10i6

Though some date the “end” of covid to 2021 when vaccines were first available, or to May of 2023 when it was declared “endemic,” I would argue that in many ways we are socially just entering the a “post-covid” state now, at least in terms of theater attendance and charity fundraisers. This year is certainly the first one for me where “gala season” has been back in truly full swing. And I have learned a few things from it.

You don’t need as many activities. Events of the past used to have all kinds of things. Games, photo booths, silent auctions, Heads or Tails,  themed food, dessert bars, specialty cocktails, mission-based activities, fire-walking…You don’t need ALL that now (but please hang on to the mission-based stuff and probably the specialty cocktail). People are genuinely happy, if a little uncomfortable, to be getting back together in person in a space. They need time to process that and to actually talk to each other. Limit the activities to the minimum.

Our attention spans are shorter. Related to the above, make your event shorter. Move the presentation earlier in the event, and make it shorter, but with a bigger punch. People are going to be leaving earlier than you expect. If you have some people you know will want to party the night away, maybe consider tapping some hosts to do “after-parties.”

You will absolutely freak out about attendance. Attendance for everything is lower, as people are pulled in a lot of other directions (including Netflix + couch). AND they buy their tickets later. I honestly don’t believe that discounting tickets last minute or other enticements will swing the needle far on this one. I think we are back to the need for ongoing, required, personal touches and asks, which is going to take more time and energy than you think.

People need some hand-holding. We’ve forgotten how to do a lot of this. The more information that you can give people about parking, dress code, order of events, etc., the happier they will be (and the more they will spend).

Be hybrid without being hybrid. We’re as weary of the term “hybrid” as we were of “pivot.” No one is going to attend your event via zoom. But if you can leave yourself some flexibility (like listing unsold or sluggish silent auction items in an “afterparty” online auction), you might be able to pick up some extra funds.

And, it’s probably time to rethink the role of special events in your contributed revenue budget, since you’ll be rethinking it all anyway….

The Minnesota legislature has rocked lately. Last year they passed a new family and medical paid leave bill, which will begin covering Minnesotans in 2026. Employees will be eligible for up to 20 weeks of paid leave a year, funded by a new payroll tax split between employers and employees. More details to come — most is still being worked out.

However, for all Minnesota employers, the first wage report for that fund is due next week, by 10/31!

If you are like most Minnesota employees, it’s not too onerous a task, because it tracks with your MN UI quarterly. You will want to check with your payroll company to make sure they are reporting correctly (if you are one of my clients I’ve got you and it’s taken care of).

However, there’s one set of people that this new requirement hits hard — small, single or dual member LLCs (like Gladhill Rhone). Previously, companies like these were exempt from UI reporting, because the state figured (probably correctly) that you were not going to fire yourself.

Now, though you still don’t have to pay state UI, you do have to set up a “Paid Leave Only” account. It’s a little bit tricky, and you only have a few more days to do so, so hop to it!

First, go to MN UI. Assuming you do not already have a UI account set up (because in the past you were told not to), you need to “Register for an account.” The system will prompt you through the set-up, for which you will need your EIN and MN State ID number. One you are set up, you will get a temporary ID and password, and you will be mailed a full password (in the mail, on a piece of paper, watch for it and do NOT overlook it, because your temporary log-in is only valid for a few weeks).

This is very important. As you move through the prompts, it will ask you for some dates, like when the business started and when you started paying covered wages. Do not bother to go back and suss when you were incorporated and ran your first payroll. The date you need to input for this is 07/01/2024. If you do anything else (like put in the real date that you incorporated), the system will suddenly wonder why you have not been paying UI all these years. Ask me how I know this.

You will want to put that you are not required to pay UI, but you are required to pay family leave. Yes, even if you are just one person. Basically every Minnesota employer will need to register.

After you have input your information (ownership, address, dates, etc.), you would *think* that then you could go and file your quarterly wage report. But NO.

Apparently, the system takes up to 3 days to get all of your registrations in before you can file. This is why it’s incredibly important that you do this ASAP, because the report is due by next Thursday 10/31, and you need to have those few days for it to all sync up internally.

Once that happens — and you will just have to mark your calendar, they don’t send you a reminder or anything — you need to log back in (good thing you saved that password, huh?), and file your quarterly hours and wages by employee. This should be pretty fast, because there are likely only one or two people to report. You just have to submit the report; there is no payment due. Basically, they are trying to get a handle on employer payroll amounts to calculate the tax/benefits, and they need a few quarters of the data to do so.

This is a putz process, and it takes awhile. Luckily, the people who work at MN UI are the nicest state employees you will ever meet. I have never talked to one who was not incredibly patient and helpful. It’s hard to get to the contact page while you are logged into another part of the site, so their number is 651-296-6141, ext. 4. They are open 8-4:30, Mon-Fri.

May the odds be ever in your favor!

I woke up this morning to an email with a variation of a question I get a lot:

“If we pay a costume designer a stipend and we contract to reimburse them for materials up to a certain agreed limit, must we include the cost of materials in the amount we list on their 1099?”

My answer:

The answer is, sadly, “it’s complicated.”

It depends upon whether the company has an “accountable” or non-accountable” plan. Legalzoom handles the description of the differences well (it covers employees but the same standard holds for 1099s):

https://www.legalzoom.com/articles/accountable-vs-nonaccountable-expense-reimbursement-plans#:~:text=An%20accountable%20plan%20is%20an,tax%20liability%20for%20the%20business.

So basically, if you have stated policies and procedures that reconcile the expenses, and you use those policies for everyone, then you could separate out those expenses and not 1099 them. Best practice would be to do a  separate check to the contractor for solely the materials. Please note that you would need to save those receipts and reimbursement info (or the payback if the contractor underspent) as part of your financial records. In an accountable plan, if the contractor used sub-contractors, you would also want to get proof that they sent them 1099s in January, as applicable.

Please note that the disadvantage to this is that the contractor can’t use items “from stock” (for example, of they have 10 yards of fabric they used for you that they had already and then charged you for). Perhaps more importantly, they cannot deduct these expenses as a business expense (either on a schedule C or their corporate taxes, depending on how they file.)

Per diems are always taxable, but I doubt this applies here

So if your company wants to establish and maintain an accountable plan, then reimbursements don’t need to be included on the 1099. Otherwise, they do. (now whether the IRS is really going to check on a small business is another thing altogether.).

The other way to get around this in the future is to establish a limited purchasing account the designer can use directly. Let me know if yow want to get connected through me to Divvy (now a division of Bill.com), which is a cross between a credit card and a line of credit that ties to the corporate assets rather than an individual and allows you to establish short term, limited cards. For example, you could give a designer a budget of $1000 and an expiration date of 1/31, and they could just charge directly to the card; as part of it they are required to upload receipts. It’s very slick.

A couple of other things you should know as you are preparing for year end:

1) You don’t 1099 people you pay by PayPal or Venmo (or a credit card, not including a service like Divvy), since they send them a 1099-K. The disadvantage to this is that these services aggregate all their payments to a vendor, so if you pay them less than the 1099 threshold, but they have other payments that put them over it, they still receive a 1099. The limit for this year was supposed to go down to a $600 aggregate, but the IRS just announced they would keep it at $20K for 2023, and it looks like going forward it would be a higher threshold, likely $5K. More here:

https://www.cbsnews.com/amp/news/irs-delay-600-reporting-form-venmo-paypal-1099k-2024/?fbclid=IwAR0QMRANgCCLkLTPgRciTnG6k-rIvMMl_BclJKOrZ4dnu3ECItmR5cgCNqY

2) Stating in Jan 24 (for tax year 2023), companies must e-file all year end paperwork of they have 10+ forms (aggregate of W2s and 1099s). So, for example, if you have 2 W2s, 7 1099-NECs,a nd a 1099-MISC for rent, you must e-file.
I live a pretty wild weekend morning, don’t I?

Patrick and I have one main joint client, The Caux Round Table for Moral Capitalism. Just now, I was listening in on Patrick’s meeting with them, when one of the people came in late and harried and apologetic. His son and daughter-in-law are in Acapulco, trying to get out after the hurricane, and he had just made phone connection with them; his son is trying to get to Mexico City, where his company could evacuate them. The Caux director, Steve Young, immediately tried to work out who he could connect him to there to make this happen.

Steve’s like that. Going to Europe? He’ll connect you to various political leaders, maybe even have you bring along his personal missive to Emmanuel Macron or even the Pope, with whom he communicates regularly. Or perhaps you’re going to Thailand and would like to visit the royal family? Steve lives to make these kind of introductions.

Steve is a New England Mayflower descendant, and has had generations of family members who have understood the power of making these connections. He also deeply values the inherent power of these exchanges, understanding that they draw alliances both between the people he is introducing — but also with himself.

He also recognizes the culture of these relationships. While connecting people is not just a white thing (Patrick’s family, for example, is more connected than anyone I know to absolutely EVERYONE, and Steve’s and his wife Hoa have a deep, deep Vietnamese network ), he realizes that here these connections can often be perceived as mainly taking place in white societies. So he’s constantly trying to stretch them.

Overhearing that meeting made me sit back and think about connections, to the point that I had to sit down and write this blog post rather than the bookkeeping I was supposed to be doing right now.

So tell me, who do you need to be connected to? And how can we make that happen?

On my personal blog earlier today, I compared House on the Rock to Taliesin. Some of you who know me well might have been surprised that I came out more on the side of order and constraint rather than eclectic chaos. I was a little surprised myself.

What stood out to me, as I considered this later, was how apt each house was to its place. Taliesin on the “shining brow” of the hill, a self-sustaining retreat for the Wright family (if only because they owed money to everyone in town). House on the Rock a crazy carnival designed to draw people in and dazzle them each step of the way, even if some of that gilding was a little tarnished. Each arguable the better for the presence of the other one.

It seems to me that, in our everyday life — whether that’s our family, our community, national politics, business — that we might have  a lot to learn from that..

That’s also why each place matters, why the “Washington slept here” places are no more important than the former automobile garage or tiny stone house that provided a home for generations. It’s why we should think hard about the meaning of every place we go. Why we should appreciate each place for the role it plays.

I blame second grade.

That’s where SPA started to drill study skills into us in homeroom. First, you worked together on your group, with spelling, reading, math, and writing alternating throughout the days of the week. Then, you had a few minutes at school to do the individual work from that group class. THEN, if you had time left over before you went to the specialized classes or lunch or recess or whatever, you had time for the coveted “free reading.”

I learned to rush through my work so I had time to read, and it took awhile to get out of that mindset, or at least to double check at the end. I still to this day knock out a lot of things in one draft (like blog posts).

But that theory of “you can do XYZ Fun Thing when your work is done” remains with me to this day, and with an extensive to-do list, I rarely get to the free time component. And even if I do, I feel guilty about the work I *should* be getting at least a head start on. My professional coach advises me that if I cut myself a break and do some of the fun things, I’ll actually be MORE refreshed and have MORE space for the work, and i inherently believe her, but I still have a hard time doing it. It’s a ridiculously hard habit to build.

(FWIW, I do still ready every night before bed though).

What do you do to get fun into your everyday life? Or do you suffer with this as much as I do?

(and then Patrick sends me this post: https://everythingchanges.us/blog/energy-makes-time/)

Sorry for the space between posts — I’ve been clearly more concerned about cocktails and gardening than I have been about work! (or, more to the point, paddling like a duck beneath the surface with client things and without enough time to think about Big Issues.)

So I started the day with an amazing coffee meeting at Nina’s with Stephanie Thompson from Ten Thousand Things. They are a client, so it started with things to solve, but quickly moved into bigger thinking, both in solving individual larger issues and then talking about the state of the performing arts in general. I left wanting hours more of that kind of conversation; it was incredible! (And, while I am taking about Ten Thousand Things, you have just a little time left to see EMILIA, and you absolutely should! Get tickets here: https://tenthousandthings.org)

From that meeting, I clarified that the language in the current Minnesota State Arts Board application guidelines for arts education (due today) was indeed confusing. But as part of that, I reached out to my AMAZING development director at FilmNorth, Nancy Paul, who sprang into action to clarify them — and ended up submitted a truly outstanding proposal a couple of hours before the 4:30pm today deadline. I am seriously in awe of her skills, and to how much thought she had already put into the programming that allowed her to write the grant at the very last minute!

It was a capstone to a great week for FilmNorth, in which I submitted a Large and Complicated pre-application for a grant I feel really good about, as well as nailing down over $160,000 in additional capital campaign funding. But don’t worry, there’s still plenty of time for you to give: https://filmnorth.org/capital-campaign/

I then went on to the always lovely Pangea World Theater, where again I solved some long-vexing issues, hung out with their fantastic staff, and felt extraordinarily productive. Any day I can cross a lot of things off my Trello list is a good one!

It’s looking like a great ending to the week, and in just a couple of hours I get to see Beatrix perform in URINETOWN at SPA, so I’m calling today a general arts win. Beatrix’s skills lie beyond the stage as well, since we just got notified she was the winner of the grades 6-9 portion of the Ordway ArtWalk, and her art will be displayed in their windows from May 30 to June 3. If you want that “arts win” feeling as well, the show is highly recommended, and is free of charge, no tickets needed, just show up at SPA’s Huss Center for the Performing Arts (Randolph and Wheeler) for shows at 7pm tonight and tomorrow or 4pm Sunday.

 

I’ve been working with a professional coach, who uses some methods that some might call woo-woo and which — perhaps because of that — have been remarkably effective. One of these is a semi-hypnotic guided meditation (by zoom, no less!); this week one of the things I ended up saying/realizing during that time was “Disruption is necessary for growth.”

I’ve been trying to sit with that a little, because it surprised me. You see, I hate change. I am currently grieving mightily the fact that Lisa Roering, who has owned Roering Auto Body across the street from us for the entire 30 years I have owned this house, apparently sold the business early in 2023 and there’s some dude-bro running it now. Clearly I did not use an auto body place OFTEN, but having Lisa there was a sense of security in my life that I miss. The email I *just* got that my old fave, Wilde Cafe, has now become someplace called “Pivo” is not helping; that said, I am part of the problem as I have not been there in months.

So back to disruption = growth. The more I sit with that the more I see it, though I am scared of it. I’m currently looking at some exciting new client opportunities (yay!), turning down some other new opportunities (unusual for me but very necessary), and casting an eye on currently client relationships to evaluate them. This is exceptionally hard for me, because I am very loyal to clients. I’m trying to see it as realizing that if they are not serving me, I might also not be serving them as well as another solution might be.

Maybe that means I am ok with change for me, but not others! In any case, I’m just generally trying to grow, and be the best possible resources I can for those I work with. It’s some of the hardest, but also rewarding, work I’ve done.