Search Results for: operations

Business Operations, 2020 Edition: Connecting in a COVID World

December 11, 2020 by admin

The year 2020 has brought much confusion and turmoil as a result of the COVID-19 global pandemic. As the world went into lockdown, many businesses were forced to close in an effort to decrease the spread of the virus. Unfortunately, many local businesses had to shut down due to financial issues, while others were faced with a new challenge of how to maintain operations in the new age of social distancing.

Large companies such as Google, American Express, Microsoft and Airbnb extended work from home policies indefinitely, with Google extending its policy into 2021. However, not all businesses have the luxury or resources to follow suit.

Fortunately, companies can take advantage of some opportunities despite the current global climate. Below, we will focus on the importance of technology and a change in mindset, which could help businesses continue to grow as if the pandemic never happened.

Technology: An investment, not an expense
Technology is extremely prevalent in the modern workplace. Every day we converse with clients via phone calls and email. Some companies, however, still value their face-to-face communication with clients. Did you know that there are more avenues of technology that can keep people connected? COVID-19 has given birth to a different means of communication. Since the pandemic, there has been a drastic increase in demand for video calls via platforms such as Zoom, Microsoft Teams and Skype.

Utilizing video calls can help companies maintain relationships with clients as well as build new ones. This is more than a simple telephone call; the use of the video function allows for more meaningful communication because you can read the body language of the client.

At Magone & Company, we’ve made it a point to engage in video calls for almost all our client meetings and are seeing great results. Clients are more willing to help us in performing our procedures since we’ve made an extra effort to be present in their business, even from behind a screen.

Gone is the time of technology being an expense; it is an investment in the business and relationships that cannot be overlooked.

Turning pandemic challenges into business opportunities
Look for opportunities in your organization to change delivery processes or business development strategies using technology. It’s one thing to have the technology, but now you must use it. Some companies may not feel comfortable with the use of video conferencing due to a lack of knowledge, or maybe they just do not feel it will have a positive effect on business.

In contrast, a transition to a more remote based work setting can have significant positive outcomes, such as reduced rental expenses or building operating costs. Reimagine your facility needs as well as your hiring needs. What skill sets are required? Geography may no longer be an impediment to hiring the perfect candidate, though you still need to be cognizant of the state tax effect of such a decision.

For Magone & Company, we’re winning new work outside of our geographic region despite having no offices remotely close to the client location. Our consistent use of video calls allows our employees to build positive relationships and also produce efficient communication to discuss our engagement progress, without ever stepping foot in the office. What was unimaginable in January or February of 2020 is now standard operating procedure — and it’s paying significant dividends.

Embrace the transformation
The year 2020 has taught us that life can change instantaneously. One of the key components to a running a successful business is being open to change. COVID-19 brought more change than most would have hoped for, however this did not stop businesses from assessing new avenues of success.

Restaurants suffered greatly from the imposed lockdowns, which caused owners to develop solutions to help mitigate the risk of closing. As a response, many establishments experimented with outdoor dining and curbside pick-up as a means to generated revenue flow. Others have gotten even more creative. According to an article from the Journal of Accountancy, one particular restaurant owner considered transforming a section of his establishment into a market for customers to buy food.

The same can be accomplished with your business with the right mentality. At Magone & Company, we saw an opportunity to establish a more prominent advisory practice in which we help our clients be better prepared to operate. This proactive, rather than reactive, approach has helped our clients to establish more efficient and effective business strategies. How can you reimagine your business to take advantage of possible opportunities?

Yes, this year has been rough and challenging; however, as outlined above, there is no need to panic. There are ways that businesses can restructure, recalibrate and execute successful business tactics. We have seen positive outcomes to continue to help our clients grow.

Taking Tax Advice from Social Media? Think Again

December 5, 2025 by Nick Magone, CPA, CGMA, CFP®

If a tax credit or deduction sounds too good to be true, it probably is.

There’s been a dramatic spike in suspicious refund claims, thanks to misleading social media advice and criminals posing as tax professionals. In fact, social media fraud even popped up on the IRS’ “Dirty Dozen” list, urging taxpayers to steer clear of bogus offers or advice.

Social media schemes aim to fool innocent scrollers with deceptive content, ranging from non-existent Employee Retention Credits (ERC) to elaborate phishing operations designed to steal personal information. What makes them even more dangerous is how legitimate they appear, often using official-looking graphics as they prey on people’s financial stress and vulnerabilities with the promise of easy money.

Heeding the red flags

As CPAs, we’ve pretty much seen it all. Here are some false social media claims to watch out for:

Influencer endorsements without disclosure of paid partnerships
Cryptocurrency-related tax “loopholes” that promise to eliminate tax liability
System “glitches” that allow people to claim credits multiple times
Foreign tax haven schemes to avoid U.S. taxes
“AI-powered” tax strategies that claim to find hidden deductions

These scams tend to follow predictable patterns. They may post a universal claim like, “This is the credit the IRS doesn’t want you to know about!” Or they may offer an unrealistic promise like getting your refund in 24 hours. But any post that requests your personal information and the pressure to act immediately should be treated as a clear warning sign.

Putting up a solid defense

Social media is great for many things, but tax planning isn’t one of them. Always proceed with caution:

Research independently. If you see a tax strategy advertised online, research it through official IRS publications and consult with a qualified professional about its validity before making any moves. Remember, legal tax strategies require documentation. If someone tells you record-keeping isn’t necessary, walk away.
Don’t share information online. When it comes to taxes, the IRS will never contact you via email, social media or text. And legitimate tax professionals will only conduct business through secure, encrypted channels and established office locations — not over Facebook.
Always verify credentials. Only work with licensed tax professionals who are credentialed through state licensing boards and other professional organizations.
Trust your instincts. Nobody is giving away free money. Scammers rely on creating urgency and FOMO, so taking time to think things through is one of your strongest defenses.

Social media tax schemes can cost you big money, hefty penalties, damaged credit and even your dignity. Don’t hesitate to reach out to the tax professionals at Magone & Company for support.

This document is for informational purposes only and should not be considered tax or financial advice. Be sure to consult with a knowledgeable financial or legal advisor for guidance that is specific to your unique circumstances.

Maximizing the Tax Benefits of Your Remote Workforce

October 24, 2025 by Nick Magone, CPA, CGMA, CFP®

The pandemic fundamentally altered how many U.S. businesses operate. Distributed teams and flexible arrangements have become permanent fixtures rather than temporary fixes.

For employers and workers, this also means new opportunities and challenges for tax planning and compliance.

The reality of remote workers

Companies have discovered that productivity doesn’t require physical proximity. In fact, 60% of remote workers report their flexible work arrangement has boosted their ability to get work done and meet deadlines. This proven effectiveness means that today’s employers may have teams spanning cities and states, creating complex tax implications that extend beyond traditional office-based considerations.

Comprehensive tax credit and incentive (TC&I) analysis has become essential for businesses supporting remote teams. These specialized programs provide detailed assessments of available opportunities, breaking down qualification requirements and implementation strategies tailored to your specific business model.

TC&I experts examine your operations, identifying federal, state and local programs that align with your workforce distribution, ensuring you’re capturing every available benefit while maintaining full compliance across all jurisdictions where your employees work.

Navigating the nexus challenge

Before your businesses can capitalize on these opportunities, you must establish and manage nexus obligations.

State tax nexus determines where your business has sufficient connection to warrant tax obligations, and remote employees can create these connections in states where you’ve never maintained a physical presence.

Each state has different standards for establishing nexus through employee activities. Some require minimal employee presence to trigger obligations, while others have higher thresholds. Getting nexus right requires a proactive approach:

Conduct regular nexus assessments. Implement regular reviews of employee locations and activities to identify new potential nexus obligations before they become compliance issues.
Establish clear remote work policies. Develop guidelines that address tax implications of employee relocations and temporary work arrangements.
Engage multi-state tax professionals. Partner with specialists who understand the nuanced requirements across different jurisdictions.

Credits that reward a remote work strategy

Once your nexus obligations are properly managed, the evolving work landscape has expanded access to numerous tax credit opportunities for remote employers. For example:

State-specific remote work incentives. Various states offer credits for companies hiring remote workers or relocating operations.
Home office deduction optimization. While limited for employees, businesses can structure arrangements to maximize legitimate office-related deductions.
Technology investment credits. Many jurisdictions offer incentives for investments in equipment and software that enable remote collaboration.
Economic development incentives. Location-specific credits may be available when remote workers are based in designated economic zones.

Making the most of your remote workforce

Regular assessment of your workforce distribution, combined with strategic implementation of available credit programs, positions your business to thrive. Learn how the experts at Magone & Co can help. Reach out or give us a call today at (973) 301-2300.

Breaking Down The One Big Beautiful Bill for Businesses

July 30, 2025 by Nick Magone, CPA, CGMA, CFP®

Recently enacted tax legislation known as The One Big Beautiful Bill was passed by Congress and signed into law on July 4, 2025.

This new legislation brings immediate relief in several key areas while creating strategic decisions that require prompt attention. Here’s a summary of the most critical provisions that may impact your business:

Research and Development (R&D) expensing. Businesses can once again fully deduct domestic R&D expenses in the year they’re incurred. Small businesses can amend 2022-2024 tax returns to claim immediate R&D deductions previously capitalized which may generate refunds and improve cash flow.

Large corporations cannot amend prior years but can take the full remaining deduction in 2025 or split it between 2025 and 2026.

Research credit coordination. New rules require choosing between claiming the full R&D tax credit or taking the full expense deduction, as you can no longer maximize both.

If you claim the Section 41 research credit, you must reduce your R&D deductions by the same amount. Alternatively, you can elect a smaller credit to preserve your full deduction.

Business interest limitation. The bill’s business interest deduction now limits returns to the more favorable 30% of EBITDA calculation, reversing the restrictive EBIT-based rules that had been in effect since 2022. This change is permanent, eliminating previous uncertainty about future policy shifts.

The key improvement is that depreciation and amortization are back in the calculation base, increasing the threshold for allowable interest deductions. This benefits manufacturers and other capital-intensive businesses that were hit hard by the previous rules.

But there’s one important clarification: Capitalized interest (interest added to asset costs rather than immediately deducted) must now be included in the limitation calculation, with the 30% cap applied to capitalized interest first before current deductible interest.

Foreign-derived income changes. The foreign-derived income deduction is being scaled back in two phases. The deduction rate drops permanently from 37.5% to 33.34% for tax years beginning after 2025. And starting mid-2025, income from selling intangible property and depreciable assets won’t qualify for the deduction, and only expenses directly tied to qualifying foreign income can reduce the benefit.

The 100% bonus depreciation is back for all qualifying equipment and property purchased after that date. This reverses the phase-down schedule that reduced the benefit to 60% in 2024 and 40% in early 2025. The reinstatement applies to plant, equipment and tangible personal property, including both new and used assets. There’s also a special elective provision for manufacturing and refinery property placed in service through 2031, giving these businesses additional flexibility in timing their depreciation benefits.

International tax changes. Starting in 2026, Global Intangible Low-Taxed Income (GILTI) rules are being renamed Net CFC Tested Income (NCTI), affecting businesses with foreign operations.

The deduction rate drops from 50% to 40%, which increases the effective tax rate from approximately 13.1% to 12.6% (around 14% when factoring in foreign tax credits). The previous exclusion for tangible asset investments is eliminated, meaning all foreign income is now subject to tax under these rules.

In addition, the foreign tax credit rate increases from 80% to 90%, and rules for allocating deductions against this income are being tightened to exclude interest and R&D expenses from the calculation base.

Next steps for your business

The One Big Beautiful Bill offers substantial tax relief, but maximizing these benefits requires proactive planning and strategic decision-making now. The professionals at Magone & Co can help. Reach out to our knowledgeable team or give us a call today at (973) 301-2300.

Financial Reporting 101 for Small Business Owners

June 6, 2025 by Nick Magone, CPA, CGMA, CFP®

New to running a business? While passion and hard work are crucial, financial reporting is integral to your company’s success.

Financial reports are detailed documents that provide a thorough overview of your company’s financial performance and position. They can help you:

Make strategic decisions
Ensure compliance with tax and legal requirements
Attract and secure potential investors or loans
Cut unnecessary expenses
Understand your business’s financial trends

Take control of your business’s financial health. These six financial reports that can help transform how you manage and grow your business.

Income statement. Is your revenue growing? Are expenses creeping up unexpectedly? An income statement generally reveals your business’s cost of goods sold, operating expenses, net profit or loss and other metrics that are indicative of whether you’re making or losing money. By regularly reviewing your income statement, you can also identify areas of high spending and gain a broader understanding of your business’s profitability.
Balance sheet. A balance sheet captures your business’s financial position at a specific moment, breaking down your assets, liabilities and your equity. It offers insights into your business’s net worth, helps track long-term financial stability and is essential for securing loans. That’s why it’s important to verify all entries monthly, ensure accuracy of asset valuations and check for outdated or irrelevant entries to proactively manage your business’s finances.
Cash flow statement. Is your core business financially sustainable? What is your company’s overall operational efficiency? Positive revenue doesn’t always mean positive cash flow. That’s why tracking your cash flow is so important. This statement displays how cash moves in and out of your business, which can help predict cash shortages, manage day-to-day operations and make more strategic financial decisions.
Inventory valuation report. An inventory valuation reports help manage your business’s physical assets, tracking current inventory levels, cost of inventory, value of existing stock and inventory turnover rates. It can be very beneficial in helping to track performance metrics like inventory turnover rate and in optimizing your inventory purchasing decisions
Accounts receivable aging report. This report is like your financial watchdog, tracking outstanding customer invoices, how long invoices have been unpaid and which customers are slow to pay up. Use this report to follow up on late payments and improve your cash collection process.
Accounts payable aging report. While an accounts receivable aging report manages what you’re owed, an accounts payable aging report helps you manage what you owe. This report provides a rundown of delinquent bills and expenses and payment due dates. Having a handle on your upcoming payments can help prevent late fees and penalties, and assist in your business’s cash flow planning.

Knowledge is power when it comes to your business’s financial health. That’s why the tax experts at Magone & Company can help you best understand your financial reports, interpret them and use the data to make informed decisions.

Reach out to our collaborative team or give us a call today at (973) 301-2300.

The New Geography of Work: A Business Guide to State Tax Nexus

May 9, 2025 by Nick Magone, CPA, CGMA, CFP®

The pandemic accelerated a massive shift to remote work, revolutionizing the way we do business. Fast-forward five years, and approximately 22 million U.S. employees continue to log in from home. It’s also not uncommon for employees to work in different states than their employer.

This new reality of distributed teams has transformed the traditional understanding of state tax nexus — the connection between a business and a state that triggers tax obligations. Understanding these evolving tax implications isn’t just about compliance; it’s about making strategic decisions that could significantly impact a company’s bottom line and operational flexibility.

For employers, understanding the state tax nexus has never been more critical.

Decoding state tax nexus: Beyond the office walls

Traditionally, physical presence determined nexus — offices, warehouses or retail spaces — but remote work has expanded its definition.

These new nexus triggers may require employers to implement employee tracking systems and regularly review their multi-state tax obligations to ensure they’re in good standing:

Employee location. Having even one employee working remotely in a state can establish nexus, potentially creating tax responsibilities in that jurisdiction.
Revenue thresholds. Many states have economic nexus laws that require tax registration based on total revenue generated within the state, regardless of physical presence.
Temporary work arrangements. Short-term remote work and even employee travel can unexpectedly create tax obligations, even if an employee is only working temporarily from another state.

Unlike traditional nexus rules, there’s also an economic nexus that focuses on revenue thresholds, transaction volumes and digital interactions, rather than physical presence. Employee locations, digital service delivery and distributed workforce models can all simultaneously trigger multiple state tax obligations, creating a complex compliance landscape.

To avoid noncompliance, businesses may need to develop and implement sophisticated strategies to address a range of intricate tax implications:

Tracking employee locations and work patterns
Understanding varying state tax regulations
Maintaining accurate records of remote work arrangements
Calculating potential tax liabilities across multiple jurisdictions

Building a tax-compliant remote work infrastructure

The key to managing tax nexus obligations is to transform obstacles into manageable processes.

Develop clear policies. Create comprehensive remote work guidelines that address pre-approval requirements for out-of-state work, duration limits for temporary relocations, tax implications notification procedures and more.
Invest in employee training. Implement regular training programs focusing on location reporting requirements, tax compliance procedures, documentation protocols and state-specific regulations.
Create compliance checkpoints. Establish periodic review processes, including regular economic threshold monitoring, annual compliance audits and state registration reviews.
Leverage technology solutions. Utilize advanced tools for real-time location tracking, automated tax calculations, multi-state compliance reporting and economic nexus monitoring.
Partner with the experts. By working with a trusted tax professional, businesses can have peace of mind they’re getting the proper guidance and expertise to address the tax nexus challenges of remote workers.

The CPAs at Magone & Company can help your remote operations remain compliant and minimize your tax liability. Reach out to learn more.