Advantages of SBA Financing

If you are buying a business, expanding a business, buying out a business partner, or starting a new business, an SBA loan may be your best solution for financing.  SBA loans almost always provide lower down payments, longer repayment terms, and easier qualifying criteria than conventional bank loans.  When financing small business real estate, the down payment requirement can be as low as 10%, and it is typically half the amount of down payment required for traditional bank financing.  Another benefit of SBA loans is long term financing.  The repayment term for an SBA real estate loan is 25 years, so the business owner does not have the risk associated with renewing short term bank financing each time it matures in intervals like every three or five years. Since the SBA loan program is actually a business loan, and not a real estate mortgage, a business owner can include financing for other business expenditures as part of the same loan.  With funding for new business equipment or working capital, in addition to financing the real estate, the SBA loan program is very versatile in its funding accommodation.  With SBA financing, these loans have helped many small business owners realize the dream of owning their own real estate where the business operates.    Let’s discuss what Fidelity Bank SBA Lending can do for you.

I felt this could be of value to all the small businesses out there especially in the aftermath of Hurricane Harvey and still in the rebuilding process.

Bruce Hurta  SBA Business Development Officer  Fidelity Bank 281-384-2595

Martin Meyer of B Meyer Bookkeeping Solutions in Sugar Land

Help Employees with Withholdings Penalities

Encourage your employees to check this years withholdings on the IRS website when filing their 2018 tax returns in 2019. The new calculator is scheduled on the IRS website at: click here.

The IRS encourages everyone to use the Withholding Calculator to perform a quick “paycheck checkup.”  This is even more important this year because of recent changes to the tax law for 2018.

The Calculator helps you identify your tax withholding to make sure you have the right amount of tax withheld from your paycheck at work.

There are several reasons to check your withholding:

  • Checking your withholding can help protect against having too little tax withheld and facing an unexpected tax bill or penalty at tax time next year.
  • At the same time, with the average refund topping $2,800, you may prefer to have less tax withheld up front and receive more in your paychecks.

If you are an employee, the Withholding Calculator helps you determine whether you need to give your employer a new Form W-4, Employee’s Withholding Allowance Certificate. You can use your results from the Calculator to help fill out the form and adjust your income tax withholding.

Hope you find this helpful.

QuickBooks Setup: The Basics

I have been looking over articles on the most common mistakes in QuickBooks and I see a list of 10 to 20 common mistakes. I agree with all these as being mistakes made once you start using QuickBooks.

What I have found is most of the articles do not cover the source of the mistakes the Initial Setup of Your QuickBooks Data File.

While the setup of QuickBooks Online is somewhat different than QuickBooks Desktop Versions there are some basics we can address in the setup. I am not going to try to explain all the differences in QuickBooks Online setup and QuickBooks Desktop setup as most of the difference are in what in naming of the different areas and the user interface in setting up.

There are 4 areas I am going to address the Chart of Accounts, item list (desktop), Products and Services (online version), vendor list and customer lists.

Chart of Accounts is the basis for all your company’s financial reports and is a critical part of setting up QuickBooks both online and desktop versions.  If you do not properly classify and create your chart of accounts you will get errors in your management reports and inaccurate data. How can you make informed business decisions with bad data?  Remember the information contained in the chart of accounts is the information that flows through to your Balance Sheet, Profit and Loss Statement, and your Cash Flow Statement.  Balance sheet shows Assets, Liabilities, and Equity accounts. The Profit and Loss is your Income, Costs of Goods Sold (if you sell a product), and your business Expenses. The cash flow statement is distinct from the income statement and balance sheet because it does not include the amount of future incoming and outgoing cash that has been recorded on credit. Therefore, cash is not the same as net income, which on the income statement and balance sheet, includes cash sales and sales made on credit. Cash Flow Statement lets you know how much income is coming in vs. cash going out. We are not going to get into more advanced analysis of the different financial reports at this time. Just be aware that the Chart of Accounts is the building block for your entire accounting system.


Item Lists (desktop) and Products and Services (online: are necessary for the creation of Customer Invoices, Estimates, Sales Receipts, Vendor Purchases, and Inventory. There are several different types of items, products and services available in QuickBooks depending on your company’s needs. Item list, products, services and inventory are used for two reasons one they help illuminate double entry as they flow back to the chart of accounts and it helps make the chart of accounts condensed and easier to use.  Items link back to your cost of goods sold, expenses, and inventory and income accounts depending on the item.

Customer List: is just what is says it is a list of the people and business you sell your products or services to.  This is where you decide when payment is due such as upon receipt, or net 10, or net 30 etc.. You can also enter payment information if they pay your by credit card, however, you will need a merchant services account to accept credit card payments. Remember this is also where your item and product and services list come in when you create your customer invoices or sales receipts.

Intuit now offers Intuit Payments which allows you to take credit cards or to get payments directly from your customer’s bank account at the customer’s option or by previous agreement. I suggest you gather as much information as possible on each of your customers such as email address, birthdays always nice to send a customer a greeting on their birthday.
Vendor List: is exactly as it sounds the list of people you buy from. When creating vendor bills in QuickBooks you will use your item, products and services listings. This again flows back to you inventory, cost of goods, and expense accounts depending on the type of business you have. You can also setup the terms of payment you have with your different vendors. If you use subcontractors or individuals they will also be part of your vendor listings and you will need to get a Form W9 from them to report payments to them on Form 1099 at year end.

If you are a start up business and need assistance please give us a call and we can discuss what you need to do to properly setup your QuickBooks Online or QuickBooks Desktop accounting system.

Give us a call or go to our website: and fill out our contact us form or give us a call at


If you are an existing business and know you have problems with your setup and need assistance to fix these problems Give us a call or go to our website: and fill out our contact us form or give us a call at





Many Hurricane Victims Qualify for Earned Income Tax Credit; Special Method Can Aid Workers Whose Income Dropped

IR-2018-10, Jan. 23, 2018

WASHINGTON – The IRS is urging victims of last year’s hurricanes, especially those who lived in areas affected by Hurricanes Harvey, Irma and Maria, to see if they qualify for the Earned Income Tax Credit (EITC). According to the IRS, many people whose incomes dropped in 2017 may be eligible to choose a special option for figuring the EITC, a credit for low- and moderate-income workers and families.

A special computation method, available only to people who lived in one of the hurricane disaster areas during 2017, may enable them to claim the EITC or claim a larger than usual credit. Under this method, taxpayers whose incomes dropped in 2017 can choose to figure the credit using their 2016 earned income rather than their 2017 earned income. Eligible taxpayers should figure the credit both ways — the regular way using 2017 earned income and this special way using 2016 earned income — to see which yields the larger EITC. For more information and special instructions on how to report, see the instructions for Form 1040, Line 66, and Publication 976, available on

The EITC helps working people who don’t earn a lot ($53,930 or less for 2017) and meet other eligibility requirements. Because it’s a refundable credit, those who qualify and claim it could pay less federal tax, pay no tax or even get a refund.

EITC can mean up to a $6,318 refund for working families with qualifying children. Actual credit amounts vary based on income, family size and other factors. Workers without a qualifying child with incomes below $20,600 could also be eligible for a smaller credit of up to $510. On average, EITC adds $2,445 to refunds.

To qualify for EITC, an eligible taxpayer must meet basic rules and have earned income from working for someone, being self-employed or running a business or farm. This includes home-based businesses, the sharing economy and employment in the service, construction and agriculture industries. In addition, certain disability payments may qualify as earned income for EITC purposes. The EITC Assistant, available on, can help taxpayers determine eligibility and estimate the amount of their credit.

To get the credit, people must file a tax return, even if they owe no tax and even if they normally aren’t required to file. The fastest and easiest way to do so is by filing electronically, whether through a qualified tax professional; using free community tax help sites; or self-preparing with IRS Free File.

By law the IRS cannot issue refunds before mid-February for tax returns that claim the EITC or the Additional Child Tax Credit (ACTC). The IRS must hold the entire refund — even the portion not associated with EITC or ACTC. This change helps ensure taxpayers receive the refund they deserve and gives the agency more time to detect and prevent errors and fraud.

The IRS expects the earliest EITC/ACTC related refunds to be in taxpayer bank accounts or debit cards starting Feb. 27, 2018, if they chose direct deposit and there are no issues with the tax return.

The IRS and partners nationwide will hold the annual EITC Awareness Day on Friday, Jan. 26 to alert millions of workers who may be missing out on this and other refundable credits. One easy way to support this outreach effort is by participating on the IRS Thunderclap to help promote #EITCAwarenessDay through social media. For more information on EITC and other refundable credits visit the EITC page on

Please contact us as we have excellent CPA’s to refer you to for getting your taxes done correctly. 

Meet Martin Meyer of B Meyer Bookkeeping Solutions in Sugar Land


Today we’d like to introduce you to Martin Meyer.

Martin, please share your story with us. How did you get to where you are today? I sold my scrap metal business in 1999 and was looking for something else I could do. My wife has always worked in accounting and prior to entering the Army in 1971 I was working on a degree in accounting so it just seemed the natural fit.

I returned to college in 2000 taking business and accounting courses at the University of Houston. In August of 2001 I decided to re-enter the work force. Unfortunately, the tragedy of September 11, 2001 and the downfall of Enron created a less than perfect environment for returning to the workforce. Jobs were scare as everyone who worked for Enron and Arthur Anderson were thrown back into the workforce after losing everything that had.

Since there were no permanent positions available I started doing contract work and that was the very beginning of B Meyer Bookkeeping. Of course the name went through several changes over the years and my wife joined the company in 2209.

Today we are a successful Veteran owned bookkeeping service providing bookkeeping services virtually nationwide. We use hosting services for the QuickBooks desktop versions and we also are certified in the QuickBooks online version. B Meyer Bookkeeping Solutions also offers payroll services.

We’re always bombarded by how great it is to pursue your passion, etc – but we’ve spoken with enough people to know that it’s not always easy. Overall, would you say things have been easy for you? Starting a business is always a struggle and transitioning to using a hosting service so we could provide virtual bookkeeping services nationwide was a challenge. Adding QuickBooks Online as part of our servicing options was a challenge as the software is totally different from the desktop version we had been using since 2002. Cash flow was a problem but we were able to resolve that issue over time.

We’d love to hear more about your business. We are a unique husband and wife team that works very well together. My wife has her clients and I have mine. However, with our over 65 years of combined bookkeeping and business experience we have a lot to offer our clients.

We are known for our availability to our clients since we office from home being virtual bookkeepers; we can take client calls and inquiries at any time. However, if you call or email me at 3AM I will have to return your call or email later in the day.

We work with a number of different clients from manufacturing, technology companies, real estate investors, and custom home builders.

What were you like growing up? I am still working on the growing up part, but I am getting there. I played football in junior high school (that’s what it was called back then) and in high school. I always have like fishing and hunting and loved spending time with my Uncle Herman who owned a sporting goods store in Bay City, Texas.

My father owned his own business a pawn shop located in downtown Houston. I started going there as far back as I can remember and really started working there some in my teen years. This was my first experience with owning your own business; of course I come for a family of entrepreneurs so that help in my resolve to for the most part work for myself.

I worked for Weingarten’s and Rice food marketing after school and on weekends starting when I was 13 easier to do in those days. I also worked for Gordon’s Jewelers in the display department while going to college.

When I returned from the Army in 1974 I went to work for the Veteran’s Administration as they had jobs for returning veterans. In 1975 I got my first introduction into the scrap metal business working for Gulf Metals Industries which has since been sold. I also worked as an electrician with Local 716 for several years until the bottom fell out of the economy in the 1980’s. I returned to the scrap metal business and eventually opened my own scrap metal business.

Contact Info:

Getting in touch: VoyageHouston is built on recommendations from the community; it’s how we uncover hidden gems, so if you know someone who deserves recognition please let us know here.


Understanding Employee vs. Contractor Designation

This came directly from the IRS website. Since, this has become such a critical issue with the IRS and they are taking a much closer look at the Employee vs. Independent Contractor Designation. I thought it was a good idea to pass this on to all business owners out there.

FS-2017-09, July 20, 2017

The Internal Revenue Service reminds small businesses of the importance of understanding and correctly applying the rules for classifying a worker as an employee or an independent contractor. For federal employment tax purposes, a business must examine the relationship between it and the worker. The IRS Small Business and Self-Employed Tax Center on the IRS website offers helpful resources.

Worker classification is important because it determines if an employer must withhold income taxes and pay Social Security, Medicare taxes and unemployment tax on wages paid to an employee. Businesses normally do not have to withhold or pay any taxes on payments to independent contractors. The earnings of a person working as an independent contractor are subject to self-employment tax.

The general rule is that an individual is an independent contractor if the payer has the right to control or direct only the result of the work, not what will be done and how it will be done. Small businesses should consider all evidence of the degree of control and independence in the employer/worker relationship. Whether a worker is an independent contractor or employee depends on the facts in each situation.

Help with Deciding

To better determine how to properly classify a worker, consider these three categories – Behavioral Control, Financial Control and Relationship of the Parties.

Behavioral Control:  A worker is an employee when the business has the right to direct and control the work performed by the worker, even if that right is not exercised. Behavioral control categories are:

  • Type of instructions given, such as when and where to work, what tools to use or where to purchase supplies and services. Receiving the types of instructions in these examples may indicate a worker is an employee.
  • Degree of instruction, more detailed instructions may indicate that the worker is an employee.  Less detailed instructions reflects less control, indicating that the worker is more likely an independent contractor.
  • Evaluation systems to measure the details of how the work is done points to an employee. Evaluation systems measuring just the end result point to either an independent contractor or an employee.
  • Training a worker on how to do the job — or periodic or on-going training about procedures and methods — is strong evidence that the worker is an employee. Independent contractors ordinarily use their own methods.

Financial Control: Does the business have a right to direct or control the financial and business aspects of the worker’s job? Consider:

  • Significant investment in the equipment the worker uses in working for someone else.
  • Unreimbursed expenses, independent contractors are more likely to incur unreimbursed expenses than employees.
  • Opportunity for profit or loss is often an indicator of an independent contractor.
  • Services available to the market. Independent contractors are generally free to seek out business opportunities.
  • Method of payment. An employee is generally guaranteed a regular wage amount for an hourly, weekly, or other period of time even when supplemented by a commission. However, independent contractors are most often paid for the job by a flat fee.

Relationship: The type of relationship depends upon how the worker and business perceive their interaction with one another. This includes:

  • Written contracts which describe the relationship the parties intend to create. Although a contract stating the worker is an employee or an independent contractor is not sufficient to determine the worker’s status.
  • Benefits. Businesses providing employee-type benefits, such as insurance, a pension plan, vacation pay or sick pay have employees. Businesses generally do not grant these benefits to independent contractors.
  • The permanency of the relationship is important. An expectation that the relationship will continue indefinitely, rather than for a specific project or period, is generally seen as evidence that the intent was to create an employer-employee relationship.
  • Services provided which are a key activity of the business. The extent to which services performed by the worker are seen as a key aspect of the regular business of the company.

Consequences of Misclassifying an Employee

Classifying an employee as an independent contractor with no reasonable basis for doing so makes employers liable for employment taxes. Certain employers that can provide a reasonable basis for not treating a worker as an employee may have the opportunity to avoid paying employment taxes. See Publication 1976, Section 530  Employment Tax Relief Requirements for more information.

In addition, the Voluntary Classification Settlement Program (VCSP) offers certain eligible businesses the option to reclassify their workers as employees with partial relief from federal employment taxes.

The IRS can help employers determine the status of their workers by using Form SS-8, Determination of Worker Status for Purposes of Federal Employment Taxes and Income Tax Withholding. IRS Publication 15-A, Employer’s Supplemental Tax Guide, is also an excellent resource.

Workers who believe an employer improperly classified them as independent contractors can use Form 8919 to figure and report the employee’s share of uncollected Social Security and Medicare taxes due on their compensation.

The IRS Small Business and Self-Employed Tax Center provides a multitude of resources for small businesses as well as self-employed independent contractors.

Additional Resources:


“Are they an Employee or Are they an Independent Contractor” that is the Question. As a Small Business Owner you should understand the difference and the IRS rules.

Why do business owners want to have Independent Contractors?

If a business can classify a person performing work for them, what are the advantages to the business owner?
One of the main reasons is a tax savings as they do not have to withhold payroll taxes and do not have to pay the employer match on payroll taxes. Another reason is they do not have to offer the independent contractor health insurance, workmen’s compensation, or 401K plans. Independent contractors are also not covered by minimum wage and hour laws as the business owner does not have to pay downtime or over time to the independent contractor.
Why does the IRS want individuals to be classified as Employees?

The major reason it is easier to collect taxes from an employer for Social Security, Medicare and Federal Income Taxes from a business than collecting Self-Employment Taxes from and independent contractor. Self Employment Taxes are the equivalent of the Social Security and Medicare taxes. Self employed individuals also can reduce the amount of taxes paid with business deductions. Where employees pay and withhold Social Security, Medicare and Income taxes based on their gross salaries.
What are the rules that determine whether and individual is an Employee or an Independent Contractor?

1. Instructions:

A worker who is required to follow the instructions of another person about how, when, and where the work is to be done is ordinarily an employee. The control factor is present; if the person for whom the services are being performed has the right to set required compliance with instructions for the person performing the services.

2. Training:

Requiring the worker to be trained by an more experienced employee, requiring them to attend meetings, or by using other methods of training to perform the work using a particular manner indicates that this person should be classified as an ordinary employee.

3. Integration:

It is when the integration of the workers services into the business’s operations and the worker is subject to direction and control of the business. When the success or continuation of the business depends to an appreciable degree upon the performance of certain services the workers who perform those services must necessarily be subject to a certain amount of control by the owner of the business.

4. Services Rendered Personally:

If the services must be rendered personally, presumably by the person or persons for who the services are performed are interested in the methods used to accomplish the work as well as in the results.

5. Hiring, Supervising, and Paying Assistants:

If the business owner or owners for whom the services are performed hire, supervise, and pay assistants, that fact generally shows control over the workers on the job. However, if one of the workers hires, supervises, and pays the other assistants in performance of a contact under which the worker agrees to provide materials and labor, and under which the worker is responsible only for the attainment of a result, this fact indicates this worker to be classified as an independent contractor.



6. Continuing Relationship:

A continuing relationship between the worker and the business owner(s) for whom the work is performed indicates that and employer-employee relationship exist. A continuing relationship may exist where work is performed at frequently recurring although irregular intervals.

7. Set Hours of Work:

The setting of specific work hours by the business owner(s) for whom the work is performed is a factor in indicating control.

8. Full time required:

If the worker must devote full time to the business of the business owner(s) for whom the services are performed then the business owner(s) have control over the amount of time the worker spends working and restricts the worker from doing other gainful work. An independent contractor on the other hand is free to work when and for whom they choose.

9. Doing work on the business owner(s) premises:

If the work performed on the premises of the business owner(s) for whom the work is performed, that suggests control over the worker, especially if the work could be done elsewhere.

Rev. Rul. 56-660, 1956-2 C.B. 693. Work done off the premises of the business owner(s) receiving the services, such as at the office of the worker, indicates some freedom from control. However, this fact by itself does not mean that the worker is not an employee. The importance of this factor depends on the nature of the service involved and the extent to which an employer generally would require that employees perform such services on the employer’s premises. Control over the place of work is indicated when the person or persons for whom the services are performed have the right to compel the worker to travel a designated route, to canvass a territory within a certain time, or to work at specific places as required.




10. Order or sequence set:

If a worker must perform services in the order or sequence set by the business owner(s) for whom the services are performed, then that is a factor that shows the worker is not free to follow the worker’s own pattern of work, but must follow the established routines and schedules of the business owner(s) for whom the services are performed. Sometime because of the nature of the occupation, the business owner(s) for whom the services do not set the order of the service or set the order infrequently. It is sufficient to indicate control if the business owner(s) retain the right to do so.

11. Oral or written reports:

A requirement that the worker submit regular or written reports to the business owner(s) for whom the services are performed indicates a degree of control.

12. Payment by the hour, week, month:

Payment by the hour, week, or month generally points to an employer-employee relationship, provide that this method of payment is not just a convenient way of paying a lump sum agreed upon as the cost of a job. Payment made by the job or on straight commission generally indicates that the worker is an independent contractor.

13. Payment of business and/or traveling expenses:

If the business owner(s) for whom the services are preformed ordinarily pay the worker’s business and –or traveling expenses, those worker(s) is ordinarily an employee. If the employer is able to control expenses generally retains the right to regulate and direct the worker’s business activities.

14. Furnishing of tools and materials:

If the business owner(s) for whom the services are performed furnish significant tolls, materials and other equipment tends to show the existence of an employer-employee relationship.


15. Significant investment:

If the worker invest in facilities that are used by the worker in performing services and are not typically maintained by the employees (such as the maintenance of an office rented at fair value from and unrelated party) this tend to indicate that the worker is an independent contractor. However, the lack of investment in facilities indicates a dependence on the business owner(s) for whom the services are being performed for such facilities and indicate the existence of an employer-employee relationship.

16. Realization of Profit or Loss:

A worker who can realize a profit or suffer a loss as the result of the workers services (in addition to the profit or loss ordinarily realized by employees) is generally an independent contractor.

Rul. 70-309. For example, if the worker is subject to a real risk of economic loss due to significant investments or a bona fide liability for expenses, such as salary payments to unrelated employees, that factor indicates that the worker is an independent contractor. The risk that a worker will not receive payment for his or her services, however, is common to both independent contractors and employees and thus does not constitute a sufficient economic risk to support treatment as an independent contractor.

17. Working for more than one business at a time:

If the worker performs more than the minims services for a multiple of unrelated businesses at the same time that would generally indicate the worker is an independent contractor.

Rev. Rul. 70-572, 1970-2 C.B. 221. However, a worker who performs services for more than one person may be an employee of each of the persons, especially where such persons are part of the same service arrangement.

18. Making services available to the general Public:

If a worker that makes their service available to the general public on a regular and consistent basis indicates an independent contractor relationship.



19. Right to work discharge

The right to discharge a worker can indicate that the worker is an employee and the business owner(s) possessing the right is an employer.
If an employer exercises control through the threat of dismissal, cause the worker to obey the employers instructions. An independent contractor cannot be fired so long as the independent contractor produces results that meet the contract specifications.

20. Right to terminate:

If the worker has the right to end their relationship with the business owner(s) for whom the services are performed at any time they wish without incurring, liability, that factor indicates and employer-employee relationship.






What happens if individuals are classified incorrectly?

The IRS has the right to audit 3 years and the consequences for misclassifying and individual can be over 10% (of compensation paid) in tax for 3 years plus penalties and interest. This could put smaller business in the hole they can never climb out of.
Be sure to always file form 1099 to be eligible for any of the three relief methods available.
Section 530 refers to section 530 of the Revenue Act of 1978.

Section 530 provides businesses with relief from federal employment tax obligations if certain conditions are met. Businesses may be relieved of their obligations both retroactively and prospectively if these conditions are met.
Section 530 was originally enacted as a response to taxpayer complaints that the IRS was too aggressive with respect to worker reclassification issues.
In its training materials the IRS states that Section 530 is a relief provision that should be considered as the first step in any case involving worker reclassification.
Section 530 allows businesses to treat workers as independent contractors if they meet the following conditions:
• Complied with the Form 1099 reporting requirements with respect to compensation paid the workers (reporting consistency)
• Consistently treated the workers (and similarly situated workers) as independent contractors (substantive consistency)
• Had a reasonable basis for treating the workers as independent contractors
The classification settlement program establishes procedures for settlement in cases where a taxpayer does not qualify for section 530 relief.
Generally the situations in question would be where a taxpayer meets the reporting consistency requirement and only one of the two remaining requirements (substantive consistency and reasonable basis).

Under the classification settlement program, the taxpayer will have to agree to treat the workers as employees on a prospective basis.
The IRS also has a program in which businesses can voluntarily reclassify individuals formerly classified as independent contractors as employees in the future for a fraction of the penalty that would be paid if caught.

Business owners make sure you meet the requirements of section 530 relief for reporting consistency (making sure Forms 1099 are filed timely), substantive consistency and reasonable basis.
Business owner(s) do sign contracts with independent contractors that specifically state they will be treated as independent contractors. These contracts would ideally have ending dates as opposed to being open ended.
Do not allow independent contractors to participate in any employee benefit packages.
Have independent contractors carry their own workman’s compensation policies.
Do not give independent contractors employee manuals or instructions so detailed as to show control by the business.
Have the independent contractor submit bills for services rendered. Include in the independent contractor’s file any advertisements and business cards or anything else showing that they are holding themselves out as independent contractors.
Here is the link to the IRS website to gain further information: