LLC Tax Business Update

Happy Summer to all you small business owners! Here’s to hoping you are all weathering the financial storm in New Hampshire and hopefully things are looking better….

But, I wanted to update you on some new storm clouds on the horizon……

Being its summer, someone cue up the JAWS soundtrack, because the DRA is back in the water…… again.

During the past few weeks the DRA has initiated a new round of “divide and conquer” against small businesses in our communities, and I wanted to give you a heads up on the details.

First, the DRA has announced that our state’s small Credit Unions are “break’n The Law”. Although it has never been the case, the DRA now wants Credit Unions to pay a new “Interest and Dividends Tax” on money it gives back to its members. Actually, no-one is breaking the law, it’s just our current State Government re-interpreting the law to its sole benefit (sound similar to the LLC Income Tax?). Just like you all did with the LLC Income Tax, the Credit Unions have banded together and are fighting for their members. One would think that after losing their fight with you, with the JUA medical fund, the LGA and more, they would be getting the picture that attacking the business community is not good, but here they go again….

Now at the same time, the DRA is accusing 2 small cigarette retail stores of defrauding the State and are trying to tack on new, additional taxation. These two shops sell tobacco in bulk packages. Additionally they rent little “roll you own cigarette” machines in their stores, for those customers who would like to use the tobacco. The DRA is now claiming the retail stores are actually now “Manufactures” and subject to a host of new additional taxes.

More on that as it develops….

Now, some of you may know the State decided to eliminate an entire industry this past spring and take government control of Weights and Measures. Traditionally we had 200 separate small companies performing the duties of checking the scales on weighing and measuring most things in our State. This includes everything from a gallon of gas at gas stations to the scales for Roast Beef at the supermarket. The State decided that it would be “best” if it eliminated all the small companies, increased the State staff and performed the duties as a government function. Well, (again, cue the Jaws soundtrack) our new State officials are out and about weighing and measuring our lives.

This week, one of the members on this list let me know that the State came to his carwash and Laundromat, with a stopwatch in hand, to time the each and every washer and dryer in the place…… all at a $20.00 per machine tax.

Now, as teh Government knows, business owners we have so much extra time on our hands, because running a business in this environment is so easy a cave men can do it, but, if you are not sufficiently busy, a little note for business owners from the National Healthcare front….

Although we typically watch how the State of New Hampshire is treating our business community, I think we need to talk about a National issue that is going to affect us all.

As the new taxes in the Healthcare Law are coming to light, there is a requirement that every business owner will be required to report every single transaction over $600.00 to the IRS. Unfortunately unless you are a company with revenue in excess of $250 Million a year, the requirement is these reports have to be in writing, and signed off by you as the owner. Apparently this new reporting requirement to the IRS will be used to compile a new database to cross review every company in America for reporting compliance. You will also be required to provide a copy of the form to your vendor for their records, too.

So everything from a new computer at Best Buy to a company car, to your internet bill…. Every single expense that exceeds $600.00 in a year….

No word yet on if this new program will require the IRS staff to increase or if they are going to compensate us for doing the reporting to them………

You can see some links here….

http://money.cnn.com/2010/05/05/smallbusiness/1099_health_care_tax_change/

http://sayanythingblog.com/entry/health-care-bill-will-mandate-that-busi...

Remember, keep up the good fight, as the small business community will bring New Hampshire out of this recession. We can fix this!

As Always

Andy Sanborn