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May/June 2015 Newsletter

Borrower Spotlight

NEDCO was pleased to pair up with First National Community Bank in Dunmore, PA in 2014 with securing a loan for Ray’s Shursave Markets for the acquisition of their Old Forge location (former Rossi’s Market). Ray’s Shursave Markets began in 1979 and is a family-owned and operated grocery chain that currently operates four supermarkets throughout northeastern Pennsylvania. At all of Ray’s 4 locations you can find a bakery, a deli, catering options, custom party platters, and fresh and ready-made dinners. In addition, Ray’s Markets also makes it convenient for its customers to be able to purchase restaurant and chain gift cards, Ray’s gift certificates, PA lottery tickets, and money orders. Ray D. Petty, President of Petty Enterprises, Inc. said:  “Financially speaking, the use of the 504 Loan Program that NEDCO offers has been a tremendous help and a remarkable experience.”  For more information on Ray’s Shursave Markets, click here.

NEDCO is proud to be able to help such great small, local businesses that provide economic development in the surrounding areas. It is NEDCO’s mission to promote development and cultivate lasting relationships with small businesses in Northeastern Pennsylvania. Call us today (570-457-6726) to receive more information on how we can assist you in finding the perfect SBA loan program to service your small business needs. At NEDCO, we like to make it happen.


Entrepreneurship Academy

Stephen Ursich

On Wednesday, April 29, 2015, NEDCO’s Executive Director, Stephen Ursich, was a featured guest speaker at the Carbondale Technology Transfer Center’s (CTTC) Entrepreneurship Academy. The Entrepreneurship Academy is a new undertaking by the CTTC to introduce local students to the concept of entrepreneurship. This Academy was hosted by CTTC Executive Director Paul Browne along with Program Coordinator John Brennan. For five weeks, students will have different lessons presented by local entrepreneurs on various business topics. In addition, the students will have a business problem presented to them and will have a chance to develop their own solutions.

Mr. Ursich’s lesson was the second session of the Entrepreneurship Academy, which focused on the importance of planning and road mapping for the future when taking on a new project or creating a new business. He introduced them to the components of a business plan, which included market analysis and sales and marketing strategies. He also spoke about financial analysis and a SWOT analysis. In order to grasp the students’ attention, Mr. Ursich tied in some of his own personal experiences to the subject matter.

The Carbondale Technology Transfer Center helps to provide technical support, business assistance, financial resources, and appropriate facilities to entrepreneurs, small businesses, and light industry/light assembly manufacturers working with technology applications or innovative products or processes. For more information about the CTTC or this Entrepreneurship Academy, click here.


SBA-gov-logo

With the 2014 tax season behind us, for most individuals and businesses, the Small Business Administration’s Guest Blogger Barbara Weltman took a moment to talk about 5 factors of audit risk for small businesses. Let’s face it, being audited can be a scary situation, because you’re now finding yourself under the microscope of the IRS. There are a few steps that a business owner can take in order to cut your chances even lower of being audited.

  1. Entity Type. The way in which a business is legally formed can have a major impact on your audit risk. Statistics show that an S Corporation or partnership had only a 0.4% chance of being audited regardless of income for the fiscal year ending September 30, 2014. During the same period, a sole proprietor with gross receipts between $100k-200k had a 2.4% risk of being audited. This mainly comes from the notion that being a sole proprietor requires a higher need on owners to maintain good books, records, and follow tax rules.
  2. Income. According to the 2014 IRS Data Book, for sole proprietors with gross receipts under $25,000 had a 1% chance of being audited; $25,000-$100,000 had a 1.9% chance; $100,000-$200,000 had a 2.4% chance; $200,000+ had a 2.1% chance.
  3. Location. Since the IRS has offices in different locations, this enables some offices to conduct more audits than others. Don’t worry – there is no current data suggesting that this may affect your audit risk.
  4. Deductions. Have high travel and entertainment expenses/deductions? The IRS looks more carefully at these more personal write-offs to assure they’re legitimate and have been adequately substantiated. While businesses should take every deduction which they are entitled to, the IRS computers are said to select returns that take unusually high deductions in relation to their income. Be sure to save all receipts and required documentation for any deductions you claim.
  5. Types of business. Are you a cash business? Since there is little to no paper trail for these businesses, the IRS has put together an audit guide that instructs agents what to look for during an audit.

In conclusion, there is really not one specific thing that may trigger an audit. The best course of action a small business can take is to maintain a hard copy of all receipts and other tax papers, carefully document income and expenses, and work with a tax professional.


Guest Article

Cyber Thieves are Stalking you…What you can do to Protect Yourself

By Don Logan

Back in February during the heat of tax season, a Wall Street Journal article announced that a significant increase in online thievery led to TurboTax suspending transmission of state e-filed tax returns. TurboTax is not alone, as it is a recent company at the heart of the current cyber threat trend where fraudulent return filings—stealing millions of dollars of taxpayer refunds—are on the rise. In 2013 the IRS dished out about $5.2 billion in theft-related refunds, and that number was only predicted to increase in future years.

The TurboTax problem highlights a huge security issue – personal information is being stolen from home computers. Virus emails and shady websites are full of malware/spyware that gains access to these home computers; Rootkits is a common virus that tracks your online moves and sends them to the hacker, who can potentially sell the information to criminals. Cyber criminals can also hack into your e-mail account using social engineering to correctly guess passwords, log in as you and easily search through your e-mail to gather all sorts of personal financial information. They then have access to change the passwords and logon information for your financial accounts.

As of late, thieves have been gaining access into computers and collecting enough information about their victims to file a fake tax return. Here at Wiss, we’ve had a handful of clients experience this. As an accounting firm, we hold lots of client data. Even though we have very sophisticated, multi-level security in place to keep client data safe, thieves have been able to gather enough information from our clients’ home computers to file fake returns and get a refund delivered to an account that closes immediately after. We first learned of this when we followed procedure to file the actual return and found it was rejected because the hacker had filled out a fake return under the taxpayer’s social security information. It can take many months and endless paperwork to work with the taxing authority to register the theft, file the real return, and secure the client’s refund.

What can you do to protect yourself? Here are some basic measures to take:

  1. Install a quality anti-virus software which checks for viruses on your computer and incoming emails on a regular basis. Keep up with and install software updates for your software. New viruses appear multiple times a day, which makes it important to make sure your anti-virus software has an automatic update schedule which should be set to an hourly basis.
  2. Enable and update firewalls on your computer to keep the bad guys out and your data safe.
  3. Never open unknown or suspicious looking e-mails. Social engineering and phishing tactics are used to infiltrate your computer and enter your computer when you open the e-mail containing the virus. For example, an email from a frequent contact may look normal and harmless, but the email address behind the person’s name is actually from a cyber thief.
  4. Buy your software from a reliable source – if you download programs from shady sources or freeware sites, they are probably infected. Internet browsers have security features in them such as popup blockers, smart screen filters, and ActiveX filtering that should be enabled and configured properly.
  5. Hackers leave USB drives with viruses unattended for you to pick up so that you plug it into your computer and they gain access. Most virus-scan software will scan media as it is introduced to your computer, so scan all media before it goes to your computer.
  6. Don’t store sensitive information on your email or transmit this information electronically. So many people store their social security number, financial logon information, etc. in their mailbox or have scanned social security cards stored in an online photo album, on their computer desktop, or on their “C” drive. Cyber thieves can pick up this information quickly and easily.
  7. Thieves use complex password cracking programs to figure out more difficult passwords. Use these tips to make your password impenetrable:
    • Longer passwords are harder to crack, so passwords that are at least 10 characters long and include letters and numbers are best. We suggest picking a sentence or phrase you often use, then use the first letters/numbers of each word, include capitals and lowercase and add a special character at some point;
    • Do not use birthdays, names, or important personal information for password content;
    • Do not use one password for multiple accounts;
    • Do not store passwords in your texts or email;
    • Change your password regularly; we suggest changing it on a quarterly basis;
    • Never use sticky notes on your monitor to store logon information;
    • Never give your passwords to others.

For future tax seasons, it’s a good idea to have your tax preparer complete your tax information as quickly as possible at the beginning of every year. The faster it is prepared and filed, the less chance a thief has to file a fake and steal your real return. Plan on getting your information sent in as soon as possible.

Don Logan is Wiss & Company, LLP’s Technology Superhero and Director. He protects Wiss daily from cyber theft and makes sure their clients have the proper systems and procedures in place to keep their company data protected. Reach Don at dlogan@wiss.com or 973.994.9400.


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