November, 2015 | RKL LLP
Posted on: November 30th, 2015

Local CPA Firm Announces New Hire in Greater Capital Region Office

Lindsay Bixler, CPAPRESS RELEASE

HARRISBURG, PA (November 30, 2015) – Reinsel Kuntz Lesher LLP (RKL), Certified Public Accountants and Consultants, today announced that Lindsay S. Bixler, CPA, has joined the firm as a Manager in its Audit Services Group.

Working from the firm’s Greater Capital Region office, Bixler will be responsible for managing all phases of the audit process from planning to deliverables, establishing responsibilities for specific areas of audit work, and supervising, reviewing, training and evaluating staff assigned to engagements.

Prior to joining RKL, Bixler worked for the Harrisburg office of a national accounting firm. She has more than ten years of public accounting experience, serving clients in a variety of industries including manufacturing, retail, hospitality management, financial institutions and employee benefit plans. Bixler is knowledgeable in US GAAP and SEC reporting, and has significant experience with Sarbanes Oxley compliance.

Bixler holds a B.S. in Accounting from the Pennsylvania State University. She is active in several community and civic organizations, including the Capital Region United Way and Junior Achievement of Central Pennsylvania. Bixler resides in Palmyra with her husband and son.

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Posted on: November 18th, 2015

Senior Living Services Team Attends Premier Aging Services Provider National Conference

RKL’s Senior Living Services Consulting Group was well represented at the nation’s largest annual conference for non-profit aging services providers earlier this month. Four RKL Senior Living professionals traveled to Boston to attend the Annual Meeting and Expo of LeadingAge, an association of 6,000 non-profit organizations dedicated to expanding the world of possibilities for aging.

For Jeff Boland, Partner and Senior Living Services Group Leader, Stephanie Kessler, Partner, and managers Tracy Montag and Jamie Spencer, the conference was a chance to showcase RKL’s Senior Living Consulting expertise to the 10,000 attendees and connect with a wide variety of professionals who participate in the aging services industry.

The conference’s more than 150 educational sessions focused on a variety of issues related to the rapidly changing landscape of senior living services. There has been a recent shift towards aging in place, and conference attendees learned how technology is playing a major role in this transformation. In-home care is increasingly replacing traditional facility-based nursing services, and payment models across the board are evolving. Data and a focus on quality outcomes are becoming larger factors in payment for services, with traditional fee-for-service reimbursements taking a back seat to payments based on outcomes of care. The goal is to provide better and more coordinated care across providers while reducing costs on the system as a whole.

As the baby boomers enter retirement, the industry is shifting to meet the evolving preferences of this generation. Unlike their parents’ generation, baby boomers prefer to maintain as active a lifestyle as possible as they age, with a plan in place to address future health and accommodation needs. To reflect this change, LeadingAge announced during the conference that communities providing a continuum of care (Independent Living, Assisted Living, and Skilled Nursing Care) would now be referred to as Life Plan Community (LPC) instead of the familiar Continuing Care Retirement Community (CCRC). Reactions from conference attendees appeared to be mixed, and it will be interesting to see how the industry handles the implementation of this new nomenclature.

Between networking opportunities and increased visibility, RKL’s Senior Living team came away from the conference equipped with the latest industry trends and knowledge to address the increasingly complex operational and strategic challenges faced by their clients. Learn more about how RKL helps position retirement communities and long-term care facilities for sustainable success.

RKL exhibit booth

RKL’s Senior Living team members at the firm’s exhibition booth, where they met with clients and industry professionals.

 

Exhibit Hall

The west end of the exhibit hall, where hundreds of exhibitors were on display for attendees.

Speakers on stage

Scene from the General Session, attended by several thousand industry professionals.

 

Posted on: November 17th, 2015

What You Need to Know about Child Care Tax Deductions

Posing youngstersAny working mom or dad with young children understands the impact of child care on the family budget. The good news is that you may qualify for a tax deduction or be able to pay for your child care with pretax earned income – taking some of the sting out of this very necessary expense.

Generally speaking, if you pay someone to care for your child while you (and your spouse, if married) work, you have two options to recoup these expenses. If your employer offers a dependent care account, you may pay for child care with pretax earned income throughout the year. Otherwise, you could claim the Child and Dependent Care Credit on your federal income tax return if you are eligible.

To qualify for either benefit:

  • The care must have been provided for one or more qualifying persons. A qualifying person is a dependent child who is age 12 or younger when the care is provided. Your spouse and other dependents who are physically or mentally incapable of self-care may also qualify.
  • The child care provider must be a licensed day care provider, preschool provider or legal nanny. Costs to attend kindergarten or a higher grade do not qualify, but before or after school care would qualify. You must identify the care providers on your tax return by including their name, address, and Social Security number or employer identification number. If you pay someone to come to your home to provide the care, you may be considered a household employer that would need to withhold and pay Social Security and Medicare taxes.

Employer Provided Dependent Care Accounts

If your employer offers a dependent care account, you can elect to fund the account based on the maximum amount you are allowed to deduct, which is the lower of $5,000 or your earnings in any given year. So if you set aside $5,000 and are in the 25 percent tax bracket, you will save $1,250 in federal taxes throughout the year.

You need to budget carefully when setting these accounts up. Any funds that are not spent on child care will be taxable to you when you file your return.

The dependent care contributions are reported on Form W-2, Box 10. If you have an amount shown in this box, you will need to file Form 2441 to show that you spent that amount for qualifying dependent care.

Child and Dependent Care Tax Credit

The child care tax credit allows you to deduct 20 to 35 percent (depending on your adjusted gross income) of the first $3,000 you spend per dependent child, per year for qualified child care. If you have two or more qualifying children, you may use up to $6,000 of expenses to figure the credit. There is no limitation on your adjusted gross income.

The credit is available for individuals to take if they work full or part-time. They may also take the credit if they are looking for work or if they are going to school full-time. If the taxpayers are married, both taxpayers must be employed, looking for work or going to school full-time. If one parent stays at home, the credit is not available.

If you exclude any income under a dependent care benefit plan, you cannot count that as an expense when figuring out the child and dependent care credit.

Form 2441

If either option is used, Form 2441 must be filed with your tax return. You need to report the qualifying individual’s name, Social Security number and the amount of expenses incurred. You also need to report the care provider’s name, address, identification number and the amount paid.

Be sure to explore these tax-saving options with your employer and tax advisor. RKL’s team of tax professionals can help you maximize your tax strategy to recoup these unavoidable costs of raising a family. Contact us today!

Ruthann J. Woll, CPAContributed by Ruthann J. Woll, CPA, a manager in RKL’s Tax Services Group and member of the firm’s Not-for-Profit Industry Group. Ruthann has significant experience in tax planning and compliance and specializes in serving individual and not-for-profit clients.

 

 

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Posted on: November 11th, 2015

How to Get the Most Bang from Gifting your Bucks [VIDEO]

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Run-time: 02:55 How can you provide gifts to immediate or extended family members while minimizing the taxes associated with those gifts? Get quick insight on different gifting options that work for your financial goals.

Interested in sharing your financial success with younger loved ones? This is a generous idea, but it is important to be aware of some key considerations before making such a gift. Keeping these three factors in mind can help you avoid unanticipated tax consequences and reap all the intended financial benefits of your gift.

  • Limits. Currently, an individual can gift either during their lifetime or at death, approximately $5.4 million without paying any estate tax. This is known as the estate tax credit. However, there is an annual exclusion that you can take advantage of each year. This exclusion allows you to gift up to $14,000 per individual per year without reducing the overall estate tax credit. This is a great way to enhance your gifting above and beyond lifetime limits.
  • Timing. When do you want to make your gift – during your lifetime or at death? There are pros and cons to giving a gift while living. The upside to making your gift while you are still living is that the amount is taken out of your estate, so it can remove considerable asset value and subsequent appreciation from your estate. Another plus is that you will experience the enjoyment of seeing the recipients use the gift. A downside to a living gift, however, is that when it is taken out of your estate there is no turning back. The funds are gone and cannot be used for your future living expenses as you age. An additional downside to a living gift is that the basis of the gift to the recipient is the same as the donor. If the same asset is transferred at death the recipient gets a “step up” in basis to fair market value. Depending on the asset this could result in a significant difference in gains recognized and the tax when sold.
  • Method. You should consider whether or not you want to gift the funds directly to your loved ones. Often times, gifters are concerned about giving a large financial gift directly to a young person as they may not be mature or sensible enough to use the money for its intended purpose. This is where a trust can help. RKL’s tax professionals often recommend putting the gifted asset into a trust so the funds cannot be accessed until the age you designate. This provides some comfort that the money will be secure until it can be used wisely. Another option, if your recipient intends to pursue higher education, is to use your gift as a contribution to a tax-free 529 college savings plan. This savings vehicle allows contributions to grow tax-free provided they are ultimately used for qualified higher education expenses.

Gifting is a financial maneuver that is very specific to your financial situation. When making decisions and plans, it’s important to talk to an advisor about your unique needs and concerns. RKL has a deep bench of professionals who work with families and individuals to develop detailed estate plans that help them accomplish their financial goals. RKL is here to help – contact us today to get started.

Michael R. DePaul, Jr., EsquireContributed by Michael R. DePaul, Jr., Esq., partner in RKL’s Tax Services Group. Mike specializes in strategic planning and compliance for corporations, partnerships and individuals, as well as services involving estate and financial planning for individuals. Mike is licensed to practice law in Pennsylvania and also has significant experience representing clients before the IRS, state administrative boards and various state agencies.

 

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Posted on: November 9th, 2015

Team Members Earn Certified Construction Industry Financial Professional Designation

PRESS RELEASE

D. Hunter Mink, CPA

D. Hunter Mink, CPA

YORK, PA (November 9, 2015) – Reinsel Kuntz Lesher LLP (RKL), Certified Public Accountants and Consultants, today announced that two of its team members have achieved an elite level of professional certification in construction industry financial management. D. Hunter Mink, CPA, and Christopher A. Winemiller, CPA, of RKL’s York office, recently earned the Certified Construction Industry Financial Professional (CCIFP) designation from the Construction Financial Management Association (CFMA).

By earning the CCIFP designation, Mink and Winemiller join an exclusive group of more than 1,250 professionals nationwide who have met CFMA’s rigorous standards in the practice of construction financial management. Established in 2003, CCIFP is the only standard to recognize financial professionals with a superior understanding of the industry’s financial opportunities and challenges. To earn the designation, an applicant must serve in a professional financial role for a construction contractor or an accounting and/or financial service provider to the industry and pass a comprehensive exam. To maintain this certification, members are required to complete ongoing continuing education in the field of construction financial management.

Christopher A. Winemiller, CPA

Christopher A. Winemiller, CPA

Mink is a Manager in RKL’s Audit Services Group, responsible for engagement planning and supervision of audit engagements for various industries including engineering, construction and manufacturing and distribution industries. He joined RKL in 2012, and has more than ten years of public accounting experience. Mink received his B.S. in Accounting from York College of Pennsylvania, and he resides in York with his wife and twin daughters.

Winemiller, a Manager in RKL’s Small Business Services Group, serves the accounting and auditing needs of privately-held clients in the construction, real estate, transportation and manufacturing and distribution industries. He joined RKL in 2012, and has over 11 years of public accounting experience. Winemiller holds a B.S. in Accounting from Indiana University of Pennsylvania, and he resides in York with his wife and son.

For more information on the services provided by RKL’s Real Estate Development & Construction Industry Group, including industry analysis, cost segregation studies and strategic planning, visit www.rklcpa.com.

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Posted on: November 4th, 2015

RKL Appoints Leader of Expanded State and Local Taxes Practice

skrinak_jason

Jason C. Skrinak, CPA

PRESS RELEASE

HARRISBURG, PA (November 4, 2015) – Reinsel Kuntz Lesher LLP (RKL), Certified Public Accountants and Consultants, today announced that Jason Skrinak, CPA, has joined the firm as the leader of its expanded State and Local Taxes (SALT) Practice. The addition of Skrinak, highly regarded throughout the region for his deep knowledge in SALT consulting, is the latest step by RKL to grow its capabilities and resources in this tax service area.

“Whether here in Pennsylvania or across multiple jurisdictions, our clients look to RKL for guidance on how to navigate an ever-changing tax landscape,” RKL CEO Edward W. Monborne said. “We recognize our clients’ need for this level of specialized tax expertise, and we are proud to strengthen our state and local tax consulting practice with an experienced, respected and knowledgeable professional like Jason.”

Skrinak will lead a deep bench of RKL professionals with SALT experience, most notably firm principal Frank Tobias’ specialized knowledge of Pennsylvania and multi-state tax matters. Together, Skrinak and Tobias offer RKL clients more than four decades of state and local tax expertise to help them identify tax savings opportunities, ensure compliance and resolve tax controversies.

Under Skrinak’s leadership, RKL’s expanded state and local taxes practice will offer clients a wide range of planning and compliance services, such as sales and use tax consulting and process improvement studies; reverse sales and use tax audits; multi-state nexus analysis and planning; and for-hire motor carrier restructuring.

Skrinak brings nearly 20 years of public accounting experience to RKL, and has significant experience representing taxpayers before Pennsylvania’s Board of Appeals and the Board of Finance and Revenue. He has also testified before the PA Senate Finance Committee on topics including state tax reform.

Prior to joining RKL, Skrinak was a Principal and State and Local Tax Practice Leader for a regional firm. He also brings more than 11 years’ experience as a SALT professional in the Harrisburg office of a “Big Four” firm. Skrinak holds a B.S. in Accounting from Villanova University and resides in Lower Paxton Township with his wife and two children.

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Posted on: November 3rd, 2015

Mergers & Acquisition 101: Understand What You’re Buying

Word cloud“Let the buyer beware.” This old saying holds true for mergers and acquisitions. When considering whether a particular business acquisition makes sense, it is important to analyze the financial performance of the target company. This analysis will allow you to determine what value proposition you expect to receive from this transaction, and generally consists of five steps:

  1. Analyzing trends in the historical financial statements
  2. Recasting of the historical financial statements to remove non-essential, non-recurring, unusual expenses and to adjust related party transactions to estimated fair market value
  3. Comparing the adjusted financial statements to industry data (gross margin percentage, operating cost structure, operating profit margin)
  4. Constructing forward-looking financial projections of the target company operations on a stand-alone basis
  5. Adjusting the financial projections to incorporate anticipated changes in revenue and expenses as a result of integrating the target company operations into your existing business model

Much of the data used to perform the financial analysis is provided by the target company. Be sure to review this information with several key questions in mind:

  1. What is the quality of the financial data? Be sure to determine whether the financial statements have been subject to an external audit or review by a CPA. It is also critical to know if Generally Accepted Accounting Principles (GAAP) were applied consistently during the preparation of the statements. You will want to also review the target company’s corporate income tax returns to make sure they are consistent with the financial statements provided to you. Finally, if the statements rely on interim financial results, the reliability of that data must be verified.
  1. How were expense adjustments and projected future operating results identified and quantified? Once you’ve determined the quality of the historical and current financial data, you will want to take a closer look at future projections and recastings. Determine whether the expenses being removed are really non-essential or non-recurring, and whether or not their removal will negatively impact the ongoing business operations. Examine the projected future operating results with this question in mind: Does it make sense that this target company would be that much more profitable in the future? You will want to ensure the projections are realistic, and not overly rosy or completely out of sync with the current cost structure. 
  1. Are the potential synergies associated with combining business operations reasonable? Once the ink is dry on any merger or acquisition agreement, the real work of combing two companies begins. That’s why it is important to consider from the outset whether any potential synergies, savings or benefits are realistic and reasonable. Determine if the revenue expectations associated with the expanded customer base make sense. You will also want to evaluate how realistic the expectations of reduced personnel or other operating expenses are. Finally, don’t neglect to consider the costs associated with the operational integration itself.

Acquiring a new business or merging operations is a significant undertaking, so performing a thorough review with a critical eye and grounded assumptions can prevent the unpleasantness of an acquisition gone bad or overpayment for a target company. Asking the above tough questions and obtaining the most up-to-date and accurate information as possible can help guide your decision-making and evaluation process. RKL has a team of consulting professionals experienced in mergers and acquisitions who can help you undertake a thorough and in-depth review. Contact one of our local offices today to get started.

John S. Stoner, CPA, CVAContributed by John S. Stoner, CPA, CVA, partner and leader of RKL’s Business Consulting Services Group in the Lancaster office. John provides a wide range of business consulting services, including business valuation, financial analysis, litigation support, merger/acquisition assistance and business succession planning to business clients.

 

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