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Author: Navaal Mahdi

How the Wayfair Decision Affects Maryland Businesses

Posted on by Navaal Mahdi

The Comptroller of Maryland has released a Tax Alert regarding the Maryland Sales & Use Tax in reference to the Supreme Court decision in South Dakota v. Wayfair. This Tax Alert is meant to shed light on what is expected of online retailers who sell products or provide a taxable service for use in Maryland.

To recap, the South Dakota v. Wayfair decision overturns the earlier decision made in North Dakota v. Quill Corporation, which stated that businesses must have a physical presence in a state in order for that state to collect and remit sales tax from its earnings. Recently, several states have signed the Streamlined Sales Tax Agreement, a plan aimed at simplifying tax collection, but Maryland is not one of the participating states.

According to the Comptroller, if you have already been collecting and paying sales tax to the state of Maryland, you should continue to do so.

If you have not been collecting and paying sales tax and you sell products or provide a taxable service in Maryland, you should read up on the recent Supreme Court’s Decision to see how it impacts you. We’ve covered this decision on our blog here.

If you would like to start collecting and paying sales tax to the state of Maryland, you need to get a sales and use tax license by completing a Combined Registration Application.

Maryland businesses selling products or taxable services in other states may be required to pay sales tax in those states. The Comptroller recommends directly contacting any states you may have business in if you have any questions regarding this decision.

For a deeper understanding about sales and use tax and to get your questions answered, you can now register for MSATP’s newest seminar/webinar, Sales and Use Tax After the Wayfair Case. To register for the webinar, click here, and to register for the in-person seminar, click here.

A Grad’s Guide to Becoming an Accountant

Posted on by Navaal Mahdi

Accountants are some of the most trusted advisors in business because of their level of involvement with their clients’ fiscal wellbeing. Because of their wide range of knowledge — from taxes to wealth management, in most cases — young CPAs and tax professionals have the potential to become the trusted advisors every business needs.

Here are some tips for graduates and young professionals:

 

1. Apply what you know.

Just because you’ve finished a degree in accounting or finance doesn’t necessarily mean that you’re fully aware how to apply the skills that you’ve learned. Start applying those textbook scenarios to real world happenings. Step outside of your comfort zone and seek opportunities that will allow you to expand your knowledge base and, more importantly, teach you how to solve a wide range of problems for your clients.

 

2. Tell the truth and hold yourself accountable.

Everyone makes mistakes, especially when first starting out in a field, and there’s nothing wrong with that. Think back to any particular moment in your life when you’ve made a mistake, and you’ll notice that you learned a lesson from it. Though making mistakes is okay, it’s essential that if you do make a mistake, you let an experienced coworker know immediately so they can help you recover. Don’t let your ego keep you from asking for help when you need it.

 

3. Stick to deadlines.

A huge part of being an accountant is having the desire to see your clients succeed. If you expect to be seen as an advisor for a business owner, you must stick to all deadlines to ensure that you never let your clients down. Work on your time management skills before tax season, especially if time management is something you struggle with. The most effective way to manage your time is by designating enough of it to each client. Make sure you’re not distracted by trivial and unimportant tasks so you can give your clients the attention they deserve.

Check out our recent blog post about time management to help you stay on top of your workload!

 

4. Build your network.

Don’t be afraid to attend networking events for accountants. Making connections with other professionals, especially those who have years of experience, will only help you become a better accountant or tax preparer. Remember, other professionals want to help you succeed — ask them questions and don’t be afraid to reach out to them for advice. After all, they were once in your shoes too, and they have an idea about what you’re going through.

 

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MSATP offers opportunities to help professionals build their businesses and their networks. Register now for our upcoming Employee to Entrepreneur event on October 25 for your chance to meet other young professionals and learn from experts in the field. The first 25 registrants will receive a free Associate Membership with their registration, so sign up now!

New Hampshire’s Take On the Wayfair Decision

Posted on by Navaal Mahdi

During our Facebook Live last week, James Dawson of Miles & Stockbridge spoke in detail about the South Dakota v. Wayfair decision which we covered in a previous blog post, South Dakota v. Wayfair: What Does This Mean for Online Retailers?.

One of the recent more intriguing developments following this decision has been in New Hampshire. The sales-tax free state is looking to “protect [their] businesses from improper attempts by other states to force…sales and use tax [collection],” according to New Hampshire Governor Chris Sununu. The state believes that the decision not only violates New Hampshire’s laws, but also the United States Constitution.

The goal is to protect local businesses from sales and use tax laws in every way possible. Out-of-state taxing authorities will have to notify the New Hampshire Department of Justice if they plan on taxing or auditing local businesses. The NH Department of Justice will have the opportunity to block attempts to impose tax collection if they feel that it violates their new law.

Although nothing is set in stone as of yet, Governor Sununu may call a special session of legislature this summer to further draw out this plan.

For a deeper understanding about sales and use tax and to get your questions answered, you can now register for MSATP’s newest seminar/webinar, Sales and Use Tax After the Wayfair Case. To register for the webinar, click here, and to register for the in-person seminar, click here.

How to Make a Great First Impression

Posted on by Navaal Mahdi

First impressions can really work to your advantage. At the same time, however, the fact that it only takes a few minutes for someone to decide whether or not they like you could hurt your businesses’ reputation.

Imagine that you’re having lunch with a client when one of their friends walks into the restaurant. Your client immediately starts trying to get their attention, and when they come over to your table, you realize that this could be a business opportunity.

The way that you present yourself in these next few minutes is all that matters. You’ll either end up catching the potential client’s attention, or you’ll fade into the background and they won’t remember having met you. Even worse, they could read you in a way that will make them turn other potential clients away from you as well.

If a first impression has the potential to be a lasting impression, how can you make sure that it will be in your favor? Consider these suggestions:

 

  1. Always dress to impress. One of the first things someone will notice about you is the way that you look and how clean you are. If you’re dressed super casually, a potential client may assume that you don’t take things seriously.
  2. Smile, even if you’re caught off-guard. Smiling at someone makes them feel comfortable with you, and most people would rather work with a company that, when it comes down to it, has a happy and understanding employee or leader rather than a bored and unsatisfied one.
  3. Impressing others means it’s not all about you. Though you want to gain a client, you don’t have to do so by talking their ear off. Encouraging others to talk more may make them like you.
  4. Avoid talking business straight away. If you jump right into talking business, you may come off as abrasive and otherwise uninterested in the person you’re speaking with. Take some time to get to know the potential client, and even if you’ll be having a short conversation, they’ll likely ask you what you do, which is when you can explain the services your company provides. Taking this approach will make it easier for you to tailor your elevator speech to their needs.
  5. Be conscious of your body language. If you’re avoiding eye contact with someone that you’ve just met, they may find it more difficult to trust you. Similarly, if you’ve got your arms crossed over your chest, your demeanor could suggest that you you don’t like the person in front of you, which could cause problems down the line.

 

Do you have any tips on making a good first impression? We’d love to hear from you! Be sure to leave a comment below and share the blog on social media.

South Dakota v. Wayfair: What Does This Mean for Online Retailers?

Posted on by Navaal Mahdi

Though online shopping has been a convenient solution for many busy Americans, people aren’t only buying products online for convenience’s sake — it may also have something to do with the fact that many of those online purchases are tax-free.

On June 21 however, the U.S. Supreme Court ruled that companies selling products on the internet can be required by the state they are selling in to collect sales tax. It no longer matters whether that company has a physical presence in that state, as it was originally declared in the 1992 case Quill Corporation v. North Dakota.

The circumstances that the original decision was made in were quite different from current conditions. In 1992, it was more difficult to purchase products from out of state retailers. It happened so rarely that it didn’t matter as much to state governments and local businesses. But now that online shopping is so accessible to Americans and the online marketplace is so vast, online retailers not getting taxed for the sales they make has become a nuisance to many.

That’s why the South Dakota v. Wayfair decision is a victory for both state and local governments, and local business. State governments can now effectively enforce sales tax laws, while local businesses are now on more of an equal footing with their online competition, as many have been able to avoid paying sales taxes until now.

It’s important to note, however, that the decision made in South Dakota v. Wayfair was in response to a South Dakota law, which means that the impact of this decision on other states is still somewhat unclear. Currently, there are 31 states that have laws that tax online sales, but if those laws are more restrictive than South Dakota’s, they may not hold up in court. That’s why states will likely be spending some time revising their laws to model new bills after South Dakota’s, so they can begin collecting sales tax on online purchases as well.

 

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Learn more about how this ruling will effect Maryland businesses on our July 12 Facebook Live. We will be joined by James Dawson of Miles & Stockbridge who will discuss the effects of the ruling on Maryland businesses.

Don’t forget to watch our Facebook Live from this week over on our YouTube channel. Be sure to like the video and subscribe while you’re there!

5 Time Management Tips to Help You Achieve Your Goals

Posted on by Navaal Mahdi

Everyone looking for success in their professional and personal lives sets goals regularly — even if they’re not writing them down as they think of them. Though you may achieve some of those goals as you get tasks done on your list of things to-do, you’ll find that a good chunk of those goals aren’t that easy to achieve — only because you aren’t dedicating the right amount of time to them.

You may run an organized business or find success in the work that you do, but that doesn’t necessarily mean that you’re using your time as efficiently as you could be. If you’re ready to achieve the goals that have been unattainable for as long as you can remember, check out this list of time management tips curated specifically to help you achieve your goals.

 

1. Audit your time for 7 days.

 

How do you spend your time at work? At home? For a whole week, keep track of what you did every hour in a journal or on your phone. Then, before bed, spend some time highlighting the least productive things you did that day. The next day, avoid the habits that you thought were unproductive, and at the end of the week, check and see where you spent the most time. This will make it easier for you to determine where you need to put in additional effort, and where you need to cut back.

 

2. Get your most important tasks done in the mornings.

Once you’ve rubbed the sleep out of your eyes, you’ll find that you’re fresh, energetic, and ready to take on the day that lies ahead of you. Mornings are usually quiet, so you can focus on your thoughts — that’s when you should define your three most important tasks of the day (MITs). Use your morning to get those three tasks done, and once they’re complete, you’ll be motivated to continue being productive throughout the rest of the day.

 

3. Schedule specific times in the day to respond to emails.

Is having your email notifications on completely necessary? In most cases, you’ll find that it’s not. Constantly getting notifications for your email is an obvious distraction, especially when you keep taking breaks from work to reply to them. Schedule three or four times in the day to check your email, and stick to your plan. Make a similar plan for answering messages so you can avoid unnecessary distractions — just be sure that your colleagues, clients, and family know to give you a call in case of an emergency.

 

4. Declutter your workspace.

Researchers at the Princeton University Neuroscience Institute have published a study that concludes, “When your environment is cluttered, the chaos restricts your ability to focus.” Spend some time cleaning off your desk — what do you need on the surface, and what can be put away? If you find that papers and other items accumulate on your desk every day, take some time each evening before your leave work to clean up your work station. Coming back to to a clean space the next morning will act as another motivational tool to help you complete those MITs you’ve set.

 

5. Find inspiration and stay positive.

Whether it’s listening to a motivational podcast while driving to work, or reading an inspiring quote before your day has begun, find a way to look forward to accomplishing your goals — it’ll even boost your creativity. Plus, always stay positive, even if you aren’t able to achieve everything you wanted to one day. After thinking about what you could’ve done better, pat yourself on the back for trying, and make sure to tell yourself that you’ll do better tomorrow. That way, you’ll hold yourself accountable while practicing self-love.

 

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Have you heard? MSATP does a Facebook Live every week! If you missed this week’s Live video where we talked about the Maryland Board of Accountants meeting, exciting changes to Microsoft Office, and updates from the IRS, check out the video on YouTube. Make sure to subscribe to our channel so you don’t miss out!

Tax Reform and the 529 Savings Plan

Posted on by Navaal Mahdi

Parents love the 529 college savings plan.

Under the Small Business and Job Protection Act in 1996, the 529 was originally established as a pre-paid tuition program. Two years later, the IRS created guidelines for tuition plans under Code Section 529.

For over a decade, parents have been using the 529 to help their children pay for higher education through pre-paid tuition programs and investment savings plans. Any money in the savings account, including investment growth, used to pay for tuition, fees, room and board, books, and any other required school supplies, is distributed tax-free.

Now, under the Tax Cuts and Jobs Act of 2017, the 529 has been expanded to cover qualifying expenses for private, public, and religious K-12 schools. Unlike the 529 for college though, the 529 for K-12 students cannot be spent on supplies, fees, or activities — it can only be spent on school tuition.

The yearly withdrawal limit per child is $10,000, and any parent that overdraws that limit will face a 10% penalty on top of the taxes they must pay on the amount of investment growth. Overdrawing may also mean having to pay back any state tax deductions received when originally depositing money into the 529.

Though less than half of U.S. states have agreed to adopt this new rule, Maryland is one of the states in which parents can start funding a 529 savings plan for their children in K-12 schools.

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For more information about the changes that the Tax Cut and Jobs Act of 2017 is bringing about, tune into last week’s Facebook Live below to learn about what was discussed during the NASBA Eastern Regional Conference in Orlando, FL.

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