What a Difference an Education Makes

A giant tub of peanut butter and a small business loan

Sam's Club, a division of Wal-Mart Stores, Inc, that has made a name for itself by satisifying our need to consume in bulk is testing a program to offer loans to small business members of the club. The company announced that it is running a pilot program with Superior Financial Group, a federally licensed SBA lender, to offer loans of $5,000 to $25,000 to qualifying Sam's Club members.

You might go in to buy a 20 pack of socks and come away with some working capital to help your small business grow.

You can find out more about Superior Financial Group and Sam's Club on their websites.

The Software Advice Blog

Accounting software blogger Chris Thorman recently got in touch with me about The Software Advice Blog.  They have a nice post about how "horizontal" accounting software is dying.  You can read the article, but I will go ahead and let you know horizontal means that one generic software package can be used across multiple industries.  You probably guessed that the opposite vertical packages then tend to be more industry specific.  The vertical parts just means that the accounting software will integrate "up and down" with packages that may be specific to an industry.  Think job costing module for a construction company accounting package.

The concept ties in well with the SaaS or Cloud based software services, I have talked about before on here.  For example look at Outright.com which integrates with multiple other web based services, so the business owner gets to pick and choose those tools that he wants and needs.

Guess what, this means choosing an accounting solution for your business is at some level getting more difficult, because you Mr. Business Owner will have to take into account more options.  The good part is that extra time spent on the front end will pay off long term because you may be using an accounting solution for years to come, so "choose wisely".

10% Tax on Tanning Service Starts July 1

The Patient Protection and Affordable Care Act, included a new excise tax of 10% on fees charged for indoor tanning services.  If your business provides tanning services, you are very likely subject to the new tax which begins for payments received after June 30, 2010.

The IRS  issued regulations to clarify some questions about how the tax will be imposed.

Payment of the tax is due quarterly and should be reported on Form 720.  Form 720 is due on April 30, July 31, Oct 31 and Jan 31.  Since the tax begins effective with payments received on or after July 1, 2010, the first return will not be due until Oct. 31.

The tax is based on when payment for tanning services are received.  If a customer pays upfront for a series of tanning sessions, the tax is due in the quarter when the payment is received, not when the service is performed.  If a customer purchases a gift card for tanning services, the tax is calculated when payment is received from the customer.  Some gift cards may be exchanged for goods and services other than tanning services, in that case the tax will be calculated when the gift card or certificate is redeemed, assuming it is redeemed for tanning services.

Qualified fitness facilities that include access to tanning services as part of their membership fee are not subject to the tax.  If the fitness facility charges an additional fee or membership charge for the tanning services, then it will become subject to the 10% tax.

If tanning services are included in a "bundled" set of services for a set fee, then a reasonable allocation of the fee to tanning services must be made.

The tax is added on to the fee charged for tanning services and should be paid by the person on whom the tanning service is performed.  If a tanning salon fails to charge the tax, it will still be liable for payment of the tax.

If you have questions about the new tanning tax you can read IRS Regulation IR-2010-73 or contact our office.