All Posts By

Brenda Jacobs

Look at your employees with cybersecurity in mind


Today’s businesses operate in an era of hyper-connectedness and, unfortunately, a burgeoning global cybercrime industry. You can’t afford to hope you’ll luck out and avoid a cyberattack. It’s essential to establish policies and procedures to minimize risk. One specific area on which to focus is your employees.

Know the threats

There are a variety of cybercrimes you need to guard against. For instance, thieves may steal proprietary or sensitive business data with the intention of selling that information to competitors or other hackers. Or they may be more interested in your employees’ or customers’ personal information for the same reason.

Some cybercriminals may not be necessarily looking to steal anything but rather disable or damage your business systems. For example, they may install “ransomware” that locks you out of your own data until you pay their demands. Or they might launch a “denial-of-service attack,” under which hackers overwhelm your site with millions of data requests until it can no longer function.

Be mindful

Naturally, crimes may be committed by shadowy outsiders. But, all too often, it’s a company employee who either leaves the door open for a cybercriminal or perpetrates the crime him- or herself.

For this reason, it’s essential for your hiring managers to be mindful of cybersecurity when reviewing employment applications — particularly those for positions that involve open access to sensitive company data. If an applicant has an unusual or spotty job history, be sure to find out why before hiring. Check references and conduct background checks as well.

For both new and existing employees, make sure your cybersecurity policies are crystal clear. Include a statement in your employment handbook informing employees that their communications are stored in a backup system, and that you reserve the right to monitor and examine company computers and emails (sent and received) on your system. When such monitoring systems are in place, prudence or suspicious activity will dictate when they should be ramped up.

Don’t compromise

These are just a few points to bear in mind in relation to your employees and cybercrime. Although most workers are honest and not looking to do harm, all it takes is one mistake or one bad apple to compromise your company’s cybersecurity. We can provide you with more ideas for protecting your data and your business systems.

© 2017

Enhance benefits’ perceived value with strong communication


Providing a strong package of benefits is a competitive imperative in today’s business world. Like many employers, you’ve probably worked hard to put together a solid menu of offerings to your staff. Unfortunately, many employees don’t perceive the full value of the benefits they receive.

Why is this important? An underwhelming perception of value could cause good employees to move on to “greener” pastures. It could also inhibit better job candidates from seeking employment at your company. Perhaps worst of all, if employees don’t fully value their benefits, they might not fully use them — which means you’re wasting dollars and effort on procuring and maintaining a strong package.

Targeting life stage

Among the most successful communication strategies for promoting benefits’ value is often the least commonly used. That is, target the life stage of your employees.

For example, an employee who’s just entering the workforce in his or her twenties will have a much different view of a 401(k) plan than someone nearing retirement. A younger employee will also likely view health care benefits differently. Employers who tailor their communications to the recipient’s generation can improve their success rate at getting workers to understand their benefits.

Covering all bases

There are many other strategies to consider as well. For starters, create a year-round benefits communication program that features clear, concise language and graphics. Many employers discuss benefits with their workforces only during open enrollment periods.

Also, gather feedback to determine employees’ informational needs. You may learn that you have to start communicating in multiple languages, for instance. You might also be able to identify staff members who are particularly knowledgeable about benefits. These employees could serve as word-of-mouth champions of your package who can effectively explain things to others.

Identifying sound strategies

Given the cost and effort you put into choosing, developing and offering benefits to your employees, the payoff could be much better. We can help you ensure you’re getting the most bang for your benefits buck.

© 2017

Consider key person insurance as a succession plan safeguard


In business, and in life, among the most important ways to manage risk is through insurance. For certain types of companies — particularly start-ups and small businesses — one major threat is the sudden loss of an owner or hard-to-replace employee. To safeguard against this risk, insurers offer key person insurance.

Under a key person policy, a business buys life insurance covering the owner or employee, pays the premiums and names itself beneficiary. Should the key person die while the policy is in effect, the business receives the payout. As you formulate and adjust your succession plan, one of these policies can serve as a critical safeguard.

Costs and coverage

Key person insurance can take a variety of forms. Term policies last for a specified number of years, typically five to 20. Whole life (or permanent) policies, which are generally more expensive, provide coverage as long as premiums are paid, and they gradually build up cash surrender value. This value appears on a business’s balance sheet and may be drawn on, if the business needs working capital.

The cost of key person insurance also depends on the covered individual’s health, age and medical history, as well as the desired death benefit. When budgeting for premiums, bear in mind that premiums generally aren’t tax deductible. On the flip side, death benefits typically aren’t included in the business’s taxable income when received.

In terms of coverage limits, insurers may quote a rule of thumb of eight to 10 times the key person’s annual salary. But every business will have different cash flow needs when a key person unexpectedly dies. A more accurate estimate typically comes from evaluating lost income (or value), as well as the costs of finding and training a suitable replacement.

An important decision

If you’ve already chosen a successor, you can buy a policy that covers both of you. And if you haven’t, it may be even more critical to buy coverage on your life to protect the solvency of your business. Please contact our firm for help deciding whether key person insurance is for you.

© 2017

An EAP can keep your top players on the floor


A good basketball team is at its best when its top players are on the floor. Similarly, a company is the most productive, efficient and innovative when its best employees are in the right positions, doing great work.

Unfortunately, it’s not uncommon for good employees to battle personal problems, such as substance dependence, financial and legal woes, or mental health issues. These struggles can negatively affect their productivity and the working environment around them. One way employers can help is by offering a benefit called an employee assistance program (EAP).

A benefit with benefits

An EAP helps identify at-risk employees and assist them in finding the professional help they need. An employee who enrolls in the EAP may, for example, immediately be put in touch with a counselor or social worker.

According to the U.S. Department of Labor’s Office of Disability Employment Policy, EAPs have been shown to contribute to:

• Decreased absenteeism,
• Reduced accidents and fewer workers’ compensation claims,
• Greater employee retention,
• Fewer labor disputes, and
• Significantly reduced medical costs arising from early identification and treatment of individual mental health and substance abuse issues.

An EAP is, of course, not a substitute for health care insurance.

Vendors available

Employers don’t have to create and administer EAPs on their own. A wide variety of vendors are available. But, as is the case with any benefit, it’s important to choose a vendor carefully and make sure you get good value for your investment. Please contact our firm for assistance in assessing the costs and specific features of an EAP.

© 2017

PTO banks: A smart HR solution for many companies


“I’m taking a sick day!” This familiar refrain usually is uttered with just cause, but not always. What if there were no sick days? No, we’re not suggesting employees be forced to work when they’re under the weather. Rather, many businesses are adopting a different paradigm when it comes to paid time off (PTO).

Under the “PTO bank” concept, employers merge most (or all) of the traditional components of excused absences (vacation time, sick time, personal days and so on) into one simple employee-managed account, typically offering not quite as many PTO days as under a traditional PTO system. One benefit of this approach is that employers are no longer put in a position to have to judge whether leave is used appropriately. PTO banks may not work for every business, but more and more companies are finding them beneficial.

6 primary motivations

There are a number of reasons that employers are offering PTO banks. Specifically, according to a survey by the HR professional society WorldatWork, here are the six primary motivations:

1. Greater flexibility for employees. Like their employers, many employees appreciate not having to worry about distinguishing vacation time from sick time.

2. Ease of administration. Employers don’t have to deal with the complications of separating the various PTO components, which makes the HR and payroll staff’s job easier.

3. Increased cost effectiveness. More efficient administration often reduces the costs of time and resources spent dealing with employee absences and lost productivity.

4. The ability to stay competitive with other companies. Many employees and job candidates view PTO banks as a more contemporary and appealing approach to excused absences.

5. Reduced absenteeism. Interestingly, some employers have seen employees miss fewer work days once PTO banks have been established — possibly because of the greater sense of control employees have over their time.

6. Improved employee morale. Simplifying the PTO process and gaining greater command over their time off is typically viewed as a positive, empowering thing by employees.

Enticing benefits

Although these many potential benefits may seem enticing, PTO banks may not be right for every employer. For example, you may not want to disrupt your current system if it’s working well. Please contact our firm for a review of your PTO approach and how it’s affecting your financials.

© 2017

How to Save on Childcare Pt. 2

The rising cost of childcare is an issue that many working parents face. Knowing ways to help save on childcare can help relieve the burden of continuing to work when there are young children at home.

The second cost saving that will be addressed is the Employer Provided Dependent Care Assistance Program (DCAP).

What is a DCAP?

A DCAP is a tax-favored arrangement by which the employer:

  1.  Reimburses employees for dependent care expenses,
  2. Makes payments directly to third parties for care of employee’s dependents, or
  3. Provides a dependent care facility for employees exclusively.

An employer must have a written plan document to establish a DCAP.


  1. Certain non-discrimination testing must be met for highly compensated employees to be eligible to participate, but all non-highly compensated employees are eligible.
  2. Reasonable notification to employees must be provided of the program’s availability.
  3. A written statement showing the amounts paid or expenses incurred by the employer must be provided to each employee on or before January 31 of the subsequent year.
  4. Reported on W-2 (but not as taxable wages)
  5. If a reimbursement plan, the employee makes elective pretax contributions to fund their individual reimbursement account.  These amounts are gradually reimbursed to the employee upon the submission of receipts for dependent care to the employer.  It is use it or lose it meaning any unspent amounts remaining in the account at the end of the year are forfeited.  There is a 2 ½ month grace period.

For more information on child care savings. Please contact Brenda Jacobs at (616) 608-8530 or

How to Save on Childcare Pt. 1

The rising cost of childcare is an issue that many working parents face. Knowing ways to help save on childcare can help relieve the burden of continuing to work when there are young children at home.

The first cost savings that will be addressed is the Child and Dependent Care Credit. This is credit for a percentage of work-related expenses paid to a qualified care provider for a qualifying individual.

Do I quality?

To qualify for the credit, one must meet the following criteria:

  • You, and or your spouse, must have earned income
  • You (and your spouse if filing jointly) must have paid child and dependent care costs so that you could work, seek employment, attend school, or if you were disabled.


Who is a qualifying individual?

  • A child under 13 years of age
  • A person who is physically or mentally incapable of caring for his or her hygiene or nutritional needs (criteria apply).


How much is the credit worth?  

The credit ranges from 35% of qualifying expenses, if adjusted gross income (AGI) is less than $15,000, to 20% of qualifying expenses, if AGI is greater than $43,000. The maximum qualifying expenses is $3000 for one qualifying individual and $6000 for two or more qualifying individuals.


How do I claim the credit?

The credit can be claimed on Form 2441 with Form 1040 or 1040A. One cannot duplicate child/dependent care expenses under both the Child and Dependent Care Credit and under a Dependent Care Assistance Program (see next week’s blog post).

The credit is nonrefundable.

For more information on child care savings. Please contact Brenda Jacobs at (616) 608-8530 or

Learn about our tax services.


Gift Acceptance Policy and Not-for-Profits

As a not-for-profit organization, do you accept any gift that is donated?  Sometimes there may be donations that go against your mission, or are more of a hassle than a good thing. Because of this, it is important for not-for-profits to have a gift acceptancy policy. A gift acceptance policy states the types of gifts that a not-for-profit will and will not accept.  Author Ken Tysiac, in a recent article published in the Journal of Accountancy, states four key elements that a gift acceptancy policy should entail:

  1. Explanation of the type of gifts that the organization will accept, conditions for the acceptance of gifts, and what kind of review needs to take place before a gift is accepted.
  2. Descriptions of gifts that the organization will not accept, such as gifts that are too challenging to administer, would jeopardize the organization’s tax-exempt status, do not further the organization’s objectives, or could damage the organization’s reputation.
  3. Description of criteria for acknowledgement and donor recognition and details of how such recognition shall be carried out.
  4. A clause explaining when legal counsel should be sought in matters relating to acceptance of gifts.

Having a clear gift acceptancy policy can help avoid trouble in the future. There are many examples of gift acceptancy policies online.  It may also be beneficial to seek legal advice in constructing such a policy. For more information on this topic, please contact Brenda Jacobs at

Learn more about our services for nonprofit organization.

What is an ABLE account?

The 529 ABLE accounts are a new way for taxpayers caring for disabled children to achieve tax savings.  Jason Borkes, in an article published in the Journal of Accountancy, discusses the programs.

ABLE (Achieving a Better Life Experience) programs were created as part of the Tax Increase Prevention Act of 2014 and became effective under Michigan law on January 26, 2016.


To be eligible for an account, an individual must be deemed disabled before the age of 26 in either of two ways:

  1. The individual is entitled to benefits based on blindness or disability under Title II of XVI of the Social Security Act.
  2. The individual files a disability certification with the IRS for the tax year.

An individual may only have one ABLE account at a time with a maximum balance of $500,000.

Contribution amount and distributions

The contribution limit for an ABLE account is currently at $14,000, which is the annual gift tax exclusion for the tax year 2015. Distributions from the account are tax-free as long as the money is used for qualified disability expenses.

What are qualified expenses?

These are expenses that benefit the disabled individual. Some examples given are: expenses for education, housing, transportation, employment training and support, assistive technology and personal support services, health, prevention and wellness, financial management and administration services, legal fees, expenses for oversight and monitoring, funeral and burial costs, and others.

For more information on ABLE accounts, please read the full referenced article. If you need assistance in tax planning with ABLE programs, or have additional questions about eligibility, please contact Brenda Jacobs at (616) 608-8530 or

Learn more about our individual tax services.

How to Stay Ahead of Identity Theft?

Jeffrey Porter, in a recent article published in The Tax Advisor, discusses the increase in identity tax fraud happening to many taxpayers. The article lists five proposals that the AICPA has supported in relation to tax fraud:

  • Using truncated Social Security numbers on W-2s and other tax forms,
  • Giving the IRS access to the National Directory of New Hires database,
  • Permitting more taxpayers access to the identity protection personal identification number ( IP PIN) program,
  • Moving up the due date for W-2s and 1099s and requiring the Social Security Administration to immediately transmit W-2 information to the IRS, and
  • Making it a felony to steal a taxpayer’s identity in relation with tax fraud.

Earlier this year, the IRS announced a collaborative effort of 34 state revenue departments and 20 tax industry members to put strong new safe guards in place for the 2016 tax season.

These efforts, while aiming at combating fraud, still come with concerns. For example, more information needed from taxpayers could potentially slow down the preparation and refund process.

For more information on identity theft and tax fraud, please contact Brenda Jacobs at (616) 608-8530 or To read the full referenced article, click here.


Learn more about our individual taxation services