Jake Snelson - Vyde

FAQ – What Qualifies as a Home Office?

If you own a small business, you undoubtedly work from home, at least on occasion. If you’re like many small business owners in today’s world, you might even work exclusively from home. Whichever category you fall under, claiming a “home office” on your taxes can be tricky. Here’s a quick step-by-step guide to make sure you’re in line with IRS standards when it comes to your home office.

Home Office for a Small Business Owner

First, to claim a home office on your taxes, both of these things must apply:

You use the part of your home exclusively and regularly for your business. If an auditor were to come to your home, they would be able to easily identify your home office. This means the area can’t double as a play area for children or living room for your family. It should look just like a regular office would.
The business part of your home must be one of these to qualify:
- Your main place of business
- A place where you meet or deal with clients
- A separate structure (not attached to your home) that you use for your business

Exclusive Use Explained

Exclusive use means you use the area in your home for business purposes only. The area must meet these requirements to be considered “exclusive”:

A room or other separately identifiable space, but it doesn’t necessarily need to be separated by a wall or permanent partition
The space cannot be used for business and personal purposes
The area cannot contain personal-use furnishings like a TV or a couch, even though these items are common in many businesses

Regular Use Explained

Regular use means you use part of the home on a continuous, ongoing, or recurring basis. You can use the space for more than one business, and you can have more than one business location (other than your home office) for each business as well. However, if you’re deducting a home office on your taxes, your home must be the principal place of business. Factors considered in “regular use” of a home office include:

Meeting clients or conversing over phone, Skype, or email
Selling or delivering goods or services
Administrative activities of your business like billing customers, small business bookkeeping and accounting tasks, ordering supplies, setting up appointments, contacting customers
Updating your website, managing SEO, and other computer-based tasks

If you’re employed by another company and work from home, you can also claim a home office. Here’s how:

You must meet the home office requirements above.
Factors determining home office eligibility as an employee may also include:
- The employer requires you to maintain a home office as a condition of employment.
- Your work for their business isn’t possible without a home office.
- The employer doesn’t provide a space for you to work outside your home office.
- You don’t rent any part of your home to your employer and use the rented portion to perform services as an employee.

If you’re already working from home and haven’t set up a home office, now is the time. Home office deductions can save you big money on your taxes and help keep your small business activities more organized. A professional accountant knows the ins and outs of working from home and can answer your questions, save you money on taxes, and make sure you get the most out of your home office deductions.

Top 20 Accounting Tips for Insurance Agents

As an insurance agent, there is no one who understands the importance of protecting your assets better than you. You’ve got your clients covered when it comes to their vehicles, home, business, assets, family members, and every other important aspect of their life. Why not do the same for your insurance agency? Proper accounting and bookkeeping practices help protect your business from potential disaster by ensuring your finances are always in order, no matter what comes your way.

Top 20 Accounting Tips for Insurance Agents to Protect Your Business and Keep It Running Smoothly

1. Find an efficient way to track income and expenses. The first accounting tips for insurance agents is to keep track of money coming in and money going out. It is important to track expenses as they really are and not how you want them to be. Having an efficient system for tracking expenses and income is the only way to know how your business is performing financially.
2. Create a budget and stick to it. Categorize and track all expenses for your insurance agency. Your budget should include monthly expenses for different aspects of your business such as payroll, marketing, utilities, office rent, office supplies, business meals, and vehicle expenses.
3. Separate business and personal expenses. One of the first orders of business for insurance agents should be to set up a business bank account and use it for all business expenses. That way, when tax time comes you will only have to review your business account bank statements for deductions and expenses, rather than reviewing your personal account and trying to remember which expenses were for your insurance agency.
4. Set aside time for business bookkeeping and accounting. If you prefer to do business bookkeeping yourself, try set aside at least one hour each week to pay bills and update your income and expenses.
5. Don’t miss out on deductions, big or small. Noting even the smallest tax deduction can add up over the course of a year and really help out during tax season. Any money spent on improving or maintaining your business is tax deductible, as long as the expense is ordinary and necessary. Visit our previous posts on business deductions here, here, and here.
6. Create a home office. If you use part of your home to conduct insurance business, you may be able to claim a home office deduction. The IRS requires that the space designated as your “home office” must be used regularly and exclusively for your insurance agency business.
7. Track vehicle expenses. While you can’t deduct your drive to and from the office, all the other driving you do for your insurance agency is deductible, like driving to see clients or taking the office staff to lunch. Make sure to keep an accurate log of all miles driven for business.
8. Pay close attention to important tax deadlines. The most important tax deadlines to be aware of for insurance agents are Estimated Quarterly Taxes, which are due four times each year.
9. Outsource payroll. Most insurance agents start out doing their payroll in-house; however, when your insurance agency reaches a certain point of growth, you may find the time and effort put into payroll isn’t worth the cost anymore. Outsourcing payroll frees up your time and provides access to the knowledge and expertise of professional accountants, who are less likely to make mistakes while processing payroll.
10. Choose benefits wisely. The most sought-after benefit for employees is health insurance, followed by retirement, life insurance, and paid leave. Employees also appreciate extra perks like wellness programs, gym memberships, and child care assistance.
11. File taxes early to prevent fraud. Not only does it relieve your stress, to get taxes done early, it reduces the risk of identity theft.
12. File a tax extension when you need to. Here’s how.
13. Employ your children. Whether they’re cleaning your insurance office or answering the phone, their wages are tax deductible and they can be a big help to your business. Teaching them work ethic at a young age is an added bonus, right?
14. Invest money wisely in your business. Don’t spend money carelessly, even if you feel like you can afford it. Make business purchases wisely and invest in the aspects of your business that will provide you with the most profit long-term.
15. Set your salary. Decide on a monthly amount or percentage of profit from your insurance agency for your take-home pay. For tips on setting your own salary as a business owner, visit this post here.
16. Develop an exit strategy for your insurance agency. If you’ve partnered with another insurance agent, an exit strategy helps keep the relationship professional and is an added security for the business. Make the tough decisions about how your partnership could potentially end now, rather than when things may be tough down the road.
17. Develop a succession plan for your business. Additionally, setting a plan of who will eventually take on more business responsibilities within your insurance agency helps keep things on track.
18. Save money where you can, but don’t cut corners.
19. Utilize technology. Stay up to date on the latest accounting software for your industry, in addition to utilizing tools like smart phones and tablets to track expenses.
20. Hire a professional accountant. Mazuma accountants can take care of all the taxes, catch-up bookkeeping, and accounting for your insurance agency for less than $100/month. It only takes ten minutes to upload your information monthly or stuff your Purple Vyde Envelope with receipts and invoices and send it off to Vyde accountants who take your financial records and turn them into neat and tidy profit/loss statements.

Protect your business finances like you protect your insurance clients and you’ll be prepared for any unexpected financial crisis that comes your way.

FAQs for Insurance Agents Regarding Accounting Practices

1. How does efficient tracking of income and expenses benefit my insurance agency?

Efficient tracking offers clear insights into financial performance, aiding informed decisions and ensuring accurate financial assessments.

2. Is it mandatory to set up a separate business bank account for an insurance agency?

Establishing a separate business account simplifies tax processes, enabling easy identification of business-related expenses during tax assessments.

3. Why consider outsourcing payroll for an insurance agency? Outsourcing payroll, especially with business growth, saves time and minimizes errors. Professional accountants handle complexities more efficiently.

4. What’s the significance of filing taxes early and considering tax extensions?

Early tax filing reduces stress and minimizes identity theft risks. Tax extensions offer flexibility, ensuring accurate filings without unnecessary rush.

5. How can utilizing technology benefit insurance agency accounting?

Adopting updated accounting software and tech tools streamlines expense tracking, enhancing accuracy and efficiency in managing financial records.

6 Benefits of Taking a Vacation from Work

Nearly 40% of Americans aren’t using all of their allotted vacation time. Why? Two reasons. 40% of workers stress about the pile of work they’ll find on their desk when they return, and 67% feel like their company doesn’t promote taking time off. Despite the negative connotations sometimes associated with using PTO for vacation, here are 6 benefits of unplugging and taking some much-needed time off:

Gain a new perspective. As you step away from the immediate demands of the workplace and ponder a question that’s been on your mind, you’re more likely to gain a clear answer. An example of this, according to CNN, would be when you ask your friend for advice on a situation. The friend is removed from the scenario, and thus can offer advice more easily.
Better physical health. A little time away from the office reduces stress and can even improve your physical health. According to studies on cardiovascular health, men who didn’t take a vacation for several years were 30% more likely to have heart attacks compared to men who did not take time off. Women who vacation only once every six years or less were eight times more likely to develop heart disease compared to women who vacation twice a year. Combine that with lower blood pressure and smaller waistlines, and you owe it to yourself to take a break from the office once in a while!
Better mental health. According to a study performed by the University of California Irvine, vacations can reset and refresh our minds. They reported that “if we had a huge amount of brain power in reserve, we might not need vacations. We could just tap those beach-lolling brain cells. But we don’t. Time off tunes up a well-functioning brain.”
Closer family relationships. Perhaps the most important benefit of vacation time is the bonds we establish with those we love. Psychology expert Susan Krauss Whitborne said, “Shared family memories and time spent together isolated from ordinary everyday activities (school, work and so on) help to promote these positive ties. Though family vacations can have their own share of stress, the benefits outweigh the risks, even in families that are not particularly close.”
Increased productivity. The best way to get more done may be to spend more time doing less. A study from Harvard University shows that sleep deprivation costs American companies an estimated $63.2 billion a year in lost productivity. Vacations help you unwind, recharge, and rest up. In fact, those who vacation more often score higher on end-of-year performance ratings from their supervisors.
Receive inspiration about your work. The best ideas often come when you’re not actively looking for them. Creativity is sure to blossom as you reconnect with nature, family, and friends, rather than under the immense pressure that comes from meeting work deadlines and attending meetings. Take it from Rieva Lesonsky, the CEO of GrowBiz Media: “Vacations help us change the view, which can spark an idea or kick start creative thinking.”

Top 5 Cyber Security Tips to Keep Your Small Business Safe

It can happen to any of us. In fact, it often does–and never at a convenient time. Hackers are working around the clock to infest millions of websites. So how do you keep your small business safe on the internet?

Here are the top 5 security tips to keep your company safe in an increasingly paperless world.

1. Protect information, computers, and networks. As annoying as all those “updates available” pop-ups can be in the middle of your work day, making sure you have the latest version of all browsers and security software will keep your computers running properly and protect you from cyber security threats.
2. Make backup copies of all business data and information. All of your important data such as word processing documents, spreadsheets, databases, financial records, and human resource files should be backed up either on a removable device or in the cloud. It is best to backup data automatically if possible, or at least do so weekly.
3. Protect passwords. Require employees to use unique passwords and change them every 3-6 months. Do not store your passwords on a word document, but rather, write them down and keep them in a locked desk drawer or other safe place. If password security has been an issue for your business before, consider implementing another level of authentication that requires additional information beyond a password to gain access to important company information.
4. Take measures to secure mobile devices. Mobile devices often create cyber security challenges, especially for small businesses. If employees regularly access any company information on their phones or tablets, require passwords to protect their devices, encrypt their data, and install security apps to prevent information from being stolen.
5. Keep payment card information safe. Perhaps the only thing worse than a cyber security threat on your company information is for a hacker to gain access to your credit card and financial information as well. Work with your bank to ensure the most trusted and validated anti-fraud services are being used. Isolate payment systems from other, less secure programs and don’t use the same computer to process payments and surf the Internet.

All small businesses need a cyber security strategy to protect their own business, their small business bookkeeping, their customers, and their data from growing cyber security threats; and, unfortunately, all companies are at risk. Protect your company by using these best cyber security practices.

FAQs about Cyber Security Tips:

Why is keeping software updated important for cyber security?

Regular updates patch vulnerabilities that hackers exploit. Ensuring browsers and security software are up-to-date enhances protection against cyber threats.

Why should small businesses backup their data?

Backing up data safeguards against data loss due to cyber attacks or system failures. Automatic backups or cloud storage provide secure redundancy for crucial information.

How can businesses enhance password security?

Encourage unique passwords changed every 3-6 months. Avoid storing passwords digitally; opt for secure offline storage. Consider implementing multi-factor authentication for added security layers.

Why is securing mobile devices crucial for small businesses?

Mobile devices pose security risks due to data access. Implement password protection, data encryption, and security apps to mitigate threats and prevent data breaches.

How can businesses safeguard payment card information?

Collaborate with banks for trusted anti-fraud services. Isolate payment systems from less secure programs. Implement stringent security measures to prevent unauthorized access to financial data.

12 Creative, Tax Deductible Ways to Promote Your Small Business This Holiday Season

The holidays are coming quickly! Is your small business ready? The best way to execute any marketing plan is to start early and plan thoroughly. Use these creative ways to promote your small business and get the most bang for your buck by making sure your festivities are tax deductible.

HALLOWEEN:

1. Have your logo printed on Halloween candy. Check out these websites: shindigz.com and whcandy.com for ordering and ideas.

2. Attach a business card or promotional flyer to your goodies. A quick, easy way to get the word out about your small business to trick-or-treaters and their families. Tax deductible, too!

3. Send a box of candy to clients in October. They’ll get lots of goodies around Christmas time, but they’re sure to remember the company that started early and sent them something for Halloween, too.

4. Donate any leftover candy to the US troops. Read more about that, here. “Charitable organizations with 501(3)c status like Operation Gratitude and Soldiers’ Angels collect leftover Halloween candy to include in care packages for soldiers. They are two of many 501(c)3 organizations on the IRS-approved list to donate tax deductible charitable goods.

THANKSGIVING:

5. Sponsor a food drive or coat drive. This is a great way to get employees and clients excited about giving back to the community and any money you donate to the cause is tax deductible.

6. Send out a “thankful” postcard or greeting to clients. There is no better time of year than Thanksgiving to let clients know how appreciative you are of their continued support. A genuine, thoughtful message from you can go a long way. Bonus: all printing and shipping is tax deductible.

7. Organize a 5k or other charity event. If you start early enough, you can plan a “Turkey Trot 5k” on or before Thanksgiving day and donate the proceeds to a local charity. Promotional materials like t-shirts or wristbands are tax deductible, and you’ll likely get some free media coverage from the event.

8. Find a way to serve Black Friday Shoppers. Nearly all small businesses capitalize on Black Friday sales, (and you can too!) but you can also offer free hot chocolate or some kind of treat to those wary shoppers waiting in line for doors to their favorite stores to open. Don’t forget to hand out business cards or flyers promoting your holiday sales as well.

CHRISTMAS:

9. Send your clients a gift or card. Keep in mind that you can only deduct $25 worth of gifts for each client in a year. Visit Vyde’s holiday gift giving guide, here.

10. Join other businesses to host a gift-giving tree. Find a local charity, put a tree in the business district or shopping area, post Christmas wishes on the tree, and have customers pick a wish and buy the desired gift.

11. Hold a “12 Days of Christmas” sale, event or contest. Give away a different prize every day, offer a different discount every day or spotlight a different product every day. All prizes you buy are tax deductible for your small business.

12. Hold a Christmas party at the office. Invite clients, customers, employees, and their families for a breakfast or luncheon. It doesn’t have to be terribly expensive to be fun. Plan some games, throw together a few refreshments, and show your gratitude for all who help make your business great.

How do you promote your small business during the holidays? Share with us on our Facebook page for a chance to be featured on our blog!

5 Steps to Open a Business Bank Account

As an entrepreneur, one of the first things on your to-do list should be to open a business bank account for your newly formed business. Even if you’re not yet making money, you’re likely investing at least a small amount in getting things up and running. A business bank account isn’t just a place to hold the millions of dollars you’re sure to make, it’s a record of transactions that will become invaluable to you as you carry on your new business venture. A business bank account helps you track expenses, show proof of transactions if you were to be audited by the IRS, and find deductions for your small business you may have otherwise missed. We’ll walk you through the steps of choosing a bank that’s right for you, getting your account set up, and using your bank statements to help with bookkeeping and accounting tasks.

5 Steps to Open a Business Bank Account

1. Choose the bank that’s right for your small business. The decision to go with a large corporate bank, credit union, or regional bank for your small business account can be quite overwhelming. All offer a plethora of loans, credit cards, fees, etc. and all would be happy to house your money for you. Here are a few points to consider when choosing the right bank:

1. - Fees. All banks have them, and there is really no escaping them for a business bank account. Depending on the size and needs of your business, your bank fees should be manageable. Larger corporate banks normally offer lower rates to start up businesses because of their volume of clients. When choosing a bank, be sure to ask about ATM fees, checking and savings account fees, maintenance fees, and any fees that may increase in the future. Make sure if you sign up during a promotional period, your bank fees won’t skyrocket when the promotion ends.
  - Minimum Balances. Some banks require that small business owners keep a minimum balance in their account at all times. Be sure to check what this fee is for each bank–whether it is $25 or $1,000, it’s best to be in the know before making a commitment.
  - Lending Opportunities. If you need a small business loan, this will be especially important. Ask several banks about their small business loans and the availability of them. A loan officer can help determine if you qualify for a small business loan, interest rates, and how much they are able to offer you. Typically, regional banks and credit unions are able to offer more flexibility in small business loans.
  - Online Accessibility. In our increasingly mobile world, online features and ease can be a huge relief to small business owners. If online banking is important to you, be sure to compare and contrast features offered from each bank. Mobile check deposits, withdrawals, transfers, and online bill pay are a few of the most commonly offered features small business owners take advantage of.

2. Gather the necessary documents to open a business bank account. Here’s a quick checklist on what you’ll need to bring with you to the bank when you go to open your account.

1. - EIN. You should have requested an Employer Identification Number from the IRS that identifies your business in the tax world. If you don’t have this number yet, you can request one here and receive it immediately.
  - Identification. Bring your driver’s license or another form of ID to prove that you’re you.
  - Certification of Business Identity. After you’ve filed paperwork to establish your business with the state, you’ll need to bring this proof to the bank. If you set up an LLC, you’ll need Articles of Organization. If you set up a proprietorship, you’ll need your DBA (Doing Business As) papers. If you set up a corporation, you’ll need to bring your Articles of Incorporation. Have questions about how to choose an entity and establish your business with the state? We can help.
  - Business License. Many states require a business license to operate. If it’s required in your state, the state will let you know, instruct you on how to obtain one, and the bank will need to see it before you can open your business bank account.

3. Fill out your business bank account application. Each bank has their own specific application, but all will require paperwork to be filled out with basic information. You can pick up the application beforehand and fill it out at home so you’re sure to do it correctly.

4. Sit down with a banker to open your account. After you’ve chosen a bank, gathered all the necessary paperwork, and filled out your business bank account application, you’re ready to sit down with a banker and open your account. They’ll walk you through the process, check your credit score, advise you on best business banking practices, and provide you with a bank account number and any other information relevant to your account. The banker will be able to help you choose the right account to meet your small business needs.

5. Receive a check card and temporary checks. The bank will likely provide you with a temporary ATM or debit card, in addition to temporary checks that can be used immediately after your account has been opened. They will then mail you an official check card and checkbook shortly thereafter.

A business bank account will not only help you track expenses and income throughout the year, it will act as a second record in addition to your small business bookkeeping tasks. Any transaction you may have forgotten to record will show up on your bank statements. A business bank account will also help you avoid these common business accounting mistakes.

Any experienced small business owner will testify that it’s best to keep your business and personal bank accounts separate to avoid confusion. Read here and here for more accounting tips on tracking and separating business and personal expenses while your business is in its infant stage.

How Does The EMV Liability Shift Affect My Business?

This October, the EMV liability shift will virtually eliminate fraud by generating a one time code for transactions that take place with a chipped credit or debit card within a store. The code changes with each transaction, rather than the traditional magnetic striped cards with unchanging information, which makes it nearly impossible to steal information.

After October 1, 2015, the liability for card-present fraud will shift to whichever party is the least EMV-compliant in a fraudulent transaction. While the EMV liability shift date will bring peace of mind to consumers, financial institutions, and merchants, it will also come with some expense and adaptation to those updating their technology to make the switch.

For merchants and financial institutions, (many of which have already done so) the update to EMV means adding new in-store credit card chip technology and internal processing systems, and complying with new liability rules.

If you offer an in-store, card present transaction, you will need to make the following changes to be compliant with the EMV liability shift rules:

Purchase a new card reader. You’ll need an updated card reader to read consumers’ chipped cards. Rather than the traditional swiping method of a magnetic card, the new device will require customers to “dip” their card in order for the chip technology to be activated. A new card reader will cost your business a few hundred dollars, depending on which device you purchase.
Update your processing system. You may or may not need to update your POS system, depending on the card reader you purchase. Check with the company you purchase your card reader from to see if your processing system needs updated as well.
Train employees to use and troubleshoot the new technology. There are two transaction types employees need to know about with the EMV technology. The most common method will be with contact cards where the chipped card is inserted into the reader, and the consumer either enters a pin or provides their signature to authorize the transaction. There is also a “contactless” EMV, where consumers use their phone or mobile wallet to pay, such as ApplePay.
Familiarize yourself with the new liability rules. After October 1, 2015, if a customer uses their chipped card in your store and their information is stolen, your business will be liable. Click here for a detailed explanation of the new liability rules from the US Treasury.

If your business accepts card-not-present payments, such as payments made online or by phone, the credit card chip technology does nothing to heighten security in those instances. If you accept only online payments, you do not need to do anything to prepare for the upcoming EMV liability shift and it will not affect you at this time.

Keep in mind that with a significant reduction of in-store credit card fraud (France claims an 80% deduction), it is likely that fraudsters will get more creative. Online payment information may become more compromised as it will be easier to access than financial information on in-store purchases with the chip technology. Do all that you can now to protect customers’ payment information submitted to your business online.

While the EMV liability shift date may bring a bit of stress and expense to your business now, it will protect your business and your small business bookkeeping in the long run. If you simply update your systems to be compliant with the new standards, you will not be liable for any fraud that may happen in your store.

Read more about the EMV liability shift:

What is Credit Card Chip Technology and the EMV Liability Shift?

What do I Need to do to Prepare my Business for the EMV Liability Shift Date?

Frequently Asked Questions

What is the EMV liability shift, and how does it impact businesses?
The EMV liability shift, effective from October 1, 2015, transfers liability for card-present fraud to the least EMV-compliant party in a fraudulent transaction.

What changes do I need to make to my business to comply with the EMV liability shift?
To comply, businesses must purchase new card readers, update processing systems if necessary, train employees on new technology, and understand the new liability rules.

What is the process for transitioning to EMV technology in-store?
Businesses need to acquire updated card readers, potentially update their POS systems, train employees on using the new technology, and understand the new liability rules.

How does the EMV liability shift affect businesses that accept card-not-present payments?
For businesses accepting card-not-present payments, such as online or phone transactions, the EMV liability shift does not directly impact security measures in those instances.

How can businesses protect themselves from potential fraud post-EMV liability shift?
Businesses should stay vigilant, update systems to comply with new standards, and focus on safeguarding online payment information to mitigate potential fraud risks.

What Do I Need to do to Prepare my Business for the EMV Liability Shift Date?

This October, the United States will be joining many other countries in the world who have made the change to EMV chip technology to protect consumers’ financial information. Hundreds of thousands of chipped credit and debit cards have already been sent to customers, but businesses are not required to have the updated credit card chip technology that protects the financial information on chipped cards until October 1, 2015. At this time, businesses are expected to have updated card readers and processing systems that generate a one-time code for each transaction with a chipped card. The code makes it virtually impossible for financial information to be duplicated or stolen.

While only 32% of small business owners are aware of the pending change, even less are aware of the steps they need to take to prepare their business for the EMV liability shift date. If your business doesn’t have the updated credit card chip technology this October, your business will be responsible for fraudulent charges.

Here Are the Steps to Successfully Prepare Your Business for the EMV Liability Shift Date:

Make a list of your current hardware. If you haven’t already, you’ll need to purchase new card readers for your checkout terminals. Make a list of all the current hardware your store has so that you can compare and get the best deal when purchasing new equipment. If you don’t accept mobile or contactless payments, now may be the time to consider upgrading so you don’t have to again in the next few years.

Discuss EMV hardware options with your vendors. Your business’ merchant acquirer can help you compare and recommend payment processors that will accept chipped cards. Rather than the traditional swiping method, the new EMV technology will be a “dip” method that generates the one-time code needed to process the transaction. These payment processors are usually around a few hundred dollars. If you use a customized POS system in your business, your independent software vendor can help you become EMV compliant and make sure any updated POS and software systems will be compatible with new card readers.

Purchase new hardware for your business. After you’ve taken the time to shop around, compare devices, and make your decision, you’ll need to purchase new payment processing hardware for your business. This will likely be done through your current technology vendor. While most businesses will get away with simply swapping out their current card readers for EMV compliant ones, this is also a time to consider upgrading your entire payment processing system. Coupling an updated card reader with inventory or customer-loyalty functionality, along with being able to accept mobile or contactless payments (such as ApplePay or Android Pay) may give you the most bang for your buck in the long term.

Get your terminals EMV certified (if applicable) before the EMV liability shift date. Your technology merchant or vendor should be able to tell you if you need to participate in EMV Level 3 Certification. This will likely only need to be done if your business operates on a highly customized POS system.

Train your employees. Like any new technology, there will be a learning curve with the EMV liability shift. A few key things employees will need to be trained on:

1. Know the difference between “chip-and-signature” and “chip-and-pin” transactions and how they work.
2. The transaction amount must be entered into the terminal before the chipped card is inserted.
3. If the card is pulled out before the transaction is completed, the transaction must be cancelled and started over.

It’s best to start the change now before the EMV liability shift date becomes effective on October 1, 2015. What may feel like a costly hassle to you now will save you time and money in the long run.

Read more about the EMV liability shift:

What is Credit Card Chip Technology and the EMV Liability Shift?

How Does the EMV Liability Shift Effect my Business?

Frequently Asked Questions:

What is EMV chip technology and why is it important? EMV chip technology provides enhanced security for credit and debit card transactions by generating a unique code for each transaction, making it difficult for financial information to be stolen.
When is the deadline for businesses to adopt EMV chip technology? The deadline for businesses to adopt EMV chip technology is October 1, 2015. After this date, businesses without the updated technology may be liable for fraudulent charges.
What steps do I need to take to prepare my business for the EMV liability shift? To prepare for the EMV liability shift, you should:
- Assess your current hardware
- Discuss EMV hardware options with vendors
- Purchase new hardware if necessary
- Get your terminals EMV certified
- Train your employees on chip-and-signature and chip-and-pin transactions.
Do I need to upgrade my entire payment processing system or just the card readers? While upgrading card readers is essential, it’s also a good time to consider upgrading your entire payment processing system. This may include adding features like inventory management or accepting mobile payments for future-proofing.
What happens if my business doesn’t adopt EMV chip technology by the deadline? If your business doesn’t adopt EMV chip technology by the deadline, you may be held responsible for fraudulent charges incurred through non-chip transactions. It’s crucial to take action to protect your business and customers’ financial information.

What is Credit Card Chip Technology and the EMV Liability Shift?

This October, merchants will be required to make the change to the new EMV (Europay, Mastercard, and Visa) credit card chip technology. With 1.24 billion payment cards and 15.4 million POS terminals currently in use, there is certainly a need for heightened security of credit card and banking information. This fall, the EMV liability shift will deliver just that.

This technology will be in your wallet with new chipped debit and credit cards, as well as in stores’ card readers at their checkout terminals. The chipped cards will protect in-store payments by generating a one-time code needed for each transaction to be approved. This EMV chip technology makes it virtually impossible to counterfeit cards or steal credit card information upon checkout because the code connected to the consumer’s card changes with each transaction.

While this technology has been available for some time, the EMV liability shift date is what will cause the greatest change on October 1, 2015. At this time, if a customer uses a chipped card to pay for a transaction at a store, and their information is stolen, either the merchant or the financial institution (whoever has not adopted the EMV technology) will be liable. Up until now, if a customer uses a magnetic striped card to pay for their transaction and their information is stolen, the merchant is not liable for the damage, but rather the banking or financial institution.

The EMV liability shift date is October 1, 2015. However, the liability shift for fuel dispensers and ATM transactions is not effective until October 2017. The EMV liability shift is applicable to all businesses–large and small–regardless of size.

When both parties adopt the new credit card chip technology, in-store fraud is virtually eliminated and both customers and merchants can enjoy peace of mind knowing their financial information is protected.

Read more about the EMV liability shift:

How Does the EMV Liability Shift Effect my Business?

What do I Need to do to Prepare my Business for the EMV Liability Shift Date?

6 Ways to Save Time and Money on Bookkeeping and Accounting as a Realtor or Real Estate Agent

There’s nothing better than being able to save a little extra time and money as a real estate agent. Finding an efficient and cost-effective way to take care of your real estate bookkeeping and accounting is imperative to doing just that.

First, let’s make a distinction between bookkeeping and accounting. Sometimes the terms are used interchangeably, but that is incorrect. Bookkeeping and accounting are two parts of the same financial cycle.

Bookkeeping involves the recording of daily transactions for your business including:

Posting debit and credit card expenses
Recording all financial transactions
Issuing invoices
Balancing bank accounts and checkbooks
Payroll duties

Accounting is a higher-level process that takes all of your bookkeeping information and makes sense of it by creating financial documents that give you insights about your business. Accounting includes:

Preparation of financial statements
Profit and loss reports
Financial analysis of the company—operational costs, determining where money can be saved, and analyzing financial data over time
Filling out small business tax forms and returns.

So how can you save time and money on these two time-intensive tasks as a real estate agent or realtor? Here are a few tips to help you out:

Do it right the first time.

If you’re managing your real estate business bookkeeping and accounting yourself, don’t take shortcuts thinking you’ll save time or money. Turn bookkeeping into a regular habit, just like checking your email each day or setting weekly goals for yourself. Decide how often you’ll take care of bookkeeping tasks—ideally at least once per month, and set aside time specifically for this task

Keep all records.

The golden rule for any accurate small business bookkeeping. Whether you prefer hard copy receipts or everything digital, find the quickest, easiest, and safest place to keep your receipts and financial records. Keep a folder or envelope in your office, car and/or wallet where you put all your business receipts. If you prefer a digital method, you can take photos of receipts and upload them to an app such as Expensify or Hello Expense.

Familiarize yourself with common accounting terms.

Accounting jargon can sometimes seem like another language, especially if you’re not familiar with business accounting. Terms like accounts receivable, balance sheet, cash flow, ledger, accrual, and Return on Investment aren’t words that often grace everyday speech. Learn the basic business accounting terms and what they mean, here.

Keep business and personal accounts separate.

Nothing creates a financial mess at the end of the year quite like personal or business expenses charged to the wrong account. By keeping your realtor business and personal accounts separate, your bookkeeping will go much more smoothly and you’ll be able to keep your business’ professional image in tact. For end-of-year accounting, you will need to review your personal account for possible business deductions such as portions of your phone bill or even your mortgage payment. Meanwhile, keep small business purchases on a personal account to an absolute minimum.

Invest in bookkeeping software that’s right for you.

If you plan to manage your own business accounting and bookkeeping, you’ll likely end up needing more features than an excel spreadsheet can provide. Research several types of accounting software and find one that fits your needs. Some are tailored to realtors specifically, but many realtors find success using general accounting software such as Quickbooks. Remember, you can always try our Quickbooks alternative.

Hire an accountant.

If you really wanted to, you could probably tackle any accounting or bookkeeping question that came your way. However, most realtor and real estate agents find that it’s not worth their time to spend hours each month doing bookkeeping when they could be focused more on the money-making aspects of their business. Instead of trying to muddle through on your own, you’re better off to hire a professional accountant to take care of your small business accounting needs. Not only will an accountant save you time, but they can also save you money by finding more business deductions during tax season, catch any accounting errors you may have made or overlooked, and advise you on how to save or invest your money. Vyde provides bookkeeping and accounting services for realtors and real estate agents, and unlimited accounting advice from real CPAs, all for less than $100/month. Give us a call today, we’d love to discuss your real estate agent accounting questions.

Resources

Author: Jake Snelson

FAQ – What Qualifies as a Home Office?

Top 20 Accounting Tips for Insurance Agents

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Top 5 Cyber Security Tips to Keep Your Small Business Safe

FAQs about Cyber Security Tips:

12 Creative, Tax Deductible Ways to Promote Your Small Business This Holiday Season

5 Steps to Open a Business Bank Account

How Does The EMV Liability Shift Affect My Business?

Frequently Asked Questions

What Do I Need to do to Prepare my Business for the EMV Liability Shift Date?

Here Are the Steps to Successfully Prepare Your Business for the EMV Liability Shift Date:

Frequently Asked Questions:

What is Credit Card Chip Technology and the EMV Liability Shift?

6 Ways to Save Time and Money on Bookkeeping and Accounting as a Realtor or Real Estate Agent

So how can you save time and money on these two time-intensive tasks as a real estate agent or realtor? Here are a few tips to help you out:

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