Understanding the Impact of Economic Changes

Foreclosure auction signs
Image by niallkennedy via Flickr

In today’s uncertain economic times it is important to understand the impact of life events as they relate to business, jobs, debt and taxes. The IRS provides a near overwhelming amount of information on a variety of topics including The What-ifs of an Economic Downturn.  As a small business we understand how economic shifts have changed business and offer the following ideas.

Millions of hardworking Americans have lost jobs, cannot find work, have lost homes, cars and filed for bankruptcy in the last five years. Yes, bad things have happened to good people. How you handle change is important. Maya Angelou said, “If you don’t like something, change it. If you can’t change it, change your attitude.” As much as we would like to, we cannot change the economy so what can we do? We can look at the opportunities of the new economy.

Job seekers are finding innovative ways to make a living. They’re utilizing skills, knowledge and traditional business contacts to obtain contract work. They are starting their own businesses with a spirit of innovation we have not seen in a generation. Americans are changing their attitude about their situation; as a result they are changing their situation.

Small business owners are turning to trade or barter for business services such as marketing, accounting, public relations and web design. Utilizing a trade group means cash is available for expenses such as rent and utilities which are not available on trade. Owners are networking more than ever to find the best ideas and vendors; no longer are they operating in silos. As author Kevin Cashman says, “change challenges our current reality by forcing a new reality to rush in.” Business owners see the need to shift how they are conducting business as a result of economic changes.

Closed businesses have popped up across America leaving owners to wonder if Uncle Sam still needs his paperwork. The short answer is yes. As the owner of a business that is no longer in operation you are still responsible for filing required tax forms including the required forms for employees. Watch this video for more information.

Foreclosure has impacted many families and left them asking, now what? In terms of tax ramifications, The Mortgage Forgiveness Debt Relief Act of 2007 allows some taxpayers to exclude income from the discharged debt on the principal of the mortgage. This does not include second or vacation homes.  To find out if you are qualified, please make an appointment with BASC Expertise and we can walk you through the process.

No one likes being in debt, especially to the IRS and while they may be perceived as a necessary evil, don’t avoid them when you owe. Did you know you can work out apayment plan to pay down debt owed to the IRS? Call 1-800-829-1040 to discuss youroptions or make an appointment at BASC Expertise and we can help.

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