Unclaimed Property

Every individual and company has the potential to have unclaimed property. Unclaimed property is any financial asset with no activity by its owner for an extended period of time. This includes unclaimed wages or commissions; savings and checking accounts; stock dividends; insurance proceeds; underlying shares; customer deposits or overpayments; certificates of deposit; credit balances; refunds; money orders; uncashed checks; and safe deposit box contents.

Companies are required to send funds from lost accounts to the state of the owner's last known address. Begin your search on your state’s database or MissingMoney.com, a Web site officially endorsed by the National Association of Unclaimed Property Administrators (NAUPA), the official collective records from most state unclaimed property programs.

If your legal entity is a business association (corporation, partnership, etc.), governmental agency, or nonprofit, you are required to file annual reports of unclaimed property. For example, in Indiana, you can report property electronically in 5 easy steps on https://indianaunclaimed.gov: (1) download the online reporting guide, (2) register to access reporting software, (3) create your NAUPA formatted report, (4) submit your report via the website, and (5) print remittance detail sheet, attach to physical check, send to: Office of the Indiana Attorney General, Unclaimed Property Division, 35 South Park Blvd, Greenwood, IN 46143. Remember:  Indiana law requires that records be retained for ten (10) years after being remitted to the State. Indiana has a November 1 annual reporting deadline. The one exception in Indiana is for life insurance companies, which must report on May 1. Indiana has the right to assess interest and penalties for noncompliance.

Property becomes lost due to a company having no communication with the owner. You should contact institutions that hold your money or property every year and especially when there is an address change or change in marital status. Keep accurate financial records and record all insurance policies, bank account numbers with bank names and addresses, types of accounts, stock certificates, and rent and utility deposits.

Tips: (1) cash all checks for dividends, wages, and insurance settlements without delay, (2) respond to requests for confirmation of account balances and stockholder proxies, (3) if you have a safe deposit box, record its number, bank name and address, and give the extra key to a trusted person, and (4) prepare and file a will detailing the disposition of your assets.

Call us at (219) 769-3616 with your questions, or email them to tlynch@swartz-retson.com.

Planning to Retire? Consider Transferring Your Business to Your Employees

Even the most dedicated small business owners eventually want to retire. But succession planning can be tricky. If a transfer to an outside party isn't feasible, an alternative is to consider selling your business to your employees. How?

One common approach is to transfer shares through an employee stock ownership plan (ESOP), a type of employee benefit program that's similar to a qualified retirement plan and governed by the same law. The costs and complexities of establishing and administering ESOPs may make them impractical for the smallest employers, however, and in such cases a direct buy-out may be a better option.

What if your employees lack the funds or the borrowing capacity to buy your company outright? Decide if you're willing to accept a long-term installment agreement. If so, you and your employees will work to reach an agreement about the value of the business, preferably based on a professional appraisal. Then the employees will execute a promissory note at a mutually acceptable interest rate to pay the agreed-upon price in installments over a fixed number of years. The note may be reduced by a down payment, and is secured by the assets and stock of the business, along with the buyers' personal guarantees and outside collateral.

You can also structure the sale on a piecemeal basis, where the buyers purchase specified percentages over time and you remain involved in the business throughout all or most of the transition period. Your involvement during the transition period is generally advisable, and you'll want to make sure the buyers are capable of running the business once your involvement is over.

A business succession plan can encompass many types of payment methods, entity structures, and tax planning opportunities. For details tailored to your specific situation, contact us.

Call us at (219) 769-3616 with your questions, or email them to gward@swartz-retson.com

Tax Scams in 2017 Released

The Internal Revenue Service recently released the 2017 list of tax scams.  Here is information on four of them:

·         Identity theft:  Tax-related identity theft occurs when someone uses your stolen Social Security number (SSN) to file a tax return claiming a fraudulent refund.  Taxpayers need to watch out for identity theft especially around tax time.  The IRS continues to aggressively pursue the criminals that file fraudulent returns using someone else's Social Security number.  Though the IRS is making progress on this front, taxpayers still need to be extremely careful and do everything they can to avoid being victimized.  Here are a few tips:

o   Don’t carry your Social Security card or any documents that include your SSN or Individual Taxpayer Identification Number (ITIN).

o   Don’t give a business your SSN or ITIN just because they ask.  Give it only when required.

o   Protect your financial information.

o   Check your credit report every 12 months.

o   Review your Social Security Administration statement annually.

o   Secure personal information in your home.

o   Protect your personal computers by using firewalls and anti-spam / virus software, updating security patches and make sure the security software is always on.  Use strong passwords and change them periodically.

o   Don't give personal information over the phone, through the mail or the internet unless you have initiated the contact or you are sure you know who you are dealing with.

·         Phishing:  Taxpayers need to be on guard against fake emails or websites looking to steal personal information.  The IRS will never initiate contact with taxpayers via email about a bill or a refund.  Don't click on one claiming to be from the IRS.  Be wary of emails and websites that may be nothing more than scams to steal personal information.

·         Phone scams:  Phone calls by criminals impersonating IRS agents remain an ongoing threat to taxpayers.  The IRS has seen a surge of these phone scams in recent years as scam artists threaten police arrest, deportation and license revocation among other things.  The IRS reminds taxpayers to guard against all sorts of con games that arise during any filing season.

·        Fake charities:  Be on guard against groups masquerading as charitable organizations to attract donations from unsuspecting contributors.  Be wary of charities with names that are similar to familiar or nationally known organizations.  Contributors should take a few extra minutes to ensure their hard-earned money goes to legitimate and currently eligible charities.  IRS.gov has the tools taxpayers need to check out the status of charitable organizations.

Call us at (219) 769-3616 with your questions, or email them to tlynch@swartz-retson.com