February 2009

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Client Highlight: Portland Studios, Inc.

February 27, 2009 in Client Highlight | 1 comment

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It’s time for another Client Highlight! We’ve gotten a lot of response from these posts. Our clients seem to enjoy seeing the other great clients we serve.

Portland Studios, Inc.is on tap for this month’s post. We’ve not been working with them for too long but have enjoyed getting to know Jamin Micah Jantz, the CEO of the group. His innovation and leadership at the studio are really making this design and illustration firm soar in market presence, efficiency and productivity. We’re glad to know them and show them off to you! (we’re proud of who we serve).

Whether it’s illustration for the book publishing industry, animation or their ever growing abilities in the areas of interactive web, Portland Studios, Inc. is rising to the top of their industry as a leader! Their award-winning illustrators are known to the nation (including the New York publishing industry) and some of the talent on board is truly mind blowing.

See examples of their illustrator’s work here, here, and here. Play some of their interactive web games here, here and here. And see their web design projects here, here and here. Man, they even have an online store where you can buy things: check it out.

Jason M. Blumer, CPA and Jamin Micah Jantz, CEO holding hands

Jason M. Blumer, CPA and Jamin Micah Jantz, CEO holding hands

As we usually do, we asked Jamin to answer four of our questions for our readers. Here they are:

1.  What have you or your organization done to remain competitive and successful?

One unique benefit of operating in the south but working with clients in New York allows us to bill high rates, but generally undercut the competition. We’re focusing a lot of energy right now to expand our client base in order to mitigate the risk of clients dropping off the radar due to financial hardship (which has happened recently). 

Additionally, we’re working to increase current residual income streams to lower our dependence on a constant stream of client work.

2.  What do you or your organization foresee as the greatest business obstacle in the near future?

The current economic situation has definitely affected Portland Studios. We work with a lot of publishers as well as creative agencies. The publishing industry is getting hammered right now and the client’s creative agencies work for are getting their advertising budgets slashed which, in turn, filter down to us.

Additionally, working in a creative environment can be emotionally exhausting as each employee invests so much of himself into each project. It’s a challenge to maintain that energy so that every project reflects the high artistic standards we claim to demand of ourselves.

3.  What do you enjoy most about your work?

Portland Studios is unique. Most of us have known each other for many years prior to Portland starting up. While working with close friends definitely has its own challenges, it allows us to enjoy a relaxed atmosphere while still being productive. The relationships also help us tackle wildly creative and team-based projects. And we’ll periodically play Risk™ over several weeks, 1-2 moves a day. We call it a team-building exercise, but really there’s a lot of false alliances and betrayal. I’m not sure how profitable it really is; but it’s fun.

4.  What has the Blumer firm done to assist you in furthering your business and its operations?

Jason helped us to redo our financial books to capture, process and distill vital information in our firm. In the past, the management team relied on gut feelings or long, manual calculations. Jason’s helped us take a step up from an upstart creative firm to one that can grow and plan for the next decade. 

Discussing the strategy behind PS operations, and how to enhance the flow of information using QuickBooks.

Discussing the strategy behind PS operations, and how to enhance the flow of information using QuickBooks.

Additional work on the details of QuickBooks reporting

Additional work on the details of QuickBooks reporting

Jamin showing Jason how he performs the breast stroke. Huh?

Jamin showing Jason how he performs the breast stroke. Huh?

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From the Back to the Front…

February 25, 2009 in Entrepreneurial Endeavors, Networking | 8 comments

When my family and I moved to Greenville in May of 2003, I took such a big salary cut that I eventually got a paper route in a high end neighborhood to make ends meet (after my daughter broke her arm and ran up a bunch of bills).

What a rough time that was… personally and for our business.  I was departing on a journey to build a business and didn’t know if I could do it and what it would take.  There wasn’t enough income to pay me a salary so my dad said you can come but you’ll have to go earn your salary.  What a scary situation to be in… but what a motivation!  I had a wife and some little kids so this move had to work.  God was going to have to do His work to meet our needs.

I remember calling the Greenville Magazine one day and tried to get my name in the back of the magazine to announce that I had come to work with my dad.  I had a little trouble because I wasn’t an advertiser, and they mentioned that they would fit me in if they could.  When it finally came out, I quickly checked the back of the magazine to see if my goofball picture and announcement had been listed.  I finally made it after a month or two… and I’m sure you never saw the announcement.  Big freakin’ whoop.

So my journey to build my business had started, with a lot fear driving me to put groceries on the table.  I began calling people I had some slight introduction to, sent letters to introduce myself and took many people to lunch.  I gave tax seminars, fed free information to our clients and gave my time to people I wanted to serve.

Now, I’ve made it to the cover of the magazine, and developing real relationships has been the reason.  I’ve learned so much in the almost 6 years it took me to go from the back to the front of the Greenville Magazine.  And we intend to grow in major ways in the very near future, and our pledge is to serve you as our clients, build real solid relationships with you, and commit our time and resources to serve you better each year.  I believe we can still do this even if we grow… I’m asking you to keep us in check.

Thank you Greenville for letting us serve you – we are in awe that we get to serve some of the best clients in the South.  You are truly the bomb, and I love you.

Thanks, Jason M. Blumer

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Tuesday Tax Time (the New Business Stimulus Edition)

February 24, 2009 in Tuesday Tax Time | No comments

from-alwaystiltingblogspotcomWe talked about my boy ‘Bama last week and what the stimulus he and his buddies passed did for individuals.  Now we are going to hit on the topic of business – and the benefits your business can expect to receive from the new stimulus bill.

Yo, check it:

1.  Special Depreciation (Bonus Depreciation).  A provision entered in to law last year has been extended with the new stimulus bill whereby businesses can immediately realize the benefit  of investing in large pieces of equipment.  This “special depreciation” allows a business to write off 50% of certain large pieces of equipment (like solar panels, computers, tractors, equipment, etc.) immediately in the year purchased instead of having to depreciate them over time.  To qualify, this equipment has to be brand spanking new, and you have to buy it before 2010.

2.  Extended Depreciation Write-off Through Sect. 179.  Section 179 of the tax code allows for expensing large pieces of equipment through a business instead of depreciating them over time.  Not to be confused with provision #1 (which allows you to write off half of the brand new equipment), this provision in the law allows a business to write off the whole piece of equipment, and it can be used equipment at that.  As originally increased in a prior year law, the new stimulus bill extends the benefits to businesses to write off up to $250,000 of equipment purchased before the end of 2009.

3.  5 Year Carryback of Net Operating Losses for Small Businesses.  If you generate a loss on your tax return for 2008, you can now go back 5 years looking for more profitable tax returns (where you paid taxes) to offset against the loss.  Who cares?  Well, for example, if you lose $10k this year, and had a $20k profit back in 2004 (and paid taxes back then), you can now apply this $10k loss to the $20k profit and get a refund on some of the taxes paid back in 2004.  Carrying back losses is an immediate way to generate some yummy cash.  If you had more than $15 Million in revenues, then you DON’T get to participate in this carryback (which means you can only carryback your losses two years).  If you are interested, you had better hurry.  You’ve got 60 days after the signing of the bill into law (February 17, 2009) to make the election to carryback your losses 5 years.

4.  Increased Target Groups to Qualify for the Work Opportunity Credit.  The Work Opportunity Credit allows a business to claim a credit of up to 40% of the first $6,000 wages paid to employees in special target groups of individuals.  Those groups have been expanded with the passage of this new stimulus bill.  Now, unemployed veterans (who have been released from active duty in the past 5 years) and disconnected youth (ages 16 to 24 who have not been in school or employed in the past 6 months) may allow for new credits to be applied for.

5.  Liberalized Estimated Tax Payment Requirements on Those Receiving Income from Small Businesses.  If you receive income from a small business (those that employ less than 500 people), then you may have to make estimated tax payments.  And to avoid a penalty each year, you need to make estimated payments of at least 100% of your last year’s tax liability or 90% of the current year’s liability (could be higher requirements if you have a higher income) – that’s under current law.  But the stimulus bill will allow you to make less payments and still avoid the penalty.  You only have to pay in 90% of your prior year’s tax liability (or 90% of your current tax year’s liability, whichever is lower) now to avoid the penalties.

So, go buy some new equipment so you can expense half of it (#1) and then write the rest of it off through Sect. 179 deductions (#2) while hiring some disconnected youths (#4) to generate some losses in your business you can carry way back to 2003 (#3) to avoid paying penalties on income you never made (#5).  Huh?

Good luck.

Thanks, Jason M. Blumer

IRS Circular 230 Disclosure: To ensure compliance with requirements imposed by the IRS, we inform you that (i) any U.S. tax advice contained in this communication (including any attachments) is not intended or written to be used, and cannot be used, for the purpose of avoiding penalties under the Internal Revenue Code; (ii) any such tax advice is written in connection with the promotion or marketing of the matters addressed; and (iii) if you are not the original addressee of this communication, you should seek advice based on your particular circumstances from an independent advisor.

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Monday Morning Message

February 23, 2009 in Monday Morning Message | No comments

“Small businesses are the backbone of job creation in South Carolina, but we’re not maximizing our potential when we’ve got what’s effectively the highest income tax rate in the Southeast holding us back.”

Mark Sanford

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GoSee: Thriveal's Three on Thursday

February 19, 2009 in GoSee | 1 comment

1.  You can input your contact phone numbers into the Phonevite website, whether it be a group or one individual, and call them all at once.  The people you call through Phonevite can even respond with a “yes,” “no,” or “maybe” – GoSee

2.  Saw this article on fellow CPA Chad Bordeaux’s  Twitter feed… a scary scorecard on the price of the economic stimulus – GoSee

3.  This is an awesome graphical depiction (and boy, do I love graphs) of the stimuls bill spending and to whom the money is being directed.  Although it is of a previous verion of the stimulus bill, it still depicts visually the extent of the spending – GoSee

Thanks, Jason M. Blumer

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Tuesday Tax Time (the Wednesday Edition)

February 18, 2009 in Economy, Tuesday Tax Time | 3 comments

from-alwaystiltingblogspotcom1Last week we detailed how the most recent stimulus bill will affect individuals.

And I was going to focus on the provisions meant to help the small businesses this week.

But I think it’s important to touch on what the FINAL provisions of the bill (about $787 Billion worth) are, and how they may affect you and me.

Here are some provisions you may be interested in :

1.  Credit for First-Time Home Buyers.  The amount has been increased to $8,000 if you buy a home between 1/1/09 adn 12/31/09.  You don’t have to pay back this refundable credit anymore (unless you sell the home within three years of buying it).

2.  Make Work Pay.  In 2009 and 2010, everybody working will get an extra $400 at tax time ($800 if a married couple works) through the “Make Work Pay” credit.  It will be a refundable credit, calculated at 6.2% of your earnings.  But I thought working already paid – it’s called a paycheck.  Man, that will barely get me a Kindle 2 from Amazon. 

3.  Payments to Retirees.  A one time payment of $250 will go to retirees, disabled individuals and those receiving Social Security Income.  That will only get you about 11 Snuggies (as seen on TV).  I guess you could give them as gifts!

4.  More on the Earned Income Tax Credit.  If you have a third kid, you can get more on the earned income credit now.  Strategy: the married couple needs to keep that income down to just over $21k or it will start to phase out.

5.  Lower Tax on Unemployment Benefits.  If you are getting unemployment checks, then you won’t pay federal tax on the first $2,400 of the money.

That’s all for now, maybe I’ll highlight the business savings in the bill next week.

Peace to you.

Thanks, Jason M. Blumer, CPA

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How Will You Change the World?

February 18, 2009 in Business, Economy, Entrepreneurial Endeavors | 2 comments

I’m listening to Tom Siebel, formerly of Siebel Systems (which later merged with Oracle Corporation) on a Stanford Technology Ventures Program podcast called Entrepreneurial Thought Leaders. 

Tom Siebel

Tom Siebel

They have fascinating guests on this program, some of which are so smart I can’t quite understand what the heck they are talking about.  Well, Tom’s pretty smart and I understood him to say:

1.  Growth in the world wide human population will be what drives substantial opportunities for innovation and growth.  As a matter of fact, by the year 2050, there will be a lot of older people in our own country.

2.  New opportunities for innovation will be about food, water, population growth, energy and health care (not information technology, computers, plastics, the Internet, etc.).

3.  Government regulation will continue to drive many areas of major production, innovation and growth.

4.  Tom Siebel and some other philanthropic individuals are giving away a $20 million prize to anyone who can create an energy-free (a zero energy footprint) home at the current costs of traditional residential construction – very hard to do.  That is how much he cares about the future responsible uses of energy.

5.  He said get on a boat and get off at Shanghai if you want to see what the US is competing with.

Be careful with what you perceive as the future of your industry and business.  It may not be what you think it is.  Maybe it is, maybe it isn’t.

As you look 30, 40 or 50 years out in your career, are you focused on the right opportunities and career?  How will you change the world?  Tell me in the comments section of this post.

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Monday Morning Message

February 16, 2009 in Monday Morning Message | No comments

“As long as we keep our fundamentals strong… the dollar (and) U.S. borrowing costs will do just fine.”

Lawrence Summers, Obama’s National Economic Council Director

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GoSee: Thriveal's Three on Thursday

February 12, 2009 in GoSee | 2 comments

1.  Google Earth 5.0 has outdone itself now (if you haven’t yet downloaded this software, or Google Pack, you are missing something).  You can dive under the oceans now and explore the ocean floor.  Amazing!  Read the blog to find out more about this amazing new release of the software – GoSee

2.  Fresh, a BusinessWeek series which highlights ”standout startups before they become household names” talks about the therapeutic garment maker and a new generation of bar codes – GoSee

3.  Still waiting on your 1099-B from your investment advisor so you can get your taxes filed?  The IRS extended their deadline last year: they have until February 17, 2009 to get those mailed out to you so don’t call them screaming.  Just calm down and wait – GoSee

Thanks, Jason M. Blumer

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My Wife Doesn't Pay for Groceries…

February 10, 2009 in Business, Other Thoughts | 5 comments

The other day, my wife came out of the grocery store with two pints of Ben & Jerry’s ice cream – and she didn’t even pay for it! She does that kind of thing regularly. No, I wasn’t ashamed that she had just pulled the five-finger discount on our ice cream. She had some coupons that allowed her to get the ice cream for free. Sweet! I love ice cream.

Actually, my wife gets about $275 worth of groceries each week but only pays around $125 for them. She stays home with our three girls and still makes us about $7,800 per year… by saving money. She often amazes the cashiers, other customers and ME! She even gets stores to pay her for products because her combined coupons and savings actually totaled more than the cost of the product! Wow!

As I’ve watched her perform these amazing feats of coupon agility, I’ve seen a few points (after she taught me her secrets) that can be potentially applied to your business to help you save money too:

  1. You Can’t Be Brand Loyal. Saving money is all about buying what’s on sale when it’s on sale. You don’t pick your favorites and buy it when you want it. If you do, then you are paying a higher premium to retailers for the convenience of having your wants met immediately. You have to show some restraint and buy the things that are discounted. Same for business – you may not get the brand you want, but you may get something that meets your needs. That’s good enough.
  2. Saving Money Takes Time… Just Like a Job. The cashiers and other customers often say, “How do you do that?” Well, it takes about 3 to 5 hours per week to cut coupons, follow blogs, search for online coupons and plan her grocery trips and what she’ll buy. People often want the savings, but they don’t want to put in the time it takes to create the savings. Saving money is a job for my wife… and she is good at it. Saving money in your business is one of the hats you must wear in your business.
  3. Organized People Make More Money. My wife has a huge notebook filled with all sorts of coupons in 40 different categories. And if you touch her notebook, you are going to have the wrath of the “coupon queen” come down on you. She put many hours of work into her notebook so she knows where everything is located. She can whip out a coupon on a moment’s notice and argue any cashier into fearful submission with knowledge about the store’s own coupon policies (which, of course, the cashier has not been trained in). She approaches these savings in such an organized way, she makes more money than if she just kept her coupons in a drawer somewhere and was unaware of the strategies and time it took to save money. Likewise for your business, your organizational abilities will allow you to (1) apply for loans more quickly, (2) know where your expenditures stand as compared to your budget on a daily basis, (3) pull out properly filed documentation when a client says they’ve already paid you, (4) keep from paying the same bill twice, (5) avoid late fees and penalties to governmental agencies for paying your taxes late, (6) be more prepared for upcoming client projects and payments, etc.
  4. You Earn Money When You Save Money. People often want to make more money. So they consider getting an extra job, bringing in more clients or increasing their marketing. But once you make more money, part of it goes to overhead, part goes to pay you and then you might have some left over. But if you save money instead, then every dollar you save is a dollar-for-dollar increase to the bottom line. As Ben said, “a penny saved is a penny earned.” Think about how you can save money in your business today, THEN go get new clients second. You’ll make more money.
  5. Keep At It And Be Consistent. If my wife saves $150 one week, but overspends by $200 the next week, then she is down by $50 for the two week period. But the fact that she is consistent over time means her savings and knowledge one week turn into savings and knowledge the next week. And this process continues to build on itself. Savings add up over time. Saving $100 per week turns into $5,200 every year… but you have to be consistent to realize this savings. You may need to hire someone (virtual assistant, back-office help, etc.) to help you be consistent and organized in your business, but that individual may ultimately pay for themselves over time.

Can you think of any points I’ve left out? Maybe I’ll run them by my wife and see what she thinks of them.

Thanks, Jason M. Blumer

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