JFCC Blog

A Guide to Exit Planning

Fri, 12 Nov 2021 20:12:27 GMT

A Guide to Exit Planning

Whether you are an entrepreneur just starting out or a seasoned CEO of a regional powerhouse, an exit plan is crucial to map out your steps toward withdrawing from your business.

It may seem counterintuitive to have a plan to exit when all is going well, but life can quickly change for many reasons including your health, the economy, or shifts in the market in which your business competes.

When it comes to business, and life in general, it is important to expect and plan for the unexpected. An exit plan can help guide decisions that will impact your personal future and the future of your company.

Why Create an Exit Plan?

All businesses need an exit plan or strategy. Eventually, a situation will arise that will lead to a business owner leaving the company. During that time, having a plan already in place can help remove emotions from the situation and guide you through the situation rationally.

When creating an exit strategy or plan, it’s important to keep a few key points in mind.

What are your professional objectives?

For some individuals, their business is a life-long endeavor or labor of love. Entrepreneurial types may enjoy setting up new ventures, making them profitable, and then moving on to the next project. Deciding if you are in it for the long haul or for shorter-term success is beneficial for exit planning.

What are your life priorities?

How many hours a week are you willing to work? Would having a child or grandchild change this? Life events and prioritizing what is truly important to you can help bring clarity to your exit plan.

What is the current financial situation and future potential for the business?

The finances of being a business owner are complicated. Creating a profitable business takes time and a serious investment of resources. Understanding what your business is worth , your profit goal for the company, and what you’d need to make for the sale of the company to benefit you are important factors for exit planning.

How does your estate plan account for the business?

Are you planning to pass the business to an interested family member, or does selling the business at a profit play a part in your retirement strategy?

What is the value of your non-business assets?

Does the business make up the core of your net worth, or is it a small piece of your financial pie? The more heavily the business plays into your financial well-being, the more risk you carry.

An Overview of Exit Options

A succession planning expert can help you develop a business exit plan and guide you in mapping out how you’d like to leave.

Exit options include, but are certainly not limited to:

· Selling to a competitor, someone you know, or in the open market

· Liquidating and closing the business

· Transferring or selling to a family member

· Bankruptcy

When to Start Planning

To put the most advantageous plan in place, exit strategies should be developed at least 10 years before you intend to leave the business. By planning far in advance, beneficial strategies can be incorporated into your exit to help you avoid a large, unexpected tax bill upon selling. It also allows time for owners to identify potential leaders and mentor them over time.

At Jordan Financial Consulting and Coaching, we recommend creating an exit plan if you are over 45 years old, have nearly all of the ownership interest in your company or if your personal net worth is closely tied to the value of your company.

How to Get Started

The first step in a successful exit plan is a business valuation . When searching for a valuation partner, two main considerations should be experience and credentials. While there are several credentials related to business valuations, the Certified Valuation Analyst (CVA) designation is the most widely recognized credential and the only credential accredited by the National Commission for Certifying Agencies ^® (NCCA ^® ) and the American National Standards Institute ^® (ANSI ^® ).

Once a valuation is complete, exit planning can begin. Jordan Financial specializes in developing a strategy and roadmap that will enable you to maximize value and leave your business on your terms.

Sherry Jordan, CEO and founder of Jordan Financial Consulting and Coaching, has more than 20 years of experience in public accounting including business valuation, exit planning, and financial forensics. She is a Certified Valuation Analyst (CVA) with experience conducting valuations for businesses large and small.

The Role of a Financial Neutral in Collaborative Practice

Tue, 09 Nov 2021 13:26:43 GMT

The Role of a Financial Neutral in Collaborative Practice

The process of dissolving a marriage and untangling two lives is fraught with emotions and expenses. People are generally familiar with the concept of going through the courts for a divorce, but many couples don’t realize there is a more affordable and less stressful way to end their marriage.

In recent years, alternatives to courtroom divorce have gained popularity. Options such as divorce mediation and collaborative practice have made it possible for couples to separate with fewer bills from lawyers and walk away more satisfied.

Financial neutrals play an important role in collaborative practice. Read on to learn what a financial neutral is and how one can support your divorce proceedings.

What is Collaborative Practice?

Collaborative practice is an alternative dispute resolution model where a team of experts help parties remain “interest-focused” during their negotiations and provide guidance for the legal contract. This is best when both parties are still hoping to avoid litigation, but need additional support from attorneys, financial neutrals and mental health professionals to help finalize an agreement. In collaborative practice, each party hires a separate lawyer, but shares a financial neutral.

What does a Financial Neutral do?

A financial neutral is a member of a collaborative divorce team or a mediator who helps couples find, organize and understand their financial information and facilitates a process of educating, visioning and creating a plan for settlement. This expert is an impartial party that will examine the couple’s full financial status and ensure all parties understand the financial implications of the divorce.

Typically, the financial neutral gathers and studies detailed financial information from both parties. Using this information, they will then help clients uncouple their finances and figure out how to move from supporting one household to two. The financial neutral helps clients by providing a reality check of how their financial life will change through the process of separation.

In many relationships, one partner handles the finances. A financial neutral can help bring the other partner up to speed and educate them on their financial situation moving forward. This can include everything from financial coaching to developing specific budgets.

The Benefits of Using a Financial Neutral

There are a number of benefits to having a financial neutral as part of your collaborative team.

Reduced Costs

By using a financial neutral, parties can share the costs instead of separately hiring financial experts.

Clarity in your Financial Future

Financial neutrals not only help sort through today’s finances, but help clients create budgets and blueprints for their future financial life. There is also the opportunity to coach and educate clients on finances.

Compromise is the Goal

Lawyers in the collaborative process are solely focused on the best outcome for their individual client. A financial neutral can step in and advise lawyers on the financial impacts on both parties and come to an acceptable solution for all involved.

Calms Emotional Decisions

For most couples, going through a divorce is a time of high stress and even higher emotions, much of which stems from financial concerns and worries. Having an unbiased party leading the financial decisions helps both spouses walk away satisfied with the outcome.

How to Select A Financial Neutral

The financial neutral will be a key member of the collaborative team working through a separation. It’s critical to find a professional who has experience in the financial and tax implications that come from decisions made in the divorce process.

Because this is an unbiased and impartial position, the financial neutral should be someone who has not previously worked with either spouse. Financial neutrals typically also agree not to work for either party in the future to keep any biases out of the decision-making process.

Sherry Jordan, CEO and founder of Jordan Financial Consulting and Coaching, has more than 20 years of experience in the areas of divorce mediation, business valuation, litigation support, financial forensics and business valuation.

Contact us today to learn more about our financial neutral services and how our team can support you during your divorce.

The Benefits of a Compassionate Financial Professional

Thu, 04 Nov 2021 21:14:57 GMT

The Benefits of a Compassionate Financial Professional

It is no secret that people often have reservations about discussing their finances. Individuals tend to avoid talking about their own financial affairs in polite conversation.

However, this culturally learned predisposition can add stress to effective financial management and planning. We hold back because we’re afraid of being judged for our financial decisions. Or we’re scared of hearing we’re not doing enough to meet our financial goals and save for our future.

If this resonates with you, finding and working with a compassionate financial professional can make a world of difference.

Compassion 101

What is compassion? According to Greater Good Magazine published by University of California at Berkeley, emotion researchers define compassion as the feeling that arises when you are confronted with another’s suffering and feel motivated to relieve that suffering.

Though the two terms are often interchangeably used, compassion differs from empathy. While empathy involves feeling the pain of others acutely, compassion involves understanding how people feel without experiencing their actual emotions.

Studies have shown that compassion and empathy even activate different areas of the brain. In a neuroscientific experiment reported in Psychology Today involving separate groups trained to practice empathy and compassion, “the compassion group ended up feeling kinder and more eager to help others than those in the empathy group.” Those in the empathy group felt emotionally drained and were less able to see past the emotions for solutions.

Why Compassion Matters

There is a common misconception that financial professionals are purely “numbers people” and only look at the cold hard facts of a financial picture. This may be true of some, but in recent years a push toward emotional awareness in financial services has grown in popularity.

A compassionate financial professional is valuable for clients in several ways:

Relationship Building

Trusting relationships with a compassionate service professional can make uncomfortable tasks bearable. Perhaps you’ve experienced this with a doctor or dentist. Finding a healthcare professional you feel comfortable with, and even look forward to seeing, can encourage you to get through those unenjoyable but important appointments for your health. Likewise, a financial professional who treats you with compassion can bring positivity to an otherwise uncomfortable or stressful process.

Getting You To Your Goals

It is impossible to give the best financial advice to someone by only looking at the numbers. To serve you well, a financial coach needs to fully understand where you are in life; your priorities, your hopes, your dreams and what keeps you up at night.

Meghaan Lurtz, senior research associate at Kitces.com and professor at University of Maryland University College remarked , “by practicing compassion, advisors can take the insights gleaned from cognitive empathy [compassion] to take action to help and support their clients productively, with confidence that the help they are providing to their clients is not clouded by the emotional burdens they may have taken from their clients.”

The Power of Listening

For some clients, meeting with a financial professional is the only time they feel able to openly discuss their finances. Sessions can take on the feeling of a counseling session alongside the financial details. Sharing your life goals, dreams and deepest fears is not something to be taken lightly. A compassionate financial coach will take time to understand and appreciate the emotions involved in your financial situation and goals to guide you in your financial planning and decision-making.

Why Choose Jordan Financial

At Jordan Financial Consulting & Coaching, we aim to holistically and compassionately empower you with financial expertise for your business and your life. Sherry Jordan, CEO and Founder, has over 20 years of experience in financial coaching and public accounting. We invite you to contact us to learn how our consulting and coaching services can help you achieve your business or personal financial goals.

The Impact of COVID-19 on Business Valuation

Wed, 03 Nov 2021 16:01:05 GMT

The Impact of COVID-19 on Business Valuation

Since arriving in the United States in early 2020, COVID-19 has impacted nearly every aspect of our lives. We’ve gone from lockdowns to re-openings and back again. For business owners, this is a time of extreme uncertainty with operational risks and opportunities. With so much ambiguity, how can one understand where their business stands and what move to make next?

Understanding Your Business Value

A business valuation expert can help you understand what your business is worth even in these unprecedented times. As we’ve shared in a previous article, there are three common approaches to determining the value of your business: an asset-based approach, income-based approach and market-based approach. Each approach has pros and cons depending on the size of your business and your industry, but no one approach stands out during the COVID-19 pandemic.

The Discounted Cash Flow Approach

Business valuation experts have found the Discounted Cash Flow (DCF) method, an income-based approach, to be the preferred tool for valuations during COVID-19.

According to Investopedia , DCF analysis attempts to figure out the value of an investment today, based on projections of how much money it will generate in the future .

When conducting projections, it is important to consider multiple scenarios in relation to COVID-19. Using multiple projections such as the virus being under control in three months, six months or a year can show how much resiliency your business has.

Beware of Market-Based Approaches During COVID-19

The market-based approach works just like it sounds – a business valuation expert reviews the market to find similar, recently sold businesses, and then uses those findings as benchmarks to value a business.

This approach is not recommended during times of extreme uncertainty and flux (such as global pandemics) because of the unstable condition of the market. Similar businesses may currently be selling for far below or far above their value, leading you to incorrectly value your own business assets.

Other Considerations for Valuations

Industry and Business Details

COVID-19 did not affect all businesses or industries equally. For example, if you owned a restaurant that already had a robust online ordering and delivery system, you were likely less affected than restaurants that had to rely on third-party services like Uber Eats or DoorDash to deliver to customers.

Intangible Assets

Aspects of your business such as brand recognition and goodwill can be powerful motivators for customers. During the COVID-19 pandemic, customers began paying closer attention to how businesses treat their employees and began rewarding businesses making positive efforts with their patronage. Emphasis was also placed on the mantra of ‘shop local’ to support small businesses in one’s own neighborhood. These feelings of goodwill towards a business can be a valuable asset during an acquisition or merger.

How to Understand Your Business’s Value during COVID-19

Even during stable times, business valuation is a complicated matter that requires an expert eye. Now more than ever, it is critical to find a valuation expert who understands how COVID-19 affects your business and industry in order to lead you to an accurate valuation.

Sherry Jordan , CEO and founder of Jordan Financial Consulting and Coaching, has more than 20 years of experience in public accounting including business valuation, litigation support, financial forensics and divorce mediation. She is a Certified Valuation Analyst (CVA) with experience conducting valuations for businesses large and small in a variety of industries.

What is Divorce Mediation and Is It Right for You?

Fri, 09 Jul 2021 00:00:14 GMT

To many people, “divorce” conjures nightmares of exorbitant legal fees, courtroom visits and intense disputes among the separating partners. But what if there was a better way?

Divorce mediation is a less-costly alternative for couples willing to work together and enter a compromise outside of court. Read on to learn more about how divorce mediation works and if it might be a viable option for you.

What is Divorce Mediation?

Divorce mediation is the process of working with a neutral, third-party mediator to negotiate the terms of ending your marriage. Commonly covered areas of interest include property division, child custody and visitation, child support and alimony or spousal support.

Typically, divorcees go through five to seven meetings with a mediator, depending on the complexity of the case. These include introductory meetings explaining the process, detailed meetings to work through custody and finances, and finally, a meeting where a tentative settlement is drafted and reviewed by the separating partners.

The Benefits of Divorce Mediation

Avoid the Courts (And Public Record)

By choosing divorce mediation, you and your spouse can avoid the high costs of paying for separate legal teams, the inconvenience of court appearances, and the exposure of those court appearances being entered into public court record.

Partners Decide the Outcome

In court-led divorce proceedings, spouses are represented by separate legal teams who each make their case to a judge, or divorce master, and hope the judge sees things their way. Once a judgment is made and entered into the court record, there is no easy way to take a step back or continue negotiations with your former spouse. It is possible that no one ends up happy as a result.

On the other hand, while divorce mediation can take considerable communication and negotiation, the process should conclude with both parties feeling in control of the outcome. The mediator cannot force either party to accept the terms of an agreement.

Speed and Cost Savings

Depending on many factors at play, such as the size of the marital estate and if children are involved, the average divorce through the Pennsylvania court system typically takes around two years.

Divorce mediation is often a much faster process. At Jordan Financial Consulting and Coaching, we have found the average mediation process takes between 3-6 months, based on the time it takes to gather financial and estate documents, receive appraisals on property and work through child custody plans.

Will Mediation Work for Me?

Several key factors will determine if divorce mediation is the best direction for you and your spouse.

You are Separating on Good Terms

Contrary to what we see so often in the media, many marriages end not with a bang, but with a whisper. Most times, divorces are years in the making as partners grow apart and realize staying together is not the best choice for either party. In these cases, a mediator may be the least painful and quickest way to a resolution.

You Are Willing to Negotiate and Communicate

It is critically important for both spouses to be willing to meet at the negotiating table and be flexible in their demands. Oftentimes, lack of communication skills trigger incidents that cause many couples to fall apart. The mediation process can help mend some of those tears and help couples learn to communicate once again. This benefit is felt most strongly by couples who will have shared custody of children.

Taking the Next Step

Jordan Financial’s professional mediation services can help you and your spouse reach a mutual agreement. When we serve as your mediator, your final product will be a jointly negotiated Memorandum of Understanding. We can save you time and the costly fees of a prolonged court battle.

4 Lessons Learned from the May PowerLink Advisory Board Meetings of 2021 – “The Art of Hiring a Superstar (when you have just a little money)”

Tue, 08 Jun 2021 17:36:19 GMT

This month, PowerLink worked with more than 185 small business owners who attended one of our 14 Community Advisory Boards, Custom Advisory Boards or Private one-on-one mentoring sessions over Zoom. The topic was one that everyone has been dealing with: hiring in the face of expansion, contraction, pivot. We welcomed a guest adviser with expertise in Human Resources to help address questions like the following:

1. “I have to hire another person to help me. Should I hire a “Mini-Me” or should I hire someone with skills that I don’t have?” Most owners wanted someone who had skills they didn’t have. We talked through what it takes to hire, train and manage someone who is different than you.

2. “How do I convince employees I laid off to come back for the same wage when they get an extra $300 per month to stay home?” Note that for full time, that is about $3/hour in extra pay and that it ends on October 1st. We talked through PA law on worker’s refusing work when an employer calls them back and how to document it for unemployment wages after a refusal.

3. “How do I get someone to actually do what I hired them to do?” PowerLink programs stick to the “Traction” methodology which reinforces “Accountability” over job tasks and developing scorecards that employees have to maintain and report back to owners regarding individual performance.

4. “How do I hire, onboard and train someone to do a job that I am terrible at?” The key is hiring someone who has similar values to you. That means asking the right questions in an interview. Coaching is available through our PowerLink Human Resource connection.

Our next two meetings are June 10 and July 8. We are sponsored by the Harrisburg Regional Chamber & CREDC as well as First National Bank. We meet via Zoom from 8:00 AM – 9:30 AM the second Tuesday of every month. Please message me if you’d like to join as my guest to see what we’re all about.

Business Valuation as a Tool for Retirement

Tue, 11 May 2021 17:48:32 GMT

Planning for retirement can feel overwhelming and complicated. This is especially true for small business owners who may not have their nest egg saved in a retirement savings plan such as a 401(k).

As a business owner, you know the ins and outs of your monthly revenue and expenses, but do you know what your business as an asset is worth? Many owners overestimate the value of their companies, potentially setting themselves up for disappointment when it is time to move on.

Understanding the value of your business is an important step to plan for your retirement, whether that includes the sale of the business or passing a family business on to the next generation.

Types of Valuations

Every business valuation is unique. A valuation expert can help you identify the best way to value your company depending on the size of the business, industry and purpose of the valuation.

Asset-Based Approach

An asset-based approach is one of the most popular and universally accepted ways to value a company. This approach values a company by subtracting its total liabilities from its total assets. These liabilities and assets can be tangible (like inventory, equipment and buildings) and intangible (like reputation and intellectual property). The asset-based valuation technique does not consider a business’ future earnings potential; rather, it considers only the company as it is today.

Income-Based Approach

In stark contrast to the asset-based approach, the income-based approach analyzes future earnings to value a business. This commonly involves reviewing historical earnings, projections of future earnings, discretionary and unusual expenses, and risks.

Market-Based Approach

The market-based approach works just like it sounds – a business valuation expert reviews the market to find similar, perhaps recently sold businesses and then uses those findings as benchmarks to value a business. This approach is most useful when many similar businesses in the same region have been sold or quoted for sale.

When to Get Started

It is highly recommended to complete a business valuation on your company regularly to understand how market fluctuations are affecting your business’ value and to gain an accurate perception of its value.

It is critical to give yourself a long runway when it comes to business transitions and retirement planning. Best practice is to consult a business valuation expert no later than three years before a planned transition. This will allow time for you to maximize your business value after your initial valuation.

How to Select a Valuation Expert

There is no shortage of “experts” offering business valuation services. Many websites offer quick, easy and inexpensive valuations, but this cookie-cutter approach lacks the nuance that a qualified, experienced professional provides.

When searching for a valuation partner, two main considerations should be experience and credentials. While there are a number of credentials related to business valuations, the Certified Valuation Analyst (CVA) designation is the most widely recognized credential and the only credential accredited by the National Commission for Certifying Agencies® (NCCA®) and the American National Standards Institute® (ANSI®).

Sherry Jordan, CEO and founder of Jordan Financial Consulting and Coaching, has more than 20 years of experience in public accounting including business valuation, litigation support, financial forensics and divorce mediation. She is a Certified Valuation Analyst (CVA) with experience conducting valuations for businesses large and small.

Divorcing? You May Need a Forensic Evaluation

Fri, 16 Apr 2021 21:20:29 GMT

For many divorcing couples, the process is daunting, difficult and emotionally tumultuous. While some marriages end amicably, others end in courtrooms with legal experts battling for their client’s positions. During this time, finances are an especially sensitive and central subject. In some situations, a legal team may not be enough to protect you and get your fair share of marital assets. In those cases, a financial forensic evaluation is key.

The Power of a Forensic Evaluation

Accountants use forensic evaluations to uncover financial information that you may not be aware of about your spouse. You can think of these accountants as financial detectives. They use both personal and business documents such as tax filings, bank statements, property deeds and investment statements to paint a complete picture of your marital financial assets and liabilities (what you own, and what you owe). In addition to digging through financial documents, forensic accountants can serve as expert witnesses in court on your behalf.

In the midst of a challenging divorce, it is tempting to rush through the process to get it over with, but this could negatively impact you and your family’s long-term financial future. Having the full financial picture is critical, as the information is used to determine spousal support, child support, the division of property, including financial assets, and more.

Unless a prenuptial agreement determines otherwise, financial assets received over the course of a marriage are considered marital property that will be split equitably in Pennsylvania between the spouses upon a divorce. It is important to be aware that “equitable” does not mean “equal” and the division of property may or may not be negotiated 50/50.

When is a Forensic Evaluation Needed?

There are several situations where a forensic evaluation can safeguard your financial future during a divorce.

Your Spouse Handled the Finances

In many marriages, one spouse pays the bills, files the taxes and handles the finances in general. If you have never actively monitored your marital finances, it may be a worthwhile endeavor to bring in a forensic expert to give you peace of mind as to the validity of the documents that you are now reviewing in divorce.

You Believe Your Spouse Has Hidden Assets

In the digital age, it’s easier than ever to move money quickly and quietly. Having a portion of a paycheck diverted into an individual account, creating off-shore accounts or transferring assets to shell corporations can easily be done with a few clicks of a mouse. Additionally, when one spouse owns a business, it is important to note that business owners have ample opportunity to hide assets by padding payroll, paying friends as employees, creating fake business debt, or simply not reporting all of their cash transactions.

You are Involved in a High-Asset Divorce

In most high-asset divorces, developing a full financial picture is no simple task. There are likely many investment and bank accounts, multiple properties to evaluate and potentially business interests to consider. In such situations, even in an amicable divorce, it is important to have a forensic evaluator support your case in court to ensure you receive your fair share.

The Divorce is Messy

We’ve all heard horror stories of divorces that turn former lovers into bitter foes. It’s certainly true that divorce and deeply hurt feelings can bring out the worst in someone. If you find yourself in this situation, it’s important to have a financial expert to verify the data as your attorney goes to bat for you to protect your interests.

Who Makes a Good Forensic Accountant?

When working with your legal team to find a forensic accountant, there are a few key qualifications to keep in mind. These include, but certainly aren’t limited to, being a Certified Public Accountant (CPA), Certified Valuation Analyst (CVA), Certified in Financial Forensics (CFF), previous experience in litigation support, service as an expert witness, and experience in business valuation. When considering a forensic accountant, ask for recent success stories for situations similar to yours.

Sherry Jordan, CEO and founder of Jordan Financial Consulting and Coaching, has more than 20 years of experience in public accounting including business valuation, litigation support, financial forensics, divorce mediation and business valuation. Contact us today to learn more about our forensic evaluation services and how our team can support you during your divorce.

The Effects of COVID-19 on Personal Taxes

Tue, 02 Mar 2021 21:35:20 GMT

The COVID-19 pandemic has drastically changed our lives and, for some, our tax situations. For many Americans, filing taxes is a daunting and complex task, even in the best of times. Due to changes brought on by the pandemic, there may be even more questions than usual swirling in the minds of tax filers.

Here we break down how changes caused by the COVID-19 pandemic may affect your personal taxes.

COVID-19 Stimulus Checks

Since the pandemic began in March of 2020, many Americans have received two rounds of Economic Impact Payments, more commonly referred to as stimulus checks. These direct payments came to taxpayers first from the CARES Act in the summer of 2020 and later from the Coronavirus Response and Relief Supplemental Appropriations Act of 2021. The eligibility for these programs depended on your 2018 or 2019 tax filing.

The Economic Impact Payments are considered refundable tax credits above and beyond a filer’s anticipated refund or tax due for the 2020 tax year. To state it simply, this means that the stimulus checks received, based on your personal eligibility, will not affect your refund or tax bill in 2020.

Recovery Rebate Credit

Most eligible filers received their payments automatically from the IRS by direct deposit or a mailed check. However, if you didn’t receive the full amount of the payments, you may be eligible to claim a Recovery Rebate Credit on your 2020 taxes.

As stated on IRS.gov, “Economic Impact Payments were based on your 2018 or 2019 tax year information. The Recovery Rebate Credit is similar except that the eligibility and the amount are based on 2020 information that you include on your 2020 tax return.”

This Recovery Rebate Credit is especially valuable for filers whose financial situations may have changed from their 2018 or 2019 filings. Eligible filers will receive this money in the form of a smaller tax bill or a bigger refund.

Early Withdrawals from Retirement Accounts

The CARES Act gave Americans additional flexibility to access money saved in retirement accounts. Typically, withdrawals from traditional Individual Retirement Accounts (IRA) and employer-provided accounts come with a 10% withdrawal penalty for anyone under 59 ½ years old. The CARES Act temporarily eliminated this penalty and gives Americans the opportunity to pay this money back into their retirement accounts if they are financially able to do so.

It is important to note that one third of the money withdrawn will be considered income on your tax filing over a period of three years. For example, if you withdrew $9,000, $3,000 will be added to your income for 2020, 2021 and 2022. Alternatively, filers have the opportunity to claim the full income in the year of the withdrawal, which may be advantageous for some.

Taxpayers will report these distributions on Form 8915-E, which was recently released from the IRS for federal filing and most state filings, including Pennsylvania.

Required Minimum Distribution (RMD) Waivers

The CARES Act also allowed Americans to forego their annual Required Minimum Distribution (RMD) or return the distribution if it was withdrawn before the passage of the CARES Act.

Required Minimum Distributions (RMD) are the minimum amount that must be withdrawn from retirement accounts annually by Americans over age 70 ½ (if your 70th birthday was before July 1, 2019) or 72 (70th birthday is July 1, 2019 or later).

Unemployment

In 2020, a record-breaking number of Americans filed for unemployment. If you collected unemployment, you may be wondering what effect this will have on your taxes.

Unlike the economic recovery payments, unemployment benefits are taxed by the federal government, including the additional $600 per week some received under the CARES Act. Luckily for Pennsylvanians, in Pennsylvania, unemployment benefits are not taxed at the state or local level. In fact, Pennsylvania allows individuals who receive unemployment to choose to have 10% of their benefits withheld for federal income taxes. (Those receiving unemployment can change their withholding online, if they wish).

If you did not have federal taxes withheld from your unemployment benefits, you may receive a larger-than-expected bill come filing time. If you can’t pay your taxes on time, it’s still important to file by the tax deadline of April 15, 2021 and pay as much as you can. While you will need to pay interest on past-due payments, the IRS is willing to work with taxpayers to discuss payment options.

The Time to File is Now

The IRS urges Americans to file their taxes early and electronically to expedite the process. To receive refunds quickly, the IRS is encouraging taxpayers to use direct deposit.

This year’s tax filing deadline is April 15, 2021.

Need professional help? Contact us today.

When will the economy recover?

sherry@jordan-financial.com (Sherry Ziesenheim) — Thu, 18 Jun 2020 18:40:10 GMT

Small businesses: Are you prepared to pivot?

A recent LinkedIn article asks an important question: When will the economy recover? LinkedIn has developed a US Recovery Tracker with key metrics regarding COVID-19 and its impact on hiring, revenue growth, and employer confidence.

Small businesses: your challenge right now is to balance your optimism -- critical for entrepreneurial growth and sustainability -- with a fair amount of conservatism. This may feel unnatural for you. How does an entrepreneur, a risk-taker spirit, behave in a conservative way? Are you reserving cash? Are you evaluating all cash flow support available to you - not just the PPP, but interest-only loan payments and short-term loan forbearance? Are you re-evaluating investment opportunities with real-time, fluid metrics?

Most economic studies I have seen to date anticipate economic recovery will stretch into 2022. Are you prepared?

Contact Jordan Financial Consulting & Coaching for assistance with your COVID-19 survival planning - individual and group coaching options are available.

#cashflow #pivot #forecast #growth

COVID-19 Daily

Mon, 30 Mar 2020 17:39:13 GMT

COVID-19 Relief Daily

COVID-19 Relief

Are you a small business in need of capital to retain employees on your payroll? The Paycheck Protection Program (PPP) may help.

The program would provide cash-flow assistance through 100 percent federally guaranteed loans to employers who maintain their payroll during this emergency.

PPP has a host of attractive features, such as forgiveness of up to 8 weeks of payroll based on employee retention and salary levels, no SBA fees, and at least six months of deferral with maximum deferrals of up to a year.

This program would be retroactive to February 15, 2020...Loans are available through June 30, 2020.

Bringing Balance To Your Financial Transition

Thu, 15 Aug 2019 20:59:50 GMT

Partner with our team for long term success...

I recently completed a 21-day meditation series led by Oprah Winfrey and Deepak Chopra - two souls on this planet that I experience as profoundly wise. The topic for this series was gratitude. It seems fitting that I attempt to channel this concept – gratitude - as I announce the launch of my first solo endeavor – Jordan Financial Consulting & Coaching, LLC.

I am grateful for finding the courage to take this leap. I am grateful for each and every employer that I have worked for over these many years. Thank you all for sharing your knowledge, for the training that you provided to me, for the opportunity
to engage in work that I enjoy, and for the opportunity to provide for my family. I am grateful for the Ziesenheim family who has so graciously shared their proud and regal name with me these past twenty some years. The name means “home for small animals” and though I am not a big fan of living with our small, furry friends, I do appreciate the concept of home and the security that this provides. I am grateful for the chance now to come “home” to my roots – grounded in my given name –
Sherry Jordan.

Driven by the need to balance passion and service, I join the ranks of many Jordan entrepreneurs who have gone before – Andrew, Brad, Christine, Diane, Julie, Mary, and William. From lawn care services to the provision of homes for disadvantaged/struggling individuals – with several professions sprinkled in between – our family has perhaps more than
its share of entrepreneurs and I am proud and grateful to share this tenacious spirit with my cousins, my sister, and my uncle as my new business is born. Jordan Financial Consulting & Coaching is proud to team up with Athena PowerLink as it launches across four counties in Central PA – Cumberland, Dauphin, Lancaster and York. Stay tuned for more information about what APL Community and Custom Advisory Boards can do for you to take your business to the next level. As the Executive-in-Residence for the region, I look forward to supporting Central PA businesses through their growth stage and beyond. In
preparation for and in support of this launch, I am also serving as the Program Administrator for PowerLink Pittsburgh.

Additionally, Jordan Financial is teaming up with Mathematical Expressions, owned by Christine Henderson, which specializes in writing and editing K-12 math content for major educational publishers. Responsive to the changing needs of employers and their future employees – today’s students – Mathematical Expressions operates at the forefront of 21 st century pedagogy. Using PowerLink proven strategies for business growth, Christine Henderson is a model for the industry and Jordan Financial is proud to support this important mission through its strategic planning, accounting, and financial services.

Finally, as owner of Jordan Financial, I will continue my commitment to serving families through their redesign in divorce. As a collaboratively trained financial neutral, I continue to provide financial services to divorcing couples in the form of business valuations, cash flow analysis, budgeting, martial balance sheet verification and more. As a Professional Mediator, I provide full spectrum divorce mediation services, including completion of the Memorandum of Understanding established between divorcing parties.

Whether you are preparing your business growth strategy, planning for the succession of your business, or navigating the challenging waters of divorce, Jordan Financial Consulting & Coaching is here to help you articulate your financial needs and bring balance to your financial transition. Partner with our team for long-term success!