Bean and Beet Symposium

January 29-30, 2020

The 2020 Form W-4, Employee’s Withholding Certificate, is very different from previous versions. The Internal Revenue Service (IRS) revised the form to comply with the income tax withholding requirements within the federal tax law changes that took effect in 2018. We are glad to share the new 2020 form W-4 for your employees.

The IRS is not requiring all employees to complete the revised form. However, certain employees will be required to use the new form, including those hired in 2020 and anyone who makes withholding changes during 2020.

We are pleased to share several documents to assist you and your employees:

A sample notice to send to your employees that announces the new form and encourages them to perform a “paycheck checkup.”
The 2020 Form W-4 — What is Your Situation? includes answers to frequently asked questions to help employees complete the form depending on their circumstances.
The 2020 Form W-4 with instructions. The 2020 withholding tables work with both the new form and prior-year forms.

Remember that you should not give tax advice to employees, but rather direct them to the IRS estimator or their tax professional for help.

When it comes to divorce, there are many areas where an expert witness can assist the trier of fact in determining the value of marital property. In instances where a business is involved, the valuation expert is retained to provide an independent opinion to substantiate the value of the business. An expert witness in divorce engagements may also help determine spousal support as well as forensic analysis in the search for hidden assets.

When there is a business interest involved, the valuation process is similar to valuations performed for other purposes, with one notable exception. The State of Michigan recognizes the concept of holder’s interest in determining the applicability of discounts to the value of the business interest.

Under the fair market value standard, value is determined based on a hypothetical seller and a hypothetical buyer, both having reasonable knowledge of the relevant facts underlying the business.

In the divorce context, the underlying rationale is that the owner will continue to operate the business and that there is no hypothetical buyer and seller of the business interest. Therefore, there would be no discounts applied to the overall value for lack of control or a lack of marketability as there is under the fair market value standard. This is generally the case where the ownership interest being valued has control (over 50% interest).

It is important to keep in mind that the holder’s interest standard is specific to Michigan case law and may be different in another state that follows other court precedents.

Another area where Michigan varies from other states is the concept of personal goodwill. Personal goodwill (especially when valuing a professional practice), focuses on intangible assets that cannot be separated from the owner.

Examples include but are not limited to:

Reputation of the owner
Years of experience
Owner’s work habits
Business name (tied to the owner)

In the case of personal goodwill in Michigan, prior court precedent has determined that personal goodwill cannot be separately distinguished from that of the practice or enterprise. However, other states do allow for the separation of personal goodwill from that of the company.

Business valuation and litigation support in the divorce context can be challenging. It’s important to call on professionals in this area who can assist the trier of fact in determining how to equitably split the marital assets, especially where the complexities of a business are involved. Yeo & Yeo’s Business Valuation and Litigation services group can help ensure that you receive the consideration you deserve.

Yeo & Yeo CPAs & Business Consultants is pleased to announce that Zaher Basha, CPA, CMAA, was recently honored with the most prestigious award bestowed by the firm, the Spirit of Yeo award. The Spirit of Yeo award recognizes an individual within the firm who exemplifies the attributes of the organization’s mission and core values.

“Zaher is an exceptionally strong leader,” said President & CEO Thomas Hollerback. “He is an effective mentor for other professionals in the firm, always showing an interest in what they want in their careers and helping them take the proper steps to achieve their goals. He has been instrumental in training and developing staff in the firm’s Auburn Hills office.”

Yeo & Yeo Honors Zaher Basha

Basha is a manager in the Auburn Hills office and serves in the tax service line, specializing in tax planning. He is also a member of the firm’s Healthcare Services Group and the Business Valuation and Litigation Support Services Group. He is a Certified Merger and Acquisition Advisor.

Basha received multiple nominations for the Spirit of Yeo award. One of his nominators said, “Zaher was an integral part of the software conversion team this year that spearheaded the firm’s largest improvement and investment in technology ever. He is a thought leader and wants to continuously ensure we stay on the leading edge of technology and how we will deliver services to our clients in the future.” Another nominator said, “Zaher is intrinsically motivated to do the highest level of work for the firm and holds himself personally and professionally to an extremely high standard.” Another nominator said, “He is a caring person who is always willing to help, no matter how busy he is, with patience and a smile.”

Basha is a member of the Michigan Association of Certified Public Accountants’ Healthcare Task Force, the Auburn Hills Chamber of Commerce and the Troy Chamber of Commerce. In the community, he serves as treasurer of the Foundation for Justice & Development and the Syrian American Rescue Network. He also volunteers for Women for Humanity and The Syria Institute and participates in Making Strides Against Cancer walks annually.

2019 marked the sixth year of the award with Yeo & Yeo employees submitting 41 nominations.

The YeoConsults Payroll Solutions Group would like to make you aware of important payroll updates that will affect you and your employees next year.

2020 payroll changes
Items to consider before December 31, 2019

The State of Michigan minimum wage will increase to $9.65 per hour. Also, we will send an eAlert about the new Form W-4 and post a summary of the new requirements on our website in the coming days to keep you informed.

Need guidance on closing 2019, preparing for 2020 payroll or meeting payroll deadlines? Contact the payroll professionals at Yeo & Yeo.

Download 2020 Payroll Planning Brief

As we all know, medical services and prescription drugs are expensive. You may list a medical expense deduction on your tax return but the rules make it difficult for many people to qualify. However, with proper planning, you may be able to time discretionary medical expenses to your advantage for tax purposes.

The basic rules

For 2019, the medical expense deduction can only be claimed to the extent your unreimbursed costs exceed 10% of your adjusted gross income (AGI). You also must itemize deductions on your return.

If your total itemized deductions for 2019 will exceed your standard deduction, moving or “bunching” nonurgent medical procedures and other controllable expenses into 2019 may allow you to exceed the 10% floor and benefit from the medical expense deduction. Controllable expenses include refilling prescription drugs, buying eyeglasses and contact lenses, going to the dentist and getting elective surgery.

In addition to hospital and doctor expenses, here are some items to take into account when determining your allowable costs:

1. Health insurance premiums. This item can total thousands of dollars a year. Even if your employer provides health coverage, you can deduct the portion of the premiums that you pay. Long-term care insurance premiums are also included as medical expenses, subject to limits based on age.

2. Transportation. The cost of getting to and from medical treatments counts as a medical expense. This includes taxi fares, public transportation, or using your own car. Car costs can be calculated at 20¢ a mile for miles driven in 2019, plus tolls and parking. Alternatively, you can deduct certain actual costs, such as gas and oil.

3. Eyeglasses, hearing aids, dental work, prescription drugs and professional fees. Deductible expenses include the cost of glasses, hearing aids, dental work, psychiatric counseling and other ongoing expenses in connection with medical needs. Purely cosmetic expenses don’t qualify. Prescription drugs (including insulin) qualify, but over-the-counter aspirin and vitamins don’t. Neither do amounts paid for treatments that are illegal under federal law (such as marijuana), even if state law permits them. The services of therapists and nurses can qualify as long as they relate to a medical condition and aren’t for general health. Amounts paid for certain long-term care services required by a chronically ill individual also qualify.

4. Smoking-cessation and weight-loss programs. Amounts paid for participating in smoking-cessation programs and for prescribed drugs designed to alleviate nicotine withdrawal are deductible. However, nonprescription nicotine gum and patches aren’t. A weight-loss program is deductible if undertaken as treatment for a disease diagnosed by a physician. Deductible expenses include fees paid to join a program and attend periodic meetings. However, the cost of food isn’t deductible.

Dependent expenses

There are some medical expense deduction costs that you pay for dependents, such as your children. Additionally, you may be able to deduct medical costs you pay for other individuals, such as an elderly parent. If you have questions about medical expense deductions, contact us.

At this time of year, many business owners ask if there’s anything they can do to save tax for the year. Under current tax law, there are two valuable depreciation-related tax breaks that may help your business reduce its 2019 tax liability. To benefit from these deductions, you must buy eligible machinery, equipment, furniture or other assets and place them into service by the end of the tax year. In other words, you can claim a full deduction for 2019 even if you acquire assets and place them in service during the last days of the year.

The Section 179 deduction

Under Section 179, you can deduct (or expense) up to 100% of the cost of qualifying assets in Year 1 instead of depreciating the cost over a number of years. For tax years beginning in 2019, the expensing limit is $1,020,000. The deduction begins to phase out on a dollar-for-dollar basis for 2019 when total asset acquisitions for the year exceed $2,550,000.

Sec. 179 expensing is generally available for most depreciable property (other than buildings) and off-the-shelf computer software. It’s also available for:

Qualified improvement property (generally, any interior improvement to a building’s interior, but not for the internal structural framework, for enlarging a building, or for elevators or escalators),
Roofs, and
HVAC, fire protection, alarm, and security systems.

The Sec. 179 deduction amount and the ceiling limit are significantly higher than they were a few years ago. In 2017, for example, the deduction limit was $510,000, and it began to phase out when total asset acquisitions for the tax year exceeded $2.03 million.

The generous dollar ceiling that applies this year means that many small and medium sized businesses that make purchases will be able to currently deduct most, if not all, of their outlays for machinery, equipment and other assets. What’s more, the fact that the deduction isn’t prorated for the time that the asset is in service during the year makes it a valuable tool for year-end tax planning.

Bonus depreciation

Businesses can claim a 100% bonus first year depreciation deduction for machinery and equipment bought new or used (with some exceptions) if purchased and placed in service this year. The 100% deduction is also permitted without any proration based on the length of time that an asset is in service during the tax year.

Business vehicles

It’s important to note that Sec. 179 expensing and bonus depreciation may also be used for business vehicles. So buying one or more vehicles before December 31 may reduce your 2019 tax liability. But, depending on the type of vehicle, additional limits may apply.

Businesses should consider buying assets now that qualify for the liberalized depreciation deductions. Please contact us if you have questions about depreciation or other tax breaks.

Yeo & Yeo’s Year-end Tax Guide 2019 provides action items that may help you save tax dollars if you act before year-end.

These are just some of the steps that can be taken to save taxes. Not all actions may apply in your particular situation, but you or a family member can likely benefit from many of them.

A Yeo & Yeo tax professional can help narrow down the specific actions that you can take and tailor a tax plan for your current situation. Please review the guide and contact Yeo & Yeo CPAs at your earliest convenience so that they can help advise you on which tax-saving moves to make.

For other helpful tools, visit our Tax Center.

‘Tis the season when employers often will provide employees with “gifts” of some type. We all know the entity in town that gives all of its employees a turkey for Thanksgiving or Christmas. While this is a wonderful gesture on the part of the employer, is it compensation to the employee?

A general rule of thumb is to assume that all compensation, which includes gifts, to employees is taxable. There are exceptions to that rule, but they are the exceptions and not the general rule.

The main exception to taxable compensation is De Minimus fringe benefits. There is no set dollar threshold on these; above $100 fair value is not de minimus, but just because it is $25 or less does not automatically make it de minimus. The intent is that the value of the benefits is small (per person and at the entity level), the frequency is infrequent, and it would be an administrative burden to track. This means if the entity is tracking the items itself, such as in inventory, it is not an administrative burden and is not de minimus. However, cash or “cash equivalents” (which includes gift cards, gift certificates, etc.) are never de minimus.

This means that the Subway gift card that is given to select winners in the staff meeting each month is taxable to the employee, even if it is only $10, and should be included in their W-2. However, that Thanksgiving turkey, which is a coupon redeemable for a turkey, and only a turkey, with a value of $X or less, is not a cash equivalent. It is in essence personal property (food) and could be de minimus if the employer deems it a small benefit, the frequency is infrequent, and it would be an administrative burden to track. The Subway gift card is used in place of cash; I could use it as part of multiple different transactions and it has a set face amount that I can use. The coupon instead can only be used in one transaction and it has a maximum face amount, but if I choose a small turkey and do not utilize the entire face amount, I lose the rest. If I choose too large of a turkey that is above the face amount, I cannot simply put that face amount towards the turkey; I must pay for the entire turkey. Therefore, that coupon is not a cash equivalent.

The sweatshirt that you get for free upon joining the organization may qualify as a de minimus fringe if it otherwise meets the criteria. The fact the sweatshirt has the company logo on it does not affect the decision, as you can wear a company sweatshirt anywhere, not just at work. You must look at the value of the benefit (typically its cost to the employer), the frequency, and the administrative burden. If instead it was a hazmat suit that can be worn only at work, it would be a working condition fringe and nontaxable.

Employee achievement awards are not taxable to the employee. However, these have a very strict definition.

First, they are items of tangible personal property and not cash or cash equivalents.
Second, the award must be for either 1) a length of service or 2) a safety achievement and must be presented as part of a meaningful presentation.
Also, the nontaxable amount cannot be more than $400 for any employee.

Sometimes nonprofits provide “stipends” to people. If the payment represents compensation for research, teaching, or other services rendered, it is taxable compensation. If it is simply to offset living expenses during training or a research program, not payment for services, the stipend is not taxable.

The general rule of thumb is that all items given to employees are taxable unless they fit into an exception. If you have specific circumstances you would like to discuss, please reach out to your Yeo & Yeo professional.

A general rule of thumb is to assume that all compensation, which includes gifts, to employees is taxable. There are exceptions to that rule, but they are the exceptions and not the general rule.

Employee achievement awards are not taxable to the employee. However, these have a very strict definition.

First, they are items of tangible personal property and not cash or cash equivalents.
Second, the award must be for either 1) a length of service or 2) a safety achievement and must be presented as part of a meaningful presentation.
Also, the nontaxable amount cannot be more than $400 for any employee.

How can you ensure that an appropriate cybersecurity system is established at your municipality and verify that it is functioning effectively? Although you might not know every detail regarding IT security, as a municipal leader, you should understand your infrastructure and know if your policies and procedures are in place and working as intended.

County and municipal networks are a prime target for hackers as they are like a pot of gold at the end of a rainbow. Government entities have massive amounts of data stored on their networks, and a lot of it contains personally identifiable information or other confidential material. Permits, utility bills, birth certificates, social security numbers and property tax information are just some of the information that is common at local government offices.

Properly implemented security controls can reduce the risk of human error, but not eliminate it. Humans remain the weakest link in any organization when it comes to municipal security risk. Cybercriminals are smart and they know who to target. Hackers target municipalities as they typically have limited budgets to invest in cybersecurity and often have not set aside the necessary resources to train their employees on this very topic. Most security breaches occur because of an internal mistake. A perfect example is that a small Florida city paid hackers almost $600,000 to get its computer systems back, all stemming from an employee who opened a corrupt email.

Below are four key factors to determine how prepared you are.

Security risk assessment – the first step is to understand where the gaps are in your security and recognize vulnerability. This applies to systems, vendors and processes as well as people.

Common weak points: Wi-fi access, hardware, software, and network equipment.

Security updates – one way to significantly improve your fight against attacks is to stay current with security updates. This should be done routinely and as soon as security patches are released.

Common weak points: These patches and updates need to be done on all devices and software. It takes only one missed patch on a device for the hacker to get in and compromise the government’s entire network, just like it only takes one “unlocked door” for a thief to enter your house.

Routine backups – One way to ensure you will not encounter data loss is to create regular backups and store them off-site. This is one of the cheapest and easiest ways to be prepared in the case of a ransomware attack or even a fire.

Common weak points: Backups should be done routinely and stored at a secure off-site location. The backups should be encrypted and tested often. This is necessary to verify that the information can be restored. Often backups are being done but never tested.

Education and Training – One of the biggest risks of cybersecurity attacks in any organization are its own employees. Cybercriminals are great at sending phishing emails that are specifically designed to get employees to click on a malicious link or release sensitive information. These types of emails look legitimate and are hard to detect.

Common weak points: Most organizations focus their cybersecurity initiatives on external threats; they should also address the internal threats, which would be their employees. The most significant benefit would be to train the employees on these threats.

One of the best ways to combat cybersecurity is effective training and testing. Educating the employees on the types of threats to watch for is crucial in protecting your municipality from cybercriminals. This training should include such items as risks related to downloading attachments from unknown emails, identifying phishing scams, ransomware, and malware. Sharing passwords, using networks that are not secure, and flash drives are other risks that should be included in security awareness training. This training should be ongoing, and constant testing has proven to keep employees on their toes as well as identify where additional training and education may be needed.

Please contact Yeo & Yeo Technology at (989) 797-4075 for information about protection for your email infrastructure, a Cybersecurity Assessment for your organization, and Security Awareness Training for the staff — train your employees to be human firewalls, preventing attacks to your organization.

How can you ensure that an appropriate cybersecurity system is established at your organization and verify that it is functioning effectively? Although you might not know every detail regarding IT security, as a business manager, you should understand your infrastructure and know if your policies and procedures are in place and working as intended.

Your organization is a target for hackers, especially if you have massive amounts of data stored on your networks, and if a lot of it contains personally identifiable information or other confidential material.

Properly implemented security controls can reduce the risk of human error, but not eliminate it. Humans remain the weakest link in any organization when it comes to security risk. Most security breaches occur because of an internal mistake. Often, we read reports of organizations that had to pay hackers hundreds of thousands of dollars to get their computer systems back, all stemming from an employee who opened a corrupt email.

Below are four key factors to determine how prepared you are.

Security risk assessment – the first step is to understand where the gaps are in your security and recognize vulnerability. This applies to systems, vendors and processes as well as people.

Common weak points: Wi-fi access, hardware, software, and network equipment.

One of the best ways to combat cybersecurity is effective training and testing. Educating the employees on the types of threats to watch for is crucial in protecting your organization from cybercriminals. This training should include such items as risks related to downloading attachments from unknown emails, identifying phishing scams, ransomware, and malware. Sharing passwords, using networks that are not secure, and flash drives are other risks that should be included in security awareness training. This training should be ongoing, and constant testing has proven to keep employees on their toes as well as identify where additional training and education may be needed.

The number of eligible participants at the beginning of the year will determine if your organization’s employee benefit plan requires an audit. An eligible participant is an employee who has met the qualification criteria outlined in the plan document. The employee does not have to be actively participating in the plan to be included in the participant count, rather just eligible to participate.

Employee benefit plans with fewer than 100 eligible participants at the beginning of the year meet the conditions for an audit waiver under 29 CFR 2520.104-46. However, what if your plan has more than 100 eligible participants? Generally, when a plan has more than 100 eligible participants, an audit is required; however, there are exceptions to this rule. If your plan is in its first year of inception, and there are more than 100 eligible participants, then an audit is required. However, if your plan has been in existence for at least one year and this is the first year that it exceeds 100 eligible participants, then an audit may not be required under the 80/120 rule. This rule can be complicated and is best explained by an example:

At the beginning of 2018, an employee benefit plan had 95 eligible participants; thus, an audit was not required for 2018. At the beginning of 2019, eligible participants increased to 110. Under the 80/120 rule, the plan can file as a small plan and is not subject to the audit requirement. Had the eligible participant count gone over 120, then an audit would have been required.

Rather than waiting until next year, review your eligible participant count now. If you think you need an audit, contact Yeo & Yeo today.

A month after the new year begins, your business may be required to comply with rules to report amounts paid to independent contractors, vendors and others. You may have to send 1099-MISC forms to those whom you pay nonemployee compensation, as well as file copies with the IRS. This task can be time consuming and there are penalties for not complying, so it’s a good idea to begin gathering information early to help ensure smooth filing.

Deadline

There are many types of 1099 forms. For example, 1099-INT is sent out to report interest income and 1099-B is used to report broker transactions and barter exchanges. Employers must provide a Form 1099-MISC for nonemployee compensation by January 31, 2020, to each noncorporate service provider who was paid at least $600 for services during 2019. (1099-MISC forms generally don’t have to be provided to corporate service providers, although there are exceptions.)

A copy of each Form 1099-MISC with payments listed in box 7 must also be filed with the IRS by January 31. “Copy A” is filed with the IRS and “Copy B” is sent to each recipient.

There are no longer any extensions for filing Form 1099-MISC late and there are penalties for late filers. The returns will be considered timely filed if postmarked on or before the due date.

A few years ago, the deadlines for some of these forms were later. But the earlier January 31 deadline for 1099-MISC was put in place to give the IRS more time to spot errors on tax returns. In addition, it makes it easier for the IRS to verify the legitimacy of returns and properly issue refunds to taxpayers who are eligible to receive them.

Gathering information

Hopefully, you’ve collected W-9 forms from independent contractors to whom you paid $600 or more this year. The information on W-9s can be used to help compile the information you need to send 1099-MISC forms to recipients and file them with the IRS. Here’s a link to the Form W-9 if you need to request contractors and vendors to fill it out: https://bit.ly/2NQvJ5O.

Form changes coming next year

In addition to payments to independent contractors and vendors, 1099-MISC forms are used to report other types of payments. As described above, Form 1099-MISC is filed to report nonemployment compensation (NEC) in box 7. There may be separate deadlines that report compensation in other boxes on the form. In other words, you may have to file some 1099-MISC forms earlier than others. But in 2020, the IRS will be requiring “Form 1099-NEC” to end confusion and complications for taxpayers. This new form will be used to report 2020 nonemployee compensation by February 1, 2021.

Help with compliance

But for nonemployee compensation for 2019, your business will still use Form 1099-MISC. If you have questions about your reporting requirements, contact us.

Four companies. One site. Infinite solutions. Yeo & Yeo CPAs & Business Consultants, Yeo & Yeo Technology, Yeo & Yeo Medical Billing & Consulting, and Yeo & Yeo Wealth Management now have one unified website. The new Yeo & Yeo website brings together all the resources, expertise and solutions that our four companies offer to help you reach your business goals.

The website offers a unique collaboration among your trusted advisors in accounting, audit, tax, technology, wealth management and practice management. It brings all our capabilities together in one location, allowing you to find what you’re looking for easily. Learn about the solutions we provide, meet our advisors, explore our robust Resource Center and access client tools.

Resource Center. Our blog, eBooks, webinars and more to help answer your questions, solve business problems and keep you informed – from accounting, audit and financial topics to technology and medical billing updates – it’s all centrally organized and easy to find.

Client Tools. Login to your client portal, submit IT service requests, and make secure online payments.

Accessibility. Easily find all the solutions that our companies can provide for Michigan businesses. Need outsourced accounting solutions? Want to know how technology can boost your business’ efficiency? Looking for financial planning advice? Find the answers you are looking for, all in one place.

Never miss a beat! Subscribe to our eNewsletters and eAlerts today!

We are excited to welcome you to our new website.

The right entity choice can make a difference in the tax bill you owe for your business. Although S corporations can provide substantial tax advantages over C corporations in some circumstances, there are plenty of potentially expensive tax problems that you should assess before making the decision to convert from a C corporation to an S corporation.

Here’s a quick rundown of four issues to consider:

LIFO inventories. C corporations that use last-in, first-out (LIFO) inventories must pay tax on the benefits they derived by using LIFO if they convert to S corporations. The tax can be spread over four years. This cost must be weighed against the potential tax gains from converting to S status.

Built-in gains tax. Although S corporations generally aren’t subject to tax, those that were formerly C corporations are taxed on built-in gains (such as appreciated property) that the C corporation has when the S election becomes effective, if those gains are recognized within five years after the conversion. This is generally unfavorable, although there are situations where the S election still can produce a better tax result despite the built-in gains tax.

Passive income. S corporations that were formerly C corporations are subject to a special tax. That tax kicks in if their passive investment income (including dividends, interest, rents, royalties, and stock sale gains) exceeds 25% of their gross receipts, and the S corporation has accumulated earnings and profits carried over from its C corporation years. If that tax is owed for three consecutive years, the corporation’s election to be an S corporation terminates. You can avoid the tax by distributing the accumulated earnings and profits, which would be taxable to shareholders. Or you might want to avoid the tax by limiting the amount of passive income.

Unused losses. If your C corporation has unused net operating losses, they can’t be used to offset its income as an S corporation and can’t be passed through to shareholders. If the losses can’t be carried back to an earlier C corporation year, it will be necessary to weigh the cost of giving up the losses against the tax savings expected to be generated by the switch to S status.

Additional factors

These are only some of the factors to consider when a business switches from C to S status. For example, shareholder-employees of S corporations can’t get all of the tax-free fringe benefits that are available with a C corporation. And there may be issues for shareholders who have outstanding loans from their qualified plans. These factors have to be taken into account in order to understand the implications of converting from C to S status.

Contact us. We can explain how these factors will affect your company’s situation and come up with strategies to minimize taxes.

The YeoConsults Payroll Solutions Group would like to make you aware of important payroll updates that take effect on January 1, 2020. The changes affect businesses that have employees.

Michigan Minimum Wage Increases

Michigan law requires a gradual increase in minimum wage from $9.25 per hour to $12.05 per hour by January 1, 2030. Increases are based on the schedule below. Also, refer to the Michigan Department of Labor Poster.

The current rate, which took effect on March 29, 2019, is $9.45/hour.

1/1/20: $9.65/hour

1/1/21: $9.87/hour

1/1/22: $10.10/hour

1/1/23: $10.33/hour

1/1/24: $10.56/hour

1/1/25: $10.80/hour

1/1/26: $11.04/hour

1/1/27: $11.29/hour

1/1/28: $11.54/hour

1/1/29: $11.79/hour

1/1/30: $12.05/hour

No inflationary increases.
The minimum wage for tipped employees remains tied to 38% of the regular minimum wage rate.*

*Under the law, all tipped employees are guaranteed to make at least the minimum wage. If their tips plus the tipped employee minimum wage does not equal or exceed the regular minimum wage, the employer must pay any shortfall to the employee. Failure to comply results in fines and fees.

FLSA Overtime Exemption Salary Threshold Increase

Following are key changes in the Fair Labor Standards Act pertaining to the salary threshold for overtime exemption:

Increase the minimum salary threshold that exempts an employee from overtime pay from $23,660 to $35,568 per year, or $684 per week.
Allow employers to use nondiscretionary bonuses and incentive payments (including commissions) paid at least annually to satisfy up to 10% of the salary threshold.
Increase the “highly compensated employee” white-collar exemption minimum salary threshold from $100,000 to $107,432 per year.
Employees who do not meet the minimum salary threshold must be paid overtime for every hour worked over 40 hours in a workweek.

For more information, refer to the U.S. Department of Labor Fact Sheet.

Yeo & Yeo CPAs & Business Consultants is pleased to announce the promotions of Elizabeth Gunnell to Project Manager and Melissa (Dean) Lindsey, PCM®, to Practice Growth Manager.

Gunnell has five years of experience in business project management. She will drive strategic initiatives to advance the goals of the firm and its affiliates by leading teams, overseeing research and providing analysis. Gunnell graduated from the University of Michigan with a Bachelor of Arts in Political Science and Psychology. She is a member of the University of Michigan’s Alumni Association and the Association for Accounting Marketing and is active in the LEA Global Marketing and Business Development special interest groups.

Lindsey has more than ten years of marketing, business development, client service and consulting experience. She will help drive the firm’s growth strategy, provide executive coaching for the firm’s senior employees, and manage lead generation marketing initiatives. Lindsey holds a Bachelor of Arts from Saginaw Valley State University and studied public relations and crisis communication at Vesalius College in Brussels, Belgium. Additionally, she earned the Professional Certified Marketer (PCM®) designation through the American Marketing Association. She is a member of Thomson Reuters’ Checkpoint Marketing for Firms Advisory Board, the Association for Accounting Marketing, the Social Media Club of the Great Lakes Bay Region and the LinkedIn Advisors Community. She is active in the LEA Global Marketing and Business Development special interest groups.

Together Gunnell and Lindsey will further the growth of the firm’s niche and service practice areas.“ Elizabeth and Melissa’s combination of project management, business development and marketing experience will enhance our client service culture,” says Thomas Hollerback, President & CEO. “We have experienced growth in many of our practice areas and they will play a key part in continuing our success by providing our professionals with the strategic direction and resources they need to align Yeo & Yeo’s solutions with their clients’ goals and objectives.”

Gunnell and Lindsey will work cross-functionally with firm leadership and the firm’s three affiliates – Yeo & Yeo Technology, Yeo & Yeo Medical Billing & Consulting, and Yeo & Yeo Wealth Management – across Yeo & Yeo’s nine offices statewide.