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How to evaluate and undertake a business transformation

Many industries have undergone monumental changes over the last decade or so. Broadly, there are two ways to adapt to the associated challenges: slowly or quickly. Although there’s much to be said about small, measured responses to economic change, some companies might want to undertake a more urgent, large-scale revision of their operations. This is called a “business transformation” and, under the right circumstances, it can be a prudent move. Defining the concept A business transformation is a strategically planned modification of how all or part of a company operates. In its broadest form, a transformation might change the very...

Choosing the right sales compensation model for your business

A strong sales team is the driving force of most small to midsize businesses. Strong revenue streams are hard to come by without skilled and engaged salespeople. But what motivates these valued employees? First and foremost, equitable and enticing compensation. And therein lies a challenge for many companies: Choosing the right sales compensation model isn’t easy and may call for regular reevaluation. Let’s review some of the most popular models and note a recent trend. Straight salary (or hourly wages) The simplest way to pay sales staff is to offer a “straight salary,” meaning no commissions or other incentives are involved....

How a business owner’s home office can result in tax deductions

As a business owner, you may be eligible to claim home office tax deductions that will reduce your taxable income. However, it’s crucial to understand the IRS rules to ensure compliance and avoid potential IRS audit risks. There are two methods for claiming this tax break: the actual expense method and the simplified method. Here are answers to frequently asked questions about the tax break. Who qualifies? In general, you qualify for home office deductions if part of your home is used “regularly and exclusively” as your principal place of business. If your home isn’t your principal place of business,...

Do you have an excess business loss?

If an individual taxpayer has substantial business losses, unfavorable federal income tax rules can potentially come into play. Here’s what you need to know as you assess your 2024 tax situation. Disallowance rule The tax rules can get complicated if your business or rental activity throws off a tax loss — and many do during the early years. First, the passive activity loss (PAL) rules may apply if you aren’t very involved in the business or if it’s a rental activity. The PAL rules generally only allow you to deduct passive losses to the extent you have passive income from...

On developing an effective IT modernization strategy

Information technology (IT) is constantly evolving. As the owner of a small to midsize business, you’ve probably been told this so often that you’re tired of hearing it. Yet technology’s ceaseless march into the future continues and, apparently, many companies aren’t so sure they can keep up. In October of last year, IT infrastructure services provider Kyndryl released its 2024 Kyndryl Readiness Report. It disclosed the results of a survey of 3,200 senior decision-makers across 25 industries in 18 global markets, including the United States. The survey found that, though 90% of respondents describe their IT infrastructures as “best in class,”...

Many business tax limits have increased in 2025

A variety of tax-related limits that affect businesses are indexed annually based on inflation. Many have increased for 2025, but with inflation cooling, the increases aren’t as great as they have been in the last few years. Here are some amounts that may affect you and your business. 2025 deductions as compared with 2024 Section 179 expensing: Limit: $1.25 million (up from $1.22 million) Phaseout: $3.13 million (up from $3.05 million) Sec. 179 expensing limit for certain heavy vehicles: $31,300 (up from $30,500) Standard mileage rate for business driving: 70 cents per mile (up from 67 cents) Income-based phaseouts for certain...