
In the past year we went from having long-overdue IOUs between friends to getting a ton of ways to pay people. Just a few taps and bing, bang, boom, you don’t have to worry about getting going to an ATM or writing a check ever again. (Wait, do people still write checks?) With so many ways to pay, this week, to Upgrade Your Life, we’re giving you the what’s what on your best options.
1. Collect Money From Lots of People: Whether you’re booking a summer hotel for you and your friends or divvying up gas money for a road trip, Glassjar can make paybacks a lot less awkward and difficult. All you have to do is start a jar, ask your friends to contribute a certain amount, and when the jar is full, the money goes to your account.
There’s even a fun roulette option that lets you take a gamble on having to pay for the next round, or not have to pay at all.
DL It: Free on Android, coming soon to iOS
2. To Split the Bill: A dinner can go from laughs and drinks to pen and paper when you have to figure out how to split the bill. It’s a total downer. With Tab, you can take a picture of the bill, and the app reads each of the items and the prices. Then, each person just joins in and claims what they ate. Tab will divvy it all up — tip included. No more pen and paper.
3. For More Professional Payments: While all of these apps could potentially be used to collect money from a client, there’s something about Payzo.io that’s just a bit more professional. Just set up your payment page, complete with your name and picture/logo. When you send someone that link, they put in their payment info just like they would for any online purchase. If you’re only using the service occasionally, you can accept up to $200 per month for free, and the monthly pricing starts at $9 after that. If you’re a Stripe user, this platform connects super easily.
4. Keep It Social: Venmo isn’t the prettiest payment app out there, but it’s great for things like getting coffee for people in the office or making lunch orders. You can pay and get paid just like with the other apps, but there’s also a feed function that lets you see who people in your network are paying. Also, when you’re making a note of what the payment is for, you can use emojis, so that’s fun.
5. Keep It Simple: From the people of Square comes one of the easiest ways to transfer money: Square Cash. The app couldn’t be any simpler: Just put in the amount you want to pay or get paid and then pick a recipient. They’ve recently added a super awesome $Cashtag feature too. Anyone can have a $Cashtag — it’s just a URL you create and send to everyone from clients to roommates so they can pay you from your page.
6. Make It Fun: Dishing out money usually isn’t super fun, but Snapchat is trying to change that with Snapcash. It’s not quite as fun to use as they make it look in their promo video, but it’s pretty simple to navigate and it’s inside of an app that you probably already have.
In case you haven’t tried it yet, you just go into your chat section, and in a message, just type any number after a dollar sign. Your send button will turn green and then you just send the money.
How do you square up funds? Let us know in the comments!
Welcome to Selfmade Finance School, our new money series with Block Advisors to help small business owners with their tax, bookkeeping, and payroll needs year-round. This week, we explore the tax implications of bringing family members into your business.
The question for today is this: Does hiring your family members make sense for your business? Let me be clear. This is not a piece about whether hiring your family members makes sense for your relationships with those family members. As someone who is part of a family business, I could fill up a lot more than 600 words on my opinions about that. For today's purposes, we focus on whether it makes sense from an overall "good business and tax implication" perspective. As it turns out, there is a decent amount of tax nuance when it comes to employing your family. Let's break it down based on relationship to the employee:
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Spouses Who Are In Business Together
Personally, if I had to be in business with my husband, it would not go well. However, many couples build viable, strong businesses together and I say, good for them! Depending on how you have your business entity structured, it will make a big difference on the tax treatment of you and your spouse working as partners. Because a business jointly owned and operated by a married couple is generally treated as a partnership for Federal tax purposes, the spouses must comply with filing and record keeping requirements imposed on partnerships and their partners. The election to file two Schedule C (Form 1040) forms, (one for each spouse) permits certain married co-owners to avoid filing partnership returns, provided that each spouse separately reports a share of all the businesses' items of income, gain, loss, deduction, and credit. Under the election, both spouses will be subject to self-employment tax and on net earnings from self-employment and receive credit for Social Security earnings.
One Spouse Employs Another
If you have a dynamic where your spouse is an employee of your business, then your spouse's wages are subject to income tax withholding, Social Security and Medicare taxes. If you are self-employed (not a corporation or a partnership), your spouse's pay does not have to be included in your federal unemployment tax account (FUTA) contributions and payments. However, if your business is a corporation or a partnership you must include that spouse's pay in your unemployment tax contribution calculation.
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You Employ Your Child
First, let's be clear. I work in my family business, but I am an adult, so I am treated just like a normal employee. However, if you, for example, run a family restaurant and want to hire your children under 18 to work for you, there are some tax benefits. But first, you should check with your state for rules on how many hours minors can work (in non-agricultural jobs) and reference the Fair Labor Standards Act for information on limitations on the kinds of work children can perform.
"This is an often overlooked or under-utilized strategy. Paying your children for true services they provide in your business can be a powerful tax-saving tool," says Cathi Reed, Block Advisors Regional Director. "If you are a sole-proprietorship or single member LLC, and the child is less than 18 years of age, the business is not required to withhold FICA or payroll taxes. The child can use his or her standard deduction against income you pay."
You Hire Your Parent
Oh dear. If you are brave enough to do this, know that you will need to pay Social Security and Medicare taxes on your parent's wages and make the appropriate withholdings, but you don't have to pay unemployment taxes. Now all you have to do is convince your parent that you are the boss. Have fun with that!
Is Hiring Family Members Worth It For The Tax Benefits?
"There are some positive tax advantages to hiring family members. It's important to treat a family member like any other employee. Hiring your children can result in substantial savings for businesses. Make sure your child has real, age-appropriate work to do and a reasonable pay rate, comparable to other employees. Consult with a Block Advisors small business certified tax pro to ensure that you are complying with all requirements," advises Reed. "Block Advisors, a team within H&R Block, is dedicated to meeting the tax, bookkeeping and payroll needs of small business owners year-round. To start working with the tax experts at Block Advisors, visit blockadvisors.com."
In my opinion, you should not hire a family member solely because of the tax benefits. You should always hire based on whether that person is right for the job and keep in mind how this hire could materially impact your relationship with that person and others in your family. Finally, as I mentioned, make sure you have a tax professional on your team when making these determinations. As you can see, things can get a little tricky!
*All details were sourced from IRS.gov and blockadvisors.com
The opinions expressed in this commentary are those of the author and may not necessarily reflect those held by Kestra Investment Services, LLC or Kestra Advisory Services, LLC. This is for general information only and is not intended to provide specific investment advice or recommendations for any individual. It is suggested that you consult your financial professional, attorney, or tax advisor with regards to your individual situation. Comments concerning the past performance are not intended to be forward looking and should not be viewed as an indication of future results. Securities offered through Kestra Investment Services, LLC (Kestra IS), member FINRA/SIPC. Investment advisory services offered through Kestra Advisory Services, LLC (Kestra AS), an affiliate of Kestra IS. O'Keeffe Financial Partners and any other entity listed herein is not affiliated with Kestra IS or Kestra AS Investor Disclosures: https://bit.ly/KF-Disclosures