ONeill & Bergado

ONeill & Bergado’s Rundown of the 5 Basic Business Entity Types

ranjan.254 / June 20, 2025

The shape of your business affects your future and when I’m talking about the “shape,” I of course am referring to your San Francisco Bay Area business entity type. Did you know that you CAN change that after the fact? Depending on which entity you are switching to, the process can be painful … but you are NOT “locked-in” to a particular entity for the entire life of your business. It’s worth being very thoughtful about all of these things, especially as we deal with an inflationary environment that may (or may not) affect you in significant ways. And yes, I saw the passage of the infrastructure bill the other day. Once the thing is signed into law by the President, I’ll dig into it a little more and give you my thoughts. And before I dive into entity topics, you are invited to grab a time to talk about your San Francisco Bay Area business before year-end to ensure that we are capturing every available tax-savings strategy for you. Find us here: (408) 241-4100 Ok, let’s talk business entity types. Nerds of the world, rejoice. (TL; DR? — We can help you make sure you have the RIGHT entity for tax considerations and for your future plans.) ONeill & Bergado’s Rundown of the 5 Basic Business Entity Types“Definiteness of purpose is the starting point of all achievement.” – W. Clement Stone The classification and type of business you have is an “entity.” Different business entities get different tax treatments (nothing’s ever simple, right?). For instance, in many circumstances, people in some partnerships, LLCs and S corporations (keep reading) can take a 20% tax deduction on their “qualified business income” (QBI). As always in taxes and business, conditions apply – and Congress is considering tweaking this break, so stay tuned. It’s one example of how the right business structure can change your tax life. Here are some of the most common entities and their good and bad points along with some very basic tax info: Business Entity Type #1 – Sole proprietorship: This is the simplest biz structure. It’s just you. You get all the profits, take all the chances, and take all the hits. You pay your regular income tax on the profits, but you also have to pay self-employment taxes. Paying these every quarter is a really good idea, no matter what business entity you have, to stay on the taxman’s good side. Business Entity Type #2 – Partnership: This is a bit more formal than just a few sole proprietorships glued together to share expenses, especially when you’re talking about taxes. You have to get an employer identification number from the IRS and register for all state taxes (think “sales tax”). You file a federal Form 1065 “information return” to report the income, deductions, gains, losses, and so on. You also have to think about excise taxes and employment taxes; these tend to pop up no matter the business entity you use. You pay income tax as an individual since the money you make (or lose) “passes through” to the partners. That’s you. Your business doesn’t get taxed separately. Business Entity Type #3 – LLC: A “limited liability company” is easier to start and run than a corporation but provides owners and their personal assets (your bank account, car, home) “limited liability” for problems the company might get into. Profits or losses pass through to your personal tax return using a federal Schedule C. Aside from you possibly being able to use that QBI deduction we mentioned, LLCs can be taxed as sole proprietorships or partnerships – but you can choose to be taxed like a corporation with the plus of paying taxes on the business profits at the (lower for now, anyway) corporate tax rate. Corporate culture Two of the most common corp structures are S and C. They resemble each other, but there are big tax differences. Business Entity Type #4 – C corp: Among other goodies, tax-free and tax-deductible benefits are available to employees in a C corporation (but as always, check with us on this), and owners can sometimes even get out of capital gains taxes when they sell a certain stock of the company. But C corps suffer two levels of tax: On the income earned by the business and on the earnings distributed to shareholders as dividends. The individual shareholders must report this income on their individual tax returns. Dividends also get a really nice tax rate compared with income (but still, ouch). Don’t be in a hurry to go to C: A recent study found that some startup C corps would have actually saved themselves money if they’d formed as LLCs. Business Entity Type #5 – S Corp: These puppies pay only one level of taxation and a lot of C corps switch to S corp status. Tax bills can be like that… S corps pass corporate income, losses, deductions, and credits through to shareholders who report the “flow-through” of income and losses on their personal tax returns – so S corps avoid that double taxation. They also get a real tax spark by only having to pay FICA taxes on salary compensation to owners and not on the remaining profits that magically transform into “distributions.” Before you get visions of fattening your distributions, paying yourself a goose egg in salary, and dodging FICA altogether, the good folks at the IRS say that S corp owner-employees must be paid “reasonable compensation” for their services to the business. Finally, there are a lot of conditions to qualify for S corp status and some states also have special rules for S corps. You should never let the tax tail wag the dog of your San Francisco Bay Area business, and there’s a lot more to know about biz entities and their plusses and minuses. If you want to learn more, make some time to chat.(408) 241-4100 To your business being in optimum “shape” … Patti ONeill and Gale Bergado(408) 241-4100ONeill & Bergado

Business Growth

ONeill & Bergado on Managing Small Business Loan Options

ranjan.254 / June 20, 2025

The big, emergency SBA loan programs for small businesses (like yours) that were launched (PPP) and expanded (EIDL) over the last couple of years are moving back from the radar or wrapping up. That said, there are still great options for funding your San Francisco Bay Area business. Including NEW government programs (like the SSBCI, for one — more about that from me later, as it becomes more available), there are a veritable panoply of small business loan options. And just so you know, the last 2 years has made us VERY good at wading through the murk and mire of these things, so feel free to grab time with us here:Patti (408) 241-4100 Gale 408-775-7800 But BIG PICTURE: Don’t enter into the commitment of a business loan lightly. Good management of your loan starts with knowing what you’re getting into. (And perhaps having somebody who is good at this stuff in your corner. *Clears throat*) ONeill & Bergado on Managing Small Business Loan Options“Always borrow money from a pessimist. He won’t expect it back.” – Oscar Wilde First, make your overall credit situation shine bright – look up your credit score, for one. Forewarned is forearmed, and you don’t want any surprises when you sit down at that lender’s desk. The better your credit rating, the better the loan terms you’re likely to get. And take it easy on how many loans you apply for at once. Yup, it’s true – each application can actually ding your score. Instead, find out as much as you can beforehand about each lender’s criteria for granting loans and apply strategically for a few where you have the best shot. While you’re at it, keep an eye on acquiring new debt and look for ways to consolidate your existing loans (such as transferring your company’s credit card debt to a zero-interest account). Also, be on the lookout for ways to cut costs, even temporarily. No such thing as free money When somebody hands you a small-business loan, it’s thrilling – sometimes such a thrill that you actually forget that you’ll eventually have to pay that money back. Nothing’s free, right? Make sure you’re crystal clear on the real cost of your loan. What’s the annual percentage rate (APR) and the length of the loan? Those are two of the biggest questions. Start by running some numbers through a simple business loan calculator. Other good questions: A borrowing buffet While we’re on the topic, there are all kinds of small business loans options– and even grants you don’t have to repay. For instance, you could go after a working capital loan for your short-term financial needs, such as expenses during down sales cycles. These loans can be quick to get – but interest rates tend to be high with these loans and the debt can even become a personal debt liability for you the owner. Risky business… Money for your San Francisco Bay Area small business might also be waiting in some unusual places. Believe it or not, Walmart Inc. offers a ton of grants to businesses. The U.S. Treasury also has a Community Development Financial Institutions Fund with a list of local resources that can help small businesses like yours, especially in certain industries and sectors. You’re approved – Now what? So, you’ve chosen a loan from the plethora of small business loan options, and you’ve signed on the dotted line. Job done, right? Well, not so much. Track spending. Did you have plans for the money? Sure, you did – anything from good intentions in your head to a detailed, written schedule. Now, follow the plan. Keep the loan separate and distinct in your accounts and spend the cash on what you planned to spend it on. Do not dip into it for personal expenses or for other business costs. Track your balance. Set up a recordkeeping system that’s clear to you – maybe an Excelspreadsheet – and stay on top of what you’ve paid on both the interest and the principal. Keep your lender up to speed on what’s happening in your business (especially if you hit bumps in the road), and see if you can make it really easy on yourself by automating payments. Loans can be a big help to your San Francisco Bay Area small business – but it takes work. If we can lend a hand (no pun intended), don’t hesitate to reach out. We’re here for you. In your corner, Patti ONeill and Gale Bergado(408) 241-4100ONeill & Bergado

Pointers From ONeill & Bergado For Handling Business Debt

ranjan.254 / June 20, 2025

While we all helplessly watch the war in Ukraine, we are also seeing the toll it’s extracting on our economy… and small businesses. Oil prices are skyrocketing and supply chain disruptions are becoming regular fare. The shock of the last two years hasn’t really worn off and new challenges are mounting as war affects the globe. And the greatest concern among small business owners right now? Inflation and how it is affecting their San Francisco Bay Area business. Most are raising prices, some are reducing staff, some are taking out loans to keep their head above water. So, even though we’re knee-deep in end-of-quarter matters and all of the various business tax work … I want to assure you that we are here for you as you face the effects of inflation in your business: (408) 241-4100 With inflation on your brain, that ultimately means facing some realities with your business’s financials, including debt. And that’s what I want to talk about today… how is that business debt different from personal debt? Let’s jump in. Pointers From ONeill & Bergado For Handling Business Debt “Creditors have better memories than debtors.” – Benjamin Franklin Both individuals and companies routinely run up bills they can’t immediately pay off – or don’t even plan to pay off … welcome to financing. But personal debt and business debt are two different things. If mishandled, one can keep you from buying that car or appliance, for a while anyway. The other can put you out of business. Our series on personal versus business financial management continues here with a look at debt, including the similarities and differences between the business and the personal kind – and pointers on how to handle business debt. There’s a lot in a name Getting into what each term means gives a good idea of how you think differently about these two types of debt. Personal debt: This is when you’re legally responsible as an individual, though generally, it can also be debt you run up with someone else like your spouse – think mortgage, student loan, personal credit card, or car payment. This kind of debt usually improves your non-work with something expensive or worth the cost. Business debt: This is taken on by a company (let’s say yours). The goal is also usually improvement, maybe property or a piece of big equipment. You, the owner or director, as an authorized person in the company generally can incur this debt in the name of the company. Generally, you can only be personally held liable for the company’s debt if you signed a personal guarantee or incurred the debt knowing that the company was insolvent. (Owing business taxes doesn’t always work this way. Check with us.) Alike in some ways There are similarities between the two. Both types of debt can be secured or unsecured, for instance. The first involves collateral and the second relies on your credit history and the likelihood that the lender will get their money back. That “getting the money back” tends to be the challenge with loans – and again, similar problems can make both personal and business debt a lot worse. Bad money decisions can happen over a kitchen table or behind an office desk. A down economy can cause both jobs and customers to dry up. Grocery stores and your suppliers both raise prices to keep up with inflation. And everybody needs gasoline, which is climbing steeply up. By the same token, realistic budgeting is an excellent step when trying to avoid debt in your personal life or in your company. Ditto such other tactics as debt consolidation, refinancing, or negotiation. But the similarities between these types of debt have limits. Never mix, never worry Did you know that about half the small businesses in the U.S. are home-based? Small wonder that too many people muddle strategies and solutions for the two kinds of debt. Using your personal finances to fund your business can be tempting and convenient. But mixing the two can cripple your chances at future commercial loans, not to mention potentially creating tax troubles when you try to claim business expense deductions. Take the example of using personal credit cards and home equity loans to fund a business. Far better you transfer your personal credit card balance to a clearly designated business credit card (same deal with auto loans and real estate). The protection isn’t 100% – you’ll still probably have to sign a personal guarantee for the debt on the card – but it is a way to keep business and personal debt more distinct. If you’re a sole proprietor, do yourself a favor and look into becoming a limited liability company (LLC), which can offer you some protection from the fallout of debt. Another tip: Did the purchase or transaction involve an Employer Identification Number, or “EIN”? If not, you may well find yourself with personal debt. Your business options to handle debt include moves not always as available to those who are in a money hole on the personal front. Contracts can be canceled in business to prevent further debt, for instance, and your small business has way more options than an individual does to increase income and cut overhead. And now the stop at the end of the debt road that nobody wants to hit: bankruptcy. Bankruptcy, in general, dropped last year, according to filings, but it’s still a danger. All we’ll get into here is that one huge general difference between personal and business bankruptcies is that businesses don’t have to pass a means test to qualify. At least that’s some kind of break. Next in our series: Business versus personal budgeting. Stay tuned. And know that we can help you examine debt-management strategies for your San Francisco Bay Area business, including keeping records to verify that you are a business. Grab a time here:(408) 241-4100 On your team, Patti ONeill and Gale Bergado(408) 241-4100ONeill & Bergado

Business Growth, Business Tax Planning

How ONeill & Bergado Handles Investors in Small Business

ranjan.254 / June 20, 2025

I can’t write without mentioning that somewhat awkward, somewhat shocking, somewhat moving star-studded Oscars event. There were some, well, memorable scripted (and *unscripted*) moments. One truly happy surprise was the best picture winner CODA (child of deaf adults) – the first streaming service movie to win Best Picture. Apple’s foray into Hollywood glory is showing how businesses can go beyond money-making endeavors to truly make a difference. And that’s something I like to talk about all the time – how a business (of any size) can impact the people around them. One way a lot of businesses are doing that very thing right now? Pulling out of doing business with Russia. Although, with US sanctions in place, it’s less of a choice and more of an imperative now. If your small business somehow has connections and trade through Russia, you’ll want to seriously consider taking some basic steps to investigate and confirm you’re not falling afoul of the complexities of these sanctions. That’s something we can talk through. Just get on our schedule:Patti (408) 241-4100 Gale 408-775-7800 Now, some other complexities you’ll want to examine are taking on investors in your San Francisco Bay Area small business, and that’s what I’m discussing today … How ONeill & Bergado Handles Investors in Small Business “The secret of creating riches for oneself is to create them for others.” – John Templeton Everybody loves money. In your small business, you’ll take all you can get, right? Investments in your company may seem like a can’t-be-beat gift. But taking on investors in small business means a lot more than skipping to the bank to cash a check – it means facing some hard realities about your business. Your plan, their fine print After a few down years, venture capital is booming again, especially for tech and large companies – but don’t mistake “VC” for other kinds of financing that your small business might attract. Get your terms straight from the get-go – and get your financial and legal professionals involved, too. The other thing to get together as completely and clearly as possible is your business plan – it’s your best tool to sell a would-be investor on the bright future of your operation. Handling an outside investment in your company is going to get off to a much more solid start if you’ve done the work and established some off-the-track records to back up the rosy predictions in your plan. Let’s assume you’ve done your searching – and vetted your would-be investors … – and you’ve got an investor ready to go. Take a breath first. Investing has a sort of mysticism in business, but in fact, it’s just like any other kind of deal you negotiate. An equity investor, for instance, usually puts down a fractional sum of money based on the value/profit of your company. If your operation is worth a million bucks, for example, the equity investor plunks down a hundred grand for 10%. Not too complicated. One major question: Does your investor expect a return based on your profit or your revenue? The latter may mean regular repayment by you whether your business makes money or not. Get this clear with your investor upfront, and if the deal is by revenue, get something in exchange for this tougher deal. When your stock is up As a symbol of investment, stocks are becoming a familiar tool: More than half of Americans, for instance, say they own some kind of stock. So let’s say your taking on an investor in small business looks like buying stock in your company. Your next question is: common or preferred shares? Common: This says your investor has a sliver of ownership in your company and says that the investor has a claim on profits (aka dividends) and voting rights. Most stock that’s issued is common stock. Preferred: Preferred stock requires more care on your part. This holding operates under a different set of rules than common stock, and even though they come with no voting rights you have to be careful how much control of your own company you hand over via preferred stock. A couple of other terms it’s good to know: Anti-dilution: We mentioned how stock gives your investors a slice of your pie. Suppose everything works out, your company takes off and down the road, you decide to issue more stock to more investors? That “slice” your original investor got will consequently shrink – unless they insist upfront on anti-dilution protection. In the most advantageous (for them) version of this, an investor will in the future be able to buy enough stock at its lowest-ever price to maintain their original percentage of control in your company (aka “full ratchet”). Naturally, you might not want to live under that condition forever – not to mention it might erode your control over your own company. This is one scenario where you have to be a hard-nosed negotiator right from the initial investment: One condition you might insist on is that the investor is welcome to buy additional shares someday, but at a price closer to the fair-market value then. Covenants: These are basically promises from you to investors on how you’ll run the company. Some can be quite detailed, from your financial planning to your insurance. Investors commonly ask for them, so don’t be alarmed. Also, don’t be quick to sign off on something you can’t, or don’t want to, deliver. Look ahead to your end game Time to be brutally honest: Only about one in four small businesses last 15 years. It isn’t always bankruptcy. Sometimes owners just want to move on and stick out the For Sale sign. Investors in small business aren’t just going to evaporate when it comes time to sell your company or, heaven forbid, go out of business. Investors may insist up front that you set up a liquidation preference – who gets what in what order if you can’t keep the lights on. Two points: Get any investment deal in writing – and never spend against promised investments. Seems obvious, we know,

Business Tax Planning

ONeill & Bergado’s Guide to the Profit and Loss Statement

ranjan.254 / June 20, 2025

As a small business owner, you’re often preoccupied with all the things that go into running your San Francisco Bay Area business – the daily logistics, managing employee workflow, paying the bills, bringing in more customers… making a profit. Let’s focus on that last one, shall we? Good. Profits are the lifeblood. And the P&L is probably the most crucial financial statement in growing your San Francisco Bay Area business. But too many people don’t really look at them or even know what to do with them. So today, I’m here to help. If you want to talk about how you can use these P/L report thingies better – or perhaps just how you can chart a financial forward path through times that might currently look a little bleak … this is what we do:Patti (408) 775-7790 Gale 408-775-7800 So let’s get into the details. Firstly, how to BUILD an effective profit and loss statement – because that’s more than half the battle… ONeill & Bergado’s Guide to the Profit and Loss Statement“I made my money the old-fashioned way. I was very nice to a wealthy relative right before he died.” – Malcolm Forbes Your San Francisco Bay Area small business needs a lot of documents, and one of the most important is your profit and loss statement (P&L). It’s called other names – income statement, a statement of profit and loss, income and expense statement, earnings statement, statement of financial results – but it always shows whether your company made a profit in a reported time period. Sure sounds like something your small business shouldn’t be without. What’s on one? Here’s an overview. Why you need a P&L Your P&L basically shows your revenue minus expenses and helps make clear how your business turns revenue into profits. Private companies use their P&L for internal management and decisions. Public companies must include a P&L in financial statements for public disclosure. Outside your company, creditors and investors will consult your P&L to estimate risk, and we’ll use your P&L to figure out your taxes and other information for the Internal Revenue Service. Plainly put, the Small Business Administration says the P&L is the best tool for knowing if your business is profitable. What to include As we said, the formula for a P&L starts with your sales minus the costs of your goods/services sold to find your gross profit. Take away your overhead and you have your net profit. The parts are: Typically, a P&L can run from a few to several pages depending on how complicated your business is. How do you start? Pick a timeframe. Monthly (usually they’re no more frequent than this), quarterly or yearly are the usual periods. Longer timeframes can show more information you can act on, but you don’t want overload from decades of data, either. List your revenue for the period. In this top line, break down the totals by month (include income sources by month) and, if applicable, account for discounts and returns. Also, note whether sales are recorded when an order is placed (accrual accounting) or later when you receive payment. Calculate your expenses. Separate such direct costs as goods and operating expenses. Costs of goods do not include selling and administrative costs (as you might have with services); those you list later. Many small businesses compute the cost of goods sold directly by taking the value of inventory at the beginning of the period, adding the value of goods purchased during the accounting period, and then subtracting the value of the inventory on hand at the end of the period. (This gets more complicated if you’re a manufacturer – check with us.) Determine your gross profit. Subtract your direct costs from your revenue. Here’s also where you enter your selling expenses and general and administrative expenses such as rent, utilities, telephone, travel, and supplies. Repairs and improvement expenses can also be deducted, but only for expenses to maintain property or equipment. (Major overhauls of equipment or maintenance that extend the life of the asset must be capitalized.) This part is also known as your gross margin, and it’s usually given as a percentage of your revenue. Other income and other expenses. Other income includes interest, dividends, non-categorized sales, rents, gains from asset sales, and so on. Other expenses can be unexpected losses unrelated to your normal business. Add both to your income and expenses categories. Subtract your total expenses from gross profit. A positive number means you’re making money. A negative number means, with luck, that you can at least pinpoint what’s hurting your company. Also, you can use one of two accounting methods to create your P&L. The simple single-step method means you just total revenue and subtract expenses. With the multi-step method, you deduct operating expenses from revenue, showing your operating income. You then add that to the net of non-operating revenues, non-operating expenses, and investment gains or losses to get your pre-tax income. Deduct taxes and you have your net income. (We can help with this.) Models to work from You can assemble a simple P&L using Excel and Google Sheets, which offer templates. Templates are also on financial websites such as U.S. Legal Forms or come with such software as QuickBooks or Microsoft 365. These, paired with what you’ve learned, should get you started on this indispensable business document. Next, we’ll look at how to analyze a P&L. If you want to get more into the details of your profit and loss statement or any other financial statement, we’re here and ready to serve you: Patti (408) 775-7790 Gale 408-775-7800 In your corner, Patti ONeill and Gale Bergado(408) 241-4100ONeill & Bergado

Business Growth

ONeill & Bergado’s Fighting Inflation Series: Taking Out a Business Loan

ranjan.254 / June 19, 2025

Today we want to start a series on how small businesses like yours can fight inflation. Because we know that’s one of the top concerns for businesses across the country right now. But I’d also like to know… How’s your business faring? We are genuinely interested in how things are going and what concerns are topping your list right now in the midst of inflation and the looming recession. The pandemic forced San Francisco Bay Area businesses like yours to pivot when it comes to serving customers and developing loyalty. And building services into your business, while struggling to hire staff, and even keep things afloat financially are all huge challenges to getting and keeping customers. It’s a lot. Here’s one thought on keeping your staff happy post-pandemic (hint: it’s more than better pay or casual Fridays). Hybrid work is here to stay. And it’s a pretty attractive employee perk for acquiring (and maintaining) good workers. So, figuring out how to make it work for your business has to be a priority. There are lots of articles on this subject out there. (Here’s a good example.) Of course, we here at ONeill & Bergado are here to help advise you on making that work for your business, both in terms of taxes and operating budget:Patti (408) 775-7790 Gale 408-775-7800 So, to get into today’s topic, in the interest of helping your business succeed in these inflationary times, one thing you might consider is taking out a business loan. I know that might seem counterproductive, but to help fight rising costs, it might just be the solution you’re looking for right now. So, what could that look like for your San Francisco Bay Area business? Here’s part one in our fighting inflation series… ONeill & Bergado’s Fighting Inflation Series: Taking Out a Business Loan“If you would know the value of money, try to borrow some.” – Benjamin Franklin Taking on debt to ease the strain of inflation may seem to go against common business sense, but the right business loan can help you fight rising costs in many areas of your operation. Our new series on fighting inflation begins with a look at how to make this plan work. The hits keep on coming The highest across-the-board price jumps in decades have driven more than four out of five small-business owners to express real worry in recent surveys. That’s all across the country, too, across all sectors and among all sizes of businesses. Owners report that to cope with rising inflation they’re often raising the prices of their goods and services or cutting staff. Cash flow struggles, rising production costs, reduced sales and slimmer profit margins, and drops in customer loyalty and satisfaction are just a few of the hard knocks businesses are reporting right now. But the U.S. Chamber of Commerce is reportedly seeing another trend among businesses right now: They’re taking out more loans. Business Loans: Why and how Like we asked before, why would businesses take on more debt now? A few reasons: – To bulk up inventory before prices rise higher– To hire new employees before they become scarcer or demand even higher wages– To accelerate marketing– To invest in technology or equipment to streamline operations If those moves sound appealing right now, slow down. Debt is debt even if you take it on to improve your operation. The debate about new debt amid high inflation has, on one side, the argument of repaying a fixed-rate loan easier with cheaper dollars in the future. The other side points out that new debt locks your business into new obligations right when you might need flexibility for your money. To see if a loan’s for you right now, start with your detailed plans to use the money (the prospective lender is going to want to know this anyway). Maybe you want to pay off an old loan and refinance at better terms. If you’re buying equipment, have you done enough price comparisons? Where and how exactly are you going to market your company? How much is the outlet going to charge to take your ads live? Do you need to engage a consultant? About hiring, what sort of wages for new talent have you been planning for in these inflationary times? Tack down the exact figure you need in a loan – no less and no more. And how much can your company afford to repay a lender each month? Don’t forget lead time: Loan applications can take days to months – and then the money can arrive with surprise fees for the application, guarantees, late repayment, and other details. The annual percentage rate is of course another major factor in the cost of your loan. Headlines have screamed a lot lately about the Federal Reserve raising interest rates to combat inflation, and experts believe that yes, this will eventually impact the costs of small business loans. This might also in fact make small business loans easier to get as more lenders enter the space. Nothing’s quite as unsure as an economy, but of all times recently, this might be the moment to go with a fixed-rate loan. They’re generally easier to comparison shop and, if inflation continues, interest rates may rise again. (We can help you with the math here, and there are also lots of biz-loan calculators out there, too.) Nuts and bolts of applying Prospective lenders are going to look at your credit score and history; the quality of your cash flow; the collateral you have at hand to cover the loan should you default; how long you’ve been in business; and the landscape of your industry and competition at large. Banks come first to mind as a place to get a loan, but you should look into other avenues as well, such as investors, asset management firms, and credit unions. Marketplace lending (aka peer-to-peer or platform lending) uses online platforms to connect consumers or businesses who seek to borrow money with investors willing to buy or invest in the loan. A business line of

Business Tax Planning

Patti ONeill and Gale Bergado’s 8 “Right Now” Business Tax Moves

ranjan.254 / June 19, 2025

Ready for some yuletide cheer? Inflation might have hit its peak this year. So say the “experts.” That particular category of people hasn’t exactly covered itself with glory of late … so, we’ll see how that actually plays out for businesses in the coming months. What’s the price environment looking like for you within your industry right now? Curious to hear what you’d have to say. We’d actually love to hear a broader picture about how your San Francisco Bay Area business is faring after the past couple of years of rising supply costs across the board. Do you need help examining where the dollars are going out and coming in? We can take a look with you to shore things up for success (and survival) in 2023. Schedule a time with us here: Patti (408) 775-7790 Gale 408-775-7800 And, while we’re at it, we can also talk about how to help lessen your 2022 tax bill. Let’s start right here with these year-end business tax moves you can make before December 31st… Patti ONeill and Gale Bergado’s 8 “Right Now” Business Tax Moves“Time is money.” – Ben Franklin It’s been yet another … interesting, to say the least, year to run a small business. We’ve tried to be there for you every minute — and we’re here today to let you know that it’s really not too late to improve your business tax situation for 2022. Even now, you can make (or change) moves that you’ll thank us and yourself for when you file this year’s taxes for your company in 2023. 8 business tax moves to make RIGHT NOW 1.) Employee bonuses. Amid the holiday exuberance, take another pass at those holiday bonuses before you hand them out. You want to show gratitude, sure, but are you certain those bonuses won’t eat up cash you’ll need in 2023? 2.) Examine deductions. We urge you (and we’re happy to help) to review all your business activities for potential deductions in 2022. Use a fine-toothed comb and tune your eye to detail. Mention them to us — we make no guarantee, but you don’t want to leave any legit deduction on the table. Ditto for tax credits like for research and development or, specific to some industries, energy credits or FICA tip credits. If you have real estate, start looking into cost segregation or, down the road, a like-kind 1031 exchange. It might be tough to pull the needed documents together in the days left this year, but at least we can start thinking about these questions. 3.) Equipment and Sec. 179. Buying equipment or machinery and putting it in service before this December 31 can get you a 2022 deduction under Sec. 179 (potentially a big one, too — but this isn’t always automatic and there can be conditions, so check with us). 4.) Tax-smart use of credit cards. Deductions can be taken as of the day of the purchase for credit cards used by a single-member LLC, by a sole proprietor who files a Schedule C, and by a corporation that uses a card that is in the corporate name. If your San Francisco Bay Area business is a corporation and you are the personal owner of the credit card, the corporation has to reimburse you, and (for tax purposes) the deduction takes effect on the date of the reimbursement. Will that be before this December 31? 5.) Accelerate or defer. The tail-end of a year brings up a time-honored tactic: accelerating expenses and spending while cutting back on billing to defer income into next year. Thoroughly review your expenses. Which ones can you speed up? Were you planning on large outlays in early 2023 anyway? If so, moving them up a month or so could be workable. This is especially effective if your business uses cash-basis accounting. (In fact, if you do use this accounting method and you can afford the money upfront, the IRS has a safe-harbor “12-month rule” that lets you deduct a prepaid future expense in the current year — but it can be tough to qualify for.) A simpler and more common tactic: Don’t bill until January (assuming most of your clients and customers don’t pay until they’re billed). This defers income into the next tax year. 6.) Retirement and medical plans. It may not be too late to establish your company’s retirement plan. One of your quickest options might be a Simplified Employee Pension plan. You can deduct the lesser of your contributions (up to 61 grand per employee for 2022) or a quarter of the employee’s compensation. Regarding your company’s medical plan, make sure as 2022 runs out that you have health insurance reimbursements recorded properly for tax deductions or credits. 7.) Pandemic loans and credits. The IRS says that if your Paycheck Protection Program (PPP) was forgiven based on “misrepresentations or omissions,” you can’t exclude the amount from your taxable income. Think now about an amended return. Ditto if you have any doubts about your eligibility for the legendary Employee Retention Credit that you might have applied for. Call us, please. 8.) Qualiï¬ed Improvement Property. A QIP, if you have one, is a property eligible for special tax consideration. But to secure the QIP deduction in 2022, you need to place the property in service on or before December 31. Also, if you ï¬led a 2019 return that you haven’t amended and that involves the QIP, you still have a little time … but let us know. It’s never too late — or early — to get the most out of your business tax situation. Before your San Francisco Bay Area company heads into another great new year, let us help you… Finish strong, Patti ONeill and Gale Bergado

Business Growth

ONeill & Bergado’s 7 Keys to Lowering Shipping Costs

ranjan.254 / June 19, 2025

Seen on Twitter this past weekend: Seems pretty typical with the way the IRS has operated over the past few years. If you’ve had any trouble with them processing anything of yours … well, that’s one explanation (and there are plenty more where that came from). But, now that they’re increasing staff with that big cash infusion from the American Rescue Plan, chances are, things will get better… right? Right? … One thing we know they’re going to get better at: collecting what’s owed to them. And that means an increase in audits. But because their new hires won’t be as well-versed when it comes to business taxes, audits will likely target sole proprietorships, as this business structure is the simplest to tackle (at least tax-wise). So all of this speaks to one reason to make sure you get an appointment on our calendar. We can help “audit minimize” your business filing so that you’re not triggering the red flag warnings with deduction claims that you can’t substantiate or that you might be claiming incorrectly. And though you have some time to get things in, the sooner you’re able to get the paperwork together, the sooner I can help with tackling your tax obligations. I’m right here when you’re ready:Patti (408) 775-7790 Gale 408-775-7800 Now, in the interest of saving you money in other ways, I want to take some time today to address a cost we see in a variety of business types – and for some, it’s significant. As the prices bloat, knowing how to get the most bang for your buck in a variety of these “small things” is going to help with your bottom line and product pricing (which makes your customers happy). And if you DON’T do a lot of shipping, this might be a short little case study in expense reduction, for any category in your San Francisco Bay Area business. Let’s break down some of the ways you can save… ONeill & Bergado’s 7 Keys to Lowering Shipping Costs“It takes four months to ship food aid and 40 percent of the cost is in the shipping. People cannot eat shipping costs.” – Andrew Natsios Ship happens, as they say. Whether you rely on shipping to stock your inventory or you sell and pass the cost on to customers and clients, your shipping costs are through the roof. This expense has jumped as much as 10% in just the past year. The hikes have slowed recently – but between inflation, supply-chain breakdowns, and other problems still coming down the road, the cost of shipping and its effect on your bottom line aren’t likely to improve soon. What can you do about itin your San Francisco Bay Area business? Lowering shipping costs with these 7 moves Lowering Shipping Costs Move #1: Talk to carriers. It may feel like you’ve got no choice in this area of your business, but carriers do vary prices sometimes. Shipping has a ton of variables, so ask if they’ll work with you to find the most bang for your buck. Figure your average shipping needs – size and weight of most items, for instance, or how fast the package needs to get there or how fast you need to get it – and call around for the best deal on those factors. Is there a price break for pre-paying or for paying online? Free pickup or delivery? If the carrier charges by dimensional weight (the amount of space the package takes up, as opposed to its weight), will two smaller boxes do the same job for you as one larger box and save money? Do they reward frequent customers? The USPS loyalty program for business shippers comes with point accumulations and shipping credits – though you do have to spend five-figure annual minimums for the best deals. Lowering Shipping Costs Move #2: Stand fast regarding guarantees and refunds. Delivery goofs could cost your customers or you completing a job on time. And the way fees are rising, be on guard against unfair early termination clauses in contracts – protect your right to bail if rates get too pricey. Lowering Shipping Costs Move #3: Scatter shipping among more than one carrier whenever possible. First-class mail from the USPS is about the best bargain out there – if you’re shipping less than 16 ounces. After that, your options increase with the price. Why put all your packages in one basket? Lowering Shipping Costs Move #4: Tinker with packaging. If you’re the shipper,flat-rate sure saves time: One box or envelope, one price. Seems simple – but is it best for all your needs? Again, a little homework can save you money. If you don’t have one already, invest in a postage scale. This tool will give you the best idea of which items (especially light ones) will save you the most money in the smallest possible box or envelope. Carriers usually give a break if you use their own containers. And who says cardboard’s always the best answer? Tyvek and padded envelopes tend to ship cheaper. The web has more than a few tools to help figure shipping costs ahead of time, such as Parcel Monkey, as well as calculators from carriers themselves such as FedEx and the appropriately named Online Shipping Calculator. Lowering Shipping Costs Move #5: Partner up. If you sell online, check a source such as eFulfillment Service to learn how stuff moves around our country and where fulfillment centers/inventory warehouses fit into that network. (Amazon, for instance, has them coast to coast.) You might be able to find one you can work with to trim your shipping costs. Check your chamber of commerce or other biz network for local companies you might be able to band together with to get a volume price from carriers. Lowering Shipping Costs Move #6: Trade time for dollars. If you’ve got a few extra days to spare for a package, slower is generally cheaper. FedEx Ground Economy, to cite one carrier’s no-frills service, will save you a couple of bucks but delivery can take up to seven business days. Lowering Shipping Costs Move #7: Insure it

Business Tax Planning

ONeill & Bergado Wants to Know: Got a Business Exit Strategy?

ranjan.254 / June 19, 2025

The big day is almost here. No, not tax day. (Which is on April 18th this year — and you should be thinking about that now and start by grabbing a time on our calendar: Patti (408) 775-7790 Gale 408-775-7800 I’m obviously talking about the Super Bowl. And maybe you’re not paying attention because you don’t really care about football, but here’s why you should… The weeks leading up to the Super Bowl — and of course, the event itself — mean big money for not only the NFL but also the plethora of businesses capitalizing on the opportunities inherent in it. I just saw the news that all the ad space is sold out. But even small San Francisco Bay Area businesses like yours can get in on the action, if you’re creative. It might be too late for this for you, or it might not … but here are a couple quick ideas: Throw a party for your customers. Create promotions around it. After the game, do something related to the final score. Talk about the commercials in an email to your customers. The point is this: Many of your customers care about this event, whether you do or not. And as a business leader, you should care about the things your customers care about. Of course, you need to have a plan to take care of your needs too. And it should be forward-facing enough to align with your goals around an eventual exit from the business, whatever it looks like. So, let’s look at that, shall we? ONeill & Bergado Wants to Know: Got a Business Exit Strategy?“Look on every exit as being an entrance somewhere else.” – Tom Stoppard Whether you look at stepping away from your San Francisco Bay Area business next month or decades down the road, it makes sense that a transition strategy is vital. But are you in the crowd of business owners who lack a written plan? It’s a common enough occurrence. Why? Maybe you think the process will be informal, depending more on soft skills and relationships than on facts and documents. Or maybe you just don’t want to think about the subject and so convince yourself that the day will never really come. (It’s hard to let your business baby go.) As I’m sure you’ve guessed, this move doesn’t bode well. How you pass on your company can be just as important as how you started it — and not just emotionally. A written plan helps you get the most of what your small business is worth. So, let’s take a look at what’s involved in a business exit strategy. Where you are A written business exit strategy is a lot more than a note to remind you to shut off the lights when you leave on the last day. Turn your notions into a document by writing out a solid assessment of your worth, activities, and goals (typically at least three to five years out). Your plan should define your current state and establish your goals and a timeframe for selling/leaving. If you haven’t done this planning yet, don’t beat yourself up — that can only paralyze you to put the task off more. Most owners have no general plan for their next life, let alone one that’s written out. Fix the details What are the goals of your business before you leave it? Write them (helps make them real) and work backward: They should dictate your everyday operations of the company. For example: If one of your plans is to go public and someday sell stock, you need to follow certain accounting regulations as soon as possible. If you want to have an in-house or family successor, the quicker you look for and start training that person, the better. M&A? All the reason you need to determine your company’s worth. It’s easier to know where you’re going if you know where you are. How many hours do you put in at the company every day/week? Are your customers concentrated in any one niche or area (maybe too much so)? How stable are your revenue, supply streams, and staff? What are your company’s biggest strengths and weaknesses? Be honest, or your projections and plan won’t be worth much. Don’t forget your personal goals. What do you want for the future of your family, your estate, and yourself away from work? These answers can help you decide (among other things) when you want to sell or leave your company. Crystal ball time We don’t have one, either, but an inescapable part of creating a business exit strategy is estimating how long you want to be with the company and how you envision it (or your involvement in it) ending. If you’re a sole proprietorship and foresee no future for the company after you leave, you might want to just run it until the operating money is exhausted. This can mean planning when to increase your pay the nearer you get to departure. If you’re in a partnership, when should you start thinking about selling your shares (and what can you do in the coming months and years to make them worth more)? We mentioned M&A earlier. If you’d like to sell to a larger competitor, part of your written plan should detail how you’re going to secure clients in a niche that’s attractive to that larger company. Looking to acquire? How many companies and by when? Detail your timeframe for funding and for approaching those potential acquisitions. Depending on when in your company’s life you’re putting plan to paper, all of the above could be either immediate snapshots or cover two, five, or 10 years, or longer. Moving forward with your business exit strategy Proper valuation of your business is the lynchpin of your plan, so after you’ve penned all you know about your books, operations, AP, and AR, you’re not done yet. Call in your team and your financial, tax, and legal advisors to finish analysis of how much your company is worth. (We’re happy to help with this.) Bounce their feedback off each other, too. All plans

Business Tax Planning

ONeill & Bergado’s Tips for 2023 Small Business Tax Planning

ranjan.254 / June 19, 2025

Forward-thinking is a must in business… that goes for your taxes too. And I’m going to dive into what that looks like today. But first, let’s talk about your tax filing. The S corp and partnership filing deadline is coming up (March 15 to be exact). While we’ll probably file an extension for you if you’re in this category and just now looking at your taxes, you’ll want to dial in VERY soon. But also, there’s little more than a month before personal tax returns are due. Let’s set procrastination aside and get on those returns so you can get Uncle Sam off your back and keep your San Francisco Bay Area business functioning optimally:Patto (408) 775-7790 Gale 408-775-7800 (And, of course, we will put clients on extension as needed.) Now, let’s get back to that forward-thinking… Taxes are more than a “once a year” obligation. They’re something you want to optimize for all. year. long. There are numerous practical strategies you can implement in your business — accommodating estimated payments in your budget, deduction-minded travel planning, and timing your expenses, to name a few. Tax-optimizing your San Francisco Bay Area business starts by knowing what the IRS has made available to you as a business owner. But even more than that, it’s knowing how to take advantage of what’s available… and that ain’t easy – Uncle Sam’s made sure of this. Getting into planning mode is going to require you actively carving out some time in your busy business owner schedule… whether you’re facing doing taxes on your own (not recommended) or meeting up with your favorite tax pro (wink, wink). In the interest of offering you some of my expert insight at no extra cost to you, I’d like to start the small business tax planning conversation here… ONeill & Bergado’s Tips for 2023 Small Business Tax Planning“Luck had nothing to do with this. It was good management and hard work.” – the Goose from Charlotte’s Web Now that covid-related tax relief is fading for most companies, it’s worth honing in once again on tried-and-true small business tax planning strategies. Of course, we first want to get you through the spring’s filings of tax returns — but after that comes all the rest of 2023, with plenty of tax developments that determine the best plan for this year (and beyond). Small business tax planning insight #1: Get ready for filing Make sure your documentation is on hand for your business expenses. Take a look at your company’s return(s) from last year and think about what you and your company did through 2022 to qualify for evergreen tax concerns such as capital purchases, payroll, maybe a home office deduction, and so on. If you have questions, reach out as soon as you can. A few general reminders for 2022 taxes: Speaking of which, your mileage may vary. (Your deductions depend on the circumstance of your small business.) Check with us. Small business tax planning insight #2: Looking ahead There’s a lot of 2023 left for you to do business tax planning. What should you be looking at in general? Business tax-filing deadlines are your first planning details, and through the rest of 2023, there are more than a dozen federal ones (depending on your business structure) beyond Tax Day on April 18. You can see the IRS filing schedule for this year here along with details on extension deadlines — and of course, you can always check with us, too. Beyond just knowing when and what you’ll have to file, having the schedule at hand will help you budget throughout the year if you deal with such obligations as paying estimated taxes every quarter. Planning strategically often makes tax liabilities a little easier to swallow — and can make saving taxes and improving your business easier, period. Considerations: Small business tax planning insight #3: Further down the road Make some preliminary notes for four or five months from now, when you’ll be closing in on the final quarter of 2023. That’s the time, for instance, to put into action your plans to accelerate or defer into 2024 income or expenses, depending on your tax situation. (We can help you decide.) And we’ll keep you up to date on tax developments that affect your business as the year progresses, such as the increasingly tricky rule about far-flung tax jurisdictions and remote workers. Taxes never stop — so your small business tax planning shouldn’t, either. We’re here to help you build the best future possible for your San Francisco Bay Area business. That includes setting you up for success, both during tax season and throughout the rest of the year. Always here to help, Patti ONeill and Gale Bergado

ONeill & Bergado’s Rundown of the 5 Basic Business Entity Types

ONeill & Bergado on Managing Small Business Loan Options

Pointers From ONeill & Bergado For Handling Business Debt

How ONeill & Bergado Handles Investors in Small Business

ONeill & Bergado’s Guide to the Profit and Loss Statement

ONeill & Bergado’s Fighting Inflation Series: Taking Out a Business Loan

Patti ONeill and Gale Bergado’s 8 “Right Now” Business Tax Moves

ONeill & Bergado’s 7 Keys to Lowering Shipping Costs

ONeill & Bergado Wants to Know: Got a Business Exit Strategy?

ONeill & Bergado’s Tips for 2023 Small Business Tax Planning

Get Directions

(408) 241-4100

Contact Details

Our Most Requested Services

Quick Links

Importaint Link