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Managing Director Leslie Daane was featured in Nevada Business Magazine CPA Industry Focus. Read the full feature below.
With over twenty-five years of public accounting experience, Leslie has provided a full range of audit, tax, and consulting services to a wide variety of clients. She is the Managing Director and the Director of Tax Services. Throughout her career, Leslie has worked with small and mid-sized privately held companies and their owners in all aspects from the start-up phase to the sale of the business. Learn more about Leslie here.
In addition, Leslie works with trustees and beneficiaries to assist in conflict resolution.
Accountants are among the most respected professionals in Nevada for their expertise and steady guidance. As businesses face turbulent times, this industry is working hard to stay on top of changing tax laws and implications for businesses with some of the new grants and loans available. Recently, CPA executives from across the state came together for a virtual roundtable hosted by Nevada Business Magazine and sponsored by City National Bank. At the roundtable they discussed everything from staffing challenges to advising their clients.
Connie Brennan, publisher and CEO of the magazine, served as moderator for the virtual event. The magazine’s monthly roundtables bring together industry leaders to discuss relevant issues and solutions.
Alisha McClellan: Our challenge really is supporting our people through these uncertain times. We have team members that have real and true challenges related to the pandemic. They have spouses that have become unemployed. Being able to provide staff with the support they need so they can continue to effectively service clients while we are in a remote environment is our current biggest challenge.
Daniel Gerety: Getting high level people that can handle the complexities of tax law, and help plan for our clients, especially with all of the changes that are happening so quickly [is challenging]. And, I’m finding planning for the future [to be difficult]. We probably have a third of our people working from home. What will our employees expect going forward? How do we design offices for the future? I don’t know, we’re trying to guess what it will be like.
Jessica Sayles: Part of the challenge we’re having in staffing is that the rapidly changing environment is moving from a compliance and commodity base to consulting analytics. I see it in the changes that are being made to the CPA exam. But, the skill set students are learning in college, the debit and credits of accounting, are no longer matching up to the needs of our clients. It’s difficult to find people who don’t have experience in reviewing business processes and technology, who have only dealt with compliance and strictly financial reporting, to understand the real needs clients have now. They don’t need a traditional CPA anymore. Some still do but, for the most part, they need CPAs who can integrate technology and rapidly changing economics to their businesses. There is a big gap in what students are coming out of college with and what we really need from them.
Curt Anderson: Basic, bookkeeping type accountants is not who we want. We are all trying to find intellectually inquisitive staff that want to expand their capabilities. That is not easy. We’ve found a pretty good compliment of people who think beyond paperwork and compliance activities, but we’ve had to train them into doing that. They don’t come out of school, or even come with one or two years of experience elsewhere, thinking that way. We spend a lot of time trying to get them to look beyond the paperwork and address what the client really needs. They’re not teaching that in school. It’s a grinding process to find the right mind set so we can train them.
Glenn Goodnough: Technical skills are important but business and leadership skills are critical to communicate that it’s not just completing a superior bank reconciliation that makes you successful as a CPA. Acquiring and retaining top talent is always a business imperative. We have found that the best way to do that is to get them as interns, identify talent and bring them in. We have more control over having a good internship program, identifying talent and growing our own, so to speak.
Mark Bailey: It’s critical you try to meet the needs of the staff. As accountants, we have a tendency to stick to three to five disciplines and try to put them in a box. For all of us to be successful, especially from a retention standpoint, we have to do things we enjoy doing. Sometimes it’s difficult to help that person and find what they really have a passion for. If they have a passion for [their work], they’ll do a good job, they’ll commit to it and be successful. If they don’t have a passion for it, they will go someplace else or not be happy in that job. It is really critical that we help them find that passion.
Leslie Daane: [We try] to grow our own and build a culture where people want to stay in public [accounting]. I think public’s gotten a bad rap for the hours and time people have to devote to it. I grew up in public and felt it was something that was actually very flexible. Providing flexibility to younger people that are having families has helped the retention piece. It’s a balance between trying to have the right culture. I think young people are actually very eager to come in and show their stuff and work with clients.
Anderson: Fundamentally, it seems like clients want someone that they can talk with and ask, “What are my options, what should I do?” I don’t think that’s changed in 50 years of public accounting. The means by which we get information to help them make these decisions is important. But, at some point in time, this comes down to people looking at each other saying, “We have a problem here or an opportunity here, what can we do?” From an old school standpoint, I just see that being the same with different methods of getting that information together to be effective.
Goodnough: Intellectual capital is always imperative, but at the end of the day we are in the people business.
Anna Durst: We’re always ranked statistically as either first or second as the most respected profession. Clients respect their personal advisor because it is a people business. That’s why it is so important to have relationships. From what I’ve seen between our members and clients, the people you deal with day-to-day know who you are and respect you. That relationship is very valuable to them and they respect it.
Daane: With the pandemic going on right now, clients are needing our help more and more and reaching out to us. That in itself has shown the importance of what CPAs can do for their clients.
Gerety: A lot of the calls [we’re getting] are on the PPP right now. [People are wondering] how much will be forgiven. They want us to start running computations to see what they need to do, and what percent of that PPP loan will be forgiven. Most of our clients have received those loans and their applications have been successful. Now it’s figuring out what’s coming next. We really don’t know, it’s a hot topic.
Sayles: I agree, the majority of the CARES Act calls I get are related to the PPP program. The advice I give clients is to make good business decisions, don’t make loan forgiveness decisions. If you can’t live with the decisions you made as a business, don’t do it just for loan forgiveness. This loan has taught us that [things are] changing, sometimes hour by hour. If you were to make a rash decision today, you may be regretting that as a business decision. I have to remind my clients that they are first and foremost business owners. Any decision you make should be beneficial and relevant to your business regardless of loan forgiveness and if you get that it’s a perk. We can strategize how to align those two ideas but number one, make a business decision.
Bruce Ford: This is evolving so quickly, even on the banker’s side. We get information from the SBA (Small Business Administration) constantly, and there’s more coming from Congress. It sounds like you guys are giving the right advice. We advise our clients to talk to their CPAs, their attorneys and go to the SBA website because it’s ever evolving and changing quickly.
Durst: My role in all of this is not to advise clients but to rather help my CPA members get clarity so they can help their clients. I try to do some homework for them when possible, so they don’t spend the time doing the research, but instead advise their clients. I’m involved on legislative and planning calls, determining the issues that need to be clarified. Unfortunately, there is so much political play in this, there’s little things in the bills that one side or the other doesn’t care for that could cause the entire bill to be unaddressed. They could just choose not to take something up as opposed to trying to negotiate. I keep telling people to wait to throw out the paperwork, advise about good business decisions and start planning. As CPAs, we like to get things done timely when possible, and not wait until the very last second. Right now, the advice I’m getting is actually to wait to apply for the loan forgiveness because it could change from 8 to 24 weeks. The percentages could change, and you don’t want to help your client do that whole application just to have it be negated and have to start all over again.
Chris Wilcox: You hit the nail on the head of what business owners are frustrated about. They can’t plan. They call and ask us what to do and we don’t have an answer, then we tell them wait two weeks. Well two weeks is beyond their eight-week period and so they don’t know how to plan. In many ways the PPP was a great program, it has been a great blessing in a lot of businesses’ lives, but in a lot of ways it’s really caused some challenges for them. They simply don’t know how to plan for the future. We don’t know what the rules are yet.
Durst: From a state level, since we don’t have income tax, we have to look at other state taxes that may be increased or even created. We may see sales tax on services, a modified business tax created to pay for things we need, or we may have other taxes. Our state is going to be operating at a deficit since we rely so much on gaming and mining taxes.
Daane: One of the challenges we’ve had for years on end is, a lot of law changes don’t happen until the ninth hour of the year. We’re having difficulties trying to do really effective planning with clients because we don’t know what the law’s going to be until almost December 31st.
Sayles: And now so many laws that did change two years ago have been retroactively put back with the CARES Act. We’re going back in and doing changes that we changed already two years ago. There’s a lot for businesses to consider.
Anderson: It’s going to be a couple of years before they really start trying to muddle with the tax laws because there’s such an impact on business right now. Politically, that’s going to be very difficult. They have modified some changes to allow more flexibility. It’s going to be coming, but I don’t think it’s going to happen in the next two years.
Bailey: At the state level, I’m a bit more concerned because we don’t have an income tax. I am fearful that government will impose additional taxes at some level. We have a very desirable economic climate here in Nevada and we certainly don’t want to follow in the footsteps of some of the other states that are heavily taxed. That concerns me a great deal.
McClellan: Where we’re seeing technology being leveraged is data mining for opportunities in some of those tax law changes that have come out with the CARES Act. [Technology provides] opportunities to automatically identify clients that would be eligible tax planning opportunities. That’s where we are seeing some positive impacts from technology.
Wilcox: Technology is streamlining a lot of lower end work that we used to have brand new staff do. Now, we’re asking staff to do work that I didn’t get to do until I was maybe a second-year person. So, our staff are growing professionally significantly faster today than they were five years ago. We’re asking them to learn new things. We have some staff that are going into data analytics to learn so we can provide new services. There are some real positives CPAs need to be prepared to take advantage of because that accounting function is going to continue to be more and more streamlined than it has been in the past. That brings a lot of opportunities.
Bailey: For us there’s been more of a shift to consulting. Of course, we do business evaluation and forensics, but we don’t have that lower level work that we do anymore. Things like Intuit and Quickbooks are giving us quality documentation from clients that we didn’t use to have. We now have flexibility to do more at the higher level. That is good for staff retention as well. Technology has helped us immensely. Even being able to work remotely has been a blessing for our profession. That’s not something we could have done too many years ago.
McClellan: Emotional decision making is the number one mistake I am seeing clients make and it’s tough for them not to do that. For a lot of them, their business is who they are, it is what they have done, and it is their livelihood; it is everything to them. [I advise them to] take a deep breath and make decisions that make sense from a long-term business preservation perspective.
Wilcox: It is easy for me to identify the most value I bring to a client and that is when I have the opportunity to sit across the table, or Zoom, with a client. Clients that call us, talk to us and bounce things off of us, that’s when we’re most valuable to them. Even if we don’t have an answer, sometimes we can ask the right questions and they find their own answer. Clients that give us an opportunity to weigh in, we can bring a lot of value to them. The ones we don’t get a chance to talk to are the ones that miss out.
Goodnough: You know to Chris’ point, as executives we like to grab issues by the vest and deal with them and make a decision and be done. The difference with all of this is that it’s just not over. It continues, and there are additional chapters. You have to stay engaged and keep good communication with your CPA, with your banker and with all of the relevant parties.
Sometimes it’s not easy to know whether to use a standard or itemized deduction for your personal Federal income taxes. We’ll break it down for you!
A standard deduction is an amount (indexed annually for inflation) of income not subject to federal taxation. It reduces taxable income. The alternative to taking the standard deduction is itemizing deductions on Schedule A. The Tax Cut Jobs Act (TCJA) of 2017 substantially increased the amount of the standard deduction, reducing the number of taxpayers who can benefit from itemizing. The chart below shows the standard deduction for different filing statuses for 2020. irs-provides-tax-inflation-adjustments-for-tax-year-2020:
FILING STATUS STANDARD DEDUCTION STANDARD DEDUCTION (If 65 Years or Older)
Single / Married, Filing Separately (MFS) $12,400 $14,050
Head of Household $18,650 $20,300
Married, Filing Jointly (MFJ) $24,800 $26,100 if one spouse is 65+ $27,400 if both spouses are 65+
Surviving Spouse $24,800 $26,100
The 2017 Tax Reform limits home mortgage interest deduction to interest on the first $750,000 in loans for homes purchased after December 15, 2017. The limitation is up to $1,000,000 in loans if the home was acquired on or before December 15, 2017. Both limits are halved for married filing separately. Interest from a home-equity loan used to purchase, build, or substantially improve the home is also qualified up to the above limits in aggregate.
Investment interest paid (on borrowed money) allocable to property held for investment is deductible. This deduction is limited to net taxable investment income for the year; any excess gets carried over to future years. This excludes interest allocable to securities or passive activities used to generate tax-exempt income.
Points on a main home/primary residence are deductible in the year the home is acquired or ratably over the life of the loan. Other restrictions apply.
4. For 2018 (retroactively) and 2019, qualified mortgage Insurance premiums is deductible if a taxpayer’s AGI is at or below $109,000 ($54,500 for married filing separately).
5. Out-of-pocket medical and dental expenses such as insurance premiums, prescription drugs, eyeglasses, etc. for tax years 2019 and 2020 that exceed 7.5% of the taxpayer’s AGI are deductible. This is a difficult threshold to meet, but if you have incurred major out of pocket medical expenses, it could be the deciding factor that tips you over to using itemized deductions.
The information above does not constitute tax advice. It is intended for information only. If you have any questions, please consult with our office at 775-786-6141 or E-mail at information@bvcocpas.com
by Nhit Hernandez nhernandez@bvcocpas.com
The Coronavirus Aid, Relief, and Economic Security (CARES) Act, signed into law in March 2020, provides financial relief to individuals, businesses, state and local governments during the COVID-19 health crisis. Below are some of the provisions related to businesses and self-employed individuals. Consult with your local banker and check SBA.GOV for updates on funding options.
The $349 billion appropriated to the PPP was depleted within the first two weeks. Congress passed a bill on April 23, 2020 for an additional $320 billion infusion.
i. Forgiveness is based on employee retention or rehiring and maintaining salary levels similar to prior periods.
i. A business is disqualified if it has received the PPP loan. Self-employed persons are also not eligible.
i. Employers can claim up to $5,000 of credit per employee.
ii. Businesses with 100 or fewer employees can claim wages paid to working or non-working employees. Employers with more than 100 employees can claim the tax credit for wages paid to employees currently not working.
We are now open to the public. Appointments must be made in advance of coming to the office. We will be following all sanitizing and social distancing protocols, and request that all visitors wear facial coverings.
As you are aware, in the past weeks, Governor Sisolak has implemented measures to mitigate the spread of COVID-19 (Coronavirus). 
In doing our part to keep our clients, employees, and community safe, we have implemented the following:
As of March 18, 2020, the majority of our workforce will be working remotely through at least May 15, 2020.
We will have limited staff coverage in our office and limited hours. Please call or email us to schedule a time to drop off any documents or pick-up any completed paper returns you have requested. This will be subject to change if our building closes or we no longer have anyone working in the office.
While we will be working during this time, we expect a delay from our normal tax season schedule in getting all returns completed and filed due to the changeover in our work environment and additional challenges as a result of the coronavirus pandemic.
The IRS has automatically extended the due date for filing of most 2019 income tax returns due through June 15, 2020, to July 15, 2020. In addition, any related income tax payments due April 15, 2020, regardless of amount, are postponed until July 15, 2020. An extension is not required to be filed under this automatic deferral. Returns not filed by July 15, 2020, will require an extension to be filed.
Payment of your first and second quarter 2020 estimated taxes due April 15th has also been moved to July 15th.
Many states have also announced similar relief plans in place.
Be assured we are working diligently to complete and process your returns as quickly as we can.
We will continue to have the following options for tax return processing:
Electronic: You may send us your documents electronically using Sharefile (we can provide you with a link) and you may continue to sign electronically via Right Signature or by uploading your signed Form 8879 IRS e-file Signature Authorization. We ask that these not be emailed directly since they contain sensitive taxpayer information. Faxing is also an option.
Paper: You may mail in your documents to our office and you can also have the Form 8879 mailed to you for signature and returned to our office.
Thank you for your understanding and trust during this time. Our dedication to you and our community is steadfast. Stay home for Nevada. Be safe.
Please don’t hesitate to contact us if you have further questions.
By Bill Saylor, CPA bsaylor@bvcocpas.com
Two major pieces of legislation were finalized and signed on December 20, 2019 and are effective now. Specifically, the tax extender provisions were covered in the previous article Late December Tax Changes are Effective Now – and Retroactively! 
The SECURE Act provides significant changes for retirement accounts for both individuals and businesses. Major changes are noted below.
If you have any questions, please talk to your tax preparer or business advisor.
By Bill Saylor, CPA bsaylor@bvcocpas.com
Two major pieces of legislation were finalized and signed on December 20, 2019 and are effective now. Specifically, the Taxpayer Uncertainty and Disaster Tax Relief Act of 2019, part of omnibus spending legislation, extends more than 30 tax provisions that have previously languished since the passage of the Tax Cuts and Jobs Act in December 2017 and the SECURE Act which changes the rules for retirement accounts. The SECURE Act changes will be covered in a separate article.
Extender legislation is generally effective retroactively for tax years beginning after December 31, 2017 and through the 2020 year. Exceptions are noted below in the specific provision.
If you are eligible for any of the above for 2019 please let your tax preparer know when you drop off your taxes. And, if you were eligible in 2018, please discuss the details with your tax preparer at that time; it may be worth amending your 2018 return to take advantage of these changes.
by Erika Hoppe ehoppe@bvcocpas.com
Every year, the IRS provides annual inflation adjustments for various tax provisions, such as tax rate schedules and the standard deduction. Here are
some of the key tax items that have changed for the 2019 tax year (these amounts will be used in 2020 to prepare your 2019 tax return):
Tax rates – Similar to 2018, there are seven tax rates, ranging from 10% to 37%. The rates apply in the following manner:
Standard deduction – The standard deduction amounts increase slightly from 2018. For 2019, they are $12,200 for single and married filing separately; $24,400 for married filing jointly and surviving spouse; and $18,350 for head of household. The additional standard deduction for those over 65 or blind remains at $1,300 for married filing jointly. For single taxpayers (not surviving spouse), however, the additional standard deduction increases to $1,650.
Medical and dental expenses – For 2019, qualified medical expenses must exceed 10% of AGI to be deductible. This increased from 7.5% of AGI in 2018.
Standard mileage rates – For 2019, the standard mileage rate is 58 cents per mile driven for business (up from 54.5 cents per mile in 2018) and 20 cents per mile driven for medical or moving purposes (up from 18 cents per mile in 2018). The standard mileage rate for charitable purposes remains the same at 14 cents per mile driven.
Shared Responsibility Payment – Under the Affordable Care Act, all taxpayers and their dependents were required to have health insurance that provided minimum essential coverage for tax years before 2019. Taxpayers who did not have health insurance would either qualify for an exemption or would have to pay a penalty. Beginning in 2019, the penalty for not having health insurance has been eliminated.
These are just a few of the changes that will affect the 2019 tax year. Additional changes and inflation adjustments can be found in Revenue Procedure 2018-57.
By Jared Streshley jstreshley@bvcocpas.com
Did your company have more net income in 2019 than you were expecting? Are some of your business use assets outdated and could use replacement? If so, this simple tip can help your company for future years.
Typically, when you purchase an asset for your use by your company, this asset will depreciate over the period of time that it will be useful. 
By using bonus depreciation, you can fully expense the purchase of an asset in the first year of use to substantially reduce your company’s taxable income. This election was originally expected to phase out in 2020, but has been extended through the 2022 tax year.
There are a few rules to follow under bonus depreciation
This election to take full 100% of the assets value as depreciation in the first year of an assets use will begin to phase out after the year 2022. Meet with our CPAs to discuss the optimal plan you can take to effectively take advantage of this election and plan an update of your assets in the most advantageous way for your business.
By Teela McCullar tmccullar@bvcocpas.com
Now that business owners have had some time to digest the impacts of the 2017 Tax Act, some may be wondering if changing to a C corporation would give them a greater tax benefit with the reduced flat tax of 21%. Owners of an S corporation or partnership could potentially be taxed as high as an effective tax rate of 29.6% on their pass-through business income.
However, there are still some downsides to being a C corporation that should be considered.
One of the biggest downsides to a C Corp is double taxation. Though the impact is not as severe as it once was with the reduced tax rate, there is no getting around having the earnings of the corporation taxed twice: once within the corporation and again should the owner decided to take a dividend. Right now, for someone at the highest individual tax bracket, the maximum combined effective federal income tax they would pay on dividends received by their C Corporation would be 39.8%. Under the prior tax law this could have been as high as 50.47%.
Additionally, C Corps are not the best entity choice for a business that expects to incur losses. A C Corp cannot deduct losses and while they do carry forward, other entity types such as an S Corp or a partnership do allow owners to deduct losses in certain circumstances.
C Corps also are not a good entity type for any business that is holding assets that are likely to appreciate like real estate or intangibles (such as a patent or software). Again, this is due to double taxation. Should the corporation sell these appreciated assets, they will pay tax on the gain at the C Corp level and the owner will pay tax if they desire to pull out some of the proceeds.
Finally, though the C Corp tax rate reduction to 21% was considered “permanent”, there is already talk that the corporate tax rate will be on the chopping block should the office of the presidency switch parties in 2020. While a complete rollback of the 2018 tax law is unlikely, some of the Democratic presidential candidates have suggested increasing the corporate rate gradually to at least 28%. This rate would be even higher than it was prior to the tax law change where the minimum corporate tax rate started at 15% and went up from there.
All of these factors should be considered along with having your CPA running the numbers to see if a C Corporation makes sense for you.
By Leslie Daane, CPA, CGMA, Managing Director
This past week at our monthly Vistage meeting our chair took the opportunity to revisit some of the teachings of Jim Collins (Good to Great).
After walking through some of the practices that Jim promotes, I realized that we as a firm have built some of these into our firm culture starting with “Get the right people on the bus.”
Hire the right people. We strive to be selective in each hire. Hiring for the long-term. Looking for people that bring energy to the firm, have a quest for continual learning, and care deeply about our clients, employees, and community.
Build Relationships. As a firm, we build relationships with clients that are long lasting. As we celebrate our 50th year, we have clients that have run the course with us. We have been with them from the start, the growth, and the sale of their businesses; into retirement with them, and for some, have experienced the loss of them with their families. Each has their own journey and story to tell. And it has been an honor to be a part of it.
Jim Collins shared a final piece of advice that he received from Peter Drucker at the end of a day spent together: “Don’t worry about being successful; instead be useful.” I’d like to think that our success as a firm is centered around being useful to our clients. Being there when they needed us.
A couple of other Jim Collins quotes to note:
“Preserve the core/Stimulate progress.” We at Barnard Vogler & Co. have always stayed true to our core values and beliefs providing this as the foundation for becoming a legacy firm in Reno. Along with this, we embrace the change and improvement required to adapt to the ever changing world of public accounting.
“Shaping a culture that can thrive far beyond any single leader is clock building.” 
We at Barnard Vogler & Co., have moved into our third generation of owners.
50 years. Something to be proud of. With this we honor our past and those that have helped us achieve this milestone. We also celebrate our future and all that we have ahead of us.
