by Solange Lopes | Dec 30, 2017 | Career
Welcome to our weekly career, entrepreneurship, lifestyle and fashion news roundup! Think of it as your online watercooler/work gossip station/coffee break spot for now…Want to add anything to our list? Email us at corporate@thecorporatesister.com!
Cheers!
To Your Success,
The Corporate Sister
by Solange Lopes | Dec 28, 2017 | Make More Money
The final version of the Tax Cuts and Jobs Act was passed on December 20, 2017. There are many aspects to this new tax plan, which mostly benefit corporations and wealthy people. However, one aspect that may be overlooked is the impact it can have on working women and their families.
The new Tax Bill will raise taxes for over 83 million middle-class families in the U.S, and it also will have important implications for employees and careers. Here are various implications for you and your family if you’re a working woman:
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Your tax rates will be lowered (although the income tax brackets will remain the same)
| New Tax Bill Rates and Income Brackets |
|
|
|
|
|
|
| New Tax Plan Rates |
Current tax plan rates |
Married Filing Jointly- Income Levels |
Single- Income Levels |
| 10% |
10% |
$0-$19,050 |
$0-$9,525 |
| 12% |
15% |
$19,050-$77,400 |
$9,525-$38,700 |
| 22% |
25% |
$77,400-$165,000 |
$38,700-$82,500 |
| 24% |
28% |
$165,000-$315,000 |
$82,500-$157,500 |
| 32% |
33% |
$315,000-$400,000 |
$157,500-$200,000 |
| 35% |
33%-35% |
$400,000-$600,000 |
$200,000-$500,000 |
| 37% |
39.60% |
$600,000+ |
$500,000+ |
Please note that these rates revert to the current rates in 2026.
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The standard deduction has been doubled
When filling out your tax return this year, you’re able to choose between the standard deduction or your itemized deductions to deduct from your Adjusted Gross Income in order to get your taxable income. If you don’t qualify to itemize your deductions, then you may have to choose the standard deduction.
If you’re a single filer, your standard deduction just went from $6,350 to $12,000. If your status is Married Filing Joint, your standard deduction is now $24,000 from $12,700 under the old tax plan. Note that this change will revert back in 2026.
Since the standard deduction has now increased to such levels, it’s more likely that most taxpayers will pick it over their itemized deductions.
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Most of your itemized deductions are now eliminated
Itemized deductions are made of various types of expenses you incur throughout the year. If the total of your itemized deductions exceeds the standard deduction, your best bet is to deduct those itemized expenses instead. These generally include your home mortgage interest, property, state and local income taxes, investment interest expense, medical expenses, charitable contributions, miscellaneous expenses.
Some itemized deductions that are now eliminated include your moving expenses, with the exception of members of the military. If you are paying interest on your home equity line of credit, you can no longer deduct this.
However, the following deductions have not been eliminated:
- Charitable contributions
- Property taxes
- Mortgage interest
- Property taxes
- Retirement savings
- Student loan interest
Note that the deduction on mortgage interest is now limited to the first $75,000 of the related loan. As for state and local income taxes, taxpayers can deduct up to $10,000 whereas there was no cap before.
Good news! Your medical expenses deduction is now expanded for 2017 and 2018, as you can now deduct medical expenses that are 7.5% or more of your income. This is in contrast to being able to deduct medical expenses that are 10% or more of your income in the old plan.
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No more personal exemptions!
A personal exemption is the amount you can deduct from your income for each taxpayer and dependent you’re claiming on your tax return. You can claim a child, friend, relative, fiancé (etc) as a dependent on your tax return.
Under the old plan, you were able to deduct $4,050 per person claimed on your tax return. These exemptions are now eliminated, which puts families with many children or dependents at a disadvantage.
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Child and Elder Care Deductions Are Increased
You may be able to claim the child and dependent care credit if you incurred expenses for the care of a qualifying person to allow you (and your spouse if filing a joint return) to work or look for employment. Under the new Tax plan, the Child Tax Credit has been increased from $1,000 to $2,000, but only $1,400 at most will be refundable against payroll taxes.
If you have a 529 plan or are planning to have one, you can now use it for tuition at private and religious K-12 schools. You can also use these funds for any homeschooling expenses you incur.
If you’re caring for a non-child dependent, you can claim a $500 credit. This is especially helpful if you’re caring for elderly parents.
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Your job expenses and miscellaneous deductions are gone!
Under the old tax plan, you could deduct miscellaneous deductions exceeding 2% of your Adjusted Gross Income (AGI). However, these deductions are eliminated from 2018 through 2025. These include unreimbursed employee expenses such as tools and supplies, as well as tax preparation expenses. Note that this doesn’t affect business-related deductions.
Overall, this new tax plan helps higher-income individuals and families the most. However, the changes to Obamacare may mean that less women may have access to healthcare. Career-related expenses which could have benefited women to further their careers are also gone. There are many changes involved, so make sure to consult with a professional if in doubt.
To Your Success,
The Corporate Sister.
by Solange Lopes | Dec 27, 2017 | Career
As women of color, we face unique challenges in the workplace and in business. Being double minorities in work environments in which we are often the “only ones in the room” comes with its share of obstacles. There’s a reason why it is said that women of color face a concrete wall in business.
As a Black woman in Big Corporate, like so many others, I’ve experienced many of these obstacles. Yet, as much as they affect many a woman of color at work, they’re not usually widely shared. My girlfriends and I would discuss these, and even laugh about them at times; but we’d never share them outside of our small group. We were too scared of being misunderstood and adding even more grief to the whole situation. Besides, some of these challenges can be so subtle that it makes it hard to even demonstrate their existence.
Here are 7 unique challenges that women of color face at work day in and day out:
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Being judged according to false stereotypes
The “angry black woman” stereotype is only one of the damaging images used to portray and unfairly judge many a woman of color. Many are the negative ideas that precede women of color before they even enter the room, speak up, or perform at work. It’s because of these very false stereotypes that many retreat in a professional corner, or get extremely defensive.
Being aware of these stereotypes is a hard realization, yet one that is necessary in order to combat them. Unrelenting dedication, commitment, assertiveness, along with a good dose of patience, are also key.
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Playing the advocate to the entire Black race (along with other minorities)
Issa Rae’s hit series Insecure does an amazing job at exposing how women of color, and Black women in particular, are sometimes expected to be representatives of their entire communities. At the non-profit organization she works, Issa is pretty much considered an “urban encyclopedia”. Her best friend, Molly, is the only Black woman associate in her law firm, which prompts one of the senior partners to ask her to speak to one of the new Black interns whose boisterous ways are not aligned with the firm’s culture.
When you’re the only woman of color in your team or department, or one of a only a few, you can quickly become the advocate for the rest of your community. Which means being asked to pass along sensitive messages, like Molly in Insecure, or explain just about anything and everything that has to do with your culture.
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Working twice as hard
Poppa Pope said it right in the hit series Scandal: “You have to be twice as good as them”, when referring to what Olivia Pope would have to do to be successful in her career. Sadly, it’s advice most women of color receive from their childhood on, and have to apply through most of their careers.
How many times have we seen women of color over-studying, overdoing, and outperforming everyone else at work; only to be passed over for promotions or asked to trained someone else they would later report to? As sad and infuriating as it may be, it’s very much a reality for many women of color at work.
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Being the odd woman out
Have you ever found yourself in the midst of environments where you have no cultural references to contribute? For many, if not most women of color, it’s more the norm than the exception.
When you’re the only woman of color, or one of very few women of color in the room, your experiences, culture, entertainment are seldom discussed or shared. Instead, you may find yourself getting relegated to the silent corner. Or, on the opposite end of the odd spectrum, you may be at the end of interesting observations and compliments about your hair, skin, or even body shape. This is not always intentional on the part of colleagues and managers. However, it’s a hard reality that many, if not most women of color, deal with every single day.
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Being at the end of double standards
There are many instances in which women of color are subject to double standards in the workplace. From differences in work expectations and perks to dress codes, these double standards can be as subtle as they can be disheartening.
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Having to do the “voice switch” and other ways of watering ourselves down
If you’re a woman of color at work, you may have had to do the “voice switch” at work. You know that time when you water down your natural voice tone to sound more “professional”. Somehow, hitting the proper “business” tone may contribute to giving more credibility to women of color who are routinely considered unprofessional, from their natural hair to their assumed aggressiveness.
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Being rejected by other women of color
When there is a belief that there are only so many spots available to women of color, it can create an atmosphere of prejudice between them. The same occurs when it’s also believed that these same women may not be competent.
The fear of associating with other women of color and being misjudged keeps many from mentoring and supporting their counterparts. Instead, they opt to stay away.
All in all, being a woman of color is a very unique experience that is seldom shared and discussed for fear of the lack of understanding or judgment that may result. However, it’s important that we start telling the stories that can change the landscape of work for the better. The more we can talk about the obstacles we face, the more we can share tools and find the appropriate solutions.
What unique challenges have you faced as a woman of color at work?
To Your Success,
The Corporate Sister.
by Solange Lopes | Dec 27, 2017 | Career
Every year, I sit down and reflect on the lessons I’ve learnt in the course of the past 12 months. As much as time seems to be flying these days, every year is an opportunity to look back and reflect. Many of us would prefer looking forward, especially if the past has been a source of failure or discontentment. However, unless you look back, you cannot learn from your wins or losses. And unless you learn, you’re not growing or progressing.
If you’re in the same place as you were last year, you’re not growing. Don’t stay in the same place.
2017 was a transition year for me, from jumping into entrepreneurship to changing my mindset to work and live differently. Here are the 10 most important lessons I learnt in 2017:
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Purpose beats money, every single time!
Don’t get me wrong, we all know bills need to get paid, shoes bought, etc. As a CPA by trade, I know all too well the importance of money and finances in our lives, careers and businesses. However, in 2017, transitioning into entrepreneurship taught me that purpose always beats money!
Whether it’s through a side hustle, a profitable business, or a change in careers, following one’s purpose is the ultimate way to success, whatever success may mean for you. Always make sure to have a solid financial plan in place though.
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Growth is better than promotion
Many of us look to promotion and increase in our careers and businesses. However, we often forego the opportunity to grow and learn. In turn, this affects our ability to maintain ourselves at the level we’ve managed to climb to.
Transitioning into entrepreneurship taught me the importance of growth, both personal and professional. As a matter of fact, it’s the personal growth that fuels our professional growth. Unless you’re growing personally, your career or business may not grow as effectively.
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The dream is free, but the journey will cost you.
If 2017 taught me one thing, it’s that there is a cost to any dream, goal, intention or desire. Social media has us believing that the process is easy and glamorous. Any worthwhile dream or goal requires a fair amount of sweat equity and seed planting, before we can even start reaping the benefits.
The average success story takes at least 10 years. The millionaire you see on social media has been working late nights and early mornings before going to their daytime job for years now. That entrepreneur who “suddenly” makes it to the top has been living frugally on their savings for years. As a matter of fact, both of them may have filed bankruptcy once or twice, lived in their cars, or missed a meal or two.
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Not everyone will go with you
Ever heard the phrase “If you want to find out who your real friends are, start a business”? I found out it’s a very accurate statement. While I don’t necessarily believe in “expecting” others to support you, or to do anything for you for that matter, I also think that life will show you the people who can go with you to where your purpose is leading you. And those who were there for a season or a reason…
Your network is really your net worth, so watching who’s in your circle can determine where your career, business and life end up. The energy you surround yourself with is so important. I learnt that who and what you allow in your life is your responsibility. That few relationships are permanent, and that we must learn to recognize where we should put a priority and where we should not.
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Your mental health is a priority!
What my career and business have taught me in 2017 is that my mental health is such an important part of my career, business or life. It’s not just about working hard and hustling all day, every day.
Doing great work in the wrong mental state can wreak havoc on your professional or business results. I’m learning to check in with myself more, and listen to my own mental concerns as a priority.
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A financial foundation is crucial to success
Jumping into entrepreneurship on a part-time and full-time basis in 2017 has also confirmed the importance of minding my finances. This is not just about keeping a budget, or balancing your checkbook regularly.
It’s about creating a solid financial foundation of savings, investments and monetary power to create the life we want. It’s hard to go after one’s purpose or dreams when you’re worried about paying the rent or putting food on the table. Rather, it’s about creating wealth in a way that serves us and others in the context of our purpose and vision.
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It’s ok to be different, trust your own voice
When I started a blog, I took a different path. Jumping into entrepreneurship was a drastically different journey than anything I, or anyone else I closely knew, had experienced. However, at first, being different and doing things differently made me mistrust my own voice and doubt myself.
Having to stick to my own vision and goals has taught me to trust my voice and own my differences. It’s the only way to be everything we can be.
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Plant seeds first
Another thing I’ve learnt this year is the power of investment. When we think of investments, we think of money. However, what I’ve realized is that investing my time, energy and faith can reap the biggest rewards.
Going from side hustle to full-time business demonstrated for me the importance of planting seeds first. It’s about putting forth the effort and down payment first, sometimes way before we can get the pay for it. It’s about fighting for something you may not be able to see right away. Fight for it anyways.
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Tell your story
As a woman of color at work, I used to hide out behind a professional façade. It took me a long time to realize that our real power is in our ability to tell our stories and be authentic about our own experiences.
Through my blog, my career and business experience in general, I’m learning that my story, just like yours, is valid and deserving to be told. Most importantly, I’m learning that it can make a crucial difference in others’ lives as well. The more authentic we can be, the more glass ceilings and concrete walls we can tear down.
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Freedom is the ultimate goal!
Last but not least, the most important career and business lesson I’ve learnt is to pursue freedom. My definition of success is to be free to thrive and flourish professionally and in business as none other than…myself!
This also means financial freedom, as well as the freedom to decide how I get to use my time, doing what I love. While it may mean initial sacrifices at first, the glimpse of the possibility to create a life of freedom is the ultimate motivator!
What business and career lessons have you learnt in 2017?
To Your Success,
The Corporate Sister.
by Solange Lopes | Dec 26, 2017 | Start Your Business
The new GOP tax plan, also known as the Tax Cuts and Jobs Act, is final as of December 2017. This sweeping reform of the U.S. Tax Code will affect your business, in more ways than you may realize. This major tax act is one of the most significant reforms for businesses and corporations, with the elimination of the Alternative Minimum Tax (AMT) among other changes.
While this new legislation may result in a reduction of taxes for families and individuals, the changes may affect businesses in different ways. Here are a few of the ways that your business may be impacted:
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If you’re a US corporation, you will benefit from a large tax cut
If your business is registered as a U.S. corporation, you’re in luck! The new tax reform actually grants a generous tax cut to corporations registered in the US. Instead of a maximum corporate tax rate of 35%, C corporations that are personal service corporations, such as legal and accounting firms for instance, will now have a 25% rate.
Note that personal service corporations are corporations performing services in the fields of health, engineering, accounting, architecture, actuarial science, consulting, performing arts, and law. This lower tax rate is particularly attractive for corporations because it will ultimately make them more profitable. It also is a great incentive for foreign businesses to move to the U.S.
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The corporate AMT no longer exists!
Prior to this tax reform, the corporate Alternative Minimum Tax (AMT) consisted of a 20% tax rate that applied in case a company’s tax credits resulted in the business’ effective tax rate dipping below that level. Under this new reform, the Alternative Minimum Tax (AMT) no longer exists.
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Your corporation’s ability to deduct its interest expense is now limited
This new tax bill actually limits any corporation’s ability to deduct their interest expense up to 30% of their income. This also means that your firm may face more challenges when it comes to borrowing funds. It may also result in businesses issuing less bonds and buying back their stock.
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There are new limits on deducting Net Operating Losses (NOL)
If your business’ expenses exceed its income, your business may incur a Net Operating Loss (NOL). Under the previous tax law, this Net Operating Loss would be carried back two years. This would result in a refund of the taxes paid in the past two years, in partiality or in their entirety.
The new tax regulation eliminates carrybacks of any Net Operating Loss. The only exception applies to small businesses in case of disaster and casualty losses. In addition, taxpayers would be able to deduct any Net Operating Loss (NOL) only up to 90% of the business’ taxable income.
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Increase in Section 179 Personal Property Expensing
Prior to this new tax regulation, business owners may have been able to deduct up to $510,000 of personal property cost purchased and used for business in a single year. Now, this amount is increased to $5 million for property acquired and placed in service between 2018 and 2022.
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If your business has depreciable assets, you can now deduct their cost in one year!
Instead of amortizing any depreciable assets your business may have over the course of several years, you can now take one deduction in one year! However, the depreciable equipment must be purchased after September 27, 2017 and before January 1, 2023.
In addition, this 100% bonus depreciation applies to both new and used property, whereas previously it was only available to new property only. The bonus depreciation for automobiles would reflect an increase from $8,000 to $16,000. However, you should note that depreciation may not be used for real property.
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If you’re a pass-through service business making less than $315,000 per year, you may get a 20% deduction!
Pass-through businesses, including sole proprietorships, partnerships, and S corporations, now get a 20% deduction. This is a great benefit to small businesses, since such a deduction would lower your business’ taxable income. In turn, it will allow these businesses to reinvest any money saved back into the company’s operations.
However, this deduction only applies to service businesses making less than $315,000 per year. This is to avoid potential tax loophole, by limiting certain service-based businesses from taking advantage of lower taxable income.
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No more taxes on your overseas profits
Prior to this new legislation, corporations engaged in business abroad were taxed on the profits they incurred in foreign territories. However, the new regulation includes a shift in what is known as the “territorial” tax structure. As a corporation, you may now have to retrieve profits previously held in foreign territories with a one-time tax of up to 15.5%.
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Offering health insurance to your employees may cost you more!
This new tax regulation also results in the elimination of one of the major tenets of the Affordable Care Act. This requirement consisted in mandating all individuals to purchase health insurance. This also means that insurance premiums will more likely be raised by insurance companies. In return, your health insurance costs as related to your employees could skyrocket as well!
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You may be able to choose between the accrual and cash method of accounting
Under this new tax reform, more businesses are now allowed to use the cash method of accounting instead of the accrual method of accounting. The cash accounting mandates that a business record income when it is received, and expenses when they’re paid. However, under the accrual method of accounting, both expenses and income are booked when owed, as opposed to when they’re received or paid.
As of now, businesses with average revenues of $25 million or less are exempted from using the accrual method of accounting, which is a $5 million increase from the prior tax law.
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Your employees’ withholdings will change!
Considering the standard tax deduction has actually doubled and personal exemptions have been eliminated, what you withhold from your employees’ paychecks will need to be modified. Additionally, any bonus, commission or supplemental wages are now subject to automatic withholdings of up to 28%. This is a 3% increase from the original 25% rate. However, these changes will not be in effect until 2018.
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Watch those employee perks!
Prior to this tax regulation, businesses were able to deduct the cost of food and beverage provided to employees. However, only 50% of these costs are now allowed to be deducted. Additionally, please also note that this provision is only effective until 2025. After this date, you may no longer be able to deduct any of these expenses.
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Other deductions and credits for your business will no longer exist
The new tax law also eliminates the following deductions and credits:
- Deduction for domestic production activities
- Local lobbying expenses deduction
- Childcare tax credit provided by employers
- Historic structures Rehabilitation Tax Credit
- Work Opportunity Tax Credit
- Credit for access to disabled individuals
While these changes will only take effect at the start of 2018, it will most likely take a few months for corporations and businesses to implement the related changes. Considering that many businesses have already set their budgets and outlined their growth plans for the new year, this may also result in significant delays.
What’s your opinion on these changes?
To Your Success,
The Corporate Sister.
