Rick Gossett

As COO of Tarkenton Companies for more than 20 years, Rick has been responsible for business software development, unique partnerships, business educational content and consulting, and more. Rick was the originator of Tarkenton Companies’s consulting service and initially handled all of the questions himself. Prior to joining Tarkenton Companies, Rick owned and operated a private practice as a CPA. Prior to that, he was a Senior Manager at Pannell Kerr Forster in tax and audit, as well as Principal in Ernst & Young's small business advisory group.

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I am the owner of a single-member LLC small business and would like to know what I can write off on my taxes this year?

An LLC is unique in that it can be taxed as a disregarded entity, partnership, C Corp or an S Corp. A single member or owner LLC can be taxed as a disregarded entity, C Corp or S corp. A multi-member or owner LLC can be taxed as a partnership, C Corp or S corp.

What info can you provide on how to set up and manage an Advisory Board?

The setup and management of an Advisory Board will depend on the objectives and goals you have and what you can afford to spend on a Board. Advisory Boards and Committees are often utilized by large companies; however, in some cases, more professional experience can also provide business ideas and help a small company to be successful.

I am the owner of a single-member LLC small business and would like to know what I can write off on my taxes this year?

An LLC is unique in that it can be taxed as a disregarded entity, partnership, C Corp or an S Corp. A single member or owner LLC can be taxed as a disregarded entity, C Corp or S corp. A multi-member or owner LLC can be taxed as a partnership, C Corp or S corp. Unless an LLC elects corporate tax classification by filing Federal Form 8832 (C Corp) or Federal Form 2553 (S Corp) with the IRS when it is formed, a single member or owner LLC is taxed as a disregarded entity and a multiple member or owner LLC is taxed as a partnership.

I’m thinking about hiring my first employee. What should I do?

When growing a business, entrepreneurs typically reach a point in the process where they must consider the prospect of adding staff. There are several important things to consider when hiring employees, which include: labor laws, compensation structure, fringe benefit programs, and workers’ compensation.

Can a three member LLC, being taxed as a partnership, place the three members on a payroll service with other employees of the company?

The members of an LLC taxed as a partnership cannot take W-2 salaries or wages like employees of the LLC and cannot therefore have their compensation processed through a payroll service. However, they make take salaries in the form of “guaranteed payments” and profit distributions from the LLC as discussed in greater detail below.

I am interested in taking my company public. How would I go about doing this?

Generally speaking, going public requires a lawyer, CPA, and investment banker. We do not know the current sales volumes and profitability, how long you have been in business, the growth potential of your business, or  other details of your business; however, becoming a public company is not an overnight process and requires time (sometimes years) to prepare.

What is the best way to determine intercompany fees when two companies share key resources and overhead expenses?

One approach to calculating intercompany management fees is to analyze the labor being spent on each business and then allocating overhead costs as a percentage of labor to determine a total intercompany fee. Also, there may be a particular legal bill or other unique costs that may be charged directly to a subsidiary or affiliate company in addition to the normal intercompany fee.

How Should I Go About Choosing a Business Entity Type?

Many small businesses are structured as unincorporated sole proprietorships and General Partnerships due to their formation and maintenance simplicity and costs; however, the primary disadvantage with a sole proprietorship or General Partnership is that it is not a separate legal entity, even when it uses a trade name (also known as an assumed, fictitious business or Doing Business As (DBA) name), and the business obligations and claims of creditors are the personal obligation of the business owner.

How far back can you amend taxes, and what forms are needed?

In order to obtain a credit or refund, an amended federal or state tax return must be filed within 3 years after the date you filed the original return or within 2 years after the date you paid the tax, whichever is later.

What are the benefits and downsides of purchasing a car through the business?

We do not know how the tax status of your sole owner LLC, Sole proprietorship, C corp or S corp, but a vehicle used for both business and personal use (a mixed use vehicle) does not have to be purchased and owned by the business in order for the business to deduct expenses associated with the business use of the vehicle.