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 Northeast Minnesota's Small Business Development Center

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In This Edition
News for Business
IRS News for Business
Export Certification
Nominate a Business for the LABO Awards
Made in Minnesota
Preparing Your Business for 2013 Tax Changes
Find us on Facebook

Upcoming Workshops 


workshop with curt

 

Social Media 101

January 23rd 9am-12pm

 

Access I

January 23rd 1pm-4pm

 

Writing the "Ultimate Business Plan"

January 23rd 2pm-4pm

 

WordPress III

January 24th 9am-12pm

 

WordPress IV

January 24th 1pm-4pm

 

Access II

January 29th 9am-12pm

 

Access III
January 29th 1pm-4pm

 

PowerPoint I

January 30th 9am-12pm

 

PowerPoint II

January 30th 1pm-4pm

 

Computers 101

January 31st 9am-12pm

 

Access IV  

January 31st 1pm-4pm 

    

 View All Upcoming Workshops 

  

IRS News for Business January 2013
Click on the maroon underlined words to read more on each item

The IRS is looking to return tax refunds that were not delivered in 2012 because of mailing address errors. 


The IRS proposed regulations on the 0.9% additional Medicare Tax
for upper-income.
View the Q&As.


Visit the Third Party Reporting Information Center on IRS.gov for updates.


Beginning on Jan. 1, 2013, the standard mileage rates for the use of a car (also vans, pickups or panel trucks) will change.

Important Business News
Click on the maroon underlined words to read more on each item

Things you need to
know about your 
 as an LLC


Do your employees drive for your business?
 Do they know the
 rules of cell phone use.



Government Contracting

Quick Links

 

 

 

 

SBA 
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Contact Us
UMD Center for Economic Development

ced doors

 

The Small Business Development Center for Northeast Minnesota

www.umdced.com

 

(218) 726-7298 - main
(888) 387-4594 - toll free

Regional Center: Duluth

 

Satellite Offices: Hibbing/Chisholm
Quad Cities
International Falls
Grand Rapids
Ely
Grand Marais/Cook County
Two Harbors/Lake County
Carlton County
Hermantown

 

HELPING ENTREPRENEURS AND BUSINESSES GROW AND SUCCEED
CED DIRECTOR EARNS CGBP CERTIFICATION
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UMD CED Director Elaine Hansen is now certified as a NASBITE International Certified Global Business Professional (CGBP).  

 

The NASBITE CGBP certification confirms knowledge in international trade and assures that a person is able to practice global business at the professional level required in today's competitive environments. Elaine has completed a comprehensive curriculum in advanced skills and knowledge to educate and assist clients with exporting issues.

 

The NASBITE CGBP certified person is competent in:

  • global business management
  • global marketing
  • supply chain management
  • trade finance

 Congratulations Elaine!  

 

OPERATION JUMP START...YOUR BUSINESS IDEA

Do you have an idea for a business?
  
Do you want to find out whether your idea has merit and will be successful?
  
Do you know what the breakeven point would be?
  
Operation Jump Start will help you answer those questions.
  
When:
The program starts Monday night February 25, and runs 5 weeks, meeting Monday and Thursday night from 5-8 p.m.
  
Cost:
The cost is $399.00 for 30 hours of training. If you have your business hat on, that comes to $13.30 per hour of instruction. If $399.00 is out of your reach, you can apply for a scholarship grant from the Duluth Superior Area Community Foundation to cover 80% of the cost of the program. That brings your cost to $79.80 or $2.66 per hour instruction. The only hitch is you have to apply for the grant by January 25 (30 days before the program starts). Space is limited to a maximum of 15.
  
Where:
The classroom in the UMD Center for Economic Development, Duluth office. 11 E. Superior St., Suite 210.
  
What you get:
  • An entrepreneur's handbook with lesson plans covering research ideas, profitability analysis, break even, and cash flow.
  • Class facilitated by certified instructors who have years of business planning experience.
  • Local experts to speak on various topics from the type of organization you should form to how to market your new company.
  • By the end of the class you will have a business feasibility plan for your idea. It will then be judged by a panel of business consultants and local experts to give you feedback and information.

How it works:

Class will be taught using multimedia, speaking presentations, slide presentations, hands-on lessons and networking with your fellow students.

 

Call to sign up: Curt Walczak at 218-726-7868 or Center for Economic Development at 218-726-7298.

NOMINATE A BUSINESS FOR THE 21ST ANNUAL JOEL LABOVITZ ENTREPRENEURIAL SUCCESS AWARDS
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A business may be nominated for an award by a customer, client, employee, vendor or a private citizen who wants to recognize a business owner. Business people and organizations from throughout the region are encouraged to participate in the nomination process by completing the online Nomination Form.

 

Award recipients will be announced at the 21st Annual Joel Labovitz Entrepreneurial Success Awards Luncheon, our regional celebration of The U.S. Small Business Administrator's (SBA) Small Business Week. 

   

More Information / Nominate a Business 

 

Nominations deadline: March 1, 2013

 

MADE IN MINNESOTA
 

One way Minnesota's vitality can be boosted is to look to our local manufacturers for the products we need before turning to out-of-state or foreign competitors.  The Made in Minnesota  project's goal is to generate exposure for products made in Minnesota, particularly to facilitate relationships between local buyers and sellers.


The Minnesota Department of Employment and Economic Development (DEED) launched a survey project January 11, 2013 to gather data on businesses interested in developing new suppliers in-state.   With this survey, DEED aims to create a directory of"Made in Minnesota"goods to better market our locally-manufactured products.
 
If you own a manufacturing company, we ask you to participate in this survey, which will take no more than 10 minutes. The survey will be available online through February 28, 2013. 

 

Ultimately, company information for survey respondents will be available to the public in the state through DEED's website. Their participation is critical to develop the most current and comprehensive directory possible of "Made in Minnesota" manufactured goods.

 

For more information on the Made in Minnesota project, contact DEED project manager Magda Olson, (651) 259-7183, [email protected].

 

TAKE THE SURVEY   

 

PREPARING YOUR BUSINESS FOR 2013 TAX CHANGES

There are many open questions about federal income, estate, and payroll taxes for 2013. Here are some tax rules that are set to change in 2013 and your business can prepare for them now.
 
Withholding for the additional Medicare tax
There is a new additional Medicare tax of 0.9% on workers that takes effect in 2013. It applies only to earned income over a threshold amount:
  • $250,000 for married persons filing jointly
  • $200,000 for singles, heads of households, and qualifying widow(er)s
  • $125,000 for married persons filing separately

The additional Medicare tax is on top of the basic Medicare tax of 1.45% on all compensation earned by employees (2.9% on all net earnings from self-employment).

 

Self employed individuals. The same additional Medicare tax of 0.9% applies to net earnings from self-employment (i.e., profits). However, as a self-employed individual, there is no withholding. The tax must be included in estimated tax payments to avoid underpayment penalties. Those who have working spouses can have them request additional income tax withholding from their wages; this withholding can then be applied to the additional Medicare tax when they file their joint returns for the year.

 

Because of the new tax, the deduction from gross income for self-employment tax will not be exactly one-half of all self-employment tax paid. The deduction is limited to the so-called employer portion, which will be something less than half of the total amount of self-employment tax paid by those with net earnings over their applicable threshold amount.

 

Employer responsibilities. The law does not require a company to notify employees about the new tax, but it might be a good idea to do this so high earners will not be surprised. Here are other points employers should know:

  • There is no employer matching of this additional tax; the tax falls exclusively on employees. However, there may be additional administrative costs for compliance with withholding for the tax - whether you handle payroll in house of outsource this function.
  • As in the case of the basic Medicare tax, it applies to all taxable compensation, including bonuses, tips, and taxable fringe benefits.
  • Withholding begins in the pay period in which an employee's earnings first exceed the applicable threshold amount.
  • Withholding applies only to the portion of earnings over the threshold amount. For example, say late in December 2013, an unmarried employee who had earned $175,000 receives a year-end bonus of $30,000. In the pay period in which the bonus is paid, withholding must be taken for the additional Medicare tax on $5,000, which is the portion of earnings over the employee's $200,000 threshold amount.

Adjusting for the new FSA cap

Companies offering medical flexible spending accounts (FSAs) must limit employee salary reduction contributions for 2013 to $2,500. Up until now, the cap on employee contributions had been set by employers, not the tax law, with the cap averaging around $5,000 in most companies. What to do:

  • Inform employees about the change in the law. The $2,500 cap will be adjusted for inflation after 2013.
  • Amend FSAs to reflect the tax law's limit on employee contributions. While the deadline for making amendments is the end of 2014, plans must be operating under the new rules in 2013.

There are some nuances in the new rule that may affect your benefit plans:

  • The cap applies only to medical FSAs. It does not apply to dependent care FSAs or other employee contribution plans, such as health savings accounts.
  • If a married couple work for the same employer, each can contribute up to $2,500 to a medical FSA.

Accommodating employee withholding changes

There are other tax rules set to take effect in 2013 that could raise taxes for individuals. In order for employees to avoid paying estimated taxes, some workers may prefer to have employers withhold more from their paychecks to cover the anticipated tax liability. Employers can furnish employees with Form W-4, Wage Withholding Certificate; employees can ask that additional withholding be made (by reducing withholding allowances or requesting that a specific amount be withheld). New law changes that could impact employee taxes in 2013 include:

  • Additional Medicare tax on net investment income of 3.8%
  • Higher threshold for itemizing medical deductions

Now is a good time for business owners to meet with their tax advisor. Discuss which tax rules need to be addressed now and how to proceed.

 

SBA and SBDC
Funded in part through a Cooperative Agreement with the U.S. Small Business Administration, Minnesota Department of Employment and Economic Development and regional support partners. All opinions, conclusions or recommendations expressed are those of the author(s) and do not necessarily reflect the program sponsors. Programs are open to the public on a nondiscriminatory basis. Reasonable accommondations for persons with disabilities will be made if requested at least two weeks in advance. Contact the UMD Center for Economic Development at 218-726-7975 or toll free 1-888-387-4594 to make arrangements.

 

UMD Center for Economic Development is a joint program of the Labovitz School of Business and Economics, Natural Resources Research Institute, and Swenson College of Science and Engineering.