Why small businesses need to think big this summer hiring season

(BPT) – Finding great employees hasn’t been easy for small businesses lately. And this summer, the competition could heat up even more.

Thanks to a healthy economy, unemployment levels are low across the country. Many companies will be adding even more jobs as the weather warms up — especially those in seasonal industries such as tourism and hospitality, and other professions that are weather-dependent. While some of these positions may be filled by new graduates, this year employers can expect a fight for top candidates in any role.

Small businesses in particular will feel the brunt of the hiring squeeze, as they often can’t match the compensation and benefits offered by their larger competitors. This forces them to get creative to attract and retain the best.

One way many businesses get a leg up on their competition is with a small-business loan. Companies like Funding Circle offer working capital loans that allow businesses to get fast, affordable financing to expand their teams and achieve their goals.

Here are three more tips that can help small businesses gain an edge this summer:

Hire strategically

What are the different seasonal roles you need? While many businesses will be hiring for customer-facing positions, don’t stop your planning there. It may be worth taking the time to ensure your systems, website and marketing campaigns are up to snuff too as you head into a summer rush. With today’s gig economy, it’s easier than ever to hire high-quality, professional seasonal employees like web designers, marketing managers and accountants on an independent contractor basis.

You should also be creative about how you find the right candidates. Online, think carefully about the job description you post. It shouldn’t just be a list of responsibilities, but a chance to market your company to your future hire. Offline, get your current employees to help with the search by offering a recruiting bonus. And rethink your preconceptions about what work actually needs to be performed onsite — roles like administrative support, marketing and bookkeeping can now be done remotely with ease, which can widen your talent pool and be more appealing to prospective applicants.

Do everything by the book

Before making any job offers, acquaint yourself with state and federal fair hiring practices and job discrimination laws — and know how to implement them. If you have questions about any employment laws related to seasonal employees, talk to a lawyer.

Second, make sure you’re correctly classifying your seasonal employees according to state and federal laws (think: part-time vs. full-time, or contractor vs. employee). You could end up facing problems down the road, like being held liable for payroll taxes, if you’ve misclassified any workers.

It’s also important to make sure you get all employment agreements in writing. A lack of written contracts, including work for hire or consulting agreements, is a common small-business mistake, and a little effort upfront can save you a lot of headaches later.

Build your employer brand

Right now, the best candidates can afford to be picky about where they work. Every employer, big and small, has a reputation, and yours can either be a secret weapon or an Achilles’ heel in your hunt for new staff.

Your employer brand encompasses all the ways your business is perceived by staff and applicants alike. This can be shaped by everything from the interview process to the perks you offer, your policies, working conditions, company values, culture and more. Ensure that you’re consistently communicating that your business is a great place to work, even if only for the summer. When done right, you’ll get good employees to come to you rather than the other way around.

For more tips and information about small business loans, visit FundingCircle.com.

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The new tax law: What you need to know now

(BPT) – With the Tax Cuts and Jobs Act of 2017 having been signed into law, here are some of the things you should be thinking about as tax season approaches, according to Robert Fishbein, vice president and corporate counsel, Prudential Financial Inc.

2017 tax returns

The new tax law is generally effective starting in 2018, which means that your 2017 income tax return is largely unaffected. However, there may be actions you can take now to benefit from the change. For example, assuming you are eligible, you could fund a traditional IRA before the due date of your tax return; the income exclusion may be more valuable under higher 2017 tax rates.

Lower tax rates and new withholding

The hallmark of the new tax law is lower marginal tax rates for individuals. The IRS has issued withholding tables employers started using in February to reflect these lower rates. While this could mean lower tax withholding and more take-home pay, you should evaluate your personal income tax position to determine if you will pay more or less under the new law and adjust your withholding accordingly.

If you make estimated tax payments, you should also estimate your tax liability under the new tax law and make necessary adjustments to your quarterly tax payments.

Assuming your withholding or estimated tax payments need no adjustment may create an unpleasant surprise if you are under-withheld and owe penalty tax and interest when you file your 2018 income tax return.

Higher standard deduction

The new higher standard deduction of $12,000 for individuals and $24,000 for married couples will greatly reduce the number of taxpayers that itemize deductions. If you did not itemize in 2016, and your tax position is similar now, you will probably not itemize in 2017. The increased standard deduction, combined with lower marginal rates, may mean your tax liability will go down.

If you itemized in 2016, compare your total itemized amount to the new standard deduction. If less, and assuming a similar tax position in 2017, you will likely no longer need to itemize.

For many, this provision will turn out to be the greatest simplification aspect of the new tax law, since they no longer must track itemized deductions or complete multiple associated forms.

No personal exemptions

Some taxpayers will need to look more closely to determine if they will pay less or even more. The new law eliminates personal exemptions and reduces deductible items, such as limiting the total deduction for state and local income taxes to $10,000, reducing the amount of deductible mortgage interest and eliminating the deduction for interest paid on a home equity line of credit. Therefore, if you itemized deductions in 2017 and your deductions were greater than the applicable standard deduction, you will have to consider what deductions are available in 2018 and estimate your tax liability.

In states with higher income taxes and property taxes, it is possible that the loss of itemized deductions will be greater than the benefit of lower rates and your tax liability could increase.

Increased child and dependent credits

The new law increases the child tax credit for children under 17 to $2,000. The income limits to phase out the credit are also significantly increased so more taxpayers will be eligible. In addition, there is a $500 credit for other qualifying dependents. Depending on your tax bracket, this could be better or worse than getting an exemption for each dependent.

Increased AMT exemption

Adding one more layer of complexity to your 2018 planning is the new tax law’s modification of the Alternative Minimum Tax or AMT. The AMT is a parallel tax system that requires you to calculate your income tax under the normal rules and then again under AMT rules, paying the higher of the two. The new tax law increases the AMT exemption, or the amount you can earn and not be subject to this alternative tax. If you have been subject to AMT in the past, you should review the new increased exemption and whether that will change.

The bottom line

The bottom line for most is whether they will pay more or less income tax in 2018 than in 2017. While it is likely many will pay less, you need to consider all the above before you know how you will be impacted by the new tax law.

Please consult your legal or tax advisor concerning your particular circumstances. The Prudential Insurance Company of America, Newark NJ and its affiliates.

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