Are you maximizing these? Early planning allows you to identify and leverage available deductions and credits, reducing your taxable income and potentially increasing your tax refund.
Increase Your 401K Contribution
Are you happy with your contribution? Can you increase it and still make ends meet? When you contribute more from each paycheck, you’ll decrease your taxable income for the year. Since employers usually have matching programs, it’s a great way to get free money and build your nest egg. Make sure you’re in it if your company offers this.
Convert a Traditional IRA to a Roth IRA
If you think you’ll be in a higher tax bracket when you’re in retirement, converting a traditional IRA into a Roth IRA is one way to reduce your tax payments in the long run. Here’s how it works. The money you contribute to a Roth IRA is taxed the moment you contribute, unlike a traditional IRA, which is taxed at the moment of withdrawal. When you convert to a Roth IRA, you’ll be paying taxes at your current rate instead of the (probably) higher tax rate in the future. Translated: You’ll pay taxes up front, which might be a big savings. Finally, Roth IRAs are not subject to the same Required Minimum Distributions as traditional IRAs are. That means more freedom when you want it most – when you retire.
Getting a handle on your finances by being proactive now gives you a great opportunity to take a breath, assess, and change direction if you need to. If anything, it will help prevent stress and scrambling in tax season. It’s safe to say that nobody wants that.
July 1, 2025 · Blog, Tip of the Month, Uncategorized
⏱ 3 min read
Right smack dab in the middle of summer might seem like the worst time to think about your taxes, but it’s actually the perfect time. Here’s what taking a pause in July allows you to do.
Get Organized
Do you have all your receipts? Are your records up to date? Did you move, get married, or change your name? If so, you’ll need to notify the IRS. In fact, you can create an individual IRS online account to look at your tax records, manage communication preferences, make payments, and more.
Take a Financial Snapshot
When was the last time you looked at your checking, savings or investments to see if you’re where you want to be? If you take the time now, you can start with January and analyze the big picture. You can see if you’re happy with the growth of your investments and discover where you can make adjustments. Taking time to do this now will pay off in the long run.
Examine Your Paycheck
Are your earnings correct? Are you withholding enough taxes? As mentioned at the top, any big life event (divorce, having a child, buying a home) can affect your taxes. If you need help, the IRS has a Tax Withholding Estimator that can help you figure out your income tax, credits, adjustments, and more. If you need to change anything, the Estimator will show you how to update your withholding with your employer or direct you to where you can submit a new W-4. Taking time to review could help you avoid an unwanted large tax bill and/or penalty come tax season.
Double-Check Deductions and Credits
Are you maximizing these? Early planning allows you to identify and leverage available deductions and credits, reducing your taxable income and potentially increasing your tax refund.
Increase Your 401K Contribution
Are you happy with your contribution? Can you increase it and still make ends meet? When you contribute more from each paycheck, you’ll decrease your taxable income for the year. Since employers usually have matching programs, it’s a great way to get free money and build your nest egg. Make sure you’re in it if your company offers this.
Convert a Traditional IRA to a Roth IRA
If you think you’ll be in a higher tax bracket when you’re in retirement, converting a traditional IRA into a Roth IRA is one way to reduce your tax payments in the long run. Here’s how it works. The money you contribute to a Roth IRA is taxed the moment you contribute, unlike a traditional IRA, which is taxed at the moment of withdrawal. When you convert to a Roth IRA, you’ll be paying taxes at your current rate instead of the (probably) higher tax rate in the future. Translated: You’ll pay taxes up front, which might be a big savings. Finally, Roth IRAs are not subject to the same Required Minimum Distributions as traditional IRAs are. That means more freedom when you want it most – when you retire.
Getting a handle on your finances by being proactive now gives you a great opportunity to take a breath, assess, and change direction if you need to. If anything, it will help prevent stress and scrambling in tax season. It’s safe to say that nobody wants that.
These articles provide general information on tax, accounting, and financial topics for small businesses and individuals. They are educational in nature and are not specific legal, accounting, financial, tax, or other professional advice, and should not be relied upon as such. This content was prepared by Service2Client and may have been reviewed or edited by the website owner for accuracy and compliance. Look for a trust mark below for verification details. No representation is made that any approach described will achieve a particular result, and no regulatory or professional body has reviewed or endorsed this content. Because each situation is different, readers should consult a qualified professional about their specific circumstances before acting. Images accompanying these articles are protected by copyright and may not be copied or reused.
June 1, 2025 · Blog, General Business News, Uncategorized
⏱ 4 min read
The goodwill to assets ratio measures how much of a company’s total assets come from goodwill – an intangible asset like brand value or customer loyalty – and it plays a role in assessing the company’s overall value. It provides a ratio or percentage of the amount of intangible versus tangible assets. Understanding what the ratio represents, how it is calculated, and how to interpret it is essential for effectively applying it to business operations and investment decisions.
Goodwill Defined
Goodwill can be defined as an intangible asset that comes about when the acquiring firm obtains such assets from the acquired firm at a higher value. When it comes to accounting standards, both International Financial Reporting Standards (IFRS) and Generally Accepted Accounting Principles (GAAP), intangible assets must be evaluated for impairment, but don’t need to be amortized. Based upon IFRS 38, goodwill is generated solely during an acquisition and is defined as the amount of the acquisition price for the acquired company over its book value. IFRS 38 does not recognize goodwill generated by the company internally.
Calculating Goodwill
Goodwill = Liabilities – Assets + Purchase Price
If a company looks at acquiring another company for $750,000, and the company being acquired has assets of $900,000 and liabilities of $450,000, the net assets would be $450,000. Based on the goodwill formula:
Once the goodwill has been established, the Goodwill to Assets Ratio Formula is used as follows:
Goodwill to Assets Ratio = Unamortized Goodwill / Total Assets
If one company is putting itself up for sale with a selling price of $75 million, it would have to establish its book value, based on recent financial statements, along with its goodwill value. Factors that go into calculating a company’s goodwill include if the company has prime real estate, a well-known brand, a rich list of clients, or intellectual property that sets itself apart from competitors in the industry that won’t expire for years. For example, if its intangible assets are $15 million, subtracted from its selling price of $75 million, its tangible assets or book value would be $60 million.
Based on the ratio, it’s calculated as follows:
$15 million / $75 million = 20 percent
Therefore, the ratio is 20 percent for the company’s goodwill as part of the company’s valuation. Otherwise, if the purchase goes through, whoever buys the company spends 20 percent on the company’s goodwill.
Analyzing the Goodwill to Assets Ratio
This ratio gives an overview of a business’s financial health. The lower the ratio, the more tangible or physical assets that can be sold. Conversely, the higher the ratio, the fewer intangibles a company has. Much like assets that can be written down, so can a company’s goodwill.
This ratio is not one-in-all and should be measured against businesses within the same industry. Based on this analysis, if a company has a large amount of goodwill on its financial statements, if it’s written down, it could still result in a lower valuation despite the company having a large amount of assets.
Looking over time, it shows the importance of ongoing evaluations. In 1975, according to the University of California, Los Angeles, companies on the Standard and Poor’s 500 (S&P 500) had $122 billion of intangible assets and $594 billion of tangible assets, or about a 21 percent intangible to tangible assets ratio. These companies included most industrial and energy sector names like GE, Procter & Gamble, 3M, Exxon Mobil, along with IBM, based on market capitalization. However, in 2018, the ratio increased to 84 percent of intangible to tangible assets. Intangible assets accounted for $21.03 trillion and $4 trillion when looking at most of the companies on the S&P 500, which included Apple, Alphabet, Microsoft, Amazon, and Facebook, based on market capitalization.
While the growth of technology and communication services has risen and skewed the tangible to intangible ratio, it shows the importance of evaluating companies and sectors individually, not just with a broad brush.
These articles provide general information on tax, accounting, and financial topics for small businesses and individuals. They are educational in nature and are not specific legal, accounting, financial, tax, or other professional advice, and should not be relied upon as such. This content was prepared by Service2Client and may have been reviewed or edited by the website owner for accuracy and compliance. Look for a trust mark below for verification details. No representation is made that any approach described will achieve a particular result, and no regulatory or professional body has reviewed or endorsed this content. Because each situation is different, readers should consult a qualified professional about their specific circumstances before acting. Images accompanying these articles are protected by copyright and may not be copied or reused.
This isn’t to say there is no hope as more improvement is made to quantum computing every day. Consider Google’s Willow, a 105-qubit processor introduced in December 2024. Willow addresses the error correction challenge and performs certain computations in under five minutes, which would take a supercomputer 10 septillion years.
Real-World Business Applications
Despite these challenges, quantum computing has demonstrated potential in real-world use cases. One example is Volkswagen who partnered with quantum computing firms to optimize traffic flow in Lisbon. This demonstrated how quantum algorithms can improve urban mobility. In finance, quantum-inspired algorithms are being tested for portfolio optimization and risk analysis by companies like JPMorgan Chase. Pharmaceutical companies are also testing molecular interactions with quantum simulation to potentially accelerate drug discovery. It’s worth noting that these applications are mainly hybrid solutions that use both quantum and classical computing. Even so, it signals there is potential in future breakthroughs.
Cloud-based quantum computing availed by platforms like IBM, Microsoft and Google have greatly contributed to this venture. These resources have made experimentation possible without the need for in-house quantum hardware. Therefore, businesses have a chance to innovate solutions to complex problems more affordably.
An example of a strategic framework that can help business leaders is the “quantum economic advantage” developed by MIT and Accenture. It requires two conditions: a quantum computer capable of handling the problem’s size (feasibility) and a quantum algorithm that outperforms a similarly priced classical solution (algorithmic advantage). Only when both conditions are met does quantum computing become economically beneficial.
How Businesses Should Get Ready for Quantum Computing
Preparing for quantum computing doesn’t require immediate transformation; however, it does call for strategic foresight. Here’s how businesses can begin laying the groundwork today.
Create a Quantum Strategy: Identify potential long-term use cases where quantum could offer an edge, and develop a roadmap aligned with industry trends and business goals.
Invest in Collaboration and Research: Partner with universities, quantum startups, and industry groups to stay updated and explore early-stage innovations.
Start Quantum-Proofing Security: Begin evaluating quantum-resistant encryption methods to safeguard future data as quantum threats to cybersecurity emerge.
Experiment Safely: Use cloud-based quantum platforms to run small pilots or simulations, gaining hands-on experience without major commitments.
Build Internal Capability: Upskill current staff in foundational quantum concepts to ensure your team can engage with this evolving technology when the time is right.
Final Thoughts
Quantum computing is in its early stages, but its disruptive potential and rapid development give businesses a reason to start planning on its adoption, or risk falling behind. Integrating quantum has the potential to boost efficiency, cut costs, and enable innovative products and services. To stay competitive, businesses should start building a quantum-ready workforce through training, hiring, and academic partnerships.
Quantum Computing: Separating Hype from Real-World Business Value
June 1, 2025 · Blog, Uncategorized, What’s New in Technology
⏱ 4 min read
Lately, there has been a lot of talk about quantum computing, drawing interest from many, including business leaders. Quantum computing promises to solve previously unsolvable problems and revolutionize entire industries. As a result, excitement around its potential is rapidly growing. However, it is important to first ask where the hype ends and the real business value begins.
What is Quantum Computing?
Simply put, quantum computing is a new way of processing information. Unlike classical computers that use bits that are either 0 or 1, quantum computers use qubits (quantum bits). Qubits can exist in multiple states simultaneously as enabled by the principles of superposition and entanglement. This allows quantum computers to process vast amounts of information in parallel. Hence, quantum computers can theoretically tackle certain classes of problems that would take classical computers years to solve.
The Hype: Quantum’s Promised Revolution
Quantum computing is said to have the potential to perform tasks such as cracking encryption, revolutionizing drug discovery, optimizing global supply, and transforming artificial intelligence. Forecasts like one from Boston Consulting Group (BCG) project that quantum computing could unlock up to $850 billion in economic value by 2040. As a result, major industries are investing heavily and hoping to be among the first to benefit from a potential industrial revolution.
The Reality: Technical and Practical Challenges
The reality tells a different story. Today’s quantum hardware is still in its infancy, with most of these computers having fewer than 100 reliable qubits. They face issues such as noise and error rates that make large-scale practical applications elusive. Unlike classic chips that can be stacked for scaling needs, quantum systems can’t be easily scaled and need major advances in architecture and interconnects. Specialized expertise is also required to develop software for quantum machines. Besides, the algorithms that fully exploit the quantum advantage are still being researched. McKinsey estimates that while there may be many operational quantum computers by 2030, their ability to solve complex problems will take more time to mature.
This isn’t to say there is no hope as more improvement is made to quantum computing every day. Consider Google’s Willow, a 105-qubit processor introduced in December 2024. Willow addresses the error correction challenge and performs certain computations in under five minutes, which would take a supercomputer 10 septillion years.
Real-World Business Applications
Despite these challenges, quantum computing has demonstrated potential in real-world use cases. One example is Volkswagen who partnered with quantum computing firms to optimize traffic flow in Lisbon. This demonstrated how quantum algorithms can improve urban mobility. In finance, quantum-inspired algorithms are being tested for portfolio optimization and risk analysis by companies like JPMorgan Chase. Pharmaceutical companies are also testing molecular interactions with quantum simulation to potentially accelerate drug discovery. It’s worth noting that these applications are mainly hybrid solutions that use both quantum and classical computing. Even so, it signals there is potential in future breakthroughs.
Cloud-based quantum computing availed by platforms like IBM, Microsoft and Google have greatly contributed to this venture. These resources have made experimentation possible without the need for in-house quantum hardware. Therefore, businesses have a chance to innovate solutions to complex problems more affordably.
An example of a strategic framework that can help business leaders is the “quantum economic advantage” developed by MIT and Accenture. It requires two conditions: a quantum computer capable of handling the problem’s size (feasibility) and a quantum algorithm that outperforms a similarly priced classical solution (algorithmic advantage). Only when both conditions are met does quantum computing become economically beneficial.
How Businesses Should Get Ready for Quantum Computing
Preparing for quantum computing doesn’t require immediate transformation; however, it does call for strategic foresight. Here’s how businesses can begin laying the groundwork today.
Create a Quantum Strategy: Identify potential long-term use cases where quantum could offer an edge, and develop a roadmap aligned with industry trends and business goals.
Invest in Collaboration and Research: Partner with universities, quantum startups, and industry groups to stay updated and explore early-stage innovations.
Start Quantum-Proofing Security: Begin evaluating quantum-resistant encryption methods to safeguard future data as quantum threats to cybersecurity emerge.
Experiment Safely: Use cloud-based quantum platforms to run small pilots or simulations, gaining hands-on experience without major commitments.
Build Internal Capability: Upskill current staff in foundational quantum concepts to ensure your team can engage with this evolving technology when the time is right.
Final Thoughts
Quantum computing is in its early stages, but its disruptive potential and rapid development give businesses a reason to start planning on its adoption, or risk falling behind. Integrating quantum has the potential to boost efficiency, cut costs, and enable innovative products and services. To stay competitive, businesses should start building a quantum-ready workforce through training, hiring, and academic partnerships.
Disclaimer
These articles provide general information on tax, accounting, and financial topics for small businesses and individuals. They are educational in nature and are not specific legal, accounting, financial, tax, or other professional advice, and should not be relied upon as such. This content was prepared by Service2Client and may have been reviewed or edited by the website owner for accuracy and compliance. Look for a trust mark below for verification details. No representation is made that any approach described will achieve a particular result, and no regulatory or professional body has reviewed or endorsed this content. Because each situation is different, readers should consult a qualified professional about their specific circumstances before acting. Images accompanying these articles are protected by copyright and may not be copied or reused.
Depending on your resources and if you have children from a previous marriage, you might want to consider a prenuptial agreement. Again, it’s not the most comfortable topic to discuss because it implies that there’s an end to what is ostensibly just beginning. That said, it can pre-empt future problems that might otherwise cause a divorce. It’s also important in the case of death because if you don’t have a prenup, a judge, not the couple, gets to decide who gets what, which might result in an unsatisfactory distribution.
Figure Out Your Checking Accounts
Joint or separate? This is totally up to you, but according to Bankrate, 24 percent of couples have separate accounts; 38 percent have both joint and separate; and 39 percent have a joint account. This topic should be part of your money date.
Consolidate Debt
If you both have debt, consolidate and start paying it off. If you’re thinking about buying a home, lenders will look at debt-to-income ratio to see how much of your total income is being used to pay off debt. If your debt is too high, you might have trouble getting a mortgage. Be honest about it. Have the tough conversations before you say, “I do.” You probably don’t want to surprise your future spouse when you’re in the already emotional process of putting a bid on a house.
Bottom line, figuring out a financial plan for your marriage can be challenging, if not downright tough. But the best time to sort through all of this is before you walk down the aisle. When you have a roadmap, the chances for a successful financial future together increase exponentially.
Sources
Money And Marriage: What To Consider Before Tying The Knot | Bankrate
How to Navigate Money Before Saying ‘I Do’
June 1, 2025 · Blog, Tip of the Month, Uncategorized
⏱ 4 min read
According to a Bankrate Financial Infidelity Survey, 28 percent of couples said they considered financial cheating as bad as physical cheating. Furthermore, money is one of the top reasons for divorce, says Rahkim Sabree, counselor and financial therapist with the Financial Therapy Association. With these facts in mind, it makes good sense to get all your financial cards on the table (literally and figuratively) before you tie the knot. Here are a few ways to navigate this often thorny subject and create a healthy relationship with money as a couple.
Have a Money Date
Be intentional and carve out dedicated time to discuss the big issues that you both might have questions about.
How will we handle student loans?
How many children will we have, if any? Will they go to public or private schools?
Where will we live? Close to or far away from family?
Where would we like to be in our careers in 5, 10, or 20 years?
When do we want to retire? How will we spend our retirement?
If talking about these things is difficult, you might consider premarital financial counseling. When you can get on the same page before you get that other page – your marriage license – you’ll be way ahead of the game.
Set Up a Financial Plan, Pre-Marriage
While this conversation probably won’t be romantic with flowers and candlelight, it’s a time where you can share the excitement of your future. While you may not see eye-to-eye on everything, set up short-term goals, long-term milestones, and seek the middle ground when disagreements arise. Remember, life happens. Goals may change. There will be job losses, health issues, and unexpected expenses like HVAC going out or plumbing problems. The idea is to remain flexible and tuned in to each other’s spending habits by using apps like YNAB (You Need a Budget), Empower, or Tiller. When you’re transparent and can see who is spending on what, you can maintain an open dialogue about your cash flow.
Decide if You Want a Prenup
Depending on your resources and if you have children from a previous marriage, you might want to consider a prenuptial agreement. Again, it’s not the most comfortable topic to discuss because it implies that there’s an end to what is ostensibly just beginning. That said, it can pre-empt future problems that might otherwise cause a divorce. It’s also important in the case of death because if you don’t have a prenup, a judge, not the couple, gets to decide who gets what, which might result in an unsatisfactory distribution.
Figure Out Your Checking Accounts
Joint or separate? This is totally up to you, but according to Bankrate, 24 percent of couples have separate accounts; 38 percent have both joint and separate; and 39 percent have a joint account. This topic should be part of your money date.
Consolidate Debt
If you both have debt, consolidate and start paying it off. If you’re thinking about buying a home, lenders will look at debt-to-income ratio to see how much of your total income is being used to pay off debt. If your debt is too high, you might have trouble getting a mortgage. Be honest about it. Have the tough conversations before you say, “I do.” You probably don’t want to surprise your future spouse when you’re in the already emotional process of putting a bid on a house.
Bottom line, figuring out a financial plan for your marriage can be challenging, if not downright tough. But the best time to sort through all of this is before you walk down the aisle. When you have a roadmap, the chances for a successful financial future together increase exponentially.
Sources
Money And Marriage: What To Consider Before Tying The Knot | Bankrate
Disclaimer
These articles provide general information on tax, accounting, and financial topics for small businesses and individuals. They are educational in nature and are not specific legal, accounting, financial, tax, or other professional advice, and should not be relied upon as such. This content was prepared by Service2Client and may have been reviewed or edited by the website owner for accuracy and compliance. Look for a trust mark below for verification details. No representation is made that any approach described will achieve a particular result, and no regulatory or professional body has reviewed or endorsed this content. Because each situation is different, readers should consult a qualified professional about their specific circumstances before acting. Images accompanying these articles are protected by copyright and may not be copied or reused.
Right smack dab in the middle of summer might seem like the worst time to think about your taxes, but it’s actually the perfect time. Here’s what taking a pause in July allows you to do.
