News. Trends. Perspectives. September 2020

September has been a month of new beginnings, and with every fresh start comes potential risks and challenges. In this month’s newsletter, I’ll be exploring the potential impact of the upcoming presidential election on personal finances, along with some current finance and tax trends.

In this edition:

• News for Now: Which President will be better for your personal finances?
• Tax Trends: The current and long-term impact of the payroll tax cut
• Paul’s Perspective: Why large businesses need good accounting, too

1. News for Now — Financial news that matters to you

Which Presidential election outcome will be better for your personal finances?

The 2020 election has everyone on their toes, and from a financial standpoint, there’s a lot to consider about the potential impact of either outcome.

While the stock market tends to fare better under Democrats, it may reactively negatively at first if Biden were to win the election. However, this shouldn’t have much of an impact on long-term investors. Regardless of which candidate wins, the market will likely rebound, and low interest rates will be here to stay.

In terms of personal finances, Biden seeks to provide more affordable health care by defending the  Affordable Healthcare Act (ACA), which will result in higher household income to spend or save. He has also proposed a tax increase on higher-income families, while Trump has expressed support for a tax cut on middle-class and a lower capital gains rate.

Overall, if Trump is re-elected, we can expect to see more of what we already have throughout his election; if Biden is elected, we can expect to see a “resurrection” of Obama’s approach.

2. Tax Trends — Helping you stay on track with your taxes year-round

How will the payroll tax cut impact your finances now?

In early August, President Trump signed an executive order to cut payroll taxes (Social Security portion) amid the ongoing COVID-19 pandemic. 

While an extra $50 or so per week might not feel like a lot, you can still make productive use of the money. For instance, if you invest those funds in an interest-earning savings account, you might be surprised at how much you accrue over time. Or, you could pay down some debt interest-free.

No matter how you plan to spend the money, it’s a good idea to chat with a financial professional to discuss your options for taking and utilizing the payroll tax cut to your advantage.

3. Paul’s Perspective — My take on hot financial topics

Why good accounting matters for large businesses

Small businesses know how important it is to consult with a trusted financial professional to stay on top of ever-changing regulations and manage their cash flow. Even as your company grows and expands its financial department, you can still benefit from the help of a third-party CPA firm.

Here are a few reasons good accounting still matters for large businesses:

• You’re less likely to miss any credits and deductions.
• You’ll have a decreased risk of an audit.
• You’ll better maintain your budget.
• You’ll remain compliant with changing tax laws.
• Your payroll processes will be easier.
• You’ll better manage and monitor your cash flow.
• You can continuously evaluate and improve your business performance.

Looking for professional guidance or help with your business accounting needs? Contact Miller and Company today to set up your free consultation.