3 Popular SBA Loans: What You Need to Know

Funding your small business or startup raises the lifelong question, how do I do it? Whether you’re in your first year operations or reaching a long-sought after landmark of one, three, five years or more, you’ll still need to continue funding your operations. While retained earnings drive your business to profits, everything from expanding your company to buying new property and technology to handle that growth, loans are one of the most commonly used ways to fund small-business projects.

How to Fund Your Small Business with Three SBA Loans

Small, or Micro Loans

When it comes to borrowing a small amount of money up to $35,000 (this is considered a relatively small amount of money compared to other larger business loans) many people find the 7(m) Microloan program to suit them best.

While the loan itself is currently being quite heatedly debated due to its direct sourcing from the SBA, this loan is perfect for startups. The funds, which max out at $35,000, can be used for pretty much any expense, keeping the loan easy-to-use with little restriction.

However, this loan requires its borrowers to enroll in financial responsibility classes that some find useful while others find to be a waste of their already-strained time as small-business owners. Regardless, this loan has a lot to offer its borrowers with relatively little cramping regulations.

Larger Loan Programs

Unlike the 7(m) Microloan program, programs such as the 7(a) or 504 Loan programs offer much larger amounts of money to companies. These loans can be borrowed in amounts between $250,000 and $1 million offered through subcontracted lenders to reduce the risk of the SBA’s offer to borrowers.

The 7(a) loan is actually one of the most popular loan programs offered, and is offered in many different forms to fit the needs of the borrower. Meanwhile, the 504 program allows small business owners the opportunity to borrow up to $1 million for new assets such as land and equipment. However, this loan is more difficult for many service companies to acquire.

Each of these loans have much more regulated spending and qualification requirements alongside a significant portion of borrower-responsibility when backing the loan.

For more information about small business loans, visit the US Small Business Administration's website. Or, drop us a line with your questions to see how Team VAST can help you decide which loan is best for you.

Third Quarter Performance ... in 200 Words (or Less)

The last day of market activity for the third quarter in 2014 comes to a close this evening. Therefore, it’s only fitting to bring you the happenings of the past three months just the way you like it: short, simple and to the point.

Third Quarter Performance: 2014


The September labor report is expected to dominate this week’s headlines. Coming out this Friday, it’s estimated that at least 200,000 new jobs were created this month alone, ending the quarter on a positive note from last month’s upset with fewer than 150,000 new jobs.

Real Estate

New home sales rose 18% in August—over 504,000 new home sales across the nation. More growth around the nation prompts builders to believe our current rising real estate trend will continue.


Consumer spending rose over .5% in August, leading analysts to believe the rest of the third quarter will continue to see consumer spending on the rise.


46 economic analysts surveyed throughout August and September agree that the expected growth rate of the national GDP at 3% throughout the third and fourth 2014 quarters.

Stay in touch with VAST. 

(177 words - nailed it)

Can Your Company Afford You?

When you embark on the adventure of entrepreneurship, there will inevitably be ups and downs for you financially.  At the end of the day, you pay employees, vendors and others and then you receive a paycheck.  Therefore, there are three numbers you need to have a solid understanding of.  I call them Survival, Comfortable and Ultimate. Survival is your worst case scenario.

It is the absolute bear minimum your company needs to pay you in order for you to survive and pay your basic bills.  It is very important to note though that the time you spend in Survival mode should be minimal.  If your company cannot pay you your Survival number other than in rare instances of growth or extra investment, then the hard answer might be that your company cannot afford you.

Once you get a handle on the answer to that all important question, then there are two additional levels of entrepreneurial compensation.

Comfortable is a step up from Survival.

At this level, you are taking a consistent salary, saving for retirement and taking vacations.  This is your Survival number plus the cost to do those things.  Comfortable comes with a different thought pattern.  At this level, you are supporting yourself and providing for your family, but you have the luxury of making decisions.  Maybe you can't quite get to the high end of Comfortable earnings but your passion for what you are doing makes it worth it to you.  That is your decision to make.

Ultimate is the highest number you can imagine your company providing for you.  

It's tempting to say "the sky is the limit", but try to put an actual number on this.  Goals are much more attainable if they are quantified.  This is a fun number to think about as a business owner...even if you are devoted to what you are doing and not in it for the money, passion can fuel the financial success of your company faster than anything else you can inject into it making Ultimate that much more attainable!

By knowing these three numbers, you can ensure that you know first and foremost whether your company can afford you.  Then you can build these numbers into other tools to fuel your growth likes budgets, cash flows forecasts and more.

To learn more about how to calculate these three metrics and tie them into your company's financial success, check out Tanya's on demand course for entrepreneurs - The VAST:Track Guide to Startup Success. Click here to learn more.

3 Big Tax Tips for the Busy Entrepreneur

No need to burden you with every little tax code in the book on this one. While there are dozens of tips that could potentially help your business, there is no need to overcomplicate the issue. The last hassle a business owner needs is a cumbersome list of tax tips to try and keep in mind throughout the year or to waste their day digging through complicated tax lingo. Here are three big tax tips that will help you drive through each tax year safely.

1.     Personal and business expenses are friendly but not intimate. Too many entrepreneurs allow their expenses to comingle in their accounting. While it may seem like they are hitting it off, in reality they are making your tax preparation far more complicated. Just like in a relationship, when things get complicated someone always ends up getting hurt. In this case, the only person who can get hurt is you, so keep those hands above the waist and visible distance between your business and personal expenses.

2.     Procrastinators, check your bags at the door. Don’t wait for the last minute, keep up to date on your estimated quarterly payments. Procrastination gets the best of us all at times. While it may be warranted to put off a trip to the DMV, and those ever-so-cheerful clerks, taking your time about getting around to your taxes is no bueno. Get those quarterly payments in on time, every time. When January rolls around and you are going through your reporting, you will be glad you did.

3.     Tax preparation is a team sport. Don’t wade off into the deep end alone. By hiring a knowledgeable and dedicated virtual accounting service your information will always be accurate and well organized. Come tax season you can call on your team to be there for the assist. Plus, we will maximize your potential for deductions, ensuring that you don’t pay more than you owe.

The IRS may be big and bad, but you don’t have to be the one who gets caught alone in the woods unprepared. These three tips can help you get safely through tax season without any surprises laying in wait at the end of the journey.

Virtual Accounting Service

VAST is a Reno-based virtual accounting service offering Virtual Bookkeeping, Outsourced Accounts Payable and Receivable and much more.

The Anatomy of Virtual Accounting

Every effective accounting department can be broken into four main areas: Accounts Receivable, Accounts Payable, Payroll, and Reporting. We call this the anatomy of accounting. Each area has a specific and important role to play and when any of these sections are not performing at their highest potential, the system as a whole can be weighted down. In order to keep your virtual accounting running accurately and at its peak performance, each section has to be carefully maintained. To detail exactly how each section contributes to the whole, we've examined each one-by-one: Virtual Accounts Receivable

This portion of your virtual accounting is simply the money your business is taking in. It consists of billing clients and entering invoices, as well as making and posting deposits. As we keep track of the money your company is earning, accuracy is pinnacle. Tracking the inflow of cash can be critical for making future business decisions.

Virtual Accounts Payable

Probably the least favorite part of virtual accounting for most business owners is accounts payable. This section takes care of money your business owes others. VAST can help you pay bills, credit cards and perform statement reconciliations. Ensuring that you are not overlooking any bills or paying too much is our priority in handling this section of your virtual accounting.

Virtual Payroll Service

Your employees work hard for you, and VAST makes paying them for their hard work simple. With Intuit, we will process their taxes and issue a check automatically every pay period. At the end of the year, filing taxes will be a cinch, because we will have kept Intuit thoroughly updated.

Virtual Reporting

Often the most neglected of all accounting services, reporting is a critical part of the process. With accurate virtual reporting, VAST gives you all the tools to manage your business and make critical decisions about the future. We reconcile all of your accounts to ensure accuracy and deliver detailed, easy-to-understand reports.

When the anatomy of your accounting is healthy and running efficiently, you can be certain that the information you need is always a click away with our virtual accounting services. When you work with VAST, we make sure that every part of the accounting process is working at peak performance. No matter how simple or complicated your accounting might be, we have the tools to manage it accurately. We understand the anatomy of accounting, and we bring this knowledge to providing exceptional virtual accounting services for our clients.

Virtual Accounting with 24/7 Accessibility


file0001949396999 We’ve all had a moment where we’re sitting in a meeting or on a phone call and some obscure financial question comes up: “So, Don, do you remember how much we income we generated from cucumber sales in Q4 2011?” Or, maybe you’re sitting at the bank trying to secure a loan that you’ve been waiting months for and are asked for the 15th time to provide a record of your tax returns from the past X-number of years. Normally, these requests can require strenuous games of phone tag or frantic searching to find the information you need.

At VAST, we maintain exact and efficient records of all things financial, so that no matter what the request, you are able to obtain all the information that is necessary for the task at hand. Virtual accounting with 24/7 accessibility means being prepared to answer any financial question at the drop of a hat.

We equip our clients with a personal online accounting login and password so their records are never more than a few clicks away. It’s like having your accountant in your pocket. 24/7 accessibility also allows you to be ever-aware of your financial standing. Because VAST stays on top of all of your business’s financial changes, you will never get stuck in the mud of money unknowns.

Not only does 24/7 accessibility eliminate mystery, but it also saves valuable time. Rather than being burdened with tedious record keeping, or getting caught up in the fluster of searching through old financial reports, VAST bookkeepers ensure all of that is taken care of, so your time can be spent on moving your business forward.

Our virtual accounting services ensure top-notch transparency and accessibility. We’ll keep your financial records organized and available, so you can reach them at anytime and from anywhere. If you’re interested in easier access and efficient accounting service, call us today, and we’ll help you experience accountant-in-your-pocket financial convenience.

Small Business Owners’ Tax Rates Top 62% … Wait, What?

Taxes: The albatross of you, me and every business owner on the planet. Most business owners are tasked with paying taxes quarterly, paying payroll taxes, paying people to prepare taxes and defending ourselves when audited for taxes—it never ends. But what most people don’t realize is how big that effective tax rate gets for an entrepreneur trying to make a living, and that’s something I aim to clear up here. Take your average small business owner. Let’s call him Joe. Now, Joe has a company he started himself and he makes a decent living. Let’s assume Joe makes $150,000 per year that he takes as salary and that this amount was basically all his company net during the year.

Joe, like many homeowners in America right now, is unfortunately doing a short sale on his house. So, back in early 2011, he stopped paying his mortgage payment and therefore he can no longer take itemized deductions. Joe is single and has no kids. Joe is going to pay about $40,000 in income taxes. And it gets much, much worse…

Joe is also going to pay over $4,000 in Medicare and about $13,000 in Social Security because he is self-employed. Joe lives in a $300,000 house that is now worth $150,000, but he will pay about $9,000 in property taxes on the old value. He is going to pay about $800 in “luxury tax” on his vehicle. He eats out a lot, and so he is going to pay about $2,000 in sales tax on meals. He buys some clothes and other household items now and again, which will take him for another $3,000 in sales tax. Joe is also going to pay excise tax on his cell and house phone, fuel tax on the gas he buys for his vehicle and unemployment tax on his salary. These miscellaneous taxes together will cost him up to another $2,000

None of what we’ve itemized thus far takes into consideration that his salary would have been higher in the first place if his company didn’t have to pay business license fees (tax), capital gains tax, industry specific tax (like gaming or entertainment tax), personal property tax, and on and on to the tune of several more thousand dollars.

But, in one area Joe is lucky. He lives in Reno, Nevada and doesn’t pay state income taxes. If Joe lived in California, he’d be facing another $12,000 for state income taxes.

If you include the state income tax, all of these add up to about $92,000 leaving Joe a net paycheck of $58,000 for the year. That’s right folks—that is an effective tax rate of 62%! Now, can Joe change his behavior—drive less, eat at home more? Maybe. But really, 62%? The reality is that all business owners pay an exorbitant combined amount of tax, and we can all end up in this spot if we’re not careful.

Our country’s tax structure will not be fixed overnight. It is unfortunate the burden that this myriad structure places on a business owner. By not educating ourselves on the large tax liability that business owners are expected to shoulder, we can set ourselves up for failure and devastating tax consequences. However, by being proactive and learning how these affect us, we can lessen this burden—at least enough to make it a little more palatable.

Here are four myths about taxes that are a good place to start in facing your own tax situation:

An audit is not the end of the world and it will most likely not kill you.

Is an audit unpleasant? Most definitely. But, just because you are facing an audit, do not just assume that you will ultimately be facing a big tax bill. If your tax return is reasonable and you are taking legitimate deductions, then the audit will most likely not result in changes to your return. You can even be aggressive and still not have additional tax bills. The key to an audit is ensuring that you are documenting your stance on tax positions, taking deductions that are truly deductible and allowed under the tax laws and that you are claiming your taxable income.

All of my deductions should fall within a range that the IRS says is reasonable.

Balderdash. Deductions are reasonable if they are truly business deductions. Not because they fall within a common percentage of your income. Your business is different than any other business. Your deductions will also be different. Here are some examples of deductions being relative to a business. First, say you own a restaurant and you are thinking about adding Eggs Benedict to the menu. You go to other restaurants to try their Eggs Benedict and that is a legitimate business expense. In many cases, I would even venture so far as to say this is marketing expense rather than meals expense. Another example would be a model or spokesperson. These are two of the rare positions that can deduct things like drycleaning and getting your hair done. Not a common deduction for the rest of us!

My Itemized Deductions (for example, mortgage interest and charitable deductions) will always be deductible.

Wrong again. Starting in 2013, the phaseout of itemized deductions is coming back to rear its ugly head. That means that when you make more than a certain amount (depending on your filing status) then your itemized deductions start to vanish. So at higher income levels, you can pay your mortgage and make donations and not get to claim any of it as a deduction on your tax return. Now, this doesn’t necessarily mean that these payments aren’t still a good idea, but if you are planning on the tax benefit, make sure you know what that is.

If I run it through my business or if my business loses money, then it must be deductible.

Wrong again. A typical business structure for a small business is either an S corporation or an LLC. Just because you take your kids to Disneyland and have your business pay for it, does not make it a business expense. Business expenses differ for every business. Yours should include items that are related to your business. But, that said, you can include expenses that maybe you didn’t deduct before you started your business like your cell phone and home office internet.

On the flipside, business losses come in many shapes and forms. In many cases, if your business shows a loss, your tax preparer could add insult to injury by telling you that you can’t deduct it on your taxes. There is a term called basis that determines if a loss can be deducted. Think of basis as your skin in the game. Basis can be very complex, but be sure to check with your tax preparer to ensure you have enough basis to deduct losses before counting on it.

Making Sense of Profit and Loss Statements (P&L Statements)

One of the most valuable tools in the small business owner’s belt is an accurate profit and loss statement. It provides exceptionally beneficial information about the progress of your business and allows you to make projections about the future. A P&L Statement, when prepared correctly, measures the profit accrued by a business against the loss. This, basically, indicates whether your business is gaining profit or losing revenue over a specified period of time. Usually done monthly, quarterly and/or annually, P&L Statements keep you informed on the financial state of your company. With accurate tracking of where and when the business is performing strongly, coupled with opportunities for improvement, you can make valuable decisions about what is working for the company and what is not.

At VAST we hear murmurs here and there about business owners either not receiving clean P&L Statements or not paying much attention to them at all because they are unclear what they are viewing. But, with our virtual accounting services, we handle the difficult work for you. We will track your income and your expenses automatically. Depending on our agreement, we will provide a full Profit and Loss Statement as frequently as requested; we can even consult on how often you should be reviewing your P&L Statements based on your type of business. Our reports are complete and easy to read, making your job simpler and more manageable.

Gain an edge with your business’s financial future with hassle-free and timely P&L Statements provided by VAST. Our services always keep your busy schedule in mind, handling all possible details to streamline your day and free you to focus on more pressing business matters. Virtual accounting has never been easier than with VAST. We provide the services that make accounting reliable and powerful; it’s the VAST solution