Advocate Capital, Inc. Schedule for New Year’s

 

Advocate Capital, Inc. will be closed on Friday and Monday, December 30 & January 2 for the New Year’s holiday.   Any payments and/or funding requests received in our offices on those days will be processed first thing on Tuesday, January 3.

 

REMINDER:  Advocate Capital, Inc. customers can access their account information, submit funding requests and generate reports 24/7 via the AdvoTracTM Web Portal.  Simply navigate to  https://secure.advocatecapital.com/login.aspx and enter the firm’s assigned username and password.

 

Everyone at Advocate Capital, Inc. wishes a prosperous New Year to our all of our wonderful law firm clients, their staffs, and families.

 

Donna A. Jones

Vice President, Operations

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Social Security Tax Rate for 2012

 

In 2011, all employees benefited from the government’s temporary reduction in the Social Security tax from 6.2% to 4.2%.  This temporary reduction has been extended for all wages paid through February 29, 2012.  At this time, the Social Security tax withholding rate will increase to 6.2% for any wages paid after this date.  If your law firm prepares its own payroll, be sure to withhold and remit the proper Social Security tax for your employees.  Click here to learn more on the IRS’ website.

 

Kelly A. O’Leary, CPA, MBA, CITP

Director of Finance and Administration

 

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Shortage of Lawyers

 

A recent report by the Associated Press discusses how a lack of legal professionals in rural communities is impacting residents.  The fact that there are so few attorneys in rural communities means that people must travel farther for legal services, thereby slowing down the process and bogging down an already-crowded court system.  Also, rural municipalities have to pay more money to bring in lawyers from nearby towns for board and commission meetings.

 

As we all know, a law firm is a business, and businesses make more money when they have more clients.  As the U.S. population becomes increasingly urban, there are a lot more people (and therefore clients) in urban areas.  According to U.S. Census data, in 1910, 72% of Americans lived in rural areas – a century later, it was at an all-time low of 16%.

 

Many states and rural communities are trying to attack this problem by providing incentives for attorneys to establish practices in rural areas.  Ideas range from forgiving loans for lawyers who commit to serving in a rural community for a period of time to providing better job placement services for lawyers’ spouses, who sometimes have a difficult time finding work in rural areas.

 

The full article can be read here, on the Minnesota Public Radio website.

 

Paul B. Myers

Chief Credit Officer

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Advocate Capital, Inc. Schedule for Christmas Week

 

Advocate Capital, Inc. will be closed on Friday and Monday, December 23 & 26 for the Christmas holiday.   Any payments and/or funding requests received in our offices on those days will be processed first thing on Tuesday, December 27.

 

REMINDER:  Advocate Capital, Inc. customers can access their account information, submit funding requests and generate reports 24/7 via the AdvoTracTM Web Portal.  Simply navigate to https://secure.advocatecapital.com/login.aspx and enter your firm’s assigned username and password.

 

Everyone at Advocate Capital, Inc. wishes a safe and happy holiday to our all of our wonderful law firm clients, their staffs, and families.

 

Donna A. Jones

Vice President, Operations

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Social Security Wage Base Increases in 2012

 

The IRS announced that the Social Security wage base will increase from $106,800 to $110,100 in 2012.  This increase, along with the possible removal of the temporary Social Security tax rate reduction, will significantly increase the IRS’ revenue this year.  Click here to view the information on the IRS’ website.

 

Kelly A. O’Leary, CPA, MBA, CITP

Director of Finance and Administration

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View All of Your Finances in One Convenient Location!

 

Finally, keeping track of multiple financial account balances is made simple. Mint.com offers a free time saving solution to host all of your account balances, accessible from the internet and with apps for the iPad, iPhone, and Android.  Best of all, it is quick and easy to set up.  Click here to understand how the application can be offered for free.

 

Users simply login to Mint.com.  Once logged in users are prompted to upload their various bank accounts, credit card, mortgage accounts, loan accounts, retirement accounts, etc. by simply inputting the name of each individual institution along with the User ID and Password associated with each individual account’s website.  Mint.com then pulls the account information from each individual site and hosts the live data for quick up-to-date information on all of your financial accounts at a glance. It literally takes only minutes to set up and boasts bank-level security.

 

Users can access the Mint.com app on their smart devices for on-the-go up-to-date information on all financial account balances at once.  The application provides transactional detail as well as the account balances.  There is also a place to input asset information (i.e. home values, automobile values, etc.) which has the added value of providing an up-to-date personal financial statement 24/7.  There are hosts of other valuable features to this free application such as budgeting tips, expense tracking, etc. Check it out and let me know what you think.

 

Lisa Wagner

Vice President, Client Services

 

Photo Credit: Mint.com
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IRS Announces 2012 Standard Mileage Rates

 

The IRS recently announced its standard mileage rates for 2012.  Most of the rates remain unchanged.  Below is the schedule effective 1/1/12:

 

  1. 55.5 cents per mile for business miles driven
  2. 23 cents per mile driven for medical or moving purposes
  3. 14 cents per mile driven in service of charitable organizations

 

Click here to read the IRS announcement.

 

Kelly A. O’Leary, CPA, MBA, CITP

Director of Finance and Administration

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Constitution? What Constitution?

 

A recent posting in the blog thepoptort.com points out a recent, major victory for those of us opposed to the notion of caps on damages.  According to the blog, Article 5, Section 32 of the Arkansas State Constitution prohibits the legislature from “limiting the amount that can be recovered for injuries resulting in death or for injuries to persons or property.”  However, in 2003, in seemingly direct contravention to the state constitution, Arkansas’s legislature capped punitive damages to the greater of $250,000 or 3 times compensatory damages, not to exceed $1,000,000.  Now, I’m no attorney, but this certainly seems as if the legislature passed a law “limiting the amount that can be recovered for injuries resulting in death or for injuries to persons or property.”

 

Well luckily, the Arkansas Supreme Court has the final say regarding the constitutionality of legislation.  Last Thursday, December 8, 2011, the Arkansas Supreme Court affirmed a nearly $50 million verdict for farmers who say they lost money because Bayer CropScience’s  genetically altered rice seeds contaminated the food supply and drove down prices.  The state Supreme Court agreed with a lower court ruling that the cap on punitive damages was unconstitutional.  Associate Justice Courtney Hudson Goodson wrote that the cap “limits the amount of recovery outside the employment relationship,” while the Arkansas constitution only allows for limits on compensation paid by employers to employees.

 

You can also read about the decision here on ABC News’ website.

 

The full opinion can be read here.

 

The Center for Justice & Democracy also outlines some judicial decisions in which courts have struck down caps as unconstitutional.

 

Paul B. Myers

Chief Credit Officer

 

Photo credit: prweb.com
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High Cost of Fraud and Risk Factors

 

In a recent report, the Association of Certified Fraud Examiners estimated that the typical organization loses five percent (5%) of its annual revenue to fraud.

 

Other pertinent findings include:

 

Median loss caused by occupational fraud was $160,000 and nearly one-quarter of the frauds involved losses of at least $1 million.

 

Frauds lasted a median of 18 months before detection.

 

Perpetrators often display warning signs such as living beyond their means (43% of cases) and experiencing financial difficulties (36% of cases).

 

Occupational frauds are much more likely detected by “tips” than any other means.

 

Read the complete report here to learn if your organization is vulnerable.

 

Also, check out the complete Fraud Resource Library for helpful tips and contacts.

 

Donna A. Jones

Vice President, Operations

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Retirement Plan Contribution Limits for 2011

Copyright: <a href='http://www.123rf.com/profile_deedeedixon'> / 123RF Stock Photo</a>As part of your year-end checklist, you may want to consider a quick look at the 2011 Retirement Plan Contribution Limits to ensure that you’re taking advantage of the maximum pre-tax contribution amounts. 

 

The 2011 Retirement Plan Contribution limits for the most widely used employer plans are listed below for quick reference:

 

Plan Type                                             Maximum Contribution for 2011

  1. Payroll Deduction IRA                     $5,500.00
  2. Simple Ira                                     $11,500.00
  3. Safe Harbor 401(k)                         $16,500.00
  4. 401 (k)                                         $16,500.00
  5. 403 (b)                                         $16,500.00
  6. 457 (b)                                         $16,500.00

 

These limits were obtained directly from the IRS Website.  For more information on these plan limits as well as other types of retirement plan limits, please visit the website.

 

The IRS Retirement Plans Navigator is available on the IRS website and is an excellent source for educating small business owners about the various plan definitions, benefits and requirements.  The online brochure provides detailed information about the various plans as well as an easy to read plan comparison table.

 

At Advocate Capital, Inc., we recommend you consult with your individual tax advisors for expert advice on retirement plan contribution amounts as well as on which plan might be best for your individual business.

Lisa Wagner

Vice President, Client Services

 

Photo Credit: 123RF Stock Photo
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