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Our observations on how the Tax Cuts and Jobs Act actually impacted our clients in 2018. 1 2 The Tax Cuts and Jobs Act that was enacted by congress last year was the biggest change to the tax code our country has seen in 30 years. We have talked about how the changes would impact you, our clients in past correspondence; so we thought it might be helpful to share our perspective now that the first tax season under the new laws is behind us. Comparing our client’s 2017 and 2018 tax returns, here are our main observations on how Monotelo clients’ returns changed from 2017 to 2018: Average income increased 4% from 2017 to 2018 Total taxes paid decreased by an average $564 per return filed The average effective tax rate decreased from 11.09% to 10.42% Federal refunds on average decreased $1,729 What’s most notable about the data we just shared is the fact that the lion’s share of our clients paid less income tax in 2018 than they paid in 2017 (and that includes the fact that you made more money in 2018), yet you received a smaller refund around tax time. People often assume that a smaller refund means the government is keeping more of your money, but that assumption would be wrong. Your tax refund is simply the difference between what you paid to the government throughout the year and what you should have paid. A tax refund is a good metric for how accurate your tax payments were, but not a good metric for how much you actually paid in taxes. Despite lower refunds, our clients actually paid $564 less in taxes than they did in 2017, while they made more money. With the average effective tax rate (actual taxes paid as a percentage of total income received) dropping from 11.09% to 10.42%, the biggest factor was the new tax brackets. Many taxpayers who were previously in the 15% or 25% brackets moved into the 12% or 22% brackets after the tax reform. If our clients payed a lower percentage of their income in taxes, and payed a lower dollar amount in taxes, then why was there such a significant drop in the average refund amount from the prior year? The primary factor that contributed to the lower refunds is the changes that were made to the withholding tables that calculate the federal tax to withhold from your paychecks. The main reason people were receiving larger tax refunds in prior years was due to the fact that the withholding tables were skewed to put more money in the hands of the government over the course of the year. The prior withholding tables did not properly account for the various deductions that taxpayers could take on their returns, and simply assumed that the taxpayer would be taking the standard deduction. With the standard deduction increasing significantly in 2018, a larger percentage of taxpayers utilized the standard deduction, and did not itemize. This single change caused the withholding tables to more accurately calculate the correct amount of federal withholding, and put more money into the pockets of taxpayers throughout the year. Lower withholding means more money in each paycheck. On average our clients had $2,300 fewer dollars taken out of their checks in 2018 than they did in 2017. The bad news is that some people were relying on the larger refunds, and didn’t realize that their raise came in each check they collected throughout the year. Takeaways Overall, our clients faired pretty well under the Tax Cuts and Jobs Act. The majority of our clients paid a lower percentage of their income in taxes. For those who paid significantly more tax in 2018 than they paid in 2017, it was usually due to a large increase in income. While most taxpayers received lower refunds than prior years, this was largely due to decreases in their federal withholdings, not because they had a larger tax bill to pay. As we approach the midpoint of 2019, now is a great time to review the tax withholdings from your paycheck to ensure you do not owe at the end of the year. If you are concerned about owing on your 2019 tax return or would like an idea of what refund you can expect next year, give us a call and we can provide you with some guidance. THE IMPACT of the Tax Cuts and Jobs Act Read more articles Failing to order your affairs to minimize your tax burden could cost you significant money - so don't wait to take action. If you have additional questions or need some planning help, please reach out to us.

TAXPAYERS IN ILLINOIS can maximize the tax benefits of their charitable donations by giving to Scholarship Granting Organizations (SGOs). SGOs are non-profit organizations that are approved by the Illinois Department of Revenue to receive qualified contributions from individuals and businesses to be disbursed to qualified, non-public schools in Illinois in the form of scholarships to eligible Illinois students. The Invest In Kids scholarship program offers a 75 percent income tax credit to individuals and businesses that contribute to SGOs. This tax credit provides a significant benefit over traditional charitable giving. Read More View Examples of How This Credit Works Schedule a Free Consultation View on Form Schedule Your No-Obligation Consultation on How To Increase The Impact and Tax Benefits of Your Charitable Giving

WHAT PARENTS NEED TO KNOW About Back-To-School Expenses August can be an expensive month for families with children heading back to school... and some of these expenses may serve you on your tax return. So we are going to spend five minutes summarizing a few of the expenses worth paying attention to. Tax Deductions for School Fundraisers If you make donations to your child's public school, you may be able to deduct the donation amount from your taxable income as a charitable donation. If you receive something in return for your donation, then the reasonable value of the property you receive must be subtracted before you take the deduction. For example: you donate $250 to your child's sports team, and you receive a sweatshirt that sells for $25. In this situation, you would subtract the $25 value of the sweatshirt and use the remaining $225 as a charitable deduction. After-school activities and Child Care Credit For a child under the age of 13, the cost of before or after school care may qualify for a tax credit. Your child must be attending the program so that you can work, look for work, or go to school. The program must also be considered "child care," so hour-long tutoring sessions don't qualify. American Opportunity Tax Credit The American Opportunity Tax Credit can amount to $2,500 in tax credits per eligible student and is available for the first four years of post-secondary education. Eligible expenses include tuition, books and required supplies. Room and board, medical expenses and insurance do not qualify for the AOTC. Income limits apply and the credit requires a 1098-T. The American Opportunity Tax Credit for education expenses can reduce your tax bill by up to $2,500 Lifetime Learning Credit The Lifetime Learning Credit can create up to $2,000 in tax credits for qualified education expenses. The credit is for 20% of the qualified education expenses (up to $10,000 in tuition and fees). There is no limit on the number of years this credit can be claimed and you may be able to deduct qualified education expenses paid for yourself, your spouse, or your dependents. The deduction phases out after certain income ranges. Tuition and Fees Deduction The tuition and fees deductions can reduce the amount of your taxable income by $4,000. This deduction is claimed as an adjustment to income, so you can claim this deduction even if you don't itemize deductions on your Schedule A. This deduction may help you if you don't qualify for the American Opportunity or Lifetime Learning credits. The qualified expenses are for undergraduate, graduate or post graduate courses. There is no limit to the number of years the credit can be claimed and you may be able to deduct qualified education expenses paid for yourself, your spouse, or your dependent(s), but the deduction phases out after a certain income range. You must file jointly with your spouse to claim this credit. At Monotelo, we exist to make a difference with meaningful and actionable financial solutions that positively impact our client's lives. If you have questions about what steps you can be taking to prepare for your retirement years, call us at 800-961-0298

Tax and Financial Planning | Monotelo Advisors | 800-961-0298 2205 Point Boulevard, Suite 175, Elgin, IL 60123 Find the location that works best for you. Elgin Office 2250 Point Boulevard Suite 210 Elgin, IL 60123 Phone: 847-923-9015 Fax: 847-929-9134 Mon-Fri: 9:00 AM - 5:00 PM Get Directions Call Office Site Title Carlinville Office 260 Alton Rd Carlinville, IL 62626 Phone: 217-854-9530 Fax: 217-854-5206 Wed/Thurs: 8 AM - 3 PM Get Directions Call Office Gillespie Office 112 S Macoupin St Gillespie, IL 62033 Phone: 217-839-4226 Fax: 217-839-4039 Mon-Fri: 8:00 AM - 3:00 PM Get Directions Call Office West Brooklyn Office 2508 Johnson Street West Brooklyn, IL 61378 Phone: 815-628-3500 Fax: 815-628-3600 Mon-Fri: 8:30 AM - 5:00 PM Get Directions Call Office Get Directions Call Office

Going to an office is no longer a requirement of conducting business in the age of the internet, cell phones, Skype and GoTo meetings. OCTOBER 2017 MONOTELO QUARTERLY Quarterly: Oct 17 UNLOCKING the Missed Deductions of a Home Office Small-business owners should not miss the benefit of a home office deduction out of fear of a tax audit. Going to an office is no longer a requirement of conducting business in the age of the internet, cell phones, Skype and GoTo meetings. This means an increasing number of small-business owners are working from home, and eligible to claim a home office deduction. When Properly implemented, this deduction can make a significant difference in your tax liability. WHAT CONSTITUTES A HOME OFFICE? In order to claim a deduction for a home office the IRS requires that a designated space be used exclusively and regularly for business. Going to an office is no longer a requirement of conducting business in the age of the internet, cell phones, Skype and GoTo meetings. Exclusively used for business means it cannot ever be used for personal reasons during the tax year, this includes any type of storage for personal items. Although the office is to be used only for business, the tax code does not mandate that it be a separate room, it can be part of a room - walls are not a requirement. The office must also be used on a regular basis for business. HOW TO DEDUCT EXPENSES FOR THE HOME OFFICE There are two different methods you can use to claim a home office deduction, the actual expense method and the simplified method. ACTUAL EXPENSE METHOD The actual expense method allows you to deduct all direct expenses and a portion of any indirect expenses. Direct expenses are any expenses incurred specifically for the home office, such as painting the office or putting in new carpet. Indirect expenses include any expenses incurred for the home such as mortgage interest, property taxes and utilities. To claim these indirect expenses you need to determine the portion of the expenses that relate to the home office. This can be calculated by dividing the square footage of the office by the square footage of the house. You can also claim depreciation or a rent deduction for the part of the home used for business purposes. On the downside, when you sell the home any depreciation taken needs to be recaptured. This can be an unpleasant surprise come tax time. When using the actual expense method, detailed records and supporting documentation must be kept for all expenses. SIMPLIFIED METHOD If you prefer not to maintain records of these expenses, you can still take a home office deduction using the simplified method. The simplified method is calculated by simply multiplying the square footage of the office by $5 per square foot (up to 300 sq. ft.). The advantage to this method is the IRS does not require you to keep any records that are required by the actual expense method. The main drawback of the simplified method is that you will not be able to deduct your actual expenses if they exceed the allowance of the simplified method. The best solution is to keep track of all of your expenses and then determine at the end of the year which method will provide the greater deduction. MILEAGE Regular commuting to and from work is not a deductible expense, however travel between your primary office located in your home to your second office is classified as business miles that are deductible. This does not mean that you can set up a "home office" to deduct your regular commuting miles. It means that if your home office is where you conduct the majority of your business, you can deduct any mileage to a secondary location. Setting up a home office can potentially create several thousands of dollars in deductible mileage each year. TAKE AWAY Even the smallest home office can unlock significant deductions if the expenses are properly accounted for using either the actual or simplified method. It is very important that the space be used exclusively for business purposes. July 2017 Save as PDF May 2018

One step away to save on your taxes. Schedule a quick 10-minute, no-obligation consultation. AVOID THE HEADACHES and Penalties Associated with 1099 Reporting When a small business hires an employee, there are a number of expenses that are incurred in addition to the hourly wage. This could include the employer-provided benefits, office space, along with the technology and other tools required to do the job. The employer will also have to make required payments and contributions on behalf of employees, including: The employer's share of the employee's Social Security and Medicare taxes, which totals 7.65% of the employee's compensation State unemployment compensation Workers' compensation insurance Depending upon the industry, the additional contributions could increase your payroll costs by 20% to 30% - or more. You can avoid these expenses by hiring an independent contractor to do the same work. The additional contributions could increase your payroll costs by 20% to 30% - or more. However, there are certain requirements that must be followed in order to avoid the headaches and penalties associated with 1099 reporting. WHAT AND WHEN DO I HAVE TO FILE? Businesses are required to report all income to the IRS for its employees and any independent contractors. For employees, a W-2 is required to be filed. Independent contractors on the other hand, get a little more complex. To make matters worse, congress recently passed the Path Act, and moved up the filing deadline for W-2's and certain 1099's. The required date to provide W-2's and 1099's to employees and independent contractors is January 31. The deadline for submitting these forms to the government is also January 31. THREE STRATEGIES TO AVOID 1099 HEADACHES The easiest way to avoid the penalties, and filing headaches caused by issuing 1099's to independent contractors is to structure your business activities to minimize the number you must issue, and prepare them in advance, if you do have to issue them. STRATEGY #1: Choose contractors that operate as corporations. Your business is not required to issue 1099's for payments made to corporations, S corporations, or LLC's that elect corporate status for tax purposes (unless the corporation collects attorney fees or payments for health and medical services). STRATEGY #2: Make payments to independent contractors with a credit card, or a third-party payment network like PayPal. Shift the burden of reporting this income to the credit card company or the third-party network. They are required to report the payments on Form 1099-K. STRATEGY #3: Require the independent contractor to provide you with a W-9 upfront before making any payments to them. Here are the benefits: You will know if a 1099 filing is required, because their business type is disclosed on the W-9. You will know whether an LLC is classified as a corporation for federal tax purposes, and excluded from 1099 reporting. By getting the W-9 upfront, it eliminates the need to chase the contractor down for the required information if you need to file a 1099. Once the contractor is paid, your leverage for getting the information is gone. If an independent contractor refuses to provide you with a taxpayer identification number (TIN), and you pay the contractor more than $600 during the calendar year, then you are required to withhold federal income tax on payments made to that contractor. If you do not withhold, your business owes the tax, and it is on you to prove the contractor paid the tax. Save as PDF

At Monotelo, we use our unique knowledge of the job-related expenses of our public-servant clients to reduce what they are paying in taxes. Learn More Getting started with Monotelo Advisors As a firefighter, we know that there are unique deductions available to you that most accountants and tax software fail to capture. That is why we start all of our firefighter clients with a no-cost, no-obligation review of their last three tax returns. We have found that we can typically recover $800-$1,500 per year. To get started with your tax review you can upload your 2015, 2016, and 2017 tax returns using the link below. Upload Your 2015-2017 Tax Returns

By failing to plan ahead, you will find that most of your medical expenses are worthless on your tax return. With a little planning, you can prevent this. If you fail to plan ahead, you will struggle to claim your medical expenses as an itemized deduction when April 15th arrives. You will lose the ability to deduct the bulk of these expenses because they need to surpass 10% of your Adjusted Gross Income (AGI) to be usable as an itemized deduction . This means that taxpayers who make $100,000 during the year will not be able to deduct the first $10,000 in medical expenses. That handicap essentially means you will not be able to deduct any medical expenses, unless you incur heavy medical bills in a single year. And if you are paying AMT (the Alternative Minimum Tax) - don't even think about it. When it comes time to pay your income tax bill, most Americans want to pay the lowest amount possible. One of the ways taxpayers seek to do this is by increasing the number of deductions they take on their tax return each year. So it's not surprising that one of the common questions we receive from our clients is whether or not they can deduct their medical expenses. While the simple answer is "yes," the reality for most taxpayers is "no." However, with a little planning, that answer can be "yes." If you fail to plan ahead, you will struggle to claim your medical expenses as an itemized deduction when April 15th arrives. You will lose the ability to deduct the bulk of these expenses because they need to surpass 10% of your Adjusted Gross Income (AGI) to be usable as an itemized deduction . This means that taxpayers who make $100,000 during the year will not be able to deduct the first $10,000 in medical expenses. That handicap essentially means you will not be able to deduct any medical expenses, unless you incur heavy medical bills in a single year. And if you are paying AMT (the Alternative Minimum Tax) - don't even think about it. The best way to counteract this nasty little piece of the tax code is to set up an HSA (Health Savings Account) and contribute to it each year. When you contribute to an HSA you get the privilege of deducting the amount of your contributions from your income and you bypass the 10% threshold. You can do this even if you don't choose to itemize your deductions! And as an added bonus (do we sound like an infomercial?) - the money you put into your HSA, as well as the earnings of the account, can be taken out tax free as long as they are used for qualified medical expenses. While you cannot pay your health insurance premiums with funds from an HSA, you can pay most other medical expenses. Additionally, once you turn 65 you can use the HSA to pay your Medicare or other healthcare premiums. Requirements for an HSA In order to qualify for an HSA you must have a high-deductible health plan - defined as a healthcare plan with: 1 An annual deductible of at least $1,350 for individual coverage or at least $2,700 for family coverage. 2 Maximum annual out-of-pocket expenses of $6,750 for individual coverage and $13,500 for family coverage. Once you have your HSA set up you can contribute up to $3,500 per year for individual coverage and $7,000 for family coverage. If you are over the age of 55 you can contribute an additional $1,000 annually. Save as PDF Read More Articles Share Failing to order your affairs to minimize your tax burden could cost you significant money - so don't wait to take action. If you have additional questions or need some planning help, please reach out to us. Avoiding the 10% Threshold for Medical Expenses How do you setup an HSA? If your employer offers a high-deductible health plan, they should also give you the ability to contribute to an HSA. You can also open an account on your own through a qualified HSA provider, such as a bank or insurance company (go to www.hsasearch.com for a list of qualified HSA providers). What happens if you don't plan ahead? So what is the solution? Key Takeaways If you don't plan ahead and contribute to a Health Savings Account then you will find that most, if not all, of your medical expenses will be ineligible for a deduction due to the 10% threshold that must be met before deducting medical expenses. By setting up and contributing to a Health Savings Account you can deduct your full contribution to the account and have the flexibility to pay your medical bills with tax-free withdrawals from the account.

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Monotelo Advisors Inc FinCEN Beneficial Ownership Engagement Letter Heading 1 Thank you for choosing Monotelo to assist you with the preparation and filing of your FINCEN Beneficial Ownership Information (BOI) report. This engagement letter outlines the scope of our services, your responsibilities, and our commitment to providing you with accurate and timely compliance solutions. By agreeing to this letter, you authorize Monotelo to gather, prepare, and submit the required information on your behalf to ensure compliance with FINCEN regulations. As part of this process, please ensure that you upload a valid driver's license for each shareholder and manager. This step is essential for verifying their identities and completing the report. Additionally, all fields marked with a red asterisk (*) are required and must be completed to proceed. Once all necessary documents are uploaded and required fields are filled out, a blue "FINISH" button will appear, indicating that you are ready to submit the report. We look forward to working with you and ensuring that your reporting obligations are met with precision and professionalism.

Whether you are just starting out, or are a seasoned veteran, you need someone who will work with you to ensure that you are set up for success. Focus on growing your business, we'll handle the rest. Any competent firm can help you file an accurate tax return, prepare your payroll or manage your monthly bookkeeping needs. And yes, we do that for our clients. But there is so much more to having the right financial partner. At Monotelo, we bring together our deep understanding of the Internal Revenue Code and how that intersects with you as business owner to arrange your affairs to mitigate short-term and lifetime tax liabilities to help you reach your long-term goals. Get started Learn More What we offer Entity Structuring C-Corp? S-Corp? LLC? Or Sole Proprietorship? Monotelo will meet with you to get an understanding of your unique financial situation, your short and long-term business goals, and the implications of your business income on your personal tax return. Then we will guide you to the right solution and walk with you step-by-step to secure the optimal corporate structure for your business. Learn more Get started All In One Business Owner Package You are more than just a business owner. Y our business is just one component of your personal financial picture. And that's why a comprehensive understanding of your personal balance sheet and your other income sources is so essential to helping your achieve your long-term goals, so there's no disconnect between you, your business, and where you want to go in life. Learn more Get started Small Business Service Bundles Monotelo will meet with you to understand your unique needs as a business owner, and suggest a level of service that best fits your growing business and your long-term goals. From there we will guide you through the process to get started, and take away the distractions that keep you from growing your business and building your best life possible. Learn more Get started How Monotelo can help your business. Heading 1 Minimize your tax liability Easy year-end tax filing Monotelo makes year-end tax filing easy. By asking the right questions and ensuring your taxes are filed on time, Monotelo will give you the confidence that things are getting done right. Grow your net bottom line Monotelo will help you structure your business so that you minimize your taxable income, and reduce your lifetime tax liability by eliminating the tax inefficiencies. Minimize your tax liability Monotelo will bring our expertise to the table to help you maximize your tax credits and tax deductions to minimize your taxable income and maximize what you keep in your pocket. Year-round support If you wait to see your accountant until tax time, there is no way they can strategically help you. Our team is a vailable year-round to come along-side you, to help you plan strategically and to answer any questions that you have . Get started Section 3 Schedule a free consultation. Monotelo Advisors will meet with you to get to know your business needs and understand your unique situation. Select your service. Monotelo will prepare a proposal and help you determine the service package that is best for your business. Sign the engagement letter. Yes. It's that simple. Get back to business. We will handle the finances, so you can focus on growing your business. How the process works Get started Helpful small business articles. Turning Your Residence into a Legitimate Tax Strategy For self-employed professionals and business owners, making the most of available tax strategies can significantly impact your bottom... Are Hidden Human Resource Risks Costing Your Business? Here’s How Assessing Your People Practices Can Protect Your Bottom Line Debbie Rabishaw is a consultant who works with small and medium-sized businesses ranging from 2 to 200 employees. She has seen firsthand... Critical Deadlines and Tax Changes for Small Business Owners As the 2024 tax season approaches, small business owners must stay ahead of critical deadlines and be aware of key tax changes to ensure... View More Retirement Planning. Our Values-Based planning will build the road map so you can have confidence that all the pieces of the puzzle are working together for you to live your best life possible. Learn more Year-End T ax Filing Services. We will help you minimize your taxable income by capturing all the deductions and credits available to maximize your refund. Learn more More services from Monotelo Checkout our book written for small business owners!

We are living in interesting times. While it is important to review the retirement and tax planning aspects of your situation on a regular basis, it is equally imperative to review the risk side of your balance sheet as well. In times like today, unaddressed risks can result in a negative impact on an otherwise healthy financial plan. That is why we created our Crisis Checklis t, designed to help families navigate a rapidly changing world. We realize some of the topics are somewhat personal, but our role as advisors is to make sure you have the proper plans in place, both in good times and in times of crisis. More than just identifying potential risks, this checklist will help you create a roadmap of areas exposed to risks that may need to be addressed. We do not want you, your family, or your financial future to be exposed to unexpected risk due to the uncertainty caused by the COVID pandemic. If you would like us to help you assess and mitigate your financial risks please complete the checklist and then schedule a complimentary 20-minute strategy call with us. We look forward to speaking with you soon, Read more articles FINANCIAL PLANNING CHECKLIST Failing to order your affairs to minimize your tax burden could cost you significant money - so don't wait to take action. If you have additional questions or need some planning help, please reach out to us.