TCM Advisors

TCM Advisors TCM Advisors is a full-service accounting firm serving clients throughout New Jersey.

At CMFF+Demo, we provide our clients with professional and personalized services and offer guidance in a wide range of financial and business needs. Our service specialties include Tax Planning and Consulting, Estate Planning, Business Valuation and Litigation Support.

Business owners may be able to transfer wealth more tax efficiently by gifting ownership interests to family members. Fo...
10/06/2026

Business owners may be able to transfer wealth more tax efficiently by gifting ownership interests to family members. For 2026, the gift tax annual exclusion is $19,000 per recipient. Certain interests may qualify for valuation discounts. For example, a minority interest may qualify for a lack-of-control discount because the holder can’t dictate business decisions. A lack-of-marketability discount may apply when there’s no ready market for selling the interest. Assuming a combined discount of 25%, this year you could gift an interest worth up to $25,333 (on a controlling basis) tax-free because the discounted value wouldn’t exceed the $19,000 annual exclusion. Contact us to learn more.

10/02/2026

Making smarter capital investment decisions

09/27/2026

From laptops and tablets to power tools and safety equipment, misplaced or mismanaged assets can quietly drain profits and disrupt operations. By tracking equipment and other assets with barcodes, your business can connect its physical property to its financial records. Here’s a closer look at how this technology can help you control costs, strengthen internal controls and maintain more reliable financial records.
Improve asset visibility
A barcode is only one component of an asset-tracking system. Many businesses use barcodes to track inventory, but this technology can also be used to keep tabs on other assets, such as laptops, equipment and tools.
With a barcode system, each item receives a label containing a unique identifier. An employee then scans the code with a dedicated scanner or, depending on the system, a smartphone or tablet. A mobile app or other asset-tracking software connects the identifier to a digital record. That record may include the item’s:
Description
Serial number
Purchase date
Cost
Assigned employee or department
Location, and
Current status.
You don’t have to limit barcode usage to depreciable assets. It’s common for businesses to extend their tracking systems to lower-cost tools, accessories or other items that are portable, valuable or otherwise important to operations.
Each time the barcode is scanned, the system can record an assignment, transfer, return, inspection or other activity. Many systems store this information on cloud-based platforms, allowing authorized employees to view and update records from different locations. The software may also generate reports and retain warranty information, repair histories and maintenance schedules. Together, the label, scanning device and software give the business a current record of tracked property — if employees consistently scan items when they’re assigned, moved or returned.
Some businesses use radio-frequency identification (RFID) instead of barcodes. RFID tags can be read without a direct line of sight, and a reader may capture multiple tags at once. However, RFID requires different tags and reading equipment and may cost more to implement. For many businesses, barcodes remain a practical and relatively affordable option.
Increase accountability
By scanning an item’s barcode when it’s assigned, transferred or returned, employees create a record of who has custody of the property and where it belongs. This documentation may encourage employees to safeguard company property and can help management investigate missing items and identify recurring losses.
Barcode systems can also track the issuance, inspection and replacement of safety equipment. In industries where workplace rules require workers to use protective gear, such as goggles, hard hats and respirators, barcode records can help management identify overdue inspections and replacements — and complement your business’s broader safety and compliance procedures.
Integrate asset and financial data
When integrated with accounting software, barcode tracking software can make financial records more reliable. Each tagged item can be linked to a digital record. For items included in the fixed asset register, the record may contain the purchase date, original cost, placed-in-service date and depreciation method. Reports on purchases, transfers and disposals can help your accounting team keep the general ledger and fixed asset register up to date.
If the system tracks usage and maintenance activity, reports may also identify equipment that’s rarely used, frequently repaired or available for reassignment. This information can help the business avoid unnecessary purchases and plan future spending.
In addition, barcode systems can simplify physical asset counts. Employees can scan assets at each location and compare the results with your accounting records. A reconciliation may uncover missing items, duplicate entries, unrecorded transfers, and assets that are still on the books after they’ve been sold or discarded.
Take control of your assets
Barcoding can be an affordable tool for managing assets. But it’s not the right solution for every business. We can help evaluate your current asset-tracking processes and identify areas for improvement. Contact us for guidance on making better use of your existing system or implementing a new solution that fits your operations and financial reporting needs.
© 2026

09/13/2026

Many small businesses start out as sole proprietorships. This structure is simple and inexpensive to establish and maintain — and it gives the owner direct access to profits without having to take formal distributions. But it also makes your taxes more complicated than when you were a W-2 employee. Here are some federal tax issues to consider if your business operates as a sole proprietorship.
Reporting income and expenses
You’ll report income and expenses from your business activities on Schedule C of your personal return (Form 1040). The net income will be taxable to you regardless of whether you withdraw cash from the business. Your business expenses are deductible against gross income, not as itemized deductions. If you have losses, they’ll generally be deductible against your other income, subject to special rules related to hobby losses, “excess” business losses incurred by noncorporate taxpayers, passive activity losses and losses from activities in which you weren’t “at risk.”
Sole proprietors may be eligible for certain deductions that generally aren’t available to other individual taxpayers. For instance, you may qualify for an above-the-line self-employed health insurance deduction for premiums paid for medical, dental and qualifying long-term care coverage, subject to certain limitations. This means your deduction for medical insurance won’t be subject to the rule that limits itemized deductions for medical expenses.
In addition, you may be entitled to deduct home office expenses if:
A home office is your principal place of business (including when you perform management or administrative tasks there and have no other fixed place to perform them),
You use your home as a place to meet or deal with customers, clients or patients in the normal course of business, or
You store inventory or product samples at home.
In general, to qualify, the area must be used regularly and exclusively for business purposes.
The home office deduction may include an allocable part of mortgage interest or rent, insurance, utilities, repairs, maintenance and, if you own the home, depreciation. Alternatively, you can use a simplified method based on the square footage of the qualifying space. You may also be able to deduct travel expenses from your home office to another work location.
Be sure to keep complete records of your income and expenses. Proper documentation is needed to claim all the tax breaks to which you’re entitled. Certain expenses, such as automobile, travel, meals, and home office expenses, require extra attention because they’re subject to special recordkeeping rules or deductibility limits.
Claiming the QBI deduction
Another special tax break that you might qualify for as a sole proprietor is the Section 199A qualified business income (QBI) deduction. It generally equals 20% of QBI, not to exceed 20% of taxable income. QBI generally is defined as the net amount of qualified items of income, gain, deduction and loss that are effectively connected with the conduct of a U.S. business. QBI doesn’t include certain investment items or reasonable compensation paid to an owner for services rendered to the business.
This deduction is taken “below the line,” meaning it reduces taxable income, rather than being taken “above the line” against your gross income. However, you can take the QBI deduction even if you don’t itemize deductions and instead claim the standard deduction.
One word of caution: The QBI deduction is subject to additional limits at higher income levels. For 2026, these limitations generally begin to apply when taxable income (calculated before any QBI deduction) exceeds $201,750 ($403,500 for married couples filing jointly). For 2026, these limitations are fully phased in once taxable income exceeds $276,750 ($553,500 for joint filers). Contact us to learn more about the limitations that apply to your situation.
The One Big Beautiful Bill Act (OBBBA) made the QBI deduction permanent. Starting in 2026, the OBBBA also expands the income ranges over which the limitations phase in, potentially allowing larger deductions for some taxpayers. And it provides a new minimum deduction of $400 for taxpayers who materially participate in an active trade or business if they have at least $1,000 of QBI from it. The minimum deduction will be annually adjusted for inflation after 2026.
Paying self-employment taxes
One downside of owning your own business is that you must pay self-employment taxes. These taxes are the equivalent of federal payroll taxes for employees, but self-employed people must pay both the employer’s and employee’s share of them. They’re imposed in addition to income tax, but you can deduct half of your self-employment tax as an adjustment to income.
For 2026, you must pay self-employment tax (Social Security and Medicare) at a 15.3% rate on your net earnings from self-employment up to $184,500, and Medicare tax only at a 2.9% rate on the excess. An additional 0.9% Medicare tax is imposed...

09/12/2026

Most Women business owners would like to offer their employees a 401(k) retirement savings plan with all the bells and whistles. But for small businesses with lean budgets and small staffs, offering such benefits may be out of the question. Fortunately, SEP IRAs and SIMPLE IRAs are less expensive and easier to administer. Might one of these tax-advantaged options work for your workforce?
SEP: Flexible and zero setup fees
Simplified Employee Pension (SEP) IRAs are individual retirement accounts you establish on behalf of each participant. (Self-employed individuals can also establish SEP IRAs.) Participants own their accounts, so they’re immediately 100% vested. If participants decide to leave your company, their account balances go with them. Most people roll their accounts over into a new employer’s qualified plan or traditional IRA account.
SEP IRAs don’t require annual employer contributions. That means you can choose to contribute only when cash flow allows. In addition, there are typically no setup fees for SEP IRAs. But participants generally must pay trading commissions and fund expense ratios (a fee typically set as a percentage of the fund’s average net assets).
In 2026, the SEP IRA annual contribution limit is 25% of a participant’s compensation, up to $72,000. That amount is higher than the standard 401(k) account contribution limit of $24,500 (in 2026). What’s more, employer contributions are tax-deductible. Meanwhile, participants won’t pay taxes on their SEP IRA funds until they’re withdrawn.
However, there are a few downsides to consider. Although participants own their accounts, only employers can make SEP IRA contributions. And if you contribute sparsely or sporadically, participants may see little value in the accounts. Also, unlike many other qualified plans, SEP IRAs don’t permit participants age 50 or over to make additional “catch-up” contributions.
SIMPLE: Easy and participant-friendly
Another possibility is to offer a Savings Incentive Match Plan for Employees (SIMPLE) IRA. As with a SEP IRA, your business creates a SIMPLE IRA for each participant, who’s immediately 100% vested in the account. Unlike SEP IRAs, SIMPLE IRAs allow participants to contribute to their accounts if they choose.
Other advantages of SIMPLE IRAs include:
They’re relatively easy for employers to set up and administer.
They don’t require your business to file IRS Form 5500, “Annual Return/Report of Employee Benefit Plan.”
You don’t need to submit the plan to nondiscrimination testing.
Participants pay no setup fees and enjoy tax-deferred growth on their account funds.
Participants can contribute up to $17,000 annually in 2026.
Participants age 50 or over can make catch-up contributions of up to $4,000 in 2026 ($5,250 for those ages 60 to 63).
Participants can contribute more to a SIMPLE IRA than to a self-owned traditional or Roth IRA. But SIMPLE IRA contribution limits are lower than limits for 401(k)s. Also, because contributions are made with pretax dollars, participants can’t deduct them. They also can’t take out plan loans. Then again, making pretax contributions does lower their taxable income. Perhaps most important is that employer contributions to SIMPLE IRAs are mandatory, regardless of your cash-flow situation. However, in general, you can deduct contributions as a business expense.
SIMPLE Roth IRAs are available, too. Ask your financial and employee benefits advisors whether this might be a better option for your business.
Lower-cost options
If you’ve thought you can’t afford to offer workers a retirement plan, think again. In addition to SEP and SIMPLE IRAs, there are now some lower-cost 401(k) options available as well. We can review your budget, tax situation and benefit needs and suggest how best to proceed. Contact us.
© 2026

09/01/2026

Trading items or services — without exchanging cash — has long been common among small businesses. Today, some use online barter exchanges to facilitate trades. In addition to preserving cash flow, these types of transactions may expand your purchasing power, help you move overstocked inventory and increase your business’s exposure to new markets. But bartering isn’t tax free. For tax purposes, bartering is treated the same as being paid in cash.
How it works
The fair market value (FMV) of goods you receive in business barter transactions must be reported as taxable income. And if you exchange services with another business, the transaction results in taxable income for both parties. You must report barter income the same way you report comparable income from regular cash transactions. For instance, a sole proprietor generally reports barter income on Schedule C, and this income may also be subject to self-employment tax.
Depending on what you receive in the exchange, you may be entitled to a business expense deduction or obtain tax basis in property. So, although bartering generates taxable income, it doesn’t necessarily increase taxable profit by the full value of the transaction.
Let’s say a veterinarian agrees to exchange services with a marketing consultant. In this situation, both parties must report the FMV of the services received as income. So the veterinarian would report the FMV of the marketing services received, and the marketing consultant would report the FMV of the veterinary services received. This generally is the amount that would normally be charged for these services. If the parties agree to the value of the services in advance, that will be considered the fair market value unless there’s contrary evidence.
Business expense deductions may also be available with barter transactions. For instance, if a plumber installs a new toilet at a local computer repair shop in exchange for fixing a broken laptop, the plumber would report the FMV of the computer repair services as income. But he or she may also deduct certain expenses:
If the laptop is used in the plumber’s business and the repair would have been deductible had it been paid for in cash, the plumber can still claim a business expense deduction for the repair, subject to the usual deduction rules.
The plumber can also deduct qualifying business expenses associated with the plumbing work, such as materials, supplies and any wages paid to employees.
Income also must be reported if services are exchanged for property. For example, if an HVAC contractor does work for a retail business in exchange for unsold inventory, he or she will have to report income equal to the fair market value of the inventory. Or if an architect does work for a corporation in exchange for shares of the company’s stock, he or she must report income equal to the fair market value of those shares.
Barter exchanges
Some businesses join online barter exchanges (sometimes referred to as barter clubs) that facilitate these transactions. Barter exchanges generally use a system of “credit units,” which are awarded to members who provide goods and services. The credits can be redeemed for goods and services from other members.
In general, bartering is taxable in the year it occurs. But if you participate in a barter exchange, you may be taxed on the value of credit units at the time they’re added to your account, even if you don’t redeem them for actual goods and services until a later year. For example, let’s say that you earn 2,500 credit units one year and that each unit is redeemable for $3 in goods and services. In that year, you’ll have $7,500 of income. If you redeem the units the next year, you won’t pay additional tax because you’ve already been taxed on that income.
If you join a barter exchange, you’ll generally be asked to provide your taxpayer identification number — such as your Social Security number or Employer Identification Number — and complete Form W-9 or a similar certification. In certain circumstances, including failure to provide or properly certify a taxpayer identification number, barter income may be subject to 24% backup withholding.
The IRS generally treats barter exchanges as brokers. If the reporting requirements apply, a barter exchange will send participants a Form 1099-B, “Proceeds From Broker and Barter Exchange Transactions,” by February 15 of the following calendar year. This form shows the value of cash, property, services and credits that you received through the exchange during the previous year. This information will also be reported to the IRS.
No tax-free trade
Bartering may be more common than you think: According to the National Association of Trade Exchanges, more than 400,000 U.S. businesses used some form of barter in 2022, the latest available statistics. Regardless of how you make a trade — directly with another business or through a barter exchange — remember your federal and state tax obligations. We can help you estima...

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Hoboken, NJ
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(651) 687-8295

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