How 40 Ambiguities (and Outright Errors) in the New Tax Law Could Cost You Big Money

Many entrepreneurs have celebrated President Trump’s signature legislative achievement, the 2017 Tax Cuts and Jobs Act, for decreasing their annual tax bills. Indeed, the law reduces the maximum corporate tax rate from 35 percent to 21 percent, and further allows pass-through firms to deduct up to 20 percent of their business income, excepting personal services. But a series of errors and ambiguities in the language of the law could mean losses for hundreds of businesses, keeping tax preparers busy this season. 

“For many retailers, there’s going to be a cash flow hit,” suggests Rachelle Bernstein, vice president and tax counsel at the Washington, D.C.-based National Retail Federation, a trade association, who notes that many of her clients are already shoring up costs in preparation for a higher tax bill in 2018. “Some companies have told me that they were planning on passing on their tax savings to workers and boost wages, but can no longer do so until this is resolved,” she adds.

In particular, Bernstein is referring to Sec. 13204/168 (3), an element of the law that intended to simplify depreciation rules for businesses making renovations or other property improvements, such that these expenses could be deducted from the company’s tax bill over 15 years. Because of a clerical error, however, these costs must be deducted over 39 years, diminishing the bonus that dozens of restaurants and retailers had expected to receive, and for which many have already begun spending. “Say I invested $100,000 in property renovations in 2018,” explains Bernstein. According to the intended depreciation rules, “I should be able to get the full $100,000 back [after filing my taxes.] Instead, the way the law is written, I will only get a 2.5 percent write off, or $2,500,” she adds.

The lack of clarity around real property investments is just one of more than 40 issues that the U.S. Chamber of Commerce recently highlighted in a letter sent to the Department of Treasury last Thursday. The 15-page document requests clarification on how the law affects multinational corporations and pass-through firms across the country. “The Chamber strongly urges the Treasury and the I.R.S. to work closely with the business community to implement the recent tax changes in a manner to ensure as little disruption as possible to normal business operations and to ensure this law encourages the U.S. economy to achieve its growth potential,” noted Caroline Harris, vice president of tax policy at the Chamber, in the letter.

Another pressing error impacting independent agriculture firms, in particular, is what analysts are referring to as the “grain glitch.” It’s an eleventh-hour addition to the tax law, permitting farmers to deduct 20 percent of their total sales to cooperatives, which are agricultural organizations owned by groups of farmers. Dozens of local processors, however, insist that the loophole is reducing their competitiveness, inasmuch as farmers are now more likely to sell to the coops to get the write off.

David Gamage, a professor of tax law and policy with Indiana University’s Maurer School of Law, notes that many companies are now looking to restructure themselves as coops to recoup the lost sales. Still, “there are costs to everyone considering restructuring,” he says. “If you think that Congress is going to fix this soon, maybe you wait and see, but I wouldn’t wait too long, and potentially lose quite a bit of business to competitors,” he advises. 

Of course, all of this could be assuaged if the Treasury and the I.R.S. simply issue a technical correction to the grain glitch and depreciation rules, respectively, though it’s unclear when that could come. It’s also worth pointing out that technical errors, such as the above, are not unheard of. The NRF’s Bernstein says she counts some 7 technical correction bills that have been issued over the past 25 years. Others, however, say the gravity of these issues is far more substantial than ever before. “Stuff like this happening isn’t unique, but the order of magnitude is completely unprecedented,” says Indiana’s Gamage.

Drawing the Line

To his point, while cooperative and property deductions are likely to be handled in an efficient manner, there are other, more ambiguous issues with the current tax law. In particular, analysts point to a provision that allows pass-through entities to deduct up to 20 percent of their Qualified Business Income, although it is unclear to whom exactly this deduction might apply, since certain ‘professional services’ are exempt. “There is a vague sense that the drafters want to offer the deduction to businesses that aren’t service types, but exactly how you draw the line is very hard to figure out from reading the statute,” suggests Gamage.

Indeed, the lack of clarity vis-à-vis pass throughs has led many partnerships to consider restructuring altogether as C-corporations, to avoid the whole depreciation aspect–and to access the reduced maximum tax rate of 21 percent. Edward Reitmeyer, a partner with the Philadelphia accounting firm Marcum LLP, notes that several of his clients are seriously considering the move. “It’s really being discussed, but you’ll see that for the most part, everyone is couching that advice,” he adds, referring to the possibility that the law could be tweaked to bring greater clarity for business owners. Other analysts caution against restructuring, inasmuch as pass-through firms could potentially be taxed twice–once on the 21 percent preferential rate, and again if and when the owners pay dividends. “The two levels of tax would make a corporate operation less advantageous than a partnership,” suggested William Kambas, a partner with the international law firm Withers Worldwide, in an earlier phone call with Inc.

Ultimately, many entrepreneurs are wise to get creative this season, or risk losing out on valuable savings. “Unfortunately, almost any business with substantial income that doesn’t want to leave easy money on the table probably needs to spend,” suggests Gamage. “Any business currently structured as a pass-through needs to get good legal or accounting advice to even start to work through their basic options.”

Did You Buy or Sell Bitcoin in the Last Year? You May Owe Taxes to the IRS

Cryptocurrencies like bitcoin may not be regulated by the government, but they’re still subject to being taxed.

There have been various forms of digital currencies around for years, but several have taken off in popularity recently. And that may leave some newcomers to this marketplace unaware that they face taxation on their dealings.

The IRS says that cryptocurrency transactions  are taxable by law. That means people who made money (or lost it) on bitcoin trades, “mined” ethereum or even bought a cup of coffee with digital currency face potential tax implications. Failure to report it could mean potential audits, fines and penalties.

There are also people who may be upset to find that cryptocurrencies, which are not linked to a government or central bank, aren’t as off-the-grid as they hoped. Part of their appeal is that it could be used as a new, more anonymous kind of currency that operates outside the traditional banking system and government oversight.

“There’s a very strong sentiment that taxing cryptocurrency is sort of sacrilegious,” said Tyson Cross, a tax attorney in Reno, Nevada who specializes in this niche. “But most people understand there is a difference between upholding a principle on an anonymous internet forum and going to jail over it.”

The IRS didn’t weigh in on how to tax digital currency until 2014 and that remains its only guidance to date. We spoke to a few experts to help break down the basics:

WAIT, I OWE TAXES ON THIS?

Yes, most likely.

All digital currency transactions are taxable events, according to the IRS. That includes if you sell it, trade it, “mine” it, use it to pay for something or were paid with it. Even if you sell cryptocurrency and keep the gains in your exchange account, instead of as real cash in checking account, it’s still taxable.

Bought some bitcoin but still holding on to it? Relax, you don’t owe any taxes yet. But any time the digital currency’s value was “realized,” you need to report it.

How it is taxed depends on how you used it, said Lisa Greene Lewis, a CPA and tax expert at TurboTax.

Another key thing to remember is that these digital currencies are taxed as property, instead of currency, for tax reasons. That means the same rules apply if you sell bitcoin as if you sold stocks.

WOULD THEY IRS REALLY KNOW?

True, the IRS only knows what you tell them, to a degree.

However, if they find out that you were not properly reporting the income from virtual currency transactions, you could be held liable. And experts are quick to point out that the IRS is very interested in this new frontier.

In 2016, a court authorized the IRS to summon information on Americans who engaged in business with Coinbase, a virtual currency exchange, to look for tax wrongdoing. It later narrowed its search to high-level traders, but was clear in its message that it will make sure all taxpayers are paying their share.

Omri Marian, a law professor at University of California, Irvine, called cryptocurrencies potential “super tax havens” back in 2013. He says people may still be using them to evade taxes but he is more optimistic these days, in part, because the IRS is going after this matter.

“This reminds me a lot of the Swiss bank crisis awhile back,” said Cross. “People were confident (their information) wouldn’t be revealed to the IRS and it worked for (years) but when Switzerland cracked, it was too late. People faced penalties and went to jail.”

SO WHAT DO I DO?

Keep good records.

It’s tough to figure out the value of some of these transactions. There is software out there to help you figure out your capital gains and losses for digital currencies, such as bitcoin.tax and cointracking.info. You can also seek out a tax professional or other expert who has some experience in this field.

And “be deliberate about when to make crypto trades” says Cross. It’s very easy to get caught up in the next trade without realizing how it’s calculated. You could be racking up considerable capital gains without realizing it.

–The Associated Press

5 Easy Rules to Better Understand How Your Cryptocurrency Is Taxed

In my practice, I have seen a lot of clients make big money investing in cryptocurrency. But I have also seen a few lose money. Whether money is made or lost, it seems clients always have a tough time understanding how virtual currency is taxed.

Back in 2014, the IRS issued official guidance clarifying how virtual currency will be taxed. In most situations, the rules that govern capital gains will apply to the sales or dispositions of such currencies. The result is that the tax treatment is similar to stocks and mutual funds.

But there are a few complexities in the application of the guidance. Let’s look at the five rules the virtual currency investor needs to know.

1. Know when you have a taxable event.

Cryptocurrency is of course volatile and, for tax purposes, you only care about what you paid and what you received when you sold it. The daily ups and downs don’t matter.

A taxable event occurs whenever it is traded for cash (or other cryptocurrency) or whenever it is used to purchase goods or services. You must sell, trade or otherwise dispose of it.

When you sell a stock or mutual fund, your brokerage will typically send you a 1099-B at the end of the year that will report the sale. However, the IRS currently does not require 1099 reporting for virtual currency.

Many platforms (like Coinbase) offer an annual transaction summary that can be used to help you at tax time. But cashing cryptocurrency out of an exchange or other platform can be treated as a sale of the asset. Ultimately, it is up to you to track your activity.

2. Understand how capital gains and losses are calculated.

For tax purposes, capital gains and losses are calculated by examining the difference between your cost basis and the sales price (net of commissions). For simplicity, cost basis is what you paid for the asset. Basis can be adjusted up or down depending on certain events.

Gain example: Let’s assume that in 2014 you acquired a cryptocurrency for $2,000. In 2017, you decide to sell it for $150,000. You have a realized capital gain of $148,000.

Loss example: Let’s assume that in 2017 you acquired $20,000 in cryptocurrency. Let’s also assume that you sold it later in 2017 for $15,000. You would have a realized capital loss of $5,000.

3. Make sure you determine the holding period.

Once you have determined that a sale occurred, you need to determine the holding period. This is the period between the date you acquired it and the date you sold it.

If you held the asset for more than one year it is considered a long-term gain or loss. These gains are generally 15 percent, but can range between zero and 20 percent depending on your income (and don’t forget the net investment income tax).

If you hold an asset for one year or less, it is considered a short-term gain or loss. These gains are taxed as ordinary income. This means that it is taxed at your marginal tax rate.

4. Understand what happens if you use cryptocurrency to pay for goods or services.

This is one of the biggest complexities about cryptocurrency. You could have a taxable event even though you don’t cash out. If you use it for goods or services, you need to treat each product or service purchase as a sale of cryptocurrency. The same holds true for trading one cryptocurrency for another one (1031 exchanges aside).

Remember, it is taxed like stocks. If you sold shares of Apple and used the proceeds to buy shares of Netflix this would be a taxable event. It doesn’t matter if you didn’t take the cash out of the brokerage account.

5. Understand capital loss rules.

You should use the prior rules to determine individual gains and losses. Then aggregate them all and if your realized losses exceed your realized gains, you have a net capital loss for tax purposes. You can take up to $3,000 of capital losses and use them to offset your other ordinary income. If your net capital losses exceed $3,000, you then carry the loss forward to future years.

The debate rages on as to whether cryptocurrencies, such as Bitcoin, Ethereum and Ripple are good investments. But one thing is for sure. The IRS wants you to report and pay tax on any taxable gains.

The documentation you may receive from the platform may be minimal, but it is up to you to make sure that you accurately and timely report it on your tax return. Not doing so can get you into trouble. Good luck to you and your accountant.

What Entrepreneurs Need to Know About the Changes to Pass-Through Taxes

As the calendar ticks forward to April 15th, the pressure of tax season, tax reporting, and getting the best deal on your return will only increase. Running your business, keeping up with technology trends that include the disruptive force of blockchain, and dealing with the periodic tax obligations (including quarterly taxes) of any business can seem complicated enough, but that is not the end to this conversation.

Following the passage of tax reform at the end of the last year, and even taking into account the reality that some of these changes will benefit your bottom line, it can be difficult to understand what this legislation means for you and your business. One change that might impact your business, and that will impact the majority of American businesses, is the is the 20 percent deduction now applicable to pass-through businesses.

Deductions on taxable income will reduce how much you owe in taxes, but like any major legislative change there are complications and tweaks that will be addressed going forward. That said, it’s important to take a serious look at some of the major changes that will impact entrepreneurs and their businesses, and understand what this means for your business.

Let’s take a look at a few things you need to know about the 20 percent deduction of qualified business income as you start preparing your taxes, and your business:

1. Certain businesses are excluded.

Deducting 20 percent of your business income from your taxable income may seem like a savvy decision, and it is — this is a change to the tax code that will have a positive impact on your bottom line. Even with this good news, however, it’s important to pay attention to the details, especially when it comes to navigating the tax landscape.

Specifically, certain businesses, including but not limited to accounting firms, engineering firms, and law firms, do not qualify for this deduction.

Also, be sure to keep an eye on the income limits for this deduction, which start at $157,500 for individuals, $315,000 for married couples, but can vary depending on how your business is structured.

2. Qualified business income may not be as straight forward as you think.

Assuming you, as many entrepreneurs do, have a 9-5 job in addition to entrepreneurial endeavors, the following example illustrates the idea of qualified business income, which can otherwise seem abstract. The 20 percent deduction, based on interpretation of current guidance, will be applied to the lesser of salaried or self-employed income.

Assuming an individual is employed, and has earnings of $110,000 on a salaried basis, and also has an entrepreneurial venture that generates $45,000 in net profit, a simple analysis is possible:

  • Let’s assume that this individual’s taxable income, less existing deductions and credits is $115,000. In this example, the 20 percent pass through deduction will be applied to the $45,000 of business income, which in this case also happens to be self-employed income. This application will result in a deduction of $9,000 ($45,000 X 20 percent).

Every entrepreneur and small business owner is different, and interpretation is still an ongoing conversation, so it’s important to work with your CPA or tax professional when analyzing these changes.

3. Other tax changes will influence your taxable income.

It’s important to remember that you, and your competition, operate both as entrepreneurs managing businesses, and also are individuals attempting to navigate the changing tax landscape. These changes include, but are not limited to:

  • The changing deductibility of state and local taxes (SALT)
  • Changes to the deductibility of individual charitable contributions
  • Increased assessment and enforcement of online sales taxes  

These changes and updates to the tax code will impact you, your employees, and your customers — not analyzing these changes will leave you unprepared in fast changing business environment.

Taxes, especially as a small business owner juggling a variety of obligations, can be a stressful time of year even without taking into account the recent changes. Digging through these the changes enacted as a result of tax reform can seem daunting, but they do not have to be. Understanding your tax obligations, working to position your business to take advantage of these updates, and working your tax professional will you leave in a position to win tax season in 2018.

Small Business Owners Hold Off Tax-Related Bonuses and Raises

Small business owners may want to hand out bonuses and raises now that there’s a new tax law, but many don’t know if they’ll have any wealth to share.

“We didn’t base any raises or bonuses on the tax situation because, quite frankly, until it actually happens, no one’s sure what’s going to happen,” says Rod Hughes, a vice president at Kimball Hughes Public Relations in Blue Bell, Pennsylvania. The company gave its seven full-time employees year-end bonuses last month.

It’s easier for big companies like Walmart and Home Depot to award bonuses because they already know their top tax rate is dropping to 21 percent from 35 percent under the old law. Millions of small business owners have far less certainty.

The law provides for a break for the owners of sole proprietorships, partnerships and small businesses structured as what are called S corporations. But while they can deduct 20 percent of their business income, the size of the deduction declines when an individual owner’s taxable income reaches $157,500. And the IRS still needs to issue regulations on how these owners’ business income is calculated.

“The 20 percent deduction is extremely complex and it’s going to require a complete understanding of how the statute works,” says William Hornberger, an attorney with tax expertise at the firm Jackson Walker in Dallas.

Big companies also have an advantage because they have billions of dollars in cash reserves. Small and mid-size businesses often don’t have such cushions or access to big lines of credit that can help pay operating costs if revenue slows. Giving bonuses or raises in response to a potential tax cut could leave smaller companies vulnerable to a cash flow crisis.

Even when tax professionals have more clarity about the law, small and mid-sized companies are likely to hold off. Owners typically give raises at the end of the year or early in the new year, after they have assessed how employees and the company overall have performed. If owners have a sense of what their revenue and profits will be in the year ahead, that goes into the mix as well.

Mark Carpenter has consulted both of his accounting firms about the law, and gotten different opinions about its potential impact on his roofing company.

“We need to see how the rules change and if it allows us to raise wages,” says Carpenter, whose business, Columbia Roofing & Sheet Metal, is based in Tualatin, Oregon. He’s already given employees raises and bonuses based on the company’s performance, but needs to be careful with cash flow because the business is growing rapidly.

It’s not known exactly how many companies overall have awarded raises or bonuses based on the law. The most recent report on employee wages from payroll company ADP covers the fourth quarter of 2017 and doesn’t reflect the impact of the law. But the first-quarter report also may not reveal any trends because it won’t specify the factors that go into higher pay, spokeswoman Allyce Hackmann says.

Many business owners say they don’t base decisions, including raises and bonuses, primarily on how much money they might save on taxes. Small business advisers say they’ve been seeing their clients holding to that conservative approach since the law went on the books in December.

“The idea of giving more money to employees purely on speculation that you’re going to see more in your pocket, that’s counterintuitive,” says David Lewis, CEO of OperationsInc, a human resources provider based in Norwalk, Connecticut, whose clients are primarily small and mid-sized companies.

Rob Basso is seeing raises being awarded at the clients of his company, Advantage Payroll Services, but he’s not hearing that the tax cut is a factor.

“What they’re doing is sticking to the normal reasons for giving raises, like giving merit raises,” says Basso, whose company is based in Plainview, New York.

Steve Kalafer has given the 700 employees of his car dealerships bonuses of up to $500 because Flemington Car & Truck Country Family of Brands will benefit from the corporate tax cut. But any further bonuses, or raises, will depend on how many cars his dealerships sell.

“We don’t have a clear trend for the year,” says Kalafer, whose dealerships are located in Flemington, New Jersey.

It’s worth noting that many of the big corporations gave one-time bonuses, not permanent raises. So if the tax cut turns out to be less of a boon than expected, or the companies have a bad year, they’re not committed to higher compensation going forward.

But the prospect of a tax cut does help some owners feel more secure about increasing staffers’ pay. Tjernlund Products has given raises and bonuses, mindful of the need to recruit and retain talented workers in Minnesota’s tight labor market; the state’s unemployment rate is a full percentage point below the national rate of 4.1 percent.

Co-owner Andrew Tjernlund doesn’t know what taxes will be like for the company that manufactures fans and ventilation equipment. But he sees the law as an opportunity to be a more competitive employer.

“The tax cut allows us to invest more in our growing business,” he says. “In this low-unemployment environment, securing and rewarding our employees is the best use of this freed-up money.”

Hughes also believes tax savings can help his company in a tough labor market.

“The war for talent is only going to get harder as we go along,” he says.

–The Associated Press

Whitney Houston’s Estate Reaches $2 Million Settlement With the IRS. Here’s Why You Should Be Concerned

Whitney Houston’s estate just cut a deal with the Internal Revenue Service. The IRS originally assessed an $11 million tax bill against the estate, but settled for a mere $2.2 million. This settlement allowed both parties to avoid a costly trial.

The award-winning singer passed away in 2012 at the age of 48. Her daughter Bobbi Kristina Brown, the sole beneficiary of her estate, passed away in 2015 at the age of 22. Disputes ensued over the remaining assets between family members, including singer Bobby Brown.

Here’s how the IRS dispute started. After Houston’s death, the IRS determined that the estate under-reported the value of her entertainment royalties, residual income and other assets.

But Houston’s estate didn’t exactly agree with the IRS assessment. They argued that the assets were fairly assessed on the original estate tax return. Obviously, with millions of dollars at stake, both sides had a lot to risk if the case went to trial.

Why business owners should care.

Situations like this should always be a concern for taxpayers, especially entrepreneurs. This is not because they should fear that the IRS is going to come after their money once they pass away. It is a reminder to make sure that they do some estate planning before it is too late.

But the problem often is that business owners don’t understand what an “estate” is (we’ll get to that shortly). In fact, many successful entrepreneurs have significant estates because of the value of their business interests.

We have all seen instances of businesses that have never generated a profit, but have sizable valuations. The owners might “feel” poor because their businesses are not generating the cash flow they desire. But in reality, there may be a substantial estate tax problem lurking.

This is why estate planning often gets overlooked. We are all busy (or complacent) and just don’t take the time to address the issue with our lawyers and accountants. Then it’s too late.

What is the estate tax?

The estate tax currently applies to the “gross estate” of the deceased. This generally includes all the decedent’s assets, including real estate, business holdings and other tangible and intangible property. The gross value of these items must be calculated normally through a lengthy and costly appraisal process.

But estates then get to deduct certain expenses and liabilities of the descendant. These would include loans and debts along with other nominal expenses like funeral costs, legal and accounting fees and possibly any estate taxes paid to states. The taxable estate is then calculated as the gross estate less any of these allowable deductions.

The IRS then allows a credit to be applied that exempts a significant portion of the estate. Under tax reform, the effective exemption was doubled to approximately $11 million for individuals. Any value of the estate over this amount is taxed at the top rate of 40%.

Had Houston passed away under current tax law, her estate would have been in much better shape. But since she died in 2012, the IRS believed it had some money coming. It was just a matter of how much.

It’s difficult to understand exactly the extent of Houston’s tax planning. But I suspect that she could have done a bit more to ease the pain of the estate tax. But it is too difficult to know for sure.

However, one thing we do know for sure, her tax troubles tell a story that I see often. Make sure that you commit to an estate plan, so you can mitigate any financial pain for your heirs. Ask the right questions before it is too late.

What You and Your Business Can Do to Avoid Identity Theft This Tax Season

Identify theft is a topic and headline that has attracted many headlines over the past few years, with individuals, large corporations, and government organizations falling victim to identify theft and data breaches. Identity theft and data breaches are always a risk, but can be even more prevalent during tax season, when information is at a premium, and business owners are already under extra pressure.

A study conducted by IBM identifies the average cost of a data breach at $3.62 million, and while this figure will obviously vary from organization to organization, the implication is clear. Data breaches and identify theft can have a large negative effect on your business, and lead you to spend large amounts of time and energy repairing the damage caused. Drilling specifically to smaller business, a study by Verizon identifies the following statistics for small businesses and data breaches:

  • Average cost is between $84,000 and $148,000
  • 60 percent of small business go out of business within six months of an attack
  • 61 percent of all data breaches impacted small to medium size business in 2017

This is a topic that definitely should be taken seriously, but it shouldn’t result in paralysis by analysis — there are things you can do today to protect yourself and your business from identify theft.

1. Set up a virtual private network for your business. 

Wi-fi can be convenient, but using an unsecured wi-fi connection is one of the easiest ways for hackers and other criminals to obtain your personal and business information. A VPN network is not a guarantee of securing your personal and business information, but it is more secure than wi-fi, and relatively simple to set up.

Setting up your business VPN, if you feel comfortable setting up a business email account and profile, is something you can do over a weekend, and is well within your budget.

2. Review your business credit report.

Setting up and improving your business credit is a process that many entrepreneurs overlook, but in addition to giving your business the financing it needs, is also something you need to monitor on a continuous basis.

You are entitled to a free credit report from each of the three major credit bureaus, and can request them either from the credit bureaus or from annualcreditreport.com. Even better, you can configure you account to send you automatic alerts and messages to keep you current on changes to your business credit file.

3. Consider identify theft insurance.

Insurance is a thing that you hope to never use, but it’s something you should certainly give serious thought to getting. This is even more true when it comes to protecting the identify and credit of your business — imagine only finding out that someone has taken out loans in the name of your business when you are looking to expand or grow your business?

There are lots of different options out there, so be sure to work with your CPA or financial professional to find a policy that is a good fit for your budget, and your business.

4. Remember that the IRS will never initiate contact except by mail.

As a CPA one of the most common questions I get, especially around tax time, is whether or not a small business owner should respond to a phone call or email from the IRS. Getting an email, or listening to a voicemail that sounds like it is from the IRS can be intimidating, stressful, and even a little scary, but the answer is a definite no — the IRS will never begin correspondence in any way but via mail.

In other words, never provide personal or business information over the phone, via email, or to an online portal without receiving official confirmation that the request is legitimate.

5. Secure your mobile devices.

It’s easier than ever before to conduct business and engage with customers via your phone, tablet, or other mobile device, but that doesn’t mean your security procedures should be any less vigorous than on your desktop computers.

Passwords are a great first step, but some other suggestions including the following, and can be set up for free.

  • Log out completely from any banking or payment app when you are done using it
  • Avoid downloading any unnecessary apps, or apps that request permissions that seem out of the ordinary, such as access to password/confidential information
  • Watch for shoulder surfers, i.e. be aware of your surroundings and anyone who appears especially interested in your phones content.

Identity theft is a real issue, and can cost you time, damage your reputation, and impact your bottom line. That said, taking a few simple steps today can help you secure you and your businesses information, and won’t break the bank.