In the most recent in a now developing line of Tax Court cases involving the application of Section 280E of the Internal Revenue Code, a hard blow struck the ever-expanding cannabis industry. In Patients Mutual Assistance Collective Corp. (dba Harborside Health Center) (“Harborside”), v. Commissioner, 151 T.C. No. 11 (November 29, 2018), the Tax Court rejected a variety of arguments in support of ordinary and necessary business deductions and costs of goods sold taken by a taxpayer...
By James Jenco
If you own a food and beverage establishment, you might be overpaying the IRS in payroll taxes. That could be the case if you’re not taking advantage of IRC 45(B). This rather little-known federal tax deduction could save you hundreds or even thousands of dollars a year, depending on the size of your tip-eligible workforce. Here’s how it works.
As you probably know, it’s your responsibility to pay the employer withholding tax on the FICA and Medicare...
Understanding the NJ Alcohol Tax
By Paul Lembo
You’ve perfected your batch. You’ve scouted your location. You’ve raised the capital. And now you are ready to venture into the wild, wonderful world of professional brewing.
But before you make that first pour, make sure you understand the state tax laws that apply to your sales.
In New Jersey, alcohol producers must pay not only state and federal taxes, but also an additional alcoholic beverage tax. These taxes can be significant,...
By Paul Lembo
In recent years, the American alcohol scene has been overtaken by the rise of microbreweries and brewpubs. Entrepreneurs across the country have been taking advantage of the evolving tastes of a beer-drinking population willing to pay a premium for flavorful ports, pilsners, IPAs and other brews.
But because of the archaic, limiting laws that were in place until late 2012, the state of New Jersey is behind the craft brew times and is only beginning to catch up to the...
By Paul Lembo
Food and beverage retailers recognize the cloud as an important digital resource for IT, security and internal and external communications. But when it comes to critical accounting services, many clients in this industry don’t think of cloud computing as an applicable solution.
Cloud computing is any hosted network services provided through the Internet and not housed on your own servers or mainframes. Accounting software can be delivered in the same way to help businesses...
Each year, approximately 48 million Americans get sick, 128,000 are hospitalized and as many as 3,000 die as the result of foodborne diseases. To better protect consumers, the U.S. Food and Drug Administration (FDA) has brought sweeping reforms to the country’s food safety laws under the Food Safety Modernization Act (FSMA).
Signed into law in 2011 and going into full effect in 2016, the FSMA requires American food and beverage producers to be more proactive in preventing foodborne...
How food and beverage entrepreneurs can ramp up production without going broke in the process
By Jim Duffy
You’ve just sold your leading food or beverage product to a major supermarket chain and it wants to conduct a test run in 50 stores.
Your hard work is finally paying off. Your company just got bigger in terms of sales and opportunity, and now you need the workforce to match. Right?
Not so fast.
The power of outsourcing
The true cost of an employee is much greater than a salary,...
How to retain ownership and control while bringing on investors
By Arnold Macalintal
Your food or beverage business is going well, but you’re thinking it may need a cash infusion.
Taking on investors can ease your financial burden, but at what cost? You’re the one with the dream, the plan and the sweat equity invested in the business, so why should you cede control to outsiders?
Here are some tips for getting the cash you need without losing the ability to run your business your...