Don’t Be A Victim: Watch Out For Tax Season Tricks

Stephen Hofmann, J.D., CPS, Assistant Vice President, Wealth Advisor & Investment Officer

Stephen Hofmann, J.D., CPA, CFP®, Assistant Vice President, Wealth Advisor & Investment Officer

With more and more of our daily lives being spent online, cyber risk continues to rear its ugly head whenever we log in.  During tax season (January – April), however, we face a higher exposure to identity thieves and the potential for a fraudulent tax return to be filed on our behalf.

In March 2016, the IRS warned that phishing attacks had increased 400% over the previous year.  While it is too early to determine the activity for the 2016 filing season, the IRS has recently concluded a week-long effort – the National Tax Security Week – to inform the public of the risk of identity theft and fraudulent tax returns.  Considerable efforts have been made by both the public and private sectors, leading to over $4B of fraudulent returns halted by the IRS fraud detection systems during the first nine months of 2016.  To thwart the growth in tax fraud, an Information Sharing Analysis Center (ISAC) specifically dedicated to identity tax fraud will launch in 2017, and a pilot program requiring additional verification on W-2’s will be expanded to a larger taxpayer population for the 2016 filing year.

The National Tax Security Week had a one-page publication 4524, known as Security Awareness for Taxpayers.  In it, three themes emerged in the publication – – namely keep your computer secure, avoid phishing and malware, and protect personal information.  These three steps are consistent with the “staying safe during tax time” outlined by StaySafeOnline.org and powered by the national cyber security alliance.

Online outlaws will attempt to lure you in a variety of ways. Watch out for the following:

Fraudulent tax returns: The FTC recommends trying to file your tax return as soon as possible. The IRS only accepts one tax return per Social Security number. If the file is ours and it’s in early, it makes it impossible for a cyber thief to submit another return with your personal information. It’s also important to always use smart practices with your personal information. Remember to only share your Social Security number when it’s absolutely necessary. Check your credit report regularly for shady activity and never throw papers with critical information – like your Social Security number or bank account information – in the trash. It’s best to shred all paper containing personal data.

Phishing and malware: Cybercriminals will try to get you to do “something” so they can steal your personal information. Watch out for unsolicited emails, texts, social media posts or fake websites that may prompt you to click on a link or to share valuable personal and financial information. Armed with this information, online thieves can pilfer funds and/or commit identity theft. And unfamiliar links or attachments can contain malware – viruses, spyware and other unwanted software that gets installed on your computer or mobile device without your consent – which can infect your computer files if opened.

Impostors claiming to be Internal Revenue Service (IRS) agents: The IRS will never email or call you demanding immediate payment without having first mailed a bill. Nor will they ask for a credit or debit card number via email or phone.

Tax preparer fraud: The overwhelming majority of tax preparers provide honest services, but some unscrupulous individuals may target unsuspecting taxpayers and the result can be refund fraud and/or identity theft. The IRS reminds anyone filing a tax return that their preparer must sign it with their IRS Preparer Identification Number.

Investment and insurance products are: not FDIC insured; not guaranteed; and, may be subject to investment risk, including possible loss of principal.

The Basics Behind New Business

A mouthwatering dish your grandmother made you, a leaf falling across the park, or one of the endless questions your preschooler has begun to ask you; the truth is great ideas can come from anywhere. If you have a concept you are itching to turn into a reality, there are some key components you’ll need to make it happen. At Alpine Bank, we were founded upon our commitment to helping businesses succeed, and we are thrilled to help you transform your inspiration into a live entity.

To complete the process from conceptualization to implementation, take into consideration these ten key components to ensure your business has all the legal qualifications necessary. Simply follow these helpful prompts, and if there are any components you’d like further clarification on, never hesitate to reach out! Our experienced team of commercial lenders is here to answer any questions or inquiries you or your business partners may have.

  1. Write a business plan. Your company’s business plan should detail the purpose and differentiators associated with your business. gov is an informative resource to help you determine all the required components for your proposed document.
  2. Register as an LLC or Corporation. An LLC is the most common choice for new business because the Corporation classification does mandate a $10,000,000 revenue requirement.
  3. Finance your new business. There are a variety of ways to finance your business. Whether debt or equity based, our dedicated team can help you determine which route is best suited for your business.
  4. Determine your business location.  Keeping your budget in mind, purchase or lease the space you’ll be using for your location. If you’ll be working from home be sure to take advantage of the associated tax benefits.
  5. Register for EIN and determine payroll structure. Before you hire any employees, you’ll need to register for your Employer Identification Number for federal taxation purposes.
  6. Register your business name. You can choose to register your business as a DBA, or Doing Business As, or you can choose to register your company name and/or logo as a trademark. Both options will allow you to operate under your desired business name.
  7. Open a designated banking and credit card account. Separating your personal finances from your business is imperative in keeping accurate accounting records. Additional tools such as Quickbooks Self Employed can help you manage all aspects of your finances at home or on the go.
  8. Complete registration for state and local taxes. Business taxes are set up differently than your personal taxes. Be sure you’re accounting for all the variables before you open the doors.
  9. Receive business licenses and applicable permits. If you plan to sell alcohol or firearms, you may need federal licenses in addition to the various state requirements.
  10. Structure and start a marketing campaign. Marketing is an ongoing effort, but to get customers in the door, they’ll need to know you’re an option. Get the word out with a strategic marketing initiative, and make a yearly plan on to keep new clients coming in.

10 Ways to Shop Local

Supporting our community is one of the most impactful ways we can help it grow. By shopping with local vendors and utilizing area service providers you and your family can help ensure that our community prospers and grows each year. If you want to shop local, but don’t know where to start, our team at Alpine Bank has come up with some creative ideas you may not have considered yet.

 

  1. Buy your produce at one of our many local farmers markets. Have you been to the North End City Market? It’s right next to our brand new N. Main branch!
  2. Purchase floral arrangements from your neighborhood florist instead of online vendors.
  3. Work with local providers for your insurance management.
  4. Venture out for the night and tour area dining and entertainment establishments.
  5. Buy groceries from a regional company compared to the large national chains.
  6. Like your favorite area businesses on Facebook and other social media.
  7. Shop for birthdays and holidays at our downtown storefront. If you haven’t been to downtown Rockford recently, there’s tons of new shops to check out!
  8. If you have received great service or products from a local business, recommend them to a friend or relative. Word of mouth will always be the most impactful marketing tool.
  9. Stay local when planning weddings or other milestone events and avoid online alternatives.
  10. And of course… bank with a community bank!

 

So make an effort to shop local! After all, money spent at a local business generates 3.5x more wealth for the local economy compared to money spent at a chain-owned business.

10 Steps to Opening Your Own Business

Small Business

Creating the foundation of your next enterprise can be a challenging process. For everything from ideas to permits, it takes a lot to get a new business up and running. At Alpine Bank we would like to help you make your dream a reality, and offer these ten steps to opening your avant-garde operation:

  1. Write a business plan. Creating the sound reasoning behind what you want to do and how you want to do it represents the building blocks to a good business. There are many tutorials to help you develop a plan and to accompany them, we recommend researching information for each section of the document.
  2. Select the best location. Location can make or break a business. In conjunction with your plan’s market research, we suggest scouting out the best potential locations. Adding this element to your proposal can help you create the optimal visualization when describing your concept.
  3. Build a marketing strategy. Great service and great promotion go hand in hand. Unfortunately the old adage, “If you build it they will come,” no longer applies. Now, in order to get clients through the door, you’ll need a structured and continual marketing plan to ensure customers in your area are aware of your business.
  4. Plan your finances. These not only refer to the funds you need to open your business but also the additional costs to help support the initial years of operation. This extra capital will help ensure your business doesn’t topple while building its ongoing customer base.
  5. Meet with a commercial lender. Once you have the core of your business planned and calculated, it’s time to meet with a small business lender to evaluate your risk. He or she may require a percentage down, or that certain criteria are met before loan signing.
  6. Fulfill any requirements. Whether it’s saving additional funds, offering up collateral, or obtaining designated permits, it is best practice to meet and exceed the requirements that your lender has suggested in order to maximize your lending potential.
  7. Close on a business loan. After securing the funds for your business, be certain they’re placed within a business account, instead of a personal one. To help ensure your funds are separated, we also recommend creating an LLC for your business prior to opening.
  8. Purchase or lease the space. Using the money you’ve budgeted, move forward with purchasing or leasing the space for your new enterprise. After space has been secured you’ll need to acquire equipment and supplies from another portion of your predetermined budget.
  9. Structure and hire your team. Another old saying goes, “If you take care of your employees, they will take care of your customers.” This is a great adage to stick by, as more often than not, people are what makes a business successful. Decide your role within the company, and then craft detailed job descriptions for the rest of your potential employees. Start building your team with the best people for the job, and add further help as needed.
  10. Open and continually promote. The big day has arrived and the doors are officially open. Continue to keep them open through constant and innovative marketing efforts. By pushing your products and services to the public you can ensure that they’re aware of your offerings and consider your business a valued option.

We look forward to meeting with you about your next corporate venture. If you have any questions on how to complete the steps above or have additional inquiries on commercial lending, please don’t hesitate to reach out.

Fix-Up Your Budget

Budgeting

HGTV’s latest hit show, Fixer Upper, has fans and home buyers looking for new ways to save and restore old homes. While Chip and Joanna have become experts in home renovation, they’re not too shabby when it comes to finances either. Using their home building skills and our banking knowledge we offer these top tips to help fix up your budget in 2017:

 

  • Build a Strong Foundation

Just as a home cannot stand without a solid base, neither can your personal finances. To begin building the foundation to your finances, it is imperative to start a monthly budget. This system can help you organize how much money is coming in and out each and every month, allowing you to allocate funds for both spending and saving.

 

  • Make the Most of the Unexpected

During the course of renovations sometimes things come up! Whether it’s an unknown pipe, water-damaged floors, or a termite torn framework, Chip and Joanna always find a way to overcome a home’s obstacles. In the case of your budget, an emergency savings account can help you cover those unexpected expenses, and give you a hand if times get tough. Stop in Alpine Bank to get started, and open a dedicated savings account for your emergency fund today.

 

  • Have Some Fun with It

Whether its home renovations or budget structuring, it’s important to enjoy what you do! Just as you see Chip adding his humor into his work, there are helpful ways you can find joy in managing your money. Instead of looking at your budget as a limitation, see it as a tool you can utilize when planning your financial strides. If you and your family want to save for your next vacation, commit to depositing a specified dollar each and every month. After six months or more, you and your family could be heading to the beach to enjoy the fruits of your labor.

  • Always Take Free Advice

Chip and Joanna offer endless tips and tricks to their home flipping business. Always full of great ideas and sage advice, these two make a consistent effort to give their viewers a leg up on their next home project. Similarly, our team at Alpine Bank wants to help you work to achieve your next financial goal! Whether it’s saving for your first home, purchasing a new vehicle, or setting a plan for your retirement, we’d love to offer our experience to help make your financial dream a reality.

 

Whether you watch Fixer Upper every week or are just starting this addicting series, we hope you keep your eyes peeled for other great financial tips. You may find more money management advice than you’d think!

Planning Your Spring Garden for the Best Return

Spring ROI

Spring is still just out of sight, but for prospective spring gardeners, the time to start seed germination is almost here! With seeds for some summer produce taking up to three months to prepare for planting, planning ahead of time can truly make or break both personal and commercial growers. Before you start organizing your garden for the season, we offer these helpful tips to help you make the most of your agricultural investment:

Grow Heirloom: Tomatoes are a staple of countless summer gardens, but what will differentiate your juicy produce from other countless selections at the market? Variety! With new strains of tomatoes being discovered each year, blue, striped, and white fruits can offer your family and customers a unique and delicious twist on a summertime classic. The basic large red tomato has an average price point of approximately $3.50 per pound, but smaller heirloom varieties often go for more than $5.00 per pound. With one plant typically producing over 20 pounds of fruit, you could easily make $100 off of one heirloom plant!

Learn to Preserve: Once you’ve harvested the tomatoes grown above, you can continue to tack on the savings by processing those fruits into recipes that can be canned. Packaged goods like salsa and pasta sauce can run about $3.00 a piece, however, you can create a pantry full for the low cost of the plants and reusable mason jars.

Add Some Flavor: Personal herb gardens have continued to grow in popularity over the past several years, and 2017 is no different. With many urban gardeners opting to plant their own seedlings, you’d think the retail need would decrease. However, the opposite may be occurring. With an influx of gardening comes an influx of use. Many home cooks are beginning to learn the benefits of using fresh herbs, and they’re not always cheap. Generally, a small bunch of herbs can run between $1-3. This in mind, most healthy plants are able to produce a consistent amount of bunches throughout the summer, and even into fall. If you have one plant that offers 50 bunches at $2 apiece, that’s a simple $100 earned for just one plant.

With so many incredible plant varieties to choose from, we’re sure your next garden will be a success! Whether you’re planning to sell your crops at the weekend farmer’s market, or stock a pantry your grandmother would be proud of, the practice of gardening has proven to be a money saver for you and your family. If you have any other great gardening tips, be sure to share them with us on Alpine Bank’s Facebook page.

Alpine Bank Participates in Small Business Assistance Workshop for Minority Business Owners

In February 2015, Congresswoman Cheri Bustos hosted Minority Small Business Roundtable discussions in Rockford and Peoria. Our office learned access to capital was a challenge for the minority business communities in both cities. In response, the Congresswoman hosted the Minority Small Business Assistance Workshop in August 2016, and proved to be very beneficial for the Peoria community.

Martesha Brown and Brenten Witherby pose with Congresswoman Cheri Bustos.

In late 2016, we followed up with small businesses in the Rockford area, and owners reiterated that an event promoting access to capital would be beneficial.

 

In 2015, the Small Business Administration issued over $23 billion in 7(a) Regular SBA loans. The Hispanic/Latino community received only 5% of those funds; the African American community received fewer than 2% of those funds, down from 8% in 2008. Small businesses account for over half of the sales in the United States, and in Illinois, small businesses represent 2.4 million jobs – 46% of the jobs throughout the state. As of 2012, the SBA states that only 36% of businesses are owned by women, and only 10.5% of those businesses have paid employees.

This workshop brought together business owners, lenders from Alpine Bank, Rockford Bank & Trust, Rockford Local Development Corporation, and ACCION, as well as representatives from the Small Business Administration (SBA), to address access to capital within the minority business community.

The experts on hand highlighted different lending resources available to prospective borrowers as well as the components of a successful loan application. By helping women and minority business owners gain access to the tools and resources they need to grow their businesses, we can help grow our regional economy and build up capital within the community.

For its part, Alpine Bank continues to add resources and team members to assist women and minority business owners. In 2012, Alpine hired experienced not-for-profit SBA and local micro-lender, Brenten Witherby, and quickly regained status as one of the top SBA lenders in the State of Illinois.  Cesar Sanchez, Small Business Development Officer, spends every day searching for ways to make loans more accessible throughout our entire community.  Most recently, Martesha Brown joined the Alpine Bank family as Community Outreach Officer where she is responsible for building awareness, implementing financial literacy programs, and providing opportunities to new and existing customers.

Financial Words of Wisdom and How to Use Them

Financial Quotes

With topics ranging on everything from love to education, the wise words of others seem to provide a perspective in our lives that we may otherwise not consider. To help you achieve your financial aspirations this year, Alpine Bank would like to share some words of encouragement that we hold dear, to help you along the way on your journey to financial success.

“Of this be sure: You do not find the happy life… You make it.” -Thomas S. Monson

An encouraging reminder, this quote tells us that the emergency fund, retirement plan, and vacation fund are all worth the effort. Although the chances of being offered a free all-inclusive vacation to Mexico are slim, WE can make it happen for ourselves and our loved ones.

“Attention is the rarest and purest form of generosity.” -Weil

This quote can be applied to both personal and business relationships. The more time you invest in a person, the more value they hold. Whether it’s taking the time to answer customer questions, making it to your child’s basketball game, or simply being willing to pick up a phone call from a frazzled friend, giving someone your time is the ultimate connection to others. If you’re looking to improve a relationship, budget, or business, investing your time is the best place to start.

 

“If you define the problem correctly, you almost have the solution.” -Steve Jobs

 

Whether you’re working on restructuring your personal finances or trying to determine your most profitable product, the first step in finding a remedy is identifying the ailment. In the example of a budget, knowing what you’re spending, earning, and saving offers a visual into potential issues, so you can further adjust those efforts into a constructed monthly plan. By speaking with others, and getting all the cards on the table, you can ensure that that problem is first made clear before the appropriate solution is determined.

“Never be afraid to try. Remember, amateurs built the Ark, professionals built the Titanic.” -Unknown

The worst action you can take is no action at all. No matter what challenge you are facing, always remember that the failure to act is the only true defeat. If you’re looking to start saving for retirement, expand your business, or tackle your debt, the first thing you have to do is start. No matter how you start, the biggest obstacle of your task will be committing to your end objective. At Alpine Bank, we want to help you succeed in both your personal and financial life. If you need a helping hand with your next venture, stop by our nearest office, and we’d be happy to lend an ear.

Can You Really Save on Travel: True or False?

Save Money

Checking numerous sites for the best deal can be labor-intensive, and potentially counterproductive. With many American travelers turning to vacation book sites and apps, Alpine Bank is curious if they really save you money. After thorough research, we’ve discovered these four truths to successfully budgeting your next getaway:

TRUE: Travel sites offer money-saving opportunities.

FALSE: The lowest value is found on the hotel’s or airline’s website.

Many travel booking sites offer discounted airfare and accommodation, boasting the same services, only at a fraction of the cost. However, many times these sites merely display the cost an airline or hotel already has on their own site at no additional reduction. Select providers have begun to reduce participation in these travel search engines, and strive to instead offer their continued customers the best value straight from their own corporation.

TRUE: Credit cards are the most secure and affordable payment option while abroad.

FALSE: Airport currency exchange is worth the convenience.  

While there are many different options to exchange currency before your next trip, the safest method of payment during your getaway will still be your credit card. With many options now offering no currency exchange fees, you’re sure to avoid unwanted conversions costs while still protecting your finances. According to both Visa and Mastercard, credit card users are held liable for zero percent of any fraudulent charges. This means that should your credit card information become compromised during your stay, you won’t lose any funds because of it.

TRUE: Traveling outside of the peak seasons offers great savings.

FALSE: The skiing in Colorado is great in June.

While it is true that avoiding the crowds can save you and your family some extra dollars, it may not be worth it if it means decreasing the activities of your trip completely. Instead of limiting your travel timeline, we recommend looking for alternative accommodations such as VRBO, along with creative dining options, to maximize your destination’s budget. These additional savings can help to bring your overall cost down, while still making your dream vacation a reality.

TRUE: You can save a lot of money by using airline miles.

FALSE: Airline credit cards are worth the annual fee for a yearly vacation.

Unless you plan to fly every month, an airline credit card is hardly worth the cost. While these cards offer tempting miles for flights, increasing numbers of travel options are blacked out throughout the year. The annual credit card fee for United, American, and Delta costs approximately $95.00 after your first year of use. While boarding in group one can be a well-enjoyed perk, it doesn’t boast much ROI for fliers who are simply looking to reach their annual destination.

As you begin to plan your next vacation, Alpine Bank looks forward to helping you save the funds to make it happen. Stop in today and learn how to open a designated savings account today!

Student Loan PSA: What Student Debt Really Looks Like

Student Loan PSA

Obtaining your secondary education can be a landmark goal on your journey to success. By opening up opportunities, and enhancing your capabilities, the study of a discipline gives you the skills you need to conquer your future ambitions. More often than not, student loans offer a helpful supplement when financing this experience. However, many students are able to obtain these financial aids without having to budget or offer a credit history, causing a higher likelihood of default among student borrowers. To help avoid this, Alpine Bank suggests answering the following questions before choosing how to pay for your collegiate participation:

What are you starting with?

The first question you should ask yourself is, ‘What money do I have to begin my education?’ If you have applied for and received scholarships, those should first count towards tuition and books. Additionally, if you have any financial support from relatives, these funds may be allocated best at the base of your budget during your college planning. By totaling the sum of these two amounts, you can determine the support outside your own savings that will be contributed towards your future learning efforts. Knowing whether or not this amount will be offered on a recurring basis can help you then decide what financial steps you need to take in order to save, earn, and/or borrow the remaining funds necessary.

How much and how often can you contribute?

After learning your total amount of support, it is now possible to create a plan of action to facilitate the rest. Depending on your length and type of education, your costs may vary drastically. When selecting both a field and institution of study, the factor of price is an important one to consider. By thinking of your education as an investment, you can ensure that you choose both a rewarding and promising career path to help you repay any debt you do incur during this time. To help decrease overall expenditures, many students take on a part-time job to supplement the costs of their education, along with the associated room and board. Utilizing this choice can decrease the overall amount of your anticipated loan, and help you avoid the additional expense of interest.