Don’t Let Beneficiary Designations Thwart Your Estate Plan

For many individuals, certain assets bypass their wills or trusts and are transferred directly to loved ones through beneficiary designations. These nonprobate assets may include IRAs and certain employer-sponsored retirement accounts, life insurance policies, and some bank and brokerage accounts. This means that if you aren’t careful with your beneficiary designations, some of your assets might not be distributed as you expected. Not only does this undermine your intentions, but it can also create unnecessary conflict and hardship among surviving family members.

3 steps

Here are three steps to help ensure your beneficiary designations will align with your estate planning goals:

1. Name a primary beneficiary and a contingent beneficiary. Without a contingent beneficiary for an asset, if the primary beneficiary dies before you — and you don’t designate another beneficiary before you die — the asset will end up in your general estate and may not be distributed as you intended. In addition, certain assets are protected from your creditors, which wouldn’t apply if they were transferred to your estate. To ensure that you control the ultimate disposition of your wealth and protect that wealth from creditors, name both primary and contingent beneficiaries and don’t name your estate as a beneficiary.

2. Reconsider beneficiaries to reflect changing circumstances. Designating a beneficiary isn’t a “set it and forget it” activity. Failure to update beneficiary designations to reflect changing circumstances creates a risk that you’ll inadvertently leave assets to someone you didn’t intend to benefit, such as an ex-spouse.

It’s also important to update your designation if the primary beneficiary dies, especially if there’s no contingent beneficiary or if the contingent beneficiary is a minor. Suppose, for example, that you name your spouse as the primary beneficiary of a life insurance policy and name your minor child as the contingent beneficiary. If your spouse dies while your child is still a minor, it may be advisable to name a new primary beneficiary — such as a trust — to avoid the complications associated with leaving assets to a minor (court-appointed guardianship, etc.). Note that there are many nuances to consider when deciding to name a trust as a beneficiary.

3. Take government benefits into account. If a loved one depends on Medicaid or other government benefits — for example, a disabled child — naming that person as primary beneficiary of a retirement account or other asset may render him or her ineligible for those benefits. A better approach may be to establish a special needs trust for your loved one and name the trust as beneficiary.

Avoiding unintentional outcomes

Not paying proper attention to beneficiary designations can also expose your estate to costly delays and legal disputes. If a listed beneficiary is no longer living, or if a designation is vague or incomplete, an asset may have to go through probate, which defeats the purpose of naming beneficiaries in the first place.

This can increase expenses, delay distributions and create stress for your family during an already difficult time. Carefully making beneficiary designations and regularly reviewing and updating them helps ensure your asset distributions align with your current wishes, helps prevent disputes, and helps protect your family from unintended financial complications. Contact us with questions regarding your estate plan.

How long should you keep business records?

The retention of tax and business records depends on the nature of the information and how it is used. This schedule has been developed as a guide only. Various regulatory, statutory and industry practices may supersede these general recommendations and alter the holding period. Consult legal counsel before destroying records if you are uncertain and before implementing any business record retention policy. This schedule applies to both paper and electronic resources.

Download the Retention Schedule

On September 18, 2025, the Financial Accounting Standards Board (FASB) published updated guidance on how companies must account for the costs of developing software for internal applications. The changes are expected to reduce compliance costs and improve financial reporting transparency. Here are the details.

Targeted improvements

When the FASB first issued its existing “internal-use software” guidance, companies typically developed software using prescriptive, sequential methods. Today, many companies use agile and iterative development methods. This shift has made it difficult for companies to determine when to begin capitalizing internal-use software development costs on their balance sheets.

Accounting Standards Update (ASU) No. 2025-06, Intangibles — Goodwill and Other — Internal-Use Software (Subtopic 350-40), Targeted Improvements to the Accounting for Internal-Use Software, aims to clarify matters. It eliminates all references to project stages. Instead, companies will capitalize internal-use software development costs after two conditions are met:

Management has authorized and committed to funding the software project, and
It’s “probable” that the project will be completed and the software will be used to perform the intended function.

Determining the “probable-to-complete recognition threshold” may require subjective judgments, particularly when there’s significant uncertainty about the development activities. For instance, coding and testing might still be necessary to resolve uncertainty for software based on 1) technological innovations, or 2) novel, unique or unproven features or functions. Uncertainty might also exist if management hasn’t identified or finalized the software’s performance requirements.

Companies will apply the disclosure requirements for property, plant and equipment to capitalized internal-use software. This explicitly relieves them from certain intangible asset disclosures.

Scope and effective date

ASU 2025-06 applies to development costs for all internal-use software. In addition, it supersedes the existing guidance for internal website development costs. Accounting Standards Codification Subtopic 350-50, Intangibles — Goodwill and Other — Website Development Costs, will be integrated into the internal-use software guidance. However, the update won’t affect accounting for costs of developing software or websites to sell, lease or market to third parties.

All entities must implement the updated guidance for annual and interim reporting periods beginning after December 15, 2027. Companies can choose to implement the guidance:

Prospectively to new internal-use software development costs incurred as of the beginning of the adoption period,
Retrospectively by recasting comparative periods and recognizing a cumulative-effect adjustment as of the beginning of the first period presented, or
Using a modified transition approach based on the project’s status and whether software costs were capitalized before the date of adoption.

The method a company chooses must be applied consistently across all projects. Early adoption is permitted, but only at the beginning of an annual reporting period.

For more information

If your company develops internal-use software or websites, now is the time to prepare for these changes. We can help you update your capitalization policies to reflect the new “probable-to-complete” threshold and guide you through the transition. Contact us to ensure your financial reporting stays compliant and transparent.

If you’re considering guaranteeing, or are asked to guarantee, a loan to your closely held corporation, it’s important to understand the potential tax consequences. Acting as a guarantor, endorser or indemnitor means that if the corporation defaults, you could be responsible for repaying the loan. Without planning ahead, you may face unexpected tax implications.

A business bad debt

If you’re compelled to make good on the obligation, the payment of principal or interest in discharge of the obligation generally results in a bad debt deduction. This may be either a business or a nonbusiness bad debt deduction. If it’s a business bad debt, it’s deductible against ordinary income. A business bad debt can be either totally or partly worthless. If it’s a nonbusiness bad debt, it’s deductible as a short-term capital loss, which is subject to certain limitations. A nonbusiness bad debt is deductible only if it’s totally worthless.

To be treated as a business bad debt, the guarantee must be closely related to your trade or business. If the reason for guaranteeing the corporation loan is to protect your job, the guarantee is considered closely related to your trade or business as an employee. But employment must be the dominant motive. If your annual salary exceeds your investment in the corporation, this generally shows that the dominant motive for the guarantee is to protect your job. On the other hand, if your investment in the corporation substantially exceeds your annual salary, that’s evidence that the guarantee is primarily to protect your investment rather than your job.

Proving the relationship

Except in the case of job guarantees, it may be difficult to show the guarantee is closely related to your trade or business. You have to show that the guarantee is related to your business as a promoter, or that the guarantee is related to some other trade or business separately carried on by you.

If the reason for guaranteeing your corporation’s loan isn’t closely related to your trade or business and you’re required to pay off the loan, you can take a nonbusiness bad debt deduction if you show that your reason for the guarantee was to protect your investment, or you entered the guarantee transaction with a profit motive.

Note: The IRS and courts will scrutinize the dominant motive carefully. Reasonable compensation doesn’t always mean money. It can include protecting employment or business interests.

Additional requirements

In addition to satisfying the above requirements, a business or nonbusiness bad debt is deductible only if you meet these three conditions:

You have a legal duty to make the guaranty payment (although there’s no requirement that a legal action be brought against you).
The guaranty agreement is entered into before the debt becomes worthless.
You receive reasonable consideration (not necessarily cash or property) for entering into the guaranty agreement.

Any payment you make on a loan you guaranteed is deductible as a bad debt in the year you make it, unless the agreement (or local law) provides for a right of subrogation against the corporation. If you have this right, or some other right to demand payment from the corporation, you can’t take a bad debt deduction until the rights become partly or totally worthless.

These are only some of the possible tax consequences of guaranteeing a loan to your closely held corporation. Consult with us to learn all the implications and to help ensure the best tax results.

Remember the SECURE 2.0 Act? It was part of a massive year-end “omnibus” spending package signed into law in 2022. Like many laws, SECURE 2.0 contains provisions that necessitate federal implementation guidance. One area of particular concern for employers has been how the act’s provisions impact the treatment of catch-up contributions to qualified retirement plans. Earlier this month, the U.S. Department of the Treasury and the IRS issued final regulations clarifying these rules.

Two major components

According to the IRS news release, “The final regulations provide guidance for plan administrators to implement and comply with the new Roth catch-up rule and reflect comments received in response to the proposed regulations issued in January.” In actuality, the final regs address two major components of the rules:

Required Roth treatment. The “Roth catch-up rule” referred to above is a provision of SECURE 2.0 that requires catch-up contributions made by certain higher-income participants to be designated as Roth contributions. This means the contributions come from after-tax earnings rather than pretax salary deferrals. The final regs stipulate that employees age 50 or above with previous-year wages exceeding $145,000 (an annually inflation-adjusted amount) must make Roth-based catch-up contributions beginning with tax years after December 31, 2026.
A higher limit for some participants. The standard catch-up contribution limit is indexed annually for inflation. For example, in 2025, it’s $7,500 for most 401(k), 403(b) and governmental 457 plans, as well as for the federal government’s Thrift Savings Plan. Under the final regs, however, the limit will rise to 110% of the standard amount for eligible participants in SIMPLE plans and to 150% of the standard amount for participants of any qualified plan (including SIMPLE plans) ages 60 through 63.

Changes to proposed rules

The IRS made several changes to the proposed rules in response to public comments. One is that plan administrators will be allowed to aggregate a participant’s previous-year wages from certain separate common law employers in determining whether the participant is subject to the Roth catch-up rule.

Another example of changes from the proposed regs to the final ones is revised guidance on corrections related to the Roth requirement. Generally, these involve either:

Transferring a pretax catch-up contribution to a Roth account and reporting it on Form W-2, or
Making an in-plan Roth rollover if Form W-2 has already been filed and reporting it on Form 1099-R.

Note that a plan needn’t use the same correction method for all participants, but it must use the same correction method for similarly situated participants. Also, a correction isn’t required unless a participant’s total erroneous pretax catch-up contributions exceed $250.

Further information

If you’d like to start early, the final regs permit plans to implement the Roth catch-up rule for taxable years beginning before 2027 using any “reasonable, good faith interpretation of statutory provisions.” The IRS news release says the final regulations don’t extend or modify the administrative transition period for the Roth requirement provided under Notice 2023-62, which generally ends on December 31, 2025. Contact us for further information about SECURE 2.0 and for help managing the costs of your organization’s employer-sponsored qualified retirement plan.

Yeo & Yeo, a leading Michigan-based accounting and advisory firm, has been recognized among Michigan’s Best and Brightest in Wellness for the twelfth consecutive year. The award honors organizations that foster a culture of wellness and show a clear commitment to supporting employee well-being and healthier communities.

Yeo & Yeo continues to expand benefits in response to employee feedback, ensuring the firm remains aligned with the changing needs of its team. This year, the firm introduced an enhanced Paid Parental Leave Program providing more financial security and flexibility for families. Other updates include additional time off for long-term employees, expanded dental coverage for orthodontics, and enhanced life insurance benefits.

Employees also benefit from access to Boon Health, which provides personalized coaching to support professional development, personal growth, and overall well-being. To further promote work-life balance, Yeo & Yeo offers a flexible work environment and hybrid work options, along with initiatives such as half-day summer Fridays that encourage a healthy integration of work and personal life.

“Our people are at the heart of everything we do, and we remain committed to providing benefits and resources that help them thrive both at work and at home,” said Dave Youngstrom, President & CEO of Yeo & Yeo. “The enhancements we introduced this year reflect our ongoing investment in employee well-being, and this recognition affirms the dedication of our HR team and leaders who continue to support our employees in meaningful ways.”

Winners of the Best and Brightest in Wellness award are chosen through a rigorous evaluation process that measures the effectiveness of wellness initiatives, employee engagement, and a company’s commitment to supporting physical, mental, and emotional health. Yeo & Yeo and the other winning companies will be honored at the Michigan’s Best and Brightest in Wellness awards celebration on October 30.

Among its numerous tax provisions, the One Big Beautiful Bill Act (OBBBA) reinstated immediate deductions for research and experimental (R&E) expenditures under Internal Revenue Code Section 174, beginning in 2025. The IRS has recently issued transitional guidance (Revenue Procedure 2025-28) on how this change will be implemented.

The guidance addresses several critical issues. Here’s what businesses of all sizes need to know.

The reinstatement

R&E expenditures generally refer to research and development costs in the experimental or laboratory sense. They include costs related to activities intended to discover information that would eliminate uncertainty about the development or improvement of a product.

Since 2022, the Tax Cuts and Jobs Act (TCJA) has required businesses to amortize domestic R&E costs over five years, with foreign costs amortized over 15 years. The OBBBA permanently reinstates the pre-TCJA treatment of domestic R&E costs, allowing their deduction for expenses incurred or paid in tax years beginning after 2024.

The OBBBA also permits small businesses that satisfy a gross receipts test to claim the R&E deduction retroactively to 2022. (For 2025, average annual gross receipts for the previous three years must be $31 million or less.) And any business that incurred domestic R&E expenses in 2022 through 2024 may elect to accelerate the remaining deductions for those expenditures over either a one- or two-year period.

The immediate deduction of qualified R&E expenses isn’t mandatory. Depending on a variety of factors, in some situations, claiming it may not be advisable. Taxpayers generally can instead elect to capitalize and amortize such expenses paid in a tax year after 2024 over at least 60 months. The election must be made by the due date, with extensions, of the original tax return for the first tax year to which the election applies. For 2025, a taxpayer that makes an accounting method change to capitalize and amortize R&E expenses will be deemed to have made the election.

Retroactive deductions for small businesses

As noted, eligible small businesses can elect to treat the changes to Sec. 174 as if they took effect for tax years beginning after 2021, rather than after 2024. How to do this depends in part on whether the taxpayer has already filed a 2024 tax return.

If the taxpayer filed a 2024 return before August 28, 2025, an automatic extension to supersede that return to include the new guidance is available. However, the taxpayer must file that replacement return by the extended deadline (typically September 15 or October 15). Alternatively, the taxpayer can file an amended 2024 return, following one of the two options discussed below.

If the taxpayer didn’t file a 2024 return by August 28, the taxpayer can file by the applicable extended deadline and either:

Elect to expense eligible R&E expenses under the new guidance, which would also require filing amended returns for 2022 and 2023, or
Do an automatic method of accounting change and a “true-up” adjustment on the 2024 return for the 2022 and 2023 R&E expenses.

Elections must be made by the earlier of July 6, 2026, or the applicable deadline for filing a claim for a credit or refund for the tax year (generally, three years from filing the return).

Accelerated deductions for all businesses

Businesses with unamortized domestic R&E expenses under the TCJA can elect to fully recover those remaining expenses on their 2025 income tax returns or over their 2025 and 2026 returns.

Notably, the IRS guidance states that taxpayers “may elect to amortize any remaining unamortized amount” of such expenses. This language suggests that the deduction will be considered an amortization expense. This is significant in light of changes the OBBBA made to the business interest expense deduction.

The business interest deduction generally is limited to 30% of the taxpayer’s adjusted taxable income (ATI). (Taxpayers that meet the same annual gross receipts test discussed earlier are exempt from the limitation.) Under the OBBBA, beginning in 2025, ATI for purposes of the interest deduction is calculated without deductions for depreciation, amortization or depletion. So amortization deductions are “added back,” potentially increasing the ATI and the allowable business interest deduction. If R&E expenses aren’t treated as an amortization deduction, they could reduce the allowable business interest deduction.

The interplay with the research credit

The Sec. 41 research tax credit is also available for certain research-related expenses, and you can’t claim both the credit and the deduction for the same expense. A tax deduction reduces the amount of income that’s taxed, while a tax credit reduces the actual tax you owe dollar-for-dollar, providing much more tax savings than a deduction of an equal amount. But the types of expenses that qualify for the credit are narrower than those that qualify for the deduction.

The OBBBA changes a TCJA provision so that the amount deducted or charged to a capital account for research expenses is reduced by the full amount of the research credit, as opposed to being subject to a more complex calculation that had been in effect under the TCJA. The amount that’s capitalized is reduced by the amount of the credit claimed. For example, suppose the allowed credit is $20,000. The capitalized amount for the year would be reduced by $20,000.

The OBBBA continues, however, to allow taxpayers to elect to take a reduced research credit, rather than reducing their R&E deduction. The OBBBA also allows certain small businesses (generally determined by the gross receipts test mentioned above) to make late elections to reduce their research credit — or to revoke prior elections to reduce the credit. The late elections generally are available for tax years for which the original return was filed before September 15, 2025, and must be made by the earlier of July 6, 2026, or the deadline for filing a claim for a credit or refund for the tax year, on an amended return or an administrative adjustment request (AAR).

Reduced uncertainty

The IRS guidance also provides automatic IRS consent to applications to change accounting methods for domestic R&E expenses under the TCJA, the OBBBA, the small business retroactive method and the recovery of unamortized method — reducing uncertainty. We can help address any questions you have about the tax treatment of R&E expenses.

Yeo & Yeo’s Smart Medical Practice Toolkit is your go-to resource for navigating the financial, operational, and regulatory complexities of healthcare. This collection includes brief, high-impact webinars, downloadable tools, and practical guidance—all built around the real challenges physicians and practice managers face.

Each resource draws on Yeo & Yeo’s decades of experience in the healthcare industry to provide actionable insights you can apply right away. Our team of credentialed healthcare advisors is dedicated to helping your practice thrive.

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Nobody’s perfect, and neither is any workplace. Every employer will likely field occasional employee complaints about inappropriate behavior or concerns about something that doesn’t seem quite right.

When a complaint or concern arises, think of it as an opportunity to test your organization’s employment policies and procedures. Handling it well can strengthen your work environment and employer brand. Handling it poorly may undermine employees’ trust and even result in financial exposure.

Deciding whether to investigate

When an employee raises an issue, employers must first evaluate whether it warrants a formal investigation under organizational policy or the law. Train supervisors, managers and human resources (HR) staff to do so and never ignore a complaint or concern.

Various federal laws require employers to immediately investigate complaints of discrimination or harassment. These include:

Title VII of the Civil Rights Act,
The Americans With Disabilities Act, and
The Age Discrimination in Employment Act.

Some concerns may have relatively simple explanations and can be resolved with a conversation. Others might signal fraud. When investigating potential fraud, work with your attorney and an outside forensic accountant. Take care when interviewing personnel and gathering evidence to protect the chain of custody and ensure findings are legally admissible.

Other types of concerns may arise as well — for example, safety violations under the Occupational Safety and Health Act or payroll problems under the Fair Labor Standards Act (or similar state laws). Even if not legally required, an investigation may be necessary if your organization’s employee handbook or posted HR policies commit you to follow up in a prescribed manner.

Laying the groundwork

Should you decide to pursue an investigation, plan it carefully. Start by determining whether it will be internal or external. One of your staffers may be qualified to lead an internal investigation — but only so long as the individual is well trained and unbiased. For more complex and serious issues, engaging an external investigator is generally recommended.

Also, clarify the investigation’s scope. Identify which policies or laws are applicable to the allegations. In addition, pinpoint what types of evidence you’ll likely need.

Collecting information

Most workplace investigations center on face-to-face interviews. Your investigator will probably want to start with the employee who made the complaint or raised the concern and then move on to the accused (in the case of a complaint), witnesses and other persons of interest. Train anyone in your organization who’ll participate in internal investigations to ask open-ended questions, actively listen and maintain strict confidentiality.

Whether internal or external, investigators should obtain other types of evidence as they’re available. Electronic communications between pertinent parties, security footage and financial records can prove invaluable to substantiating interview findings.

Ultimately, ask each investigator to write a formal report that summarizes the investigative process and objectively presents the findings. Use the report to determine whether the allegations are substantiated, to decide on appropriate action and to serve as legal documentation.

Reaching a decision

Based on the investigator’s report and further discussion, qualified members of leadership should decide how to proceed. Don’t hesitate to consult legal counsel as well.

Unlike a criminal court, your organization needn’t prove beyond a reasonable doubt that wrongdoing occurred. If it’s reasonably likely that an employee misbehaved or grossly underperformed, your organization can still take proportionate action. However, if you decide to terminate the individual, you’ll need a sound rationale and well-documented evidence to minimize legal risks.

Communicate your decision carefully to the parties involved. Generally, complainants aren’t entitled to know exactly how employers handle a substantiated allegation. But organizations may choose to provide more information.

Above all, demonstrate that you’ve protected everyone’s privacy while actively addressing the complaint or concern. If your response involves disciplinary consequences or performance improvement measures, be sure they’re consistent with your stated policies and proportional to the specifics of the case.

Protecting your organization

The stakes of workplace investigations are high. Employers who fail to handle them properly face serious risks, such as higher turnover, reputational harm, and increased insurance and legal costs.

Work with your attorney to continuously improve your organization’s employment policies and procedures. Meanwhile, if you need assistance investigating potential misconduct or improving internal controls and financial documentation, our team can help you build processes that protect your organization and withstand scrutiny.

The more things change, the more they stay the same. This age-old saying applies to many things, and one of them is fraud perpetrated against businesses by their employees.

In fact, occupational fraud cost organizations about 5% of their revenue on average last year, according to the Association of Certified Fraud Examiners’ Occupational Fraud 2024: A Report to the Nations. Let’s review its three basic categories.

Misappropriating assets

The first category is asset misappropriation. It comprises theft or misuse of any business asset, but related schemes often involve cash. These types of scams are the most common type of occupational fraud, though they’re typically less costly than crimes committed under the other two categories.

One classic example is the “ghost” employee ploy, where a staff member with payroll access channels funds to a nonexistent worker. Naturally, those funds end up in the real employee’s pocket.

There are plenty of others. Asset misappropriation has long involved check tampering, whereby an employee steals, forges or alters company checks to reap ill-gotten financial rewards. Now that midsize and larger businesses rely more on electronic transactions, these companies are relatively less susceptible to check schemes. However, many small companies are still at risk.

If you run a cash-intensive business, be on the lookout for dishonest workers skimming funds before they’re recorded. And if your company maintains inventory or supplies, safeguard these carefully to avoid theft.

Engaging in corrupt activities

The second category of occupational fraud is corruption. Dishonest employees in positions of influence may commit crimes for personal gain and the company’s loss. These types of schemes are rarely simple and may go on for months — or even years — without anyone noticing.

For instance, a corrupt staffer may work with a vendor rep to inflate prices on the vendor’s goods and services. The two then split the difference when the business pays the bill. Collusion like this can hurt your company’s financial performance and business reputation. Leadership teams that fail to prevent such schemes risk losing the confidence and support of lenders and investors.

Don’t ignore the possibility of kickback schemes either. Here, a person of influence in the company uses a vendor or other provider, not because they’re the best choice, but because the employee involved gets a personal benefit. Examples might include cash, a valuable gift or free services.

Falsifying financial statements

The third category is financial statement fraud. In these schemes, perpetrators falsify financial statements to either hide poor performance or commit outright theft. On the upside, this category is generally the least prevalent of the three. The downside? It’s often the costliest — with such crimes costing companies many hundreds of thousands of dollars on average.

One example to watch out for is inflated revenue. A manager, perhaps angling for a promotion or fearful of termination, records sales that never actually occurred to make the business appear more profitable. On a similar tack, a dishonest employee may hide or delay recording legitimate expenses or debts to make financial results look stronger.

Fraudulent manipulation of financial statements can be particularly dangerous. These crimes are often sophisticated, hard to detect and damaging to a company’s reputation at the highest levels.

Common thread

As you can see, occupational fraud can take many forms. But the common thread is the financial and reputational damage to affected businesses. And the threat level is often higher for smaller companies because they may have fewer resources to fight back. Let us help you spot vulnerabilities in your operations, strengthen internal controls, and devise tailored fraud prevention and detection strategies.

We want to make you aware of an important change from the IRS that may affect how you receive your tax refund.

Effective September 30, 2025, the IRS will no longer issue paper checks for tax refunds. This change is part of Executive Order 14247, which mandates that all federal payments and collections be processed electronically. This includes IRS refunds, tax payments, and other disbursements.

What This Means for You

Refunds will only be issued via direct deposit, prepaid debit cards, mobile payment app, or other approved electronic methods.
Paper checks will be discontinued, except in limited cases such as:
- Individuals without access to banking services
- Emergency or hardship situations
Tax payments should be made electronically if possible, although we believe the IRS will continue to accept payments via check for the time being.

Action Required

To ensure timely receipt of your refund:

Provide your bank account information when filing your tax return.
Update your IRS online account with current banking details if needed: https://www.irs.gov/payments

Why This Change is Happening

The move to electronic payments is designed to:

Reduce fraud and theft associated with paper checks
Speed up refund delivery
Lower processing costs for the federal government

Need Help?

Our team is here to assist you with updating your payment preferences and ensuring a smooth transition. Please contact your Yeo & Yeo tax professional for assistance.

Yeo & Yeo, a leading Michigan accounting and advisory firm, is pleased to announce that Michael Wilson II, CPA, has received the Rising Star Award from the Michigan Association of Certified Public Accountants (MICPA). The Rising Star Award honors the accomplishments and contributions of up-and-coming CPAs who add value to their firm or company through strategic and innovative initiatives, leadership competencies, and commitment to the profession.

Wilson joined Yeo & Yeo in 2020 and was recently promoted to manager. He serves in the firm’s Tax & Consulting Service Line and is a key leader within the firm’s Cannabis Services Group. He specializes in business advisory services, consulting, and tax planning and preparation with an emphasis on the cannabis industry. In addition to serving clients, he supports the firm’s annual two-day Summer Leadership Program, which helps attract and inspire the next generation of accounting professionals.

Reflecting on what the Rising Star Award means to him, Wilson shared, “To me, this award represents more than just professional achievement—it’s about making a difference in the lives of those around me. Whether advising a client, mentoring a peer, or organizing a community project, I want to lead with empathy, build trust, and leave a positive impact.”

Wilson’s passion for service shines through both his leadership at Yeo & Yeo and his volunteer efforts in the community. He serves on the Yeo & Yeo Foundation Board and has led several firm-wide service initiatives, including the current 2025 project benefiting the Greater Michigan Chapter of the Alzheimer’s Association. He is an active member of the Saginaw County Chamber of Commerce’s Young Professionals Network Steering Committee and volunteers with Rescue Ministries of Mid-Michigan.

“Michael brings energy to everything he does—whether helping a teammate understand the ‘why’ behind their work or stepping up to lead a firm initiative that gives back to the community,” said Alex Wilson, CPA, principal. “He leads by example and always lifts up those around him.”

“Michael is a strategic thinker who inspires others to succeed,” added Chris Sheridan, CPA, CVA, principal. “He’s innovative, service-driven, and absolutely deserving of this recognition from the MICPA.”

Honorees will be recognized at the MICPA Celebrate Awards on November 12, 2025, at the Colony Club in Detroit.

Does your business receive large amounts of cash or cash equivalents? If so, you’re generally required to report these transactions to the IRS — and not just on your tax return. Here are some answers to questions you may have.

What are the requirements?

Although many cash transactions are legitimate, the IRS explains that the information reported on Form 8300 “can help stop those who evade taxes, profit from the drug trade, engage in terrorist financing and conduct other criminal activities. The government can often trace money from these illegal activities through the payments reported on Form 8300 and other cash reporting forms.”

Each person who, in the course of operating a trade or business, receives more than $10,000 in cash in one transaction (or two or more related transactions), must file Form 8300. Who is a “person”? It can be an individual, company, corporation, partnership, association, trust or estate. What are considered “related transactions”? Any transactions between the same payer and recipient conducted in a 24-hour period. Transactions can also be considered related even if they occur over a period of more than 24 hours if the recipient knows, or has reason to know, that each transaction is one of a series of connected transactions.

In order to complete Form 8300, you’ll need personal information about the person making the cash payment, including a Social Security or taxpayer identification number.

The IRS reminds businesses that they can “batch file” their reports, which is especially helpful to those required to file many forms.

Note: Under a rule that went into effect on January 1, 2024, businesses must now file Forms 8300 electronically if they’re otherwise required to e-file certain other information returns electronically, such as W-2s and 1099s. You also must e-file if you’re required to file at least 10 information returns other than Form 8300 during a calendar year.

What’s the definition of cash and cash equivalents?

For Form 8300 reporting purposes, cash includes U.S. currency and coins, as well as foreign money. It may also include cash equivalents such as cashier’s checks (sometimes called bank checks), bank drafts, traveler’s checks and money orders.

Money orders and cashier’s checks under $10,000, when used in combination with other forms of cash for a single transaction that exceeds $10,000, are defined as cash for Form 8300 reporting purposes.

What about digital assets such as cryptocurrency? Despite a 2021 law that would treat certain digital asset receipts like “cash,” the IRS announced in 2024 that you don’t have to report digital asset receipts on Form 8300 until regulations are issued. IRS Announcement 2024-4 remains the latest official word.

Note: Under a separate reporting requirement, banks and other financial institutions report cash purchases of cashier’s checks, treasurer’s checks and/or bank checks, bank drafts, traveler’s checks and money orders with a face value of more than $10,000 by filing currency transaction reports.

What type of penalties can be imposed for noncompliance?

If a business doesn’t file Forms 8300 on time, there can be a civil penalty of $310 for each missed form, up to an annual cap. The penalties are higher if the IRS finds the failure to file is intentional, and there can be criminal penalties as well.

In one recent case, an Arizona car dealer failed to file the required number of Forms 8300. While the dealer did file 116 forms for the year in question, the IRS determined that the business should have filed an additional 266 forms.

The tax agency assessed penalties of $118,140. The dealer argued that it had reasonable cause for not filing all the forms because the software it was using wasn’t functioning properly. However, the U.S. Tax Court ruled that the dealer wasn’t using the software correctly and didn’t take steps to foster compliance. (TC Memo 2025-38)

Stay on top of the requirements

Compliance with Form 8300 requirements can help your business avoid steep penalties and trouble with the IRS. Recordkeeping is critical. You should keep a copy of each Form 8300 for five years from the date you file it, according to the IRS. “Confirmation receipts don’t meet the recordkeeping requirement,” the tax agency adds.

Yeo & Yeo is pleased to announce that Nonprofit Consulting Manager Kevin Bouma, CPA, has earned the Certified Nonprofit Accounting Professional (CNAP) designation. The CNAP certification recognizes Bouma’s specialized knowledge in nonprofit financial management and his commitment to helping mission-driven organizations strengthen their operations and achieve long-term success.

The CNAP certification is awarded to nonprofit financial managers and accounting professionals who complete a comprehensive training program and pass a rigorous examination. The program covers key areas including governance, budget development, financial reporting, and internal controls, equipping professionals with the skills needed to ensure financial transparency and accountability in the nonprofit industry.

Bouma has more than 25 years of experience in public and private accounting and has held leadership roles in several nonprofit organizations, including serving as Chief Financial Officer and Director of Finance and Operations. His experience includes conducting internal control studies, developing and analyzing budgets, reviewing policies and procedures, providing strategic financial consulting, and reporting to boards and stakeholders. With a passion for helping nonprofits thrive, he is dedicated to equipping leaders with the insights and strategies they need to strengthen their organizations.

“Although an organization may be a nonprofit, there are clear benefits to running it like a business—ensuring efficiency and strategic growth,” Bouma said. “Earning the CNAP certificate has strengthened my ability to provide nonprofits with the financial insights and best practices they need to make informed decisions and maximize their impact.”

Kevin’s CNAP designation reflects the depth of expertise that Yeo & Yeo’s Nonprofit Services Group applies to every engagement. The team supports hundreds of nonprofit organizations across Michigan, providing independent audits, internal control assessments, outsourced accounting, HR solutions, and financial management consulting. Whether serving as trusted advisors or interim staff, Yeo & Yeo professionals empower nonprofit leaders to focus on what matters most: advancing their mission.

When it comes to estate planning, one of the more nuanced tools available is a quiet trust (also known as a “silent” trust). Unlike a traditional trust, a quiet trust keeps beneficiaries — often children or young adults — in the dark about its existence or details until they reach a certain age or milestone.

Many states permit quiet trusts, but these trusts have both positives and negatives. Depending on the situation, an incentive trust may be a better way to achieve your goals.

The pros

One of the biggest benefits of using a quiet trust is that it helps preserve ambition and independence. If your heirs know too early about a significant inheritance, they may lose motivation to pursue educational goals or build a career. By keeping the details private, you give them the chance to grow independently.

Quiet trusts can also reduce family conflict during your lifetime, especially if distributions are unequal or come with specific conditions. In addition, secrecy offers protection from outside pressures — such as creditors, estranged spouses or opportunistic friends — and allows time for heirs to develop the maturity needed to manage wealth responsibly.

The cons

Quiet trusts aren’t without drawbacks. Some beneficiaries may feel resentful when they eventually discover that assets were withheld from them. This secrecy can also increase the risk of legal challenges once the trust is revealed.

By keeping heirs uninformed, you also may unintentionally deprive them of valuable opportunities. For example, they might forego graduate school because they don’t want to take on student loan debt that could take decades to pay back when, in fact, the trust would eventually allow them to pay off the loan more quickly. (Or current access to the money could allow them to avoid student loan debt altogether.) And because trustees must administer the trust without beneficiary input, their decisions could later be questioned, adding tension at an already difficult time.

Another option

The idea behind a quiet trust is to avoid disincentives to responsible behavior. But it’s not clear that such a trust will actually accomplish that goal. A different approach is to design a trust that provides incentives for responsible behavior.

For example, an incentive trust might condition distributions on behavior you wish to encourage, such as obtaining a college or graduate degree, maintaining gainful employment, or pursuing worthy volunteer activities. Or it could require getting treatment for alcohol or substance abuse and maintaining a sober lifestyle.

One drawback to setting specific goals is that it may penalize a beneficiary who chooses a different, but responsible, life choice — a stay-at-home parent, for example. To build some flexibility into the trust, you might establish general principles for distributing trust funds to beneficiaries who behave responsibly but give the trustee broad discretion to apply these principles on a case-by-case basis.

Finding the right balance

A quiet trust can be a powerful way to encourage independence and protect your heirs, but it requires careful planning. Many families find success in combining secrecy with a gradual disclosure strategy — sharing information at key milestones or leaving behind a written explanation to reduce confusion and conflict.

Every family is different, and the decision to use a quiet trust or an incentive trust should be based on your goals, values and relationships. We can help you weigh the pros and cons and structure your plan in a way that best protects your family and your legacy.

Your company’s supply chain is one of the many business functions vulnerable to fraud, particularly as foreign tariffs take effect. Dishonest employees and vendors are known to have taken advantage of the COVID-19 pandemic’s supply shortages and abrupt switch to remote working. Now, tariff disruptions provide a similar opportunity for fraud perpetrators.

Many businesses are currently assessing their supply chains. Some are switching to domestic vendors while others are implementing policies to address the increased costs, customs delays and logistical challenges of importing goods. If your company is in this process, add fraud risk to the list of urgent issues you must address.

Change equals risk

Any change in how your business operates can create risk, especially if it occurs quickly and there’s some uncertainty about the timing and effects of the changes. For example, you may be struggling to ascertain what tariffs apply and where all your goods or production components originated. It’s important to get these details right because the U.S. Department of Justice has indicated it will vigorously prosecute customs evasion under the U.S. False Claims Act.

According to the Association of Certified Fraud Examiners, businesses should look out for several common tariff evasion schemes, including:

Routing shipments through a third country to hide their origin,
Lying about shipments’ declared values,
Falsely classifying the contents of shipments, and
“Structuring” or splitting orders into multiple shipments to lower the overall assessed tariff.

A newer scam, “delivered duty paid,” has emerged recently and is gaining popularity. In such schemes, suppliers charge slightly higher prices and deliver products duty-free. They tell their U.S. customers they’ve already paid the tariffs, but they haven’t — and don’t intend to. Customers often recognize that cheating may be involved, but the vendors provide them with plausible deniability.

Protecting your company

You can help protect your business from tariff evasion risk by carefully documenting all purchases, payments and shipments, and requiring copies of documents from vendors. If you don’t have adequate in-house expertise, consider outsourcing work to international trade professionals. These specialists can provide a framework and policies that will enable you to import goods cost-effectively and legally.

And if you’ve decided to replace cross-border suppliers with domestic alternatives, be sure to follow your usual screening methods. These should include reviewing references from legitimate organizations and performing background checks of vendors’ principals. Don’t rush the due diligence process. Some stateside criminals may be lying in wait to take advantage of the situation.

Additional resources

Finally, don’t overlook your workers. When it comes to supply chain fraud, rank-and-file employees often are the first to spot or hear about suspicious activities. Consider establishing an anonymous whistleblower hotline or online reporting mechanism, if you don’t already have one. Contact us for additional fraud prevention suggestions or help assessing your supply chain risk.

Do you and your spouse together operate a profitable unincorporated small business? If so, you face some challenging tax issues.

The partnership issue

An unincorporated business with your spouse is classified as a partnership for federal income tax purposes, unless you can avoid that treatment. Otherwise, you must file an annual partnership return using Form 1065. In addition, you and your spouse must be issued separate Schedules K-1, which allocate the partnership’s taxable income, deductions and credits between the two of you. This is only the beginning of the unwelcome tax compliance tasks.

The self-employment tax issue
Self-employment (SE) tax is how the government collects Social Security and Medicare taxes from self-employed individuals. For 2025, the SE tax consists of 12.4% Social Security tax on the first $176,100 of net SE income plus 2.9% Medicare tax. Once your 2025 net SE income surpasses the $176,100 ceiling, the Social Security tax component of the SE tax ends. But the 2.9% Medicare tax component continues before increasing to 3.8% — because of the 0.9% additional Medicare tax — if the combined net SE income of a married joint-filing couple exceeds $250,000. (This doesn’t include investment income.)

With your joint Form 1040, you must include a Schedule SE to calculate SE tax on your share of the net SE income passed through to you by your spousal partnership. The return must also include a Schedule SE for your spouse to calculate the tax on your spouse’s share of net SE income passed through to him or her. This can significantly increase your SE tax liability.

For example, let’s say you and your spouse each have net 2025 SE income of $150,000 ($300,000 total) from your profitable 50/50 partnership business. The SE tax on your joint tax return is a whopping $45,900 ($150,000 × 15.3% × 2). That’s on top of regular federal income tax. (However, you do get an income deduction for half of the SE tax.)

Here are three possible tax-saving solutions.

1. Use an IRS-approved method to minimize SE tax in a community property state

Under IRS guidance (Revenue Procedure 2002-69), there’s an exception to the general rule that spouse-run businesses are treated as partnerships. For federal tax purposes, you can treat an unincorporated spousal business in a community property state as a sole proprietorship operated by one of the spouses. By effectively allocating all the net SE income to the proprietor spouse, only the first $176,100 of net SE income is hit with the 12.4% Social Security tax. That can cut your SE tax bill.

2. Convert a spousal partnership into an S corporation and pay modest salaries

If you and your unincorporated spousal business aren’t in a community property state, consider converting the business to S corp status to reduce Social Security and Medicare taxes. That way, only the salaries paid to you and your spouse get hit with the Social Security and Medicare tax, collectively called FICA tax. You can then pay reasonable, but not excessive, salaries to you and your spouse as shareholder-employees while paying out most or all remaining corporate cash flow to yourselves as FICA-tax-free cash distributions. Keep in mind that S corps come with their own compliance obligations.

3. Disband your partnership and hire your spouse as an employee

You can disband the existing spousal partnership and start running the operation as a sole proprietorship operated by one spouse. Then hire the other spouse as an employee of the proprietorship. Pay that spouse a modest cash salary. You must withhold 7.65% from the salary to cover the employee-spouse’s share of the Social Security and Medicare taxes. The proprietorship must also pay 7.65% as the employer’s half of the taxes. However, because the employee-spouse’s salary is modest, the FICA tax will also be modest.

With this strategy, you file only one Schedule SE — for the spouse treated as the proprietor — with your joint tax return. That minimizes the SE tax because no more than $176,100 (for 2025) is exposed to the 12.4% Social Security portion of the SE tax.
Additional bonus: You may be able to provide certain employee benefits to your spouse, such as retirement contributions, which may provide more tax savings.

We can help

Having a profitable unincorporated business with your spouse that’s classified as a partnership for federal income tax purposes can lead to compliance headaches and high SE tax bills. Work with us to identify appropriate tax-saving strategies.

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Once an organization reaches a certain size, it’s difficult to compete for talent and retain employees without sponsoring a qualified retirement plan. However, the costs of doing so can be intimidating, and plan administration might seem overwhelming. Let’s explore four ways to run a more cost-effective plan.

1. Use automatic features

Among the most effective and inexpensive steps any organization can take is adding automatic features to its plan to simplify the experience for both employer and participant. For example, automatic enrollment adds employees to the plan by default, usually after they reach a certain amount of service time. This tends to dramatically boost participation, which is to your advantage from a cost and compliance perspective.

Also consider automatic contribution escalation. This feature gradually increases participants’ contribution rates over time, helping them save more without seeing a big hit to their paychecks.

2. Match prudently

Agreeing to match each participant’s salary-deferred contribution can serve as a major enticement in hiring and plan enrollment. But your organization doesn’t need to make huge contributions to make a difference. Even a 2% or 3% match can encourage employees to participate in your plan. Plus, it signals that you’re willing to invest in your staff’s future financial security.

What’s more, employers may set up their plans so that participants must contribute more of their own money to receive the full match. For instance, rather than matching 100% of the first 3% an employee contributes, you might match 50% of the first 6%. This approach would cost your organization the same amount but encourage higher savings rates among participants.

3. Right-size investment options

“The more, the better” may seem like a good philosophy when offering plan participants various investment options. However, particularly for small to midsize employers, this approach can backfire when employees feel overwhelmed and dissatisfied with the plan.

You may be better off providing a smaller, carefully curated set of investment choices. Target-date funds are an especially popular choice. This will likely help participants feel more confident in their investment decisions and more engaged with the plan.

Another benefit of a right-sized approach is that you’ll likely reduce your fiduciary risk as plan sponsor. With fewer funds to deal with, and well-chosen ones at that, you should be able to better monitor performance, fees and suitability for your workforce. In turn, this will make it easier to fulfill your plan administration responsibilities.

4. Offer financial education

Sponsoring a qualified plan alone may not be enough. Many employers find they also need to educate employees about financial wellness so they know how to manage their retirement funds. Consider approaches such as:

Hosting educational seminars (live or virtual) on various topics,
Providing access to online tools or apps, and
Holding Q&A sessions with a rep from your plan provider.

In addition, be sure to recap your plan’s positive features during open enrollment and issue regular reminders about the importance of participants actively managing their accounts. It can all add up to stronger plan participation and satisfaction.

Why it matters

There are valid reasons why qualified retirement plans have become such a common employer-sponsored fringe benefit. Employees who feel financially secure are generally more focused and less stressed about the future.

Meanwhile, your organization can enjoy competitive advantages in hiring and retention. It may also benefit from tax deductions for contributions and even potentially qualify for tax credits that help offset administrative costs. Contact us for assistance exploring ways to strengthen your plan’s effectiveness without overspending.

Yeo & Yeo HR Advisory Solutions expands its leadership development offerings with AMPLIFY, a people-centered training program designed to prepare leaders to navigate complexity, motivate teams, and drive meaningful impact. Registration is now open for the first cohort, which will convene October 23-24 at Yeo & Yeo’s Troy office location (Troy Corporate Center II, 880 W. Long Lake Road, Troy, MI).

AMPLIFY goes beyond traditional leadership training—it’s an immersive six-month, hands-on experience built on the principle that great leadership demands both empathy and execution. With personalized coaching, guided self-assessment, and in-person development, participants will gain deeper insight into their leadership style, enhance their communication skills, and build practical strategies for managing teams and leading through change.

The program begins with individual planning and leadership assessments, laying the foundation for a two-day, in-person workshop on October 23 and 24. The workshop fosters personal reflection, peer connection, and real-world application, equipping participants with a personalized leadership roadmap and a comprehensive toolkit of resources. The program continues well beyond the workshop with individualized coaching sessions, ensuring that learning is reinforced and leadership strategies are refined in alignment with each participant’s unique goals and growth plans.

Through a blend of strategic planning, hands-on training, and sustained support over the course of six months, AMPLIFY empowers leaders to transform their leadership philosophy, drive meaningful change, and make a lasting impact within their organizations.

“Leadership is personal. It shapes culture, influences retention, and drives results,” said Amy Cell, President of Yeo & Yeo HR Advisory Solutions. “With AMPLIFY, we’ve created an experience that’s deeply reflective, highly actionable, and grounded in what leaders need most today—clarity, trust, and the ability to inspire others.”

Built by a team of organizational development professionals, AMPLIFY brings together decades of consulting experience and insights from clients across industries. The program’s focus on practical leadership tools, paired with a supportive peer community, makes it ideal for professionals stepping into leadership roles, new managers seeking confidence, or experienced leaders ready to elevate their impact.

AMPLIFY builds on Yeo & Yeo HR Advisory Solutions’ deep expertise in leadership development and talent strategy. Formerly known as Amy Cell Talent, the team recently marked a decade of supporting businesses, nonprofits, municipalities, and startups across Michigan. Since joining Yeo & Yeo in early 2025, the group has continued to expand its reach while maintaining a strong reputation for effective, personalized HR services. Now with more than 20 professionals, the team brings its proven approach to leadership development through AMPLIFY—combining experience, insight, and a commitment to helping leaders thrive.

Amplify

Learn more and register here