Skip to main content Skip to search


Ready to quit the day job?

Food for thought for the would-be entrepreneur (part 1 in a series)

The good news:  about 80% of new businesses make it through the 1st year.  ????

The bad news:  about 50% of new businesses don’t make it through the 5th year.  ☹

Interestingly, these statistics are consistent whether it’s boom time or bust in the economy at large.

The most frequent excuse for a failed business is “undercapitalization.”  What does that mean in everyday English?  It means even after closing the doors, the owners still believed they would have made their requisite millions if only they’d had enough money to keep paying the bills (including their own living expenses) until their product/service caught on sufficiently.

So, if the business isn’t paying its own bills, and if the business isn’t supporting the owners (and paying their bills,) we have to wonder how are all these bills being paid?

Most new business owners dig deep into their own pockets.  Savings get depleted.  Retirement funds are cashed in.  An unwitting spouse works overtime at a “real” job to pick up the slack.  Credit cards are maxed out.  The home might be re-mortgaged.  And all this cash is poured down the greedy throat of the needy new business.  Worst of all, sometimes it even ends in personal bankruptcy.

Owners are frequently indignant that they can’t get a loan to keep things going.  The usual lament is, “I can’t get a loan until I’m successful, but if I were already successful, I wouldn’t need a loan.”

In this series, I will address some of the underlying concerns of most wannabe entrepreneurs.  Should I incorporate?  What’s a business plan and why do I need one?  How do I know when to hire my first employee?  What kind of paperwork do I need to do?  Can I write off my car?  What’s this nexus thing I hear about?  I am a CPA, not a lawyer, so I can’t give legal advice.  However, I can tell you the tax consequences of various decisions and situations (which is something that baffles many lawyers,) and I can share my experience and observations from a couple decades of working with entrepreneurs.

So, if I haven’t scared you off… let’s go!

Read more

Estate Spending Pitfalls

My own layman’s guide, born of my own experience and observations – Part 9

 First, let me apologize. This article is sure to upset someone.


When it comes to administering an estate, the general thinking feeling is, but Granny would have wanted it that way!

 The law, however, contends that if Granny had wanted it that way, she should have written it into her will; if she did not write it into her will, it doesn’t count.

Read more

Fees for the Executor

My own layman’s guide, born of my own experience and observations – Part 8

By now, you should realize that settling an estate takes a lot of work.  This is why the estate can compensate the executor for doing the job.  Of course, by executor, the law also includes executrix, as well as administrator and/or administratix.

BUT, it may be that the will specifically forbids payment to the executor/executrix.  Why would the will forbid this payment?  Hard to say.  Could be that Great-aunt Bunny really wanted the ‘stuff’ to be divvied up a certain way, or just didn’t realize it would be so much work.  Also note, if you are the executor as well as a fellow-heir, the other heirs may not realize the amount of work, (or believe it should  be a labor of love,) and your fees could start (or contribute to) a family feud.

Read more

Estate Taxes and Accounting

My own layman’s guide, born of my own experience and observations – Part 7

In order to discuss the taxes, it’s important to understand the difference between assets and income.

Assets include all property (money, real estate, crab traps, etc.,) transferred into the estate.  Every single cotton picking thing that Grampy owned is immediately owned by the estate upon Grampy’s death.

Income is money the asset earns.

Read more

Estate Attorneys. Who needs them? (Not a rhetorical question!)

My own layman’s guide, born of my own experience and observations – Part 6

It is perfectly legal and acceptable for the executor to hire an estates attorney.  Do you need an attorney?  I don’t know. It would be good to at least have a consultation with an estates attorney before you decide to take the DIY approach.  Planning the funeral and working through the assets could be headache enough without having to do the necessary paperwork to liquidate the assets, file the inheritance tax papers, prepare the accounting, and distribute the proceeds.  Also, if you have an attorney, you won’t be “the bad guy” in the eyes of other heirs.

When you interview potential attorneys, ask how long it is likely to take to wrap things up.  Then, keep them accountable.  Some attorneys ask for a retainer up front, and invoice monthly as time and filing fees mount.  Some attorneys will tell you a flat fee up front.  When this is the case, be sure to ask what circumstances might require additional payment.  Always ask exactly what will be required of you!

A good estates attorney can handle the liquidation of assets.  This would include financial assets as well as real property or other assets.  The attorney can also navigate the transfer of real property, even if the property is in other states.  Your estates attorney will take care of all interaction with the Surrogate’s office.  They can also engage an accountant to prepare the various tax forms, though some larger estate attorneys do this in-house with an on-staff accountant.  Best of all, your attorney will handle any and all correspondence with the IRS and State of New Jersey.

Any trusts?  Any long lost heirs?  Any bad blood between heirs?  Save the headache:  Get an attorney.

Read more

Estate Expenses – Funeral

My own layman’s guide, born of my own experience and observations – Part 5

One of the biggest expenses is the funeral.  Unfortunately, all of the funeral decisions (and funeral spending) happen while the grief is very new and raw.  The assets probably haven’t even been tallied yet, or an estate bank account opened.  It is easy to lose sight of the need to spend wisely and to track expenses.  Fortunately, an honorable funeral parlor will provide a detailed invoice.

Funeral expenses can be broken down into 4 areas:  funeral parlor, viewing and/or service, cemetery, and what has commonly become known as the “funeral lunch.”

Read more

Estate Expenses – Overall

My own layman’s guide, born of my own experience and observations – Part 4

Expenses are easy. They happen under your control. You get to write them down as they happen.

The hard part is spending the money in accordance with the will and the law. There will be all kinds of reasons to break protocol, so to speak. There’s always an heir with a sob story. Somebody might need a loan. Somebody might propose perfectly rational non-stated items to spend on, or a perfectly rational alternative distribution schedule. Don’t do it! Stick to the script. The script was written by the deceased, in accordance with the laws of the State of New Jersey: as executor, your job is to follow through.

Read more

Estate Assets

My own layman’s guide, born of my own experience and observations – Part 3

Everything that the deceased owned is an ASSET.

Some assets are easy to identify:  house, vacation house, rental property, furnishings inside the various houses, vehicle, antiques, gold bars, silver coins, “fine” jewelry/watches, “fine” artwork, “fine” china, etc.

Some assets are financial:  cash, bank account, annuity, 401K, IRA, mutual fund, bonds, etc.

Some assets are valuable, and need to be listed individually:  everything above.

Some assets only have sentimental value:  old worn slippers, costume jewelry, photos, framed jigsaw puzzles, ancient lawnmower, broken recliner, chipped dishes and glassware, stacks of magazines, drawers of letters, unfinished afghans, etc.

Read more