Five Signs That You Need a Back-Office Family CFO

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What is a Back-Office Family CFO?

At Plumb Family CFO, our idea of a “Back-Office Family CFO” is a team of outsourced accountants who handle the financial reporting, bill pay, and cash flow management of a high-net-worth family, rather than having one single Family CFO who takes care of all the tasks associated with a complicated financial life.  A back-office Family CFO, using the Plumb Family CFO approach typically works off-site to handle the accounting and bill pay work remotely, yet still delivers accurate and timely financial information to the client.

Here is a list of five signs that you need a Back-Office Family CFO:

1. Missing due dates and incurring late payments.

You become overwhelmed with the amount of mail received on a daily basis and the pile of bills and due dates keep stacking up.  With so many properties, automobiles, credit card statements, household employees and recurring bills, they are hard to keep track of and get paid in a timely fashion.  Any incurred late payments can lead to damaging credit scores.

Plumb Family CFO offers comprehensive bill pay services for families and individuals.  We oversee your monthly expenses, initiate payments, reconcile your accounts and track your credit card statements.  That way, you never miss a bill and have your credit cards monitored at the same time.  We also provide weekly or monthly cash flow reports, so you know exactly how much cash is coming in and how much cash is being paid out.

Want to learn more about the family bill pay service offered by Plumb?  Click here for a list of frequently asked questions.  Ready for a quote? Answer these questions and we can prepare a proposal based on the amount of accounts to track and bills to pay.  Request a Quote

2. Trouble with keeping track of multiple entities, investments, rental properties and trusts.

You may be the head of the household, but it feels like you a running a multimillion dollar company.  With great wealth comes great responsibility.  Your family’s financial life is complex with multi-faceted undertakings, such as corporate entities, private equity, international exposure, homes and rental properties, and alternative investments. This is a sign that you need help with your personal accounting needs.

Plumb Family CFO delivers financial peace of mind by helping affluent families organize, coordinate and navigate through their financial affairs.  Working in partnership with the family’s team of trusted advisors, we provide the highest quality data and financial reporting to establish a complete view of your assets and financial holdings.

See examples of personal financial reports & analysis that we provide:

  • Statement of Cash Flow
  • Net Worth Statement
  • Family Monthly Budget
  • Vacation/Second Home Expenses
  • Bill Pay Reports

3. You do not have a clear picture of your wealth.

With so many investment accounts, credit card statements and bank accounts, it’s hard to see a clear view of overall wealth.  At Plumb Family CFO, we work with your personal financial team to gather all the information tied to your family’s assets and turn it into a one-page summary of net-worth.  The financial reports we provide are detailed, holistic, and customized to your preference. In order to make better decisions about your wealth, it is important to have up-to-date financial data.

Read: Retain your Family Wealth by Organizing your Financial Life

4. Financial paperwork is not organized for tax season.

Tax deadline is looming and your CPA is working frantically to gather all your necessary paperwork to calculate the right deductions and track all your income and expenses.  It’s costing your family more time and money working with your CPA, because you do not have your financial house in order.

Plumb Family CFO works with their high-net-worth clients to provide an Annual Tax Organizer which is an audit-proof package that allows for maximized standard deductions.  Additionally, we provide your CPA with quarterly reports to adjust estimated tax payments as needed to avoid annual penalties and interest charges from the IRS or Franchise Tax Board.

Learn More: Plumb Family CFO Annual Tax Organizer

5. Too much time is spent handling household finances and not enjoying your wealth.

A good amount of your free time is spent handling household finances and it has become too complex to track properly.  Your family has acquired a team of trusted advisors to help you handle the maze of legal issues, tax planning, and investments, yet you don’t have a consolidated view of your overall wealth.

Why not outsource your personal accounting and family bill pay needs to a trusted and reliable firm with over 20 years of experience working with affluent families and corporations?

See how these families benefited from engaging with Plumb, back-office Family CFO:

Back-Office Family CFO Services by Plumb

If any of these items on the list applies to you and your family, Plumb Family CFO can help.  We are not a wealth management firm and do not recommend investment strategies. We are not a CPA firm and do not file tax returns.  Simply put, we are a back-office Family CFO with a team of personal accountants that have experience working with high-net-worth and their specific needs.  Plumb Family CFO works in partnership with your financial team to provide the highest quality data to help them make better decisions about your wealth and financial planning.

Want to learn more?  Here is a list of the top frequently asked questions about the clients and services offered by Plumb Family CFO.  

Accounting Services Include:

  • Family bill pay – including mail management & vendor management
  • Producing monthly financial statements
  • Cash flow reporting
  • Personal financial reporting & analysis
  • Bank and credit card reconciliation
  • Investment account reconciliation
  • Budgeting services and reporting
  • Household employee payroll services
  • Foundation and trust accounting
  • Annual tax organizer for the CPA

Are you ready to take control of your financial life and start enjoying your wealth?

Schedule a consultation with Plumb Family CFO today:

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3 Things to Know About Form 1099-NEC

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What is Form 1099-NEC (Nonemployee Compensation)?

The IRS is bringing back a form last used in 1982s —Form 1099-NEC, to be used beginning with 2020 information returns. The draft 2020 version of the form has been posted by the IRS to the agency’s website. Part of the rationale for the new Form 1099–NEC was that the Protecting Americans from Tax Hikes (PATH) Act of 2015.

It will be used to report at least $600 payments made to each person during the calendar year for your business:

  • Services performed by someone that was not your employee
    • Include parts/materials used to perform the service
  • Cash payments for fish (or other aquatic life) you purchase from anyone engaged in the trade or business of catching fish
  • Payments to attorneys

Withheld any federal income tax under the backup withholding rules regardless of the payment amount.

Common examples of who will receive Form 1099-NEC:

  • Attorneys
  • Architects
  • Accountants
  • Graphic Designers
  • Web Developer
  • IT Consultants
  • Freelance writer
  • Non-employee Sales Commission
  • Freelance Contractors
  • Landscapers
  • Other self-employed individuals

Form 1099-NEC:

Due to IRS & Recipient 2/1/21

  • A IRS
  • 1 State Tax Department
  • B Recipient
  • 2 Recipient copy to be filed with state income tax return (if applicable)
  • C Payer

Form 1099-MISC:

Due to recipient by 2/1/21 or 2/16/21 if reporting in box 8 or 10. Due to IRS by 3/1/21 (paper) or 3/31/21 (electronic)

  • A IRS
  • 1 State Tax Department
  • B Recipient
  • 2 Recipient copy to be filed with state income tax return (if applicable)
  • C Payer

Ready to start your new year with organized financials in preparation for tax season? Plumb Family CFO works in partnership with your CPA and personal financial team.  Find out more…

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Know Your Net Worth: Personal Bookkeeping & Bill Paying Services

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Personal bookkeeping & bill paying services help keep your financial life on track.

Do you know your net worth?

It is a simple math equation. Your net worth equals your assets minus your liabilities.

personal bookkeeping

For those with a complex financial life, it can be a challenge to determine this calculation. You must first assign values to all your assets, including investments, brokerage accounts, personal property such as real estate, vehicles, jewelry, etc.  You also need to accurately track your expenses and debt, including loans, bills, taxes due, etc.

When someone’s wealth accumulates to a certain level, many individuals and families turn to a personal bookkeeping service or setup a single family office to help with the day-to-day financial tasks of tracking income/expenses, paying bills and creating consolidated financial reports.

How Can a Personal Bookkeeping Service Help?

Here at Plumb Family CFO, we understand the unique needs of the high-net-worth.  We have been helping affluent families, busy entrepreneurs and retired couples navigate their personal finances by providing a high-level bookkeeping service that is trusted and dependable.

We become your back-office accounting team. Our accounting experts have both corporate and personal bookkeeping backgrounds and deliver white-glove customer service.  By outsourcing bookkeeping to Plumb Family CFO, you will receive a team of accountants to provide services including:

  • Monthly consolidated financial statements to determine your net worth
  • Cash flow reports to track your income and expenses
  • Budget analysis to create a personal budget based on spending habits and long-term goals
  • Bank & credit card reconciliations
  • Entity bookkeeping for sole proprietorships, partnerships or corporations if necessary
  • Payroll administration for your household employees
  • Trust and foundation accounting
  • Bill payment services, including wire transfers, vendor management and capital calls

The setup process is unique for each family.  Personal bookkeeping services are customizable and pricing is based on a monthly fixed-fee basis.  The back-office accounting means that we can work virtually for the majority of the bookkeeping transactions, but also have meetings in person or on the phone to review financial statements and goals.

At Plumb Family CFO, we believe that by knowing your net-worth you can take true control of your wealth. 

What are the benefits of hiring a personal bookkeeper?

  • Reduce your stress and anxiety from managing multiple bills and due dates
  • Get a clear picture of your net-worth to make better decisions regarding your wealth
  • Gain access to a view of your monthly expenses, due dates and income from all your entities, etc
  • Have more time to focus on your family, your business and free time
  • Add the missing piece to your team of trusted advisors 

Want to learn more?  Please contact us for a no-obligation phone call to learn more about our process, pricing and personal bookkeeping services offered.

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Get a Quote for Personal Bill Pay – answer these questions regarding your expenses to help determine monthly price:

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Personal Income Tax Organizer: Preparing your Financials for Filing Tax Returns

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Personal Income Tax Organizer, an Outsourced Recordkeeping Solution by Plumb Family CFO

In this client case study, Plumb Family CFO gives an overview of the recordkeeping and accounting services that go into putting together a personal income tax organizer that streamlines year-end tracking and creates financial organization in order to file tax returns.

Client: High-net-worth real estate investor with multiple properties, S Corp, and brokerage accounts.

Net Worth: $35MM

Background:  This real estate investor has a large portfolio of multi-family rental and mixed-use properties, along with an S Corp, and complex personal accounting needs. With limited time and resources to organize his financial records and supporting tax documents, he turned to Plumb Family CFO as an outsourced accounting solution.

The Solution:  Plumb Family CFO collects, tracks and organizes the client’s financial data to create a comprehensive and audit-proof financial package for year-end.  This allows for the client’s CPA firm to be more cost-effective with their time and helps to maximize standard deductions. Plumb also supplies the CPA with quarterly financial reports to properly adjust estimated tax payments as needed to avoid any penalties and interest chargers with the IRS or Franchise Tax Board.

By having accurate recordkeeping throughout the year, with up-to-date reconciliations and properly tracked income and expenses, the client experienced tax season with the peace of mind knowing that he had the highest quality of data and financial reporting to file tax returns. With a clear financial picture, he was able to make informed decisions with his wealth and property portfolio.

View: Additional Family CFO Case Studies

“Plumb Family CFO tracks and organizes my client’s financials and paperwork throughout the year and I never have to worry about any last-minute fire drills or missing information during tax deadlines”.  – Client’s CPA

Download: Sample copy of Annual Tax Organizer / Personal Income Tax Organizer

Personal Income Tax Organizer: “Pulling it all Together”

In order for Plumb Family CFO to organize and compile all the data for the client’s CPA to file tax returns, we follow an accounting preparation guideline, including:

  • Step 1: Fully reconcile and close out year-end financials
  • Step 2: Print a P&L statement for each entity to use as reference tool
  • Step 3: Work with the client’s CPA to use their standard personal income tax organizer or create document using Plumb Family CFO template
  • Step 4: Outline and track any major purchases made throughout the year that may have a tax impact – for example, purchase/sale of real estate, purchase of electric vehicle or IRA contributions

Financial Recordkeeping & Supporting Tax Documents

Here is a sample list of the supporting tax documents that Plumb Family CFO will collect throughout the year for the personal income tax organizer package.

  • Wages/Salary – W2
  • Interest/Dividend Income:
  • 1099s from bank and brokerage firms
  • General Ledger for private loan/note interest received
  • Capital Gains/Losses
  • 1099 from brokerage firms
  • K1 Schedules
  • Private Equity
  • Hedge Funds
  • Privately Held Companies
  • Property Income/Expenses
  • Include P&L by investment property to be included on Schedule E of the tax return
  • Standard Deductions
  • Include GL detail for each category
  • General Expense Categories
  • Medical and Health Insurance
  • Legal – Estate Planning
  • Interest Expense – either 1098 form for mortgage or investment interest
  • Property Taxes for Residence(s)
  • Donations – include donation receipt for amounts over $250 per annum
  • Tax Payments (IRS and State)

Ready to start your new year with organized financials in preparation for tax season? Plumb Family CFO works in partnership with your CPA and personal financial team.  Find out more…

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How to Prepare a Net Worth Statement and Track Your Wealth

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Track your Wealth with a Personal Net Worth Statement

Many of our clients turn to Plumb Family CFO because they have a complicated financial life and need help preparing their net worth statement. By having a clear picture of their wealth, including assets and liabilities, they can make better decisions with their investments and long-term financial goals.

What is a Net Worth Statement?

Net Worth = Assets – Liabilities

Let’s start with the basics.  A net worth statement is a personal balance sheet.  It lists your assets and liabilities.  Assets are items listed that have cash value (or can be converted to cash).  These assets typically include any money that is in your bank account, retirement account, investment accounts, and major items such as real estate or automobiles and other valuable property.  Liabilities are the debts or expenses that you owe. These include: bills, loans, mortgages, etc.

Need help with bill pay? Top 5 signs that you should hire a personal bill payer

How to Prepare a Net Worth Statement

There is technology available to help you track your net worth, or you can start with a simple spreadsheet.  For people who have a high net worth, it is beneficial for them to use a professional accounting firm to help them track their income and expenses.  To calculate your net worth, you subtract your liabilities from your assets.

Need help with your personal accounting to better track your wealth?

With great wealth comes great responsibility. There is complexity that comes with wealth, including high volumes of bills and income and expenses to track. Setting up a net worth statement or bill pay schedule with the appropriate checks and balances is not an easy task.

At Plumb, we offer personal CFO and bill pay services to ensure that our client’s finances are efficiently tracked and bills are paid, so they can focus their time on enjoying life and have financial peace of mind.

Article: A Corporate Approach to High-Net-Worth Individuals 

Back-Office Accounting Services for High-Net-Worth include:

net worth statement

For more information on Plumb Family CFO – or to receive a quote for bill pay and reporting services

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Paperwork Relief after a Natural Disaster: Guidance on how to start managing the chaos

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4 Steps for Paperwork Relief:

After experiencing devastating natural disasters in the past weeks, those who were affected are trying to get back on track and find paperwork relief. Besides numerous other steps, victims need to document their losses and damages, checking their records and embracing lots of paperwork. Since various issues need to be managed in such times, any guidance can be helpful for getting things done. The following methods give an idea on how to reconstruct documents as a first step for claiming benefits and organizing financial records.

1. Support by the IRS

For helping the victims, Internal Revenue Service (IRS) is providing support from reconstructing records to a variety of tax relief. Free tax return transcripts for taxpayers are available on IRS.gov or with the smartphone app IRS2Go  or via phone (800) 908-9946. The documents can give an overview of the information required to claim the offered benefits.

Extended tax deadlines can help to relieve stress and anxiety for those affected. Detailed information on paperwork relief can be found on the website of IRS or in the Disaster Resource Guide published by IRS.

2. Documentation and Records

For claiming benefits like tax relief or financial support, verifications and documentation of personal property or belongings are required to establish values. The following methods help to capture damages and losses:

  • Photos and videos right after the disaster can be used to verify ownership and record the extent of damages. Also lost belongings that are captured on pictures taken before the disaster help to verify.
  • Another possibility are online purchases, where invoices can be found in the buyers account on the website or in the emails.
  • Credit or debit card purchases will also help to give an overview on the bought property.
  • Service providers like financial institutions or contractors can also provide copies of necessary documents to verify costs or investments.

3. Auto Damage

If a vehicle was damaged, independent sources could help to estimate a realistic and fair value. Services can be found online, for example at Kelly Blue Book or National Automobile Dealers Association.

4. Insurance Coverage

Depending on the extent of coverage, insurances often take care of replacements and financial support. Especially real estate owners should check their insurance policies and the stated value to calculate a base figure for replacement.

How Plumb Family CFO can help

Paperwork can be overwhelming at such times of crisis, and starting is never easy. A good understanding of financial services, tax deadlines and accounting services help to fully realize losses and damages. You can obtain financial relief through insurance, tax deductions, and other sources. In case you do not have time to handle these issues, an experienced and reliable accountant is recommended.

Plumb Family CFO provides assistance and paperwork relief by collecting and organizing documents and financial records. Due to consistent communication and interaction with all of the client’s professional advisors, an overall view on accounting and financial documents can be provided. The services mentioned below show how Plumb can offer guidance, no matter if in good or in bad times.

Family CFO paperwork relief

Are you looking for paperwork relief?  Schedule a consultation to learn more.

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Plumb Family CFO Asks: Who’s Managing your Wealth?

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A top priority for affluent families is managing wealth.

To make things clear, Plumb Family CFO does not provide services that manage wealth or advise on investment strategies. Plumb Family CFO works with their client’s personal financial team to provide an accurate view of wealth through consolidated reports and financial statements.  Consistent communication with the family’s professional advisers leverages their total expertise and provides a backdrop to make better financial decisions to sustain wealth.

family office services

In this article, written by Tony Robbins for MarketWatch, he gives his opinion on how to take charge of your money and managing wealth by knowing the difference between a financial adviser, broker-dealer and an independent registered investment adviser.  Go to Tony Robbins person website >> here

Managing Wealth: Considerations for Choosing a Financial Adviser

These statements are taken from a series of articles written by Tony Robbins who explains how to improve investment and personal-finance skills. Managing wealth is a complex topic and by knowing the answers to these questions it will help you learn the financial system better.

  1. What’s the difference between a Financial Adviser, Wealth Manager, or Investment Consultant vs. Registered Investment Adviser?
  2. Does the investment firm have an affiliation with a Broker-Dealer?
  3. Does the firm offer proprietary mutual funds or separately managed accounts?
  4. Does the firm receive any third-party compensation for recommending particular investments?
  5. Where is the money held?
  6. Does the firm offer any financial planning services beyond investment strategy or portfolio management?

Managing wealth can include various tasks outside of financial planning and investment.  This is where Plumb Family CFO can help by handling personal accounting services not provided by the client’s CPA or family office.  Read: “Top Ways that Plumb Family CFO Works with Trusted Advisers”

Plumb Family CFO Provides:

Gain Financial Peace of Mind with Plumb Family CFO.  For more information…

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Tax Deduction Survey for Tax Season

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Take the Tax Deduction Quiz!

Just in time for tax season

Do you think you know what qualifies as a tax deduction?  Here at Plumb, an outsourced accounting firm in San Diego and Orange County, we have a full team of accounting professionals who organize our client’s financials to get prepared for filing tax returns.  We are not a CPA firm, rather a company that supports businesses and high-net-worth families with their part-time and outsourced accounting needs.

Whether you are a CPA, tax professional, accountant or simply handle your own personal tax returns, test your knowledge with this quiz!

 >> Tax Deduction Quiz! <<

Plumb works in partnership with our client’s CPAs to handle all the preliminary tax work for year-end.  With our customized 7-Step Process, Plumb delivers an Annual Tax Organizer, consisting of a one-page tax summary sheet outlining information sent to the CPA.  With our pre-tax accounting services, it ensures accurate record-keeping, and reconciliation of all asset accounts.  For more information on our Annual Tax Organizer, click here.

Pre-Tax Accounting Services:

  • Tracking and recording 1099’s,
  • Tracking and recording charitable contributions
    • Any contribution over $250 must have a letter or receipt
  • Tracking and recording medical expenses
  • Tracking and recording sales of stock
    • Enter gross proceeds and gross cost basis
  • Record and calculate Gross Distribution, Taxable amount and taxes withheld from Wages, Pensions or Gambling Winnings
  • Re-classify income per 1099
  • Verify 1099-G; money received from State & Local Tax Refunds

If you want to experience financial peace of mind this tax season, Plumb is here to help.  

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Personal Concierge Services for the Frequent Traveler

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Are you ready for your summer vacation?

Luxury travel and relaxation is a top priority for many of our Family CFO clients.  With their extended stays away from home, many entrepreneurs and affluent families have a lot of responsibilities to keep organized. At Plumb Family CFO, our goal is to add simplicity and clarity to our clients’ financial lives. This gives them peace of mind while traveling the globe.

Our personal concierge services can be customized to meet the needs of any situation, with a wide range of projects and oversight. Client’s can take a long-term summer vacation and not have to worry about missing a bill or paying their household staff.

Personal Concierge Services:

  • Calendar Management
  • Bill Pay
  • Mail Services
  • Payroll for Household Staff
  • General Errands

“As a long-term client, I count on Plumb Family CFO to not only help organize my financial life, but also take care of other personal tasks.”

Frequent Traveler Case Study:

Background:

A successful business owner, actively engaged in day-to-day operations, begins traveling the world on a more regular basis.

Personal Concierge Services Provided by Plumb Family CFO:

  • Calendar, email and personal files were set up virtually to allow shared access at anytime
  • Event and travel calendar were kept up-to-date
  • All requests for donations, appointments and investment opportunities were initially screened by Plumb
  • Processed payroll for household employees
  • Handled HR duties for household employees
  • Created financial calendar of due dates and paid bills
  • Bank and credit card reconciliation

Outcome:

  • Well-organized calendar, with no event or meeting conflicts
  • Client spends less time searching through emails and proposals
  • Bills are paid on time
  • Peace of mind – more time to enjoy life and take care of business priorities

Read More: Frequent Traveler Case Study

Ready to Simplify your Life and Take Advantage of Personal Concierge Services?

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