Frequently Asked Questions (FAQs)

Answers to some of the most common questions we receive are detailed below. Contact us for a no-obligation consultation about your unique situation.

Is my insurance deductible?

Insurance policies vary widely, so some are deductible and some are not. Your insurance provider should be able to advise you on their unique policy, but we’ll be happy to review your eligibility as well.

Do I need long-term care insurance?

Experts estimate that about 43 percent of us will spend some time in a nursing home at some point. But the risk of needing nursing home care before age 75 is relatively low. Also, most people will not need nursing home care for longer than a year.

Your chances of needing long-term care vary with your age, health, family history and longevity, exercise habits, diet, smoking, and gender. Women are at higher risk because they live longer.

Should I set up my small business as an LLC or an S corporation?

The answer depends on your situation. S corporations offer a special status that eliminates double taxation, while LLCs offer more flexibility when it comes to sharing income with the owners. Other factors to consider include:

  • An LLC may offer several classes of membership interests while an S corporation may only have one class of stock.
  • Any number of individuals or entities may own interests in an LLC. However, ownership interest in an S corporation is limited to no more than 100 shareholders.
  • S corporations cannot be owned by C corporations, other S corporations, many trusts, LLCs, partnerships, or nonresident aliens.
  • LLCs are allowed to have subsidiaries without restriction.
How can I avoid cash flow problems in my business?

Failure to properly plan cash flow is one of the leading causes for small business failures. Knowing a few basic accounting principles will help you avoid common mistakes.

A business’s monetary supply can exist either as cash on hand or in a business checking account available to meet expenses. A sufficient cash flow covers your business by meeting obligations (i.e., paying bills), serving as a cushion in case of emergencies, and providing investment capital.

Cash-flow analysis should show whether your daily operations generate enough cash to meet your obligations, and how major outflows of cash to pay your obligations relate to major inflows of cash from sales. As a result, you can tell if inflows and outflows from your operation combine to result in a positive cash flow or in a net drain. Any significant changes over time will also appear.

A monthly cash-flow projection helps to identify and eliminate deficiencies or surpluses in cash and to compare actual figures to past months. When cash-flow deficiencies are found, business financial plans must be altered to provide more cash. When excess cash is revealed, it might indicate excessive borrowing or idle money that could be invested. Contact us to develop a plan that will provide you with a well-balanced cash flow.

Should my business keep a cash reserve?

Yes. You should always keep enough cash on hand to cover expenses and as an added cushion for security. Extra cash should be invested in an accessible, interest-bearing, low-risk account, such as a savings account, short-term certificate of deposit or Treasury bill.

How do I determine my long-term financial goals?

The first step is to decide what you realistically want to achieve financially. Financial goals might include early retirement, travel, a vacation home, securing your family’s financial comfort on the death of a bread-winner, planning for the care of elderly relatives or building a family business.

How can I minimize Maryland Inheritance and Estate Taxation?

Maryland’s estate tax does not mirror the federal estate tax credit.  Rather the State of Maryland imposes a lower threshold estate tax, which over several years will increase until it is brought into alignment with the Federal system.  This requires special attention to estate planning by residents of the State.  As well, Maryland imposes an inheritance tax to be paid by the beneficiary of an estate.  While the inheritance tax has many exceptions, it is important to review and plan for this extra element in your estate tax planning.  A&H is well qualified and experienced to assist.

Looking for something else?

Call 410-810-2472 or send us a message and we’ll try to help you as quickly as possible.