NAICSCODE.com, a free industry search engine sponsored by Axiom Valuation, has over 1 million visits since 2008

Axiom Valuation Solutions has provided the most user-friendly industry search engine for NAICS codes and SIC codes since 2002.  We started tracking visits through Google Analytics in April 2008.  NAICSCode.com has had almost 1.1. million visits since then.

The Internal Revenue Service requires that businesses report their Principal Business Activity Code on their federal tax return. There are over 400 business activity codes from which a business owner or accountant can select as the appropriate one for their principal activity from a table in the tax return instructions. However, for many small- and medium-sized businesses, even this level of detail does not provide enough specificity to determine which is the right business activity code for the business.

Since the IRS business activity codes are based on the North American Industry Classification System (NAICS pronounced Nakes), NAICSCode.com has constructed a more detailed searchable index of NAICS codes, their descriptive titles, and over 18,000 additional terms that provide alternative descriptions of these industries. With this level of detail, you should be able to find the right business activity code for almost any type of business.

Why Is the Right Business Activity Code Important to the IRS?

According to the IRS, classifying a business “facilitates the administration of the Internal Revenue Code.” Practically speaking, the business activity code helps the IRS to determine for auditing purposes what is the right comparison group for a business. The IRS uses computer programs to compare financial ratios of a business with the same ratios for a comparable grouping of businesses in the same industry and within the general size range. Companies that show substantially different ratios from the average for their industry group are more likely to be flagged for further scrutiny.

For the IRS, the more accurate the activity code designations are, the better this screening process will work. The IRS does not rely solely upon the business activity codes for categorization. They also request a brief description of the company’s principal business activity and of the company’s principal product or service.

Why Is the Right Business Activity Code Important for You?

For owners or accountants preparing tax returns for a business, the business activity code is the most important indicator used to determine the peer group for comparison in the IRS audit screening programs. The IRS uses computer programs to compare financial ratios of a business with the same ratios for a comparable grouping of businesses in the same industry and within the general size range. Companies that show substantially different ratios from the average for their industry group are more likely to be flagged for further scrutiny.

Visit www.naicscode.com/  for more information.

Upcoming Free Webinar on 7/18/2013: Valuing Personal Goodwill and Minimizing Pushback from the IRS

Axiom Valuation Solutions is pleased to offer the Webinar, “Valuing Personal Goodwill and Minimizing Pushback from the IRS”.  This Webinar was originally held in December of 2012.  The original response was so encouraging, that we decided to offer it again.

Objective: Understanding the proper valuation of personal goodwill during an acquisition and the ensuing tax implications.

Dr. Stan Feldman, Co-Founder and Chairman of Axiom Valuation Solutions will be the presenter.  Dr. Feldman is a recognized expert in the field of valuation and has published many articles and books on the subject.  He was an Associate Professor of Finance for over 22 years and as a member of the Financial Accounting Standards Board’s (FASB) Valuation Resources Group, helped draft FAS 157 (now Topic 820)

The webinar will cover the following topics:

  • How is personal goodwill defined?
  • What is the difference between personal goodwill and corporate goodwill?
  • What are the benefits of establishing and valuing personal goodwill?
  • What standards does the value of personal goodwill have to meet to minimize pushback from the IRS?
  • Case Study
  • Final Thoughts

Welcome to Axiom on Value, the blog of Axiom Valuation Solutions

We are a business and securities valuation firm working globally across all industries.  We will be posting valuation-related content on a wide variety of topics.   We look forward to your feedback!