Today’s asset purchase could turn into tomorrow’s tax break
 
June 28th, 2016

CTDA Wants You To Know

 

 

Today’s asset purchase could turn into tomorrow’s tax break

Shopping, anyone? If your business is in need of office equipment, computer software or perhaps an HVAC system, the purchase you make today could provide you with a tax break tomorrow — or, more specifically, when you’re ready to file your 2016 taxes. The Section 179 expensing deduction remains a solid potential tax-saving value for today’s companies. Expensing your buys Sec. 179 of the Internal Revenue Code allows businesses to elect to immediately deduct — or “expense” — the cost of certain tangible personal property acquired and placed in service during the tax year. This is instead of claiming the costs more slowly through depreciation deductions. The election can only offset net income, however. It can’t reduce it below $0 to create a net operating loss.

The election is also subject to annual dollar limits. For 2016, businesses can expense up to $500,000 in qualified new or used assets, subject to a dollar-for-dollar phaseout once the cost of all qualifying property placed in service during the tax year exceeds $2 million. Improving real property, too The expensing limit and phaseout amounts would have been far lower had Congress not passed the Protecting Americans from Tax Hikes Act in late 2015. The new law made the limits permanent, indexing them for inflation beginning this year. It also makes permanent the ability to apply Sec. 179 expensing to qualified real property, such as eligible leasehold-improvement, restaurant and retail-improvement property.

Finally, the new law permanently includes off-the-shelf computer software on the list of qualified property. And, beginning in 2016, it adds air conditioning and heating units to the list. Considering all options You can use Sec. 179 expensing for both new and used property. A related tax break, bonus depreciation, applies only to new property. Be sure to consider all options when purchasing assets.

 


Business Owners: Put your successor to work before you set sail
 
June 21st, 2016

CTDA Wants You To Know

 

 

Business owners: Put your successor to work before you set sail

A hastily chosen or ill-prepared successor can lead a company astray or, in worst cases, mismanage it into bankruptcy. Before you set sail into retirement or perhaps on to your next great professional adventure, make absolutely sure that your chosen replacement is ready to, well, succeed. Build stakeholder confidence Perhaps the simplest, most important thing you can do is to put your successor to work. Co-owners, board members and employees are more apt to follow a replacement’s lead if they feel confident in his or her knowledge and skills. And the only way to truly build that confidence is to allow these stakeholders to experience your successor’s leadership style and capabilities first-hand.

For instance, let your successor gain experience examining and discussing financial information for tax and financial reporting compliance and profitability analysis. In addition, allow him or her to spend time among your HR staff to learn about your hiring methods and benefits issues. Get hands dirty Don’t hesitate to let your heir apparent get his or her hands dirty. For example, if you’re a manufacturer, let him or her spend plenty of time down on the plant floor to see and participate in daily operations. Or, for other types of businesses, send your prospective replacement out on sales calls to face the challenges of meeting customer demands head-on.

While your successor gets acclimated, you may want to hire an interim manager. His or her objective industry and supervisory experience can be invaluable in training your next-in-line. But you must give the interim manager executive powers, including the ability to guide careers and make employment decisions. Create a comprehensive strategy Properly training and preparing your successor is immensely important if you want to truly leave your company in good hands. However, this is just one aspect of succession planning.

 


Cultivating your company’s strategic plan
 
June 6th, 2016

 

Cultivating your company’s strategic plan

Most companies start life as a business plan. Eventually, that plan should evolve into a formal strategic plan document that lays out key initiatives for the business over the next three to five years.

Unfortunately, even when said document is created, that seed planted in the ground often ends up largely ignored, untended and malnourished. So how can you make sure to cultivate your strategic plan so it grows with the company? Here are some ideas. Champion the process Your top managers must take the lead in collecting relevant facts, setting priorities, weighing competing alternatives and then making choices. And they need to be highly engaged in a process of debate and discussion before decisions are made.

When the focus is on the process, not just the output, it’s easier to make it an ongoing effort. That’s because managers develop a deeper understanding of and buy into the analysis and options that were considered in developing the strategic plan. They’ll also have a greater sense of ownership, and thus be much more willing to keep it up to date. Set the specifics Don’t view strategic planning as simply setting long-range goals. A good plan also includes:

  • Strategies (broad directions to achieve your goals),
  • Programs (shorter term actions required to implement the strategies),
  • Metrics (such as incremental market share improvement), and
  • Milestones (such as “opening a new store on the decided-upon date”).

In addition, accountability is key. Assign responsible individuals to oversee each strategy or program. And regularly assess their progress against the metrics and milestones. Be prepared to pivot Some businesses annually update their strategic plans, whether necessary or not. Although this is better than doing nothing, it may not be sufficient. Always be prepared to “pivot” — or update your plan on the fly — should a market opportunity develop. Back to CTDA This Week

 


An update from CTDA’s Representative to ANSI ASC A108:
 
June 1st, 2016

CTDA Wants You To Know

 

 

An update from CTDA’s Representative to ANSI ASC A108:

A revision for steel framing in A108.11 is being forwarded to the backerboard committee for review and resubmittal.

Two additional submissions have been made:

  1. Adding tub wall brackets
  2. Changes to toilet flange installations.

There is still work to be done before these are ready to be considered for ballot.

A lengthy discussion was held regarding proposed standards for Thin Tile or Panels in Draft Format for Gauged Porcelain Tile & Gauged Porcelain Tile Panels/Slabs A137.3 & A108.19. These products are considered to be tiles or panels over the size of one square meter. Several issues were discussed and it was determined that there is still a lot of work to be done on this project with a sense of urgency for completion.

It was suggested that a several items need to be reviewed in ANSI A137.1. Feedback from the group will be incorporated into a submittal and balloted in the next few months.

There was discussion of the need to do a complete review of all the A108 standards as there is a lot of information that needs updating. Most likely this will be completed in sections.

The next meeting is scheduled in conjunction with TSP on Friday afternoon 10/21/16.

Back to CTDA This Week

 

Foster and Clark Real Estate
CTDA - Online Education
CTDA - Membership