Success in the construction industry requires the ability to cost effectively create the building envelope, structure or support systems such as electrical, plumbing or HVAC. It also requires sharp project management skills to ensure that labor, materials, supplies and equipment are properly scheduled and managed. The ability to manage unexpected scheduling and other surprises reflects management’s skill. However, beyond the day-to-day, management needs to be aware of trends and issues impacting the industry and develop a plan to address them.
Business valuation is an evolving discipline. In some jurisdictions, investment value — rather than fair market value — has emerged as the preferred standard of value in some divorce cases. This trend is important to monitor to ensure your valuation expert estimates the correct standard of value. If not, a court may disregard his or her conclusion.
Investment Value Definition
Fair market value, which is the most common standard of value, estimates the value that the universe of hypothetical buyers and sellers would agree on for an interest in the subject company. It is customarily defined by IRS Revenue Ruling 59-60, but it also may be appropriate for valuations prepared for purposes other than federal taxes.
Once upon a time, taxpayers could generally deduct 50% of business-related meal and entertainment expenses. However, several exceptions allowed larger deductions in certain circumstances.
Then came the Tax Cuts and Jobs Act (TCJA), which dramatically shifts the playing field for expenses paid or incurred after December 31, 2017. The new law also creates some uncertainties, as this article will explain.
The Before and After of Exceptions
Under prior law, the following exceptions to the general 50% deductibility rule were available. (In some cases, as you will see below, the exceptions have been retained under the TCJA).
Whether you recently left a job, are in the middle of a financial crunch, or you are beginning your retirement, you need to be aware of the income tax implications of withdrawing funds from your retirement savings account(s) for personal use. Having both taxable and tax-free retirement plan assets available from your retirement accounts is a prudent tax-planning method when taking retirement plan distributions for personal use. For example, In years where the income tax rates are higher, you may want to withdraw more retirement plan funds from your income tax-free alternatives to reduce your overall income tax exposure.
Retirement accounts come in many forms. Some retirement accounts include:
In October 2017, the Internal Revenue Service (IRS) released the 2018 contribution and benefit limits for retirement and other benefit plans types. The IRS recently announced revisions to the Health Savings Account (HSA) contribution limit for individuals with family coverage. This change is a result of the tax reform law. Keep in mind, for HSA purposes, family coverage is any coverage other than self-only coverage. Below are a few HSA contribution highlights:
It is estimated, across the globe, cybercrimes cost businesses $450 billion in 2016. Yet companies of all sizes continue to ignore these threats. Many business owners feel they are too small for a cybercriminal to waste their time. However, the opposite is often true. Small companies are assumed to not have the proper safeguards in place to protect themselves or even recognize an attack.
Real Life Example: You received your financial statements from your accountant and you are making money. That is great! Isn’t it? But what else are the numbers on the paper telling you? Is your company performing as well as its peers? Should you be doing better?
Utilizing benchmarks is the easiest way to determine how well your hospitality company stacks up against others in your industry. Below are benchmarks regarding three major subgroups in the hospitality industry – restaurants, hotels & lodging and golf courses:
Businesses in the transportation industry often face complex challenges not encountered by other companies. Managing the demands of a large fleet including; drivers, safety and compliance, and the maintenance of new trucks and other equipment can be quite complicated. To stay competitive, transportation companies look for every advantage possible to win new business, reduce expenses and increase service levels. The good news is the Tax Cut and Jobs Act of 2017, more commonly known as tax reform, ushered in several changes which will benefit transportation companies.
Many business owners fail to follow the strict tax rules for substantiating vehicle expenses. But if your business is audited, the IRS will most likely ask for mileage logs if you deducted vehicle expenses — and it tends to be especially critical of the amount deducted if you are self employed or you employ relatives. While the basics seem simple, there are numerous exceptions.
Taxpayers can deduct actual vehicle expenses, including depreciation, gas, maintenance, insurance and other vehicle operating costs. Or they can use the standard mileage method, which allows a deduction based on the standard rate for each mile the vehicle is driven for business purposes.