Construction

As the COVID-19 emergency measures phase-out and the state continues to reopen, contractors and construction companies are looking to position themselves for the future. While there are many considerations that need to be made to comply with state and local guidelines, management is also spending time reviewing cash flow strategies.

In the construction industry where finding skilled labor has been a persistent issue for years, it appears the disruptions are also taking a toll. According to the Associated General Contractors (ACG) Coronavirus Survey Results, construction employment has reduced by 29,000.

The construction industry is still looking for ways to solve the worker shortage puzzle, an issue plaguing the industry. The problem started when the recession hit the industry hard resulting in large scale layoffs leaving qualified workers with no future job prospects. When the economy changed when the demand for new residential, commercial and other projects increased there were far fewer workers available. This has left many looking for new ways to fill the gap through more aggressive compensation and recruiting, as well as, the introduction of enhanced technology.

The answer to this important question will vary between companies and industries. There are some Atlanta companies that naturally face higher fraud exposure because of the type of business, how services are delivered and where the opportunity for fraud occurs. Whatever your industry, it’s important to understand your company’s risk profile and areas of opportunity for fraudulent activities.  While most focus on growing the company through strategic planning, new business development, customer service, and account management, it’s imperative not to overlook this important exercise.

Earlier this month, the Financial Accounting Standards Board (FASB) announced they extended the effective dates for the new lease accounting standard. It had been rumored for months that the FASB would make this adjustment for non-public entities, and the day has finally come. Public entities struggled to overhaul their business processes in time to comply by their effective date of January 1st of this year, and non-public entities implored the FASB to help them avoid a similar result. The FASB heard these requests from industry groups, professional organizations, and private businesses nationwide and agreed to push back the effective date for non-public entities.

One area that many don’t pay much attention to until the end of the year is tax planning. It’s common to think about what steps can be taken to help reduce the company’s overall taxes before year-end. The good news is since the 4th quarter just started, there are many steps companies can now take to ensure they pay the least amount possible. There are some new opportunities courtesy of the Tax Cuts and Jobs Act of 2017 (tax reform) and a bevy of other strategies as well.

On January 1, 2020, an estimated 1.3 million more U.S. workers will become eligible for overtime pay. Just last month, the Department of Labor (DOL) ruled to raise the minimum salary threshold for determining an employee’s overtime status by a whopping 50%. Currently, employees earning less than $23,660 annually are eligible for overtime pay, but beginning in the new year, this threshold will jump to $35,568. This shift will compel employers to review their pay scales and reevaluate their existing employee makeup, and more importantly, they must learn to juggle the new costs associated with this new rule.

The Tax Cuts and Jobs Act of 2017 (tax reform) challenged some long-held assumptions many businesses have about how and when to use bonus depreciation. The changes ushered in through tax reform have transformed how to use bonus depreciation allowing for an expansion of benefits in some respects and a contraction in others. Atlanta business owners that rely on bonus depreciation as part of their tax savings strategy need to be aware of the changes and how it will impact their approach. To help clients, prospects, and others, Wilson Lewis has provided a comprehensive summary of the changes and key considerations

In July, Senators Maggie Hassan (Democrat, New Hampshire) and Thom Tillis (Republican, North Carolina) introduced a bill that would expand the research and development (R&D) tax credit. Currently, the R&D tax credit is available in two forms: as a nonrefundable credit to benefit larger and more established businesses, and as a refundable credit to benefit startups and small businesses. Their bill seeks to double the credit for startups by improving their ability to apply for the credit against payroll tax liabilities. The changes represent a greater tax-saving opportunity for qualifying Atlanta and Georgia based companies.

Retirement planning is an essential financial discipline that Atlanta area individuals need to focus on throughout their career. While there is no shortage of retirement saving approaches, very few are as effective and utilized as employer-based retirement plans. In fact, the U.S. Department of Labor (DOL) found that ERISA covered plans offer higher contribution limits, lower investment management costs, enhanced regulations such as financial reporting and disclosure requirements and automatic enrollment features. Unfortunately, many small businesses struggle to offer employees a plan because of the associated costs. Unfortunately, this leaves employees without a vital retirement savings tool. To address the situation, the DOL recently issued a new final rule which makes it easier for small businesses to participate in multiple employer plans (MEPs).