Construction Consulting Hot Topics

2012-02-16T08:19:00.001-05:00

Sounds like a deal has been struck to extend the payroll tax cut...more news promised by end of week...

2012-02-06T13:38:00.000-05:00

2012-02-01T16:41:00.001-05:00

Nice article on some changes that could be coming our way...

http://www3.cfo.com/article/2012/1/tax_tax-2012-corporate-tax-reform-tax-extenders-payroll

2012-01-18T09:44:00.000-05:00

Major banks are lending again...

http://online.wsj.com/article/SB10001424052970204555904577166523861298962.html?mod=dist_smartbrief

2012-01-11T10:41:00.001-05:00

With construction activity having been down for several years now for a large number of contractors, it may be time to review your tax accounting method for long term contracts. Call a Rehmann Construction Industry Group Advisor today at 989.799.9580.

2011-12-28T16:24:00.001-05:00

On December 23, Congress passed, and President Obama signed into law, H.R. 3765, the “Temporary Payroll Tax Cut Continuation Act of 2011” (the TTCA). The tax provisions of the TTCA consist of a two-month temporary extension of the payroll tax cut that's in place for 2011, plus a parallel extension of a lower Self-Employment Contributions Act (SECA) tax rate on self-employment income. In a related news release, IRS also provided guidance to employers on how and when to implement the new rate.

2011-12-15T11:52:00.002-05:00

Identity Theft Rising

The holidays always bring out the best--in identity theft. It's a shame. Last week, our firm stopped a thief from wiring $15,000 out of our client's bank account. It was like a Mission Impossible counter with three seconds left on the detonator. Honest. In short, identity thieves created a spoofed real estate website (firm name withheld) where users could "get property alerts" when foreclosures arise. Of course, you need to fill out an application, in which you provide a user name, email, password, personal information, etc. Using this data, they hacked our client's email and circled it like digital vultures. In time, they learned everything--bank accounts, passwords, contacts. They finally had enough to assume our client's identity, then emailed the bank to request a wire transfer of $15,000 to a third party. Thanks to our astute business advisors, we intercepted the transmission just before the buzzer, and talked to the client--directly. We put a stop to a major shenanigan. Unfortunately... these thieves are off to find easier prey. Mix up your passwords and stay vigilant, world.

2011-12-14T23:08:00.000-05:00

At the AICPA National Construction Industry Conference that I recently attended, one of the breakout sessions covered succession planning and a great technique for transferring ownership to family members or key employees. The speaker made the excellent point that many construction companies do not transfer ownership to an outside owner – and although the technique he outlined will work for outside owners, it really works well for family members and key employees because it also serves as a financing mechanism. I’m partial to this technique because I’ve used this same strategy (with some variations) with several of my own clients.

The strategy essentially uses an LLC to gradually transfer ownership. An LLC provides excellent flexibility for an existing owner to leave capital in the business as long as it’s needed, and also allows percentage sharing of profits to change over time. Debt is not a part of the strategy, which many companies find attractive. Essentially, the existing owner(s) gradually decrease their percentage share of profits as they remove capital from the business. There are variations on the strategy which break down ownership into “pools” which are transferred over time, but again, the general concept remains the simple transfer of cash to existing owners as the profits-sharing percentage of the new owners increase.

It’s important to the success of this technique that the company have strong financial performance, that the existing and prospective owners trust each other, and that the ownership transfer is properly structured by professionals familiar with the company and the tax laws applicable to LLCs.

2011-12-12T15:09:00.000-05:00

Ways and Means Chairman Dave Camp (R-MI) introduced the H.R. 3630, The Middle Class Tax Relief & Job Creation Act. The legislation extends a number of provisions scheduled to expire at the end of the year and includes fully paid-for extensions of the payroll tax holiday and a reformed unemployment insurance program, along with a two-year freeze on cuts to doctors providing care to our nation’s seniors enrolled in Medicare. The legislation also extends and expands provisions to encourage employers to invest and hire.

2011-11-04T11:10:00.002-04:00

Looking for a great year end idea for your business...there may still be enough time to consider a captive insurance company for 2011...call your Rehmann Tax Advisor today!

2011-10-13T09:08:00.003-04:00

Michigan Unclaimed Property Reporting Requirements -

This item has broad application beyond the construction industry and explains current developments in Michigan regarding "unclaimed property"...

The state is now requiring an attestation for all Michigan businesses to affirmatively file that they do not have any unclaimed property. As an initial deadline has already passed, businesses are advised that action must be taken now.

The Michigan Uniform Unclaimed Property Act (Public Act 29 of 1995) provides that all tangible and intangible personal property, including any income or increment, that is held, issued or owing in the ordinary course of business that remains unclaimed by the owner for more than the statutory dormancy period after it becomes payable or distributable, is presumed to be abandoned (or unclaimed) property. Every business that has unclaimed property belonging to owners whose last known address is in Michigan, and additionally, every business in Michigan that has unclaimed property belonging to owners for whom there is no known address, must annually report and turn over this unclaimed property to the Unclaimed Property Division of the Treasury Department.

The most common example of unclaimed property that may need to be reported is uncashed checks for items such as wages, commissions, dividends, vendor checks, pension, insurance claims, etc. A few other common examples are account receivable credit balances, unclaimed money orders, gift certificates or cards, utility deposits, and unclaimed stocks or intangible ownership interest in a business or from Dividend Reinvestment Plans (DRPs).

The unclaimed property act was recently amended to shorten the dormancy period for many reportable items down to 3 years, and was amended to change the due date of the annual unclaimed property reporting from November 1st to July 1st. In addition, businesses who have determined that they have no unclaimed property to report must complete Form 4305, Attestation of Compliance with Unclaimed Property Reporting (available on state website). The due date for this attestation was July 1, 2011, and based on the law any person (business) who willfully fails to file any required report may need to pay up to a $5,000 civil penalty. Based on Rehmann's discussions with the Unclaimed Property Division, there are currently no penalties being assessed for those that file the Form 4305 late, and this form only needs to be filed for 2011.

Earlier in 2011, the state sent notices to some businesses who had not historically been filing any unclaimed property reports explaining the new attestation reporting requirement. It is our understanding that if these letters are ignored, the state will continue to send notices to them until either any unclaimed property they possess is reported or the Form 4305 attestation of no unclaimed property is filed. It is also possible that the state may decide to audit a taxpayer who fails to reply to ongoing notices.

For those businesses that have not yet received a notice regarding their unclaimed property reporting requirement, the law does still require that they review their records for any unclaimed property and remit it to the state on an annual basis, or file the attestation report that was due on July 1, 2011.

2011-09-27T11:35:00.002-04:00

Audit technique guide pinpoints problem areas specific to the architecture industry

This post is intended to capture some of the highlights of the IRS' recently issued Audit Technique Guide for its auditors to use in conducting examinations architectural firms. It pinpoints the problem areas that IRS agents are instructed to review, and explains certain examination techniques to be used in conducting such audits.

Several issues that agents are being instructed to examine are:

Whether a corporate taxpayer is a personal service corporations (PSCs) - A C corporation engaged in the architectural business can be a qualified PSC. Features of PSCs include a flat 35% tax rate under Code Sec. 11(b) and the ability to use the cash basis of accounting, with certain limitations.

Whether the domestic production activities deduction (DPAD) is properly calculated - An architectural business may be eligible to claim the Code Sec. 199 DPAD, equal to 9% for 2010 and later years (3% for 2005 and 2006, 6% for 2007-2009) of the lesser of the qualified production activities income (QPAI) of the taxpayer for the tax year or taxable income up to 50% of the allocable W-2 wages paid by the taxpayer. QPAI equals the taxpayer's domestic production gross receipts (DPGR), which includes gross receipts derived from architectural services performed in the U.S., reduced by the cost of goods sold and other deductions, expenses, and losses allocable to the DPGR. In examining an architecture firm's DPAD, auditors are instructed that certain services do not qualify as architectural services for DPAD purposes.

Whether the proper accounting method is being used - Architects and landscape architects are generally permitted to select the cash or accrual methods of accounting. They are not permitted to use the completed contract method of accounting or the percentage-of-completion method of accounting, since architectural contracts don't qualify as “long-term contracts” under Code Sec. 460. Examiners are instructed that, if a taxpayer is using an improper method of accounting for income, they will have to change the method by making a Code Sec. 481(a) adjustment in the earliest year under examination. Discontinuing the use of the long-term contract method of accounting constitutes a change in accounting method.

Whether proper reporting is provided for non calendar year end tax years - PSCs, partnerships, and S corporations generally are required to be on the calendar year, unless they can establish a business purpose and obtain IRS's approval for a different period. S corporations and partnerships that elect a fiscal year are subject to specific rules and must file Form 8752, Required payment of Refund Under Section 7519, for each year the election is in effect.

For more specifics and complete details of this recent industry audit guide, readers can locate it on the IRS website at "www.irs.gov"

2011-07-18T17:36:00.003-04:00

Many closely held construction companies carry officer/shareholder accounts on their balance sheet representing amounts due to those individuals. If the company is carrying the balance as a current liability in a situation where the balance won't be paid in the short-term there may be an opportunity to strengthen the balace sheet by formalizing the obligation. If legitimate payment terms are established and followed, the appropriate portion of the liability can be classified as long-term debt. This improves working capital and the "net quick" type ratios that banks and in particular, bonding companies focus on. Establishing the appropriate interest rate on the debt may be beneficial from a tax standpoint also. Interest paid to the note holder is not subject to payroll taxes. This is a pretty simple idea that can offer some nice beneits to the company and it's principals.

2011-06-07T08:05:00.002-04:00

The IRS has offered guidance on several issues related to bonus depreciation. In case you have not heard, asset purchases in 2011 could qualify for immediate expensing with no limitation. Typically business assets have to be depreciated over a period ranging from three to 20 years depending on the type of asset purchased and/or the industry you are in. This 100% bonus depreciation is only available until the end of 2011. Call your Rehmann Tax Advisor for more information or call 989.799.9580 to get more information.

2011-06-02T11:37:00.001-04:00

I’ve been hearing lots of questions from my clients and friends about the changes to Michigan tax laws. Some of Rehmann’s SALT (State and Local Tax) experts will be conducting seminars soon to answer those questions. I think you may find it very helpful to attend. The seminars will be held at eight locations across Michigan, between June 14 and June 22. You can find complete information about locations, times and dates on the Rehmann website.

Please contact me if you have questions about the seminars or if I can assist in any other way.

2011-05-24T20:05:00.001-04:00

Podcasts

I subscribe to several accounting industry and technical tax podcasts - you know, material recorded verbally and distributed for playing on an Ipod (much like music). Most of these are free and if you find the right ones, they are very informative and helpful. I found a great construction industry podcast at the following link, which also includes some blog-type postings and video, if you're so inclined. They cover much more than accounting and tax material - including lots of construction best practices. Check it out! http://www.traunerconsulting.com/constructionnetcast/index.php

2011-05-17T10:50:00.002-04:00

Continuing on the topic of LLC's and taxes, the Michigan legislature just passed a business tax overhaul that greatly benefits LLC's, partnerships and S corporations and sole-proprietors.

On May 12, 2011, the Michigan Legislature approved a plan to repeal the Michigan Business Tax (MBT) and replace it with a corporate income tax and to make major changes to the state's individual income tax law. The governor is expected to sign the legislation. The bill also creates a corporate income tax (CIT), levied on businesses organized as traditional C corporations under federal law.

The rate of the new corporate tax will be 6% on apportioned taxable income. The corporate tax still maintains the alternative tax credit better known as the small business credit. The corporate tax is still unitary for C-corporations. The new corporate income tax would be effective January 1, 2012, which may require short period returns for some taxpayers with fiscal year-ends. Sole proprietorships and pass-through entities such as partnerships, S corporations and limited liability companies currently taxed at the entity level under the MBT would not be required to pay taxes or file returns under the CIT. The income from a pass-through entity would be taxed to the individual on their personal income tax return.

In order to recoup the lost tax revenues from flow-throughs and sole-proprietors, the bill eliminates numerous individual income tax credits, deductions and exemptions and changes future income tax rates. Some of the changes to the individual income tax are the phase-out of personal exemptions above certain income levels and the elimination of the $1,800 child care exemption. Many of the credits have been eliminated such as, the Community Foundation credit, the City Income Tax credit, the Public Contribution Credit and the Homeless/Food Bank credit. In addition, arguably the most far reaching change is the effect on retirement income. For all those younger than 67 on December 31, 2011, retirees will see part of the retirement income taxed based on their income levels and year of birth.

2011-05-02T09:33:00.000-04:00

The entity of choice for many businesses is the limited liability company (LLC) - it provides tremendous flexibility in ownership, distributions, income/loss allocations and deductibility of losses. This flexibility, however, is not without a cost: COMPLEXITY! LLCs are taxed as partnerships. It is well-known among tax practitioners that the partnership tax area is among the most complex areas of tax law.

As I've worked through returns this tax season, I'm reminded that not everyone appreciates or understands what this entity can do in terms of flexibility, or how complex these entities can be from a tax reporting standpoint. Many real estate entities (as well as many other business operations) can be contained in LLCs, and can use this inherent flexibility to their advantage in securing investors and minimizing taxes.

My caution, though, to anyone using an LLC is to coordinate carefully with your tax advisor to make sure your operating agreement contains all the necessary provisions to make the most of your LLC. And your tax advisor can also keep you in good stead with the IRS by properly taking care of your annual reporting.

2011-03-09T15:15:00.000-05:00

With the introduction of increased Section 179 expensing and 100% bonus depreciation, it may be a great time to have a cost segregation study done on your new or substantially improved building. Call Rehmann at 989.799.9580 for more information.

2011-03-03T10:02:00.002-05:00

As we are quickly approaching April 18, construction contractors, real estate developers, and real estate brokers who generate income from the lease or rental of realty should consider a special election under IRC Section 469 to aggegagate their rental and leasing activities and treat income and losses from such activities as non-passive in nature. Taxpayers who spend at least 750 hours a year in realty trades (construction, management, sales, etc.) may make this election. Additionally, 500 hours per year must be spent with respect to the rental/ leasing activities.

This election is particularly beneficial if rental and leasing losses are incurred as passive losses. Additionally, in 2013, passive activities will be subject to an additional 3.8% medicare tax- this important tax election could position you to avoid this additional tax if rental and leasing activities generate taxable income.

This election is often missed or misunderstood by practitioners. If you are a real estate professional and have been deducting rental/ leasing losses, you will want to ensure you maintain a copy of the original election in your tax records. If you can not find a copy of that election, a protective election may be recommended. If you have not made this election, consideration should be given to evaluating the election this filing season.

2011-02-05T20:06:00.004-05:00

The Michigan Governor’s office has fired the first salvo regarding changing Michigan’s tax structure. Late last week, a draft bill outlining a new Michigan Corporate Income Tax was released. Lt. Governor Brian Calley is championing the new tax and has met with business leaders to share details.

Though this is an awaited and exciting change in business taxes, we must remember that the bill is simply a draft. Although some have said the effective date is or should be January 1, 2011 (a retroactive bill), according to the draft bill it appears that the plan is to make the new tax effective next January 1, 2012. However, there is still much negotiation and politicking left before this bill is passed and signed. The effective date is merely one possible issue to be determined.

Consequently, if you have Michigan Business Tax (MBT) estimates due, you should continue to make those payments under the current MBT.

Here are some highlights of the new tax being proposed:

Corporate income tax for C-corporations only

Rate is flat 6%

Single-factor apportionment

All sourcing rules for apportionment would stay the same including the benefit rule for sourcing of services

Makes it clear that disregarded entities would be taxed the same as federal by including the income of the member in the "parent" return

Small business credit basically the same as before

If tax is less than $100, then no requirement to remit tax.

It appears that no carryover of any previous state losses would be allowed.

Allows the "normal" subtractions and additions to a state corporate tax (i.e. addback of state taxes, bonus depreciation, DPAD and subtraction of U.S. goverment obligations)

Tax return would be due April 30 and estimates due April 15, July 15, October 15, and Jan 15 for calendar year-end taxpayers.

For further information, contact your trusted business advisor.

2011-01-27T15:52:00.003-05:00

The 2010 Tax Relief Act has created an opportunity to write off a heavy SUV purchase if you placed the vehicle in service after September 8, 2010. This was not an option before the 2010 Tax Relief Act since there were limitations on how much could be expensed if you were using Section 179 and 50% bonus depreciation along with regular MACRS depreciation. Call your Rehmann tax advisor to discuss your individual facts and circumstances.

2011-01-25T17:50:00.002-05:00

2010 was plagued with uncertainty regarding estate taxes. Under the law in effect before the enactment of the 2010 Tax Relief Act, the estate tax was scheduled to be repealed in 2010, and then to return in 2011 with an exemption of $1 million and graduated rates reaching a top rate of 55% on transfers over $3 million. The 2010 Tax Relief Act reinstates the estate tax retroactively to the beginning of 2010. However, an election is available to opt out of the new rules in favor of no estate tax (and basis step up limited to $1.3MM).

For estates of decedents dying after 2009, the 2010 Tax Relief Act provides that the estate tax exemption is $5 million (indexed for inflation after 2011), and the tax is imposed at a flat rate of 35% on all transfers exceeding the exemption amount. Additionally, the Act provides portability of exemption amounts between spouses. Furthermore, in 2011, the gift tax exemption is again unified with the estate tax exemption ($5MM). Though these rules are favorable, they sunset January 1, 2013.

Though these rules sunset in 2013, the unification of the gift tax exemption provides what could be a limited opportunity to make gifts of up to $5 million. Current market conditions along with the favorable exemption amount makes 2011 and 2012 favorable years to transfer assets as part of estate planning!

2011-01-19T09:12:00.002-05:00

Various provisions enacted in 2010 provide relief and incentives for busineses to renovate and build in 2011. In particular, certain leasehold, retail space, and restaurant facility expansions may qualify for current year expensing up to $250,000. Additionally, equipment purchases and portions of new construction may qualify for 100% current year expensing. Though these provisions accelerate deductions, tax savings in 2011 may be sufficient to provide the equity necessary for bank financing.

In my client base, I am seeing a lot of clients turning the corner to restored profitability- incentives as described above may provide the impetus needed to take on construction projects in 2011.

2011-01-15T11:44:00.002-05:00

For a recent article from the October 2010 issue of CFO Magazine regarding some of the practical issues and considerations created by the proposed new revenue recognition accounting standards, copy and paste the following link to your web browser. The time is now to understand and begin assessing how the standards will effect the financial reporting of your business. The public comment period has closed that is referred to in the article and comments submitted are under consideration.

http://www.cfo.com/article.cfm/14526504/c_14527042?f=magazine_alsoinside

2011-01-13T09:54:00.002-05:00

With the recent surge in the price of a barrel of oil, resulting increases at the pump when we fill up our vehicles and the discussion of $5 a gallon gasoline in the not too distant future, it may be a good time to review your company's fuel expense and policies related to fuel purchases and use. There are several options to consider when reviewing fuel policies such as safeguards to make sure employees are not misusing fuel cards. A service like Fuelman can help with restricting use of fuel cards. GPS systems installed on vehicles can also assist in evaluating whether an employee's total cost of gas for a certain time period such as a month actually add up since you can track where that vehicle went and match that up with monthly fuel statements. How is the on site gas storage tank used? Are surveillance cameras used? Employees should also maintain log sheets in the vehicles and those should periodically be checked as well. There are also companies now such as Pricelock which help you budget your fuel costs allowing you to also share in increases in fuel costs. Rehmann and Rehmann Corporate Investigative Services can help review your policies and procedures.

2011-01-10T10:48:00.002-05:00

The 2010 Tax Relief Act just passed had a nice benefit for residential builders: it retroactively restored and extended the energy-efficient home credit. Contractors can claim a credit of either $2,000 or $1,000 per new home purchased by a homeowner between January 1, 2010 and December 31, 2011. Homes that achieve a 50% reduction in energy usage are eligible for the $2,000 credit; those that achieve a 30% reduction are eligible for the $1,000 credit. The energy reductions are determined by reference to the standards of Chapter 4 of the 2003 International Energy Conservation Code as in effect on August 8, 2005.

2011-01-07T10:25:00.002-05:00

This isn't exactly construction-related, but I did find it interesting. Reading through another blog by Sir Richard Branson, CEO of Virgin Records and well-known publicity hound, he wrote about the importance of taking time off to recharge the batteries and inspire your creative side. Many times, those great ideas escape us because we're too tied up in the day-to-day minutae of managing our businesses. Take a look at Sir Richard's two cents on the matter:

http://www.openforum.com/idea-hub/topics/managing/article/to-succeed-take-time-off-richard-branson

2010-12-27T08:55:00.002-05:00

Part of the latest Tax Relief Act of 2010 was 100% bonus depreciation on purchases that would normally qualify for the 50% bonus depreciation. It is not only good for 2011 but for purchases of new qualified property that was placed into service after September 8th of 2010. Don't forget you have to take bonus on all property by class life or you have to elect out completely by class life. It is all or nothing with bonus depreciation which is unlike Section 179. There is quite alot of planning opportunities this year when it comes to depreciation.

2010-12-08T13:26:00.001-05:00

As you know, 2010 is the first year that anyone is eligible to convert an IRA to a Roth IRA. There is a good deal of planning that goes into the decision to convert. We can help with this. At a minimum it should be discussed by everyone with retirement accounts. This includes 401k and 403b savings also, as there are planning strategies to look at here as well.

Furthermore, because anyone can convert to Roth, anyone (with earned income) can make a non-deductible Traditional IRA contribution, and then convert it to a Roth. This is especially valuable right now, because the five-year waiting period for eligible distributions will begin 1/1/2010 for any Roth account established before 12/31.

Call Rehmann for more information or to set up an appointment to discuss...989-799-9580

2010-12-08T13:25:00.003-05:00

Thanks to all who attended our seminar this morning and to those who made it happen. We had a great turn out and presented some very good topics.

Thanks again and we look forward to seeing you at the next seminar in the spring.

2010-12-06T16:45:00.004-05:00

Not too late to rsvp...looking forward to hearing three great speakers discuss three great topics.

Here is the information you need...

December 8th at Saginaw Club...7:45 am registration

Seminar begins at 8 am and concludes at 10 am

Call 989.799.9580 to rsvp or for more information

Sponsored by Rehmann, Saginaw Bay Underwriters and Braun Kendrick Finkbeiner

2010-12-06T16:43:00.001-05:00

Have you ever considered the research and development credit for your construction company. As long as it gets extended (hopefully this week) it should be something you consider. Rehmann can help you determine whether you qualify or not.

2010-11-11T17:00:00.002-05:00

As year end approaches, tax planning might become top of mind. Though there are bright spots in the economy and even in the construction industry, many real estate developers and investors may still have projects that are generating losses due to bad debt write-offs and low occupancy. Often, these losses may not be currently deductible due to passive activity limitations.

For real estate professionals (including developers, contractors, and brokers) there may be relief in the passive activity rules. R/E professionals may make a special election to treat all of their rental activities as one activity under the passive loss rules, AND treat that activity as an active trade or business provided the professional materially participates in the rental activities. This election would allow net real estate losses to be deducted against other income without limitation.

Even if net real estate activites generate net gains, the above election might prove beneficial in staving off the 3.8% Medicare tax on investment income scheduled to be effective in 2013!

2010-11-10T22:32:00.001-05:00

Traverse City Hot Topics in the Construction Industry seminar on Wednesday, December 8^th

Noon to 4:30 pm at Left Foot Charley at the Grand Traverse Commons

Sponsored by Rehmann, Smith Haughey Rice & Roegge and Northwestern Bank

2010-11-09T13:06:00.003-05:00

Now is the time to start thinking about year-end tax planning. Given the numerous tax breaks that are currently set to expire at the end of this year, as well as recently enacted breaks that will expire in 2011 or 2012, it is critical that you plan carefully to ensure that you're paying the least amount of tax possible over the next few years.

While there is much talk about extending the lower income tax brackets to some or even all individuals next year, there is a real possibility that Congress won't make it happen. This necessitates a unique planning mindset. Ordinarily, one would want to defer income as much as possible to delay paying tax. However, with the tax rates scheduled to go up in 2011, it might actually make more sense to accelerate income into 2010 and pay the tax now at lower rates.

If you haven't already done so, schedule a meeting with your tax adivisor to discuss your options betweeen now and year-end.

2010-11-07T19:14:00.000-05:00

Succession planning: have you given it much thought? I've been meeting with a very successful contractor client over the past several years about his succession plan. It's been a valuable process - there have been instances over the past few years where an outsider offered to buy the business, and also an opportunity to possibly pass along the business to an existing key employee. Although he's not really close to retirement age, the client has had enough with the day-to-day management of his business, and would probably move along to something else if the right opportunity came along.

It can pay to have an ongoing dialogue with your advisors regarding your succession thoughts, even if your retirement date is more than three, five or ten years away. You never know when a great opportunity might present itself, and you can be ready to hit the ground running if you've already covered some of it with a trusted advisor.

2010-11-05T14:10:00.002-04:00

I have found myself in a postion where I am looking to fire a client and although it is never an easy thing to do, sometimes it is the best thing to do. It is a fresh start for us and a fresh start for the client. It can be beneficial to all involved. I got to thinking that this could also be true with construction customers. Are there customers you are working for that you shouldn't be. Are the margins just not there. Do they contest change orders? The customer might take a lot of your resources away from other more profitable jobs or maybe having this customer is preventing your company from becoming more involved in a certain niche you have gained experience in and the margins will contribute more to the bottom line. It is a prudent practice to look back as we near the end of the year and ask yourself if the customers you were working for in 2010 are the customers you should continue to work with in 2011.

2010-11-03T16:36:00.002-04:00

For those of you that are owned to some extent by an ESOP, have a desire to put an ESOP in place or have no idea what an ESOP is or can do for you or your company...We have a great event for you.

The Mid-Michigan ESOP Roundtable is meeting on Wednesday, November 10, 2010 at Rehmann in Saginaw, Michigan. The topic is "Banker's Panel on ESOP Financing".

The meeting begins at 8 am and adjourns at 10 am.

For more information or to rsvp, please call 989.797.8341 or email Heather.Long@rehmann.com

2010-11-01T10:52:00.002-04:00

Hot topics for the Construction industry...

December 8th at Saginaw Club - registration begins at 7:45 am

Seminary begins at 8 am and ends at 10 am

Topics to be presented include bonding, state and local taxes, and construction litigation

Seminar is sponsored by Braun Kendrick Finkbeiner, Rehmann and Saginaw Bay Underwriters

RSVP at 989-799-9580

2010-10-26T14:34:00.002-04:00

The IRS recently announced employers will not have to report the aggregate cost of health insurance coverage on Forms W-2 for the 2011 tax year. Reporting was to be required in 2011 pursuant to the Patient Protection and Affordable Care act of 2010, and was to be mandatory. However, the IRS has determined that it is necessary to provide employers with additional time to make changes to their payroll systems or procedures in preparation for compliance with the new reporting requirements.

The IRS did issue a draft of Form W-2 for 2011, which includes the codes that employers may use to report the cost of coverage under an employer-sponsored health care plan. It is expect the IRS will be publishing guidance on reporting requirements in upcoming months.

2010-10-20T10:37:00.002-04:00

Contractors are reminded to review their 2010 payroll related records to confirm whether they are taking advantage of tax benefits under the Hiring Incentives to Restore Employment (HIRE) Act.

In short the Act provided two tax benefits to empolyers who hire previously unemployed workers. The first is in the form of a payroll tax exemption, providing an exemption from the employer's share of social security tax on wages paid to qualifying employees. This is effective for wages paid from March 19, 2010 through December 31, 2010, and it is claimed on Forms 941.

Interestingly, there is no disqualification of seasonal employers from these benefits. One way of confirming whether benefits were claimed is to review the 2nd and 3rd quarter Form 941, lines 6a - 6e. If these are blank, no tax credit was claimed. Payroll and hiring records should be reviewed to confirm whether qualified employees were hired and benefits should be claimed.

The second benefit provides employers with a general business tax credit in 2011, up to a maximum of $1,000, for qualifying employees retained at least 52 weeks. This benefit may not apply to seasonal contractors.

This benefit can translate quickly to large savings...10 qualifying employees each with $30,000 of qualifying wages would generate $18,600 in payroll tax savings in 2010.

The IRS website (www.irs.gov) has excellent information on the details of this credit.

2010-10-18T08:31:00.003-04:00

Have you had a chance to review some of the outstanding taxpayer-friendly provisions of the new tax bill signed into law about two weeks ago? Expanded section 179 expensing, new bonus depreciation provisions, and better health-insurance deductions for business owners are just some of the provisions effective for 2010. There's also a contractor-friendly provision that removes the use of bonus depreciation in making percentage-of-completion calculations (this has the effect of postponing income that otherwise would have been recognized). See this link from Rehmann's e-newsletter for more details:
http://www.rehmann.com/default.cfm?t=news.cfm&L2=NEWREL&ShowNewsId=1704&linkname=back%20to%20homepage

2010-10-15T09:38:00.002-04:00

Interesting fact for today...

What percent of their net income did U.S. couples in the top tax bracket pay during the Eisenhower administration?

The answer is 91 percent....on incomes over $400,000.

2010-10-07T17:38:00.002-04:00

Is your accounting software integrated with other aspects of your business? If not, you may want to consider upgrading. A number of software providers offer vertically intregated software at a reasonable price. You can integrate your accounting, project management, cost estimating and service manangement with one software package.

2010-10-05T15:25:00.003-04:00

Legislation Watch - H.R. 6097 introduced on 8/10/10 and sent to the House Committee on Ways and Means would help construction contractors at a time when it is needed most. Most contractors with revenues consistently above 10 million are using percentage complete to recognize income on long term contracts. H.R. 6097 proposes raising the revenue threshold to 40 million. It would also be indexed for inflation. This would allow more contractors to use complete contract and thereby simplifying reporting requirements. H.R. 6097 would also allow the use of completed contract for Alternative Minimum Tax which currently requires those using completed contract to go back through and recompute inome on those long term contracts using percentage complete. The bill would also eliminate the lookback requirements which are required when using percentage complete.

2010-09-28T08:47:00.004-04:00

Commercial Condominium Associations Create a Trap for the Unwary

Frequently, when a commercial property is subdivided into units, a condominium association is created in order to manage the common areas and make common area improvements. The condominium association then collects dues, fees and assessments from the unit owners in order to pay for services provided and to make capital improvements to common areas. While assessments may be made in one year for improvements, those improvements must be depreciated over 5, 7, 15 or 39 years for tax purposes.

On numerous occasions, I have seen template homeowner association documents modified for use on a commercial association. Furthermore, because the association is created under non-profit association statutes, advisers erroneously assume the association is federal tax exempt. To be tax exempt under the Internal Revenue Code, the association must relate to residential property.

Because a commercial association is not federal tax exempt, it must file annual corporate income tax returns (Form 1120). Consequently, fees, dues, and assessments collected are taxable revenues while capital expenditures are depreciated over a number of years. Though the association may be cash flow neutral, because of the mismatch of depreciation with revenues, taxable income and a related tax liability may arise. Understanding the tax treatment of commercial condominium associations up front can help avert such tax liability. Following specific tax regulations, segregated funds derived from special assessments may be used to make capital expenditures. Properly structured, these funds may not be recognized as income when received, however, these special assessments may not be deductible by tenants. As an alternative to a condominium association, common area maintenance costs may managed utilizing a limited liability structure (LLC).

When structuring the manner in which common area costs will be managed on a commercial development, care must be taken. Condominium Association tax is often misunderstood. The improper tax treatment of an association can lead to unanticipated tax liabilities. The failure to file the correct returns on initial filings may also lead to missed tax elections.

2010-09-14T15:35:00.004-04:00

Construction contractors are survivors. Most of the people and companies that I know in the industry have figured out how to operate in our challenging economic environment. Adaptability has always been a requirement in the construction industry. Automatic recurring business is generally not a part of that world.

I many cases construction companies are funtioning at lower levels of volume. If you find yourself in that situation make sure that you investigate the possibility of adopting favorable tax reporting methods that may not have been available to the company in past years due to it's size. Whether it's reporting on the cash basis or completed contract basis there may be an opportunity to defer taxable income. This would not mean that these methods would have to be used for financial reporting to banks and bonding companies. Generally accepted accounting principles can still be used for financial reporting and are a better scorecard for the company's financial performance. So, for example the finacial statements used for mangement of the company and outside reporting might utilize percentage completion contract accounting while the company's tax returns are being filed using the completed contract method.

The tax methods which result in deferal income taxes(resulting in increased cash availability) are available in certain circumstances. One of the criteria is usually sales volume thresholds.

2010-09-10T06:59:00.000-04:00

Perusing some materials from last year's AICPA construction industry conference, I came across an interesting datapoint from FMI (a consulting and investment banking firm specializing in the construction industry). They did a study of the various factors that lead to success or failure in construction companies. They then categorized those factors based on which factors were under the control of the company, and which ones weren't. Here's the list of the top four factors (in order of importance, most important first) under the control of the company that are predictors of success:

The ability to turn a profit (no surprise there)
Customer satisfaction
Employee satisfaction
The company's reputation in the community and industry

Actually, none of these are particularly surprising. But when was the last time you sought out and received independent, third-party analysis of your customer satisfaction? Of your employee satisfaction?

I ask virtually all of my clients, on an annual basis, whether I'm doing a good job. I try to get feedback from colleagues that I work with as well. But the direct feedback I receive, I think, can be biased because some people might feel uncomfortable expressing dissatisfaction directly. And that feedback regarding dissatisfaction is addressing exactly the weaknesses I need to improve upon! Independent, third-party surveys give customers and employees an anonymous shield so they don't have to feel uncomfortable providing the feedback that is most important.

2010-08-31T09:29:00.002-04:00

Banks are still very cautious in lending and still watching their clients very closely. Make sure as we get closer to year end that you are watching your loan covenants and ratios. As you prepare for your year end, you should be paying attention to cash flow as most banks are really looking for positive cash flow right now which can be a problem if you are borrowing against receivables. You should be tracking key ratios on a monthly basis to make sure you are in compliance. Also, be prepared as you negotiate with your bank or look to switch to a new bank, more and more banks are requiring audited financial statements which can be very costly for your company. Also, be prepared as more banks are requiring personal guarantees and even from shareholders owning very little stock. Covenant default waivers are also coming with more strings attached. In summary, know your covenants and realize that the waters could be choppy when discussing these with your bank.

2010-08-19T18:29:00.003-04:00

An article in today's local Traverse City paper caught my eye and made me think about the impact of personal property taxes on construction companies. Local tax authorities have decided to audit businesses that haven't filed personal property tax reports. It appears they plan to target certain industries (oil and gas being one). As local governments become more and more squeezed by their budgets, these types of "revenue-enhancers" will become much more common.

My experience has been that local assessors sometimes aren't fully aware of the various exemptions that may apply to personal property taxes. For instance, heavy equipment licensed for use over-the-road, and items permanently attached to such equipment, are already taxed as part of the licensing with the Secretary of State, and are thus exempt from local personal property taxes.

A tax professional well-schooled in personal property tax audits can help businesses handle audits and minimize their tax burden.

Side note: Watch for announcements coming soon about our Construction Industry Seminars to be rolled out statewide in late 2010 and early 2011!

2010-08-17T09:06:00.003-04:00

If you think you might have outstanding state tax filing requirements, it might be a good time to take a look at getting these resolved. Florida, Maine, Nevada, New Mexico and the District of Columbia all have tax amnesty programs underway. These programs generally allow taxpayers to pay overdue taxes without penalties and often with little or no interest. You can check out each State's and DC's website for the terms and deadlines of the tax amnesty programs. Below are the links:

http://dor.myflorida.com/dor/amesty
http://www.maine.gov/revenue/Compliance/trri_10.htm
http://tax.state.nv.us/amnesty.htm
http://www.taxrelief.newmexico.gov/
http://www.dctaxamnesty.com/

2010-08-09T15:22:00.002-04:00

Building information modeling or BIM for short, is a powerful tool with enormous potential in the construction industry. BIM is a digital representation of the physical and functional characteristics of the project. It allows for a project to be viewed in three or more dimensions and can be used for various issues such as design flaws and ideal locations for equipment such as cranes. Many believe that BIM will lead to more use of the integrated project delivery concept since BIM requires communication and cooperation with all the members of the construction team. Are you using BIM or IPD? Have you looked into either of these concepts? If you are using it, is it working?

2010-07-30T10:43:00.002-04:00

2010-07-30T09:16:00.003-04:00

Looking for creative ways to potentially minimize sales and use tax...have you considered an equipment leasing company? Rehmann can assist you in trying to decide if one is right for you and your construction company.

2010-07-30T09:05:00.002-04:00

Love them or hate them....Build America Bonds are getting extended if the current house version of H.R. 5893 "Investing in American Jobs and Closing Tax Loopholes Act of 2010" gets passed. There is alot of discussion about what will happen to the construction industry after all the ARRA money is spent and whether the private sector can fill some of the void left after the state and local governments spend all their allotted monies.

2010-07-27T10:32:00.002-04:00

While recent data indicates an increase in new home construction, the prospects for home remodeling appear even brighter. There are numerous energy-related tax credits that homeowners can take advantage of in connection with remodeling projects. This year, updated HVAC systems, windows, doors, roofs, insulation, and water heaters can qualify for a 30% federal tax credit capped at $1,500. Geothermal heat pumps qualify for a 30% credit with no dollar cap. Residential contractors should make sure their clients are aware of these credits-- doing so might even lead to upgrades and increased construction fees.

2010-07-16T12:17:00.002-04:00

...more ideas that aren't just for construction business...

Four Money Mistakes You Can Learn From
It's hard to know when the economy will truly recover, although there are signs that things are headed in the right direction. But if you want your own finances to stabilize over the long term, you'll need to evaluate what you've been doing right... and wrong. There's no magic bullet, but avoiding these four money mistakes may help you survive and ultimately thrive in any turbulent economy.
Mistake 1: Expecting things to stay the same
It's a familiar tale. Economic times were good. The stock market went up, up, up. Home values (and real estate prices) soared, credit was flowing, and the job market was robust. And then... the bottom fell out.
At the heart of all economic bubbles is the euphoric, yet ultimately mistaken, idea that the good times are here to stay. And when the economic news is bad, it's just as easy to assume that the tough times will remain. But your own financial recovery will ultimately depend on you not jumping on any bandwagon. Instead, take a proactive, rather than reactive, approach to financial planning, no matter what economic news you're hearing. Prepare yourself for a variety of financial scenarios and avoid basing money decisions on emotion, or you may find yourself making the same financial mistakes over and over.
Mistake 2: Only saving your leftovers
Do you worry that you're not saving enough? Do you routinely rely on credit rather than cash to pay for the things you want or need? Rather than blame your financial inertia on your income, look a bit deeper, because the real culprit may be the lack of financial priorities. If you don't know exactly how you're spending your money and you haven't set financial goals, it's unlikely that you'll see much financial progress.
"Success does not consist in never making mistakes but in never making the same one a second time."
George Bernard Shaw
Go back to basics by preparing (or reviewing) your budget. If you tend to save only what you have left over every month, you can put yourself on a more disciplined course by having a fixed amount taken out of your paycheck automatically for retirement. Or, you can set up automatic transfers from your checking account to a savings or investment account.
Mistake 3: Not having an emergency fund
One of your savings priorities should be an emergency fund. An emergency fund isn't glamorous, but this underappreciated work horse really pulls its weight during hard times. Having cash on hand that you can use for an unexpected expense, or to pay bills if you lose your job or become disabled, is vital because it can help you avoid having to rely on credit or tap your retirement savings. Without emergency savings to fall back on, worse financial trouble may lie down the road.
Mistake 4: Not asking for help
Even if your finances are in good shape right now, you may be overdue for a checkup. A close look at your financial plan will help you identify potential strengths and weaknesses. If you're already in financial trouble, don't let fear or shame prevent you from asking for help. Facing financial problems early may help you make a full recovery. Many creditors are willing to work with you, but this may be much easier while your credit is still good, and while you still have time to turn things around.

Any advice in this communication is not intended or written by Rehmann to be used, and cannot be used by a client or any other person or entity for the purpose of: (I) avoiding penalties that may be imposed on any taxpayer or; (II) promoting, marketing or recommending to another party any matters addressed herein. The information contained herein is of a general nature and is not intended to address the circumstances of any particular individual or entity. Although we endeavor to provide accurate and timely information, there can be no guarantee that such information is accurate as of the date received or that it will continue to be accurate in the future. No one should act on such information without appropriate professional advice after a thorough examination of the particular situation.
Securities offered through Royal Alliance Associates, member FINRA/SIPC. Investment advisory services offered through Rehmann Financial, an SEC Registered Investment Advisor not affiliated with Royal Alliance Associates.

2010-07-15T19:05:00.003-04:00

Here's a thought, not necessarily applicable only to construction contractors...

Capital gains rates are currently scheduled to bounce up to 20% (from the current 15%) effective January, 2011. There's plenty of talk about whether Congress will do anything to change the currently scheduled increase, but for tax planning, it may be a good time to consider triggering capital gains currently to take advantage of the low rates. For instance, if you have real estate currently held inside an S-corporation (generally a no-no for tax purposes), distributing that real estate to the shareholder(s) can trigger gain at the corporate level (which is taxed at the individual level).

This strategy isn't always a good idea - but in the right circumstances, it can make sense. Talk to a Rehmann business advisor to see if it helps you.

2010-07-12T14:23:00.003-04:00

Contractors should be educating themselves on the impact of the new proposed revenue recognition standards and the recently published (June 24, 2010) exposure draft pertaining to revenue from contracts with customers. Public comments are due October 22, 2010, and it is expected the standards will be finalized in 2011. When the new standards become effective, the long standing guidance of SOP 81-1 will no longer apply. Rather, the guidance in the new standards will govern the recognition of construction contract related assets and liabilities, and revenue. Construction accounting and finance professionals will need to deal with the concepts of identifying the contracts, performance obligations and rules related to accounting for contract costs. There is no need to panic, as the construction industry has contributed significantly to the content of the exposure draft. However, as finalization of the standards approaches, it will become increasingly important to understand how the new standards will impact revenue recognition and accounting systems/procedures.

2010-07-07T10:40:00.003-04:00

Very interesting article on the federal stimulus money provided by ARRA and the effects of decreased federal spending going forward. It will be interesting to see what happens with the economy after Uncle Sam is done with the spending spree they have been on.

http://www.latimes.com/business/la-fi-0630-stimulus-20100630,0,6536431,print.story

2010-07-02T16:22:00.001-04:00

Have a very safe and happy Holiday weekend from the construction consulting team at Rehmann.

2010-06-29T08:46:00.002-04:00

Contractors should take a careful look at how they are classifying their workers-- as employees or independent contractors. The IRS and the DOL have begun a massive worker classification initiative, which will include IRS audits of 6,000 randomly slected companies. Proper payment of payroll taxes and employee benefits, including overtime wages, are the focus. Employee vs. independent contractor status is generally determined based on the business's right to control and direct a worker as to when and how the worker performs a job. The IRS has developed a 20-factor test in making this determination. If you're unsure about the classification of some of your workers, now is the time to take a close look at make the right determination.

2010-06-18T16:55:00.001-04:00

Has the value of your family owned construction firm decreased over the last year or so? It might be time to do some estate and succession planning.

2010-06-11T09:31:00.002-04:00

It looks like contractors and plumbers may escape the proposed 15% tax on S corporation profits. The House passed a Bill (H.R. 4213) that would subject the profits of small S corps to self-employment taxes. The Bill targets S corps that provide professional services and have three or fewer employees. Construction workers, plumbers and repair people are excluded from the proposed tax, but architects and engineers would have to pay. The Bill still has to be passed by the Senate-- if you're opposed to the tax, you should contact your Senator.

2010-06-06T12:40:00.003-04:00

Many smaller construction contractors have historically been on a cash basis of accounting because it offers numerous benefits (postponing taxation of receivables and the ability to more easily control annual taxable income are just two). In down economic times, I've found that clients can benefit from a switch back over to the accrual basis of accounting for tax purposes - since receivables are down and payables tend to be higher. I changed at least one client over for 2009, and am examining others for the same benefit. It's not a decision to be made lightly or on the spur-of-the-moment, since there are other considerations - including long-term expectations for the business. But it is an idea to consider...

2010-06-04T09:28:00.009-04:00

In case you have never heard of the pickup indicator, click on the following link or copy and paste in your browser and see what pickup sales say about the overall economy.

http://finance.yahoo.com/banking-budgeting/article/109717/pickup-truck-indicator-economy-improving

2010-06-02T09:51:00.003-04:00

The webinar on June 22nd will also discuss the new Healthcare Reform Act and how it will impact your business.

2010-06-01T13:08:00.001-04:00

Please Join Us for:

Research and Experimentation Tax Credit Update Webinar

Tuesday June 22, 2010
10:00 am to 12:00 pm, EDT

There have been some recent developments in the Research Tax Credit that will impact how and to whom these credits apply. Additionally, the 2010 Health Care Reform Tax Act will have both short- and long-term implications. Please log in for a discussion of the changes and their impact on your business.

Hosted By: Rehmann & Habif, Arogeti & Wynne

Location: Webinar (login information will be provided within 48 hours of event)

Who should attend: Corporate Tax Managers, Directors, CFOs and Attorneys

Facilitators:
Tim Giacoletti, Principal, Rehmann
Mike Powell, Senior Mgr, Rehmann
David Swatosh, Senior Associate, Rehmann
Kerry Defler, CPA, Habif, Arogeti & Wynne
Sharon Kelly, Habif, Arogeti & Wynne

Topics: Recent developments in Research Tax Credits and the 2010 Health Care Reform Act

CPE: This seminar qualifies for 2 hours of CPE

RSVP: The webinar is complimentary, but registration is required. Please RSVP to Candice Conrad at candice.conrad@rehmann.com or 248.293.7196 by June 18, 2010. Login information will be provided via email within 48 hours of the event

2010-06-01T10:38:00.000-04:00

Another reason to go green in the construction industry...

Proposed LEED state tax incentives, Senate bills 1111-1114, would create two financial incentives for building green. The first would be a property tax abatement of up to 12 years for new or rehabilitated LEED buildings — 20% for basic LEED certification, 30% for silver, 40% for gold and 50% for platinum. The second incentive is a tax-increment financing program for LEED-certified buildings with eligible sustainability features on eligible brownfield sites.

2010-06-01T10:36:00.002-04:00

Great example of partnering up...a consruction company teaming up with a chemical company to help with the green initiative...

Dow Chemical Co. has partnered with Cobblestone Homes, a mid-Michigan home builder, to create a home that it contends will eliminate utility bills. The 3,400-sq.ft. "Vision Zero" home in Bay City will produce as much energy as it consumes using Dow products, from Styrofoam to insulate the basement to Powerhouse Solar Shingles to generate power. The house will use 60-70% less energy than a conventional home.

2010-05-25T11:21:00.001-04:00

Food for thought...

"American Express is planning to bring a $400 million data services center to North Carolina, and it will do so without the types of incentives many companies look to pry from state and local governments. American Express already has a Greensboro call center that employs 2,000 workers. Local officials had considered offering up to $13 million in incentives to entice another facility."

A common perception among lawmakers is that companies don’t care about good tax policy. If forced to choose between broad-based, low-rate, neutral taxes, or special targeted tax incentives that benefit only their company, conventional wisdom is that companies prefer targeted tax carve-outs every time.

But this is often not true. Many large companies are well aware of the dual-edged nature of special targeted tax incentives. Tax preferences designed to boost corporate investment may provide short-term advantages to some companies—and allow lawmakers to take credit for new jobs in campaign speeches—but in the long run they add enormous complexity to the code, and ultimately transform the tax system into an economic minefield of narrow bases and punitively high rates."

In this case, it looks like the overall low-tax, business-friendly climate of North Carolina was more important to American Express in the long run for its facility expansion decision, than the short-run tax benefits it was offered. Maybe more states should follow top-ranked states like Texas and North Carolina and create a permanent, ongoing favorable business climate with low taxes, small government and right-to-work laws, rather that try to offset their generally anti-business environments with some publicity-generating targeted tax incentives (like 49th ranked Michigan and its generous 40% refundable tax credits for making films in the state).

2010-05-24T15:17:00.004-04:00

Reminder regarding 2009 tax net operating losses:

Taxpayers incurring NOLs in 2009 have the opportunity to carry them back up to 5 years. Care should be taken to make proper elections and to note the carryback to the 5th preceding year is limited to 50% of that year's taxable income. Failure to limit the carryback in the 5th preceding year is causing rejection of the loss carryback filings and delays in the anticipated refunds.

2010-05-20T11:07:00.001-04:00

Will the prevailing wage law be repealed on the fourth of July this year? A bill is before the House Labor Committee.

2010-05-17T14:18:00.003-04:00

Building Information Modeling (BIM) seems to be growing in application within the construction idustry. Technology is used to facilitate a more seamless effort between all of the participants of the building design and construction process. Architects and engineers render buildings in three dimensions, uncovering conflicts in the planning phase that would otherwise be discovered on the job site and result in slowing the project and change orders. This seems to be an example of the old concept of moving quality from the back end to the beginning and through out the process.

2010-05-13T12:31:00.002-04:00

The majority of CFOs see state taxes increasing for their companies and believe that state and local tax compliance requires more time than the corporate federal returns according to a new survey.

Is your company traveling more across state lines? If so, are you reviewing your footprint in those states from a tax filing perspective?

2010-05-10T08:45:00.001-04:00

Although it appears the worst of the "credit crunch" is behind us, there still seems to be a bias against real estate and construction loans by many lenders, particularly for our clients in Michigan. Here are some thoughts to enhance the odds of getting that loan:
· Go in with a strong business and cash flow plan;
· Avoid borrowing for spec building. Owner-occupied real estate has the best chance of getting the thumbs-up from many lenders;
· Work relationships with several lending sources - lenders are hungry for revenue and a little competition between them doesn't hurt;
· Don't overlook alternative lending opportunities (SBA, Department of Agriculture, local Economic Development agencies, etc.).

2010-04-29T09:25:00.001-04:00

Warranty work in highway construction contract ineligible for long-term contract method; district court reversed
Koch Industries, Inc. v. U.S., (CA 10 4/27/2010) 105 AFTR 2d ¶ 2010-813

You have probably heard of super completed contract...well this is super percentage complete.

2010-02-25T09:20:00.002-05:00

Coming Soon to the Rehmann Construction Professionals

Warm weather and the end of busy season will bring us........

Get Linkedin - Constructing Better Relationships

More to follow on this incentive and referral plan

2010-01-28T06:42:00.002-05:00

While our value to clients generally doesn't extend to improving the top line, we can offer some thoughts in that regard. What are construction companies doing during the winter to stay busy? I have a client that has expanded to serve a larger area (down to southern Ohio), some that do snowplowing, and still others that essentially shut down and do as little as possible during the winter months in order to save costs.

2010-01-19T07:59:00.001-05:00

FYI - Just read in my ENR magazine the other day that the IRS is ramping up for audits on developers and builders who use the completed contract method of accounting for condo and residential developments. The IRS has believed for quite some time that a "Super Completed Contract Method" is being used especially in respect to developments where at some future point there will be common improvements constructed such as a fitness facility or pool house.

2010-01-05T12:04:00.000-05:00

I have been hearing from my construction clients (both generals and subs) that the phone has been ringing more and there seem to be more jobs to bid for the spring. Bidding remains very competitive though. What are all of you hearing?

2009-12-11T09:31:00.002-05:00

Interesting link for construction...some of you may know about it but others may not.

http://www.irs.gov/businesses/small/industries/article/0,,id=185182,00.html