 HARDING, SHYMANSKI & COMPANY Certified Public Accountants and Consultants
|
|
|
| See What Our Clients Are Saying... | |
|
|
|
| Construction and Real Estate Industry | |
Because Harding, Shymanski & Company, P.S.C. is committed to providing quality service to our construction and real estate clients, we have selected a team of dedicated professionals to serve as your industry's consultants. These individuals understand the language and key issues unique to your industry and possess the drive and determination to help you manage your company on a proactive basis. |
|
|
ICA Southwest Construction Roundtable |
Our construction team at Harding, Shymanski & Company, P.S.C. would like to send out a special thanks to all of those who braved the extreme temperatures at the July 11th Golf Outing supporting the ICA Southwest Construction Roundtable. Thanks to everyone's support, the event continues to be a great success. Our representatives on the 15th tee thoroughly enjoyed meeting each of the events participants and would like to congratulate Chad Fulkerson from The State Group Industrial for winning the drawing for the $50 Golf Plus gift card. |
|
Mileage Rate Increase | |
Effective July 1, 2011 the mileage rate increased to 55.5 cents per mile for business miles driven from July 1, 2011 to December 31, 2011. During the first six months of 2011, the mileage rate was 51 cents per mile. Due to increases in gas prices during the first part of the year, the IRS made the adjustment of 4.5 cents mid-year. Typically, mileage rates are reviewed and adjusted once per year in the fall for the next calendar year.
The standard mileage rate is determined based on several factors, with gasoline prices having a significant impact. Depreciation, insurance, and other fixed and variable costs also affect the determination of the standard rate. In place of tracking actual costs, the standard rate is available to compute deductible costs of operating a business vehicle. If the taxpayer chooses, the option always remains to track and deduct actual expenses over the mileage rate. The standard rate also serves as a benchmark for reimbursing employees for mileage.
Also, for the six months from July 1, 2011 to December 31, 2011, the standard mileage rate for medical and moving expenses increased 4.5 cents per mile from 19 cents to 23.5 cents. Mileage for services provided to charitable organizations remains steady at 14 cents per mile. |
|
|
|
|
Construction Legislative Updates | |
On July 1, 2011, new legislative changes (Code 5-22-15-20.9) relating to "Buy Local" provisions went into effect. These provisions relate to public works contracts and could have a significant impact on contractors interested in bidding on such jobs. The new statute mandates Indiana political subdivisions to award a public works contract to a "local Indiana business" even in the event a non-local contractor has a lower bid. Political subdivisions include cities, counties, towns, school corporations, redevelopment commissions, special taxing districts, and any other local agency authorized to award public works contracts on behalf of a political subdivision. Public work is defined as the "construction, reconstruction, alteration, or renovation of a public building, highway, road, bridge, sewer, drain or other structure or improvement that is paid for out of a public fund or out of a special assessment."
Who qualifies as a "local Indiana business"? A contractor who 1) has a principal place of business in an affected county, 2) pays a majority of its payroll to residents of affected counties, 3) employs a majority of its employees from affected counties, 4) makes significant capital investments in affected counties, or 5) has a substantial positive economic impact on the affected counties is eligible to claim the "local Indiana business" preference. The contract needs to only meet one of the above listed criteria to qualify. According to the statute, affected counties are defined as the county where the political subdivision is located or a county that is adjacent to the location of the political subdivision.
The new statute states the public works contract shall be awarded to the lowest responsive and responsible local Indiana business that claims the preference. Contractors should use this new provision to their advantage and claim the "buy local" preference whenever possible. All information relating to the claim must be submitted at the time of the bid in order to qualify.
For more information about this legislative update, please contact Randy Schulz, CPA, at (800) 880-7800.
Written from slides of a seminar presented by Bamberger, Foreman, Oswald & Hahn, LLP. |
|
Workers Compensation Changes | |
A recent article published by WorkCompEdge discusses a future change in workers compensation experience mod calculations, which could potentially have a negative impact on some employers. In particular, employers in heavy severity industries, such as construction, are likely to be impacted by the change.
The National Council on Compensation Insurance (NCCI) has recently reviewed the experience rating plan with respect to workers compensation. The NCCI considered making various changes to workers compensation standards, but ultimately decided to make a change exclusively to the primary-excess split point. The proposed change will increase the split point from $5,000 to $15,000 over a three-year period. After the three-year transition period, the split point would then be adjusted for inflation in subsequent periods. The change is anticipated to be filed during the third quarter of 2011 and likely to become effective on a state-by-state basis beginning in late 2012 or early 2013.
The purpose of the split point is to set the dividing point between the primary portion and excess portion of each loss. For example, using the current split point of $5,000, a $9,000 loss would be allocated as $5,000 primary loss and $4,000 excess loss.
The primary portion is an indicator of loss frequency and is fully counted in an organization's mod calculation. Alternatively, the excess portion is an indication of loss severity and is reduced by an organization's weighting factor in the mod calculation. Increasing the split point from $5,000 to $15,000 could therefore give the image of greater frequency rather than severity. The insurance industry currently follows the rationale of "severity follows frequency," so the increase in the appearance of frequency could potentially impact insurance premiums.
For more information about how these changes will affect your business, please contact Paul Esche, CPA, CCIFP, CCA, at (800) 880-7800.
"NCCI Changing Primary-Excess Split Point in Experience" Article by Kory Wells featured in the WorkCompEdge blog. |
|
|
Harding, Shymanski & Company, P.S.C. provides accounting, tax, and consulting services to our clients from offices in Evansville, Indiana, and Louisville, Kentucky.
We are committed to quality. Adding value to the services we provide is our most important goal. Our unwavering dedication and commitment to quality resonate throughout every aspect of our work.
Call us today! (800) 880-7800 in Evansville and (502) 584-4142 in Louisville
www.hsccpa.com
|
| Disclaimer |
The information contained in this email is for general guidance on matters of interest only. The publication does not, and is not intended to provide legal, tax or accounting advice. |
|
|
|
|
|
