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Paradigm Partners Newsletter
March, 2010 |
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Greetings
Dear :
The purpose of our newsletter is to keep you informed and up-to-date on the latest regarding R&D Tax Credits, Cost Segregation, IC-DISC (Exporters' Tax Incentive), WOTC/HUD Zone, Section 179, other tax related issues, Business Development and Personal Development.
If you find the Newsletter helpful, you may want to forward it to a friend. Just click below.
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Friday, April 9, 2010 Last Chance to Sign Up for Your 2009 R&D Tax Credit Study
If you plan on filing on April 15 for tax year 2009 and you would like to take advantage of your tax credit from an R&D Tax Credit study, then you need to contact us NOW to initiate your study.
Paradigm will be accepting signed agreements up until Friday, April 9.
As you know, it is always better to include any tax credits or tax incentives (including the R&D Tax Credit) when you file as opposed to amending.
Call your representative at Paradigm at 281-558-7100 or contact me, Mark Lauber, at MLauber@ParadigmLP.com and we'll get you started. |
| Are You Missing Out on a Well-Known Tax Incentive?
The Energy Policy Act of 2005 (EPACT) added section 179D to the Internal Revenue Code. Section 179D permits a deduction for the costs of installing certain energy efficient building systems in commercial buildings. This was extended beyond 2008 for another 5 years by President Bush on October 3, 2008 with the Historic Financial Rescue Bill HR 1424, which also included the Tax Extenders and Alternative Minimum Tax Relief Act.
The deduction applies for both new and previously existing properties and is applicable for the year in which the energy-saving property was made ready for its intended use.
The owner of the building can claim the deduction but most importantly a special rule exists for Energy Efficient property installed in commercial buildings owned by a federal, state or local government entity
The rule is that the deduction is allocable to the designers of the technical specifications of the energy efficient property. A designer is a person that creates the technical specifications for installation of energy efficient property and may include architects, engineers, contractors, environmental consultants or energy services providers.
Persons who perform installations, repairs, or maintenance of the property are not qualified to receive the deduction allocations.
Many architects, engineers, contractors, environmental consultants and energy services providers are not taking advantage of this potentially large tax deduction. Most are unaware that they are eligible for the deduction, in addition, if they were aware, as with many tax incentives, there is lots of red tape involved.
Here is some of what's involved:
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Certification of the building as an energy efficient building meeting standards set forth must be performed by a licensed engineer or contractor who is properly licensed in the jurisdiction where the building is located.
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The engineer or contractor cannot be related to the taxpayer claiming deduction and has represented in writing to the taxpayer that he or she has the qualifications to provide the certification required or to perform the inspection and testing described.
Statute requires that certain approved software programs must be used in identifying energy expenditures for the purposes of the deduction. A public list of allowable software is viewable at the DOE's web site:
I'm sure you're wondering if this is such a hassle why should I even bother? The reason is the substantial tax benefits.
For a fully qualified building, the deduction is a maximum of $1.80 per square foot, less the aggregate amount of Section 179D deductions allowed for the building for all prior taxable years.
Partial qualification is allowed as well and the maximum allowable deduction available in this case is $0.60 per square foot, less the aggregate amount of Section 179D deductions allowed with respect to the building for all prior taxable years.
Example:
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100,000 square foot building could have a maximum deduction of $180,000 at $1.80 per square foot
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At a marginal tax rate of 35 percent, the tax savings would be $63,000
As you can see, there is substantial benefit. The benefit is based on work you are doing or have done. The deduction is taken in the year the work was completed but you can go back 3 open tax years. That means, for example, if you completed work on a facility back in 2008, you can amend your 2008 returns and take advantage of the incentive.
If you believe you may have completed some work or in the process of completing a project that may qualify, how can you or your firm take advantage of this incentive? The answer is to outsource the task to a qualified consulting firm. Their certified engineering professionals can help you determine if you can take advantage of this great tax incentive and if so, maximize your deductions. Find a firm that offers a cost free analysis to determine if your project qualifies and if your firm can take advantage of the tax incentive. |
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Valant & Company's Solid Rules
Can Ensure Success in Life, Business
Editor's Note: Today we present the fourth installment in a special inspirational series from business performance improvement expert Laurence B. Valant, who specializes in growing profits for accounting firms and general business. Larry has been a frequent contributor to our newsletter, and again today, we feature excerpts from his new book, Stop Breaking These Rules! 100 Hard-Hitting Truths for Business Integrity and Performance. If you want more information or would like to order a copy of the wonderful new book, please visit www.valantco.com.
40 - Spend the majority of your time doing what only you can do. Delegate the rest.
Since most managers have difficulty delegating, implementing this rule may be challenging. However, the payback is enormous:
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First my staff gets to complete work that I can do but which they must learn
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Next, I free myself to work on those things only I can do
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Finally, I can gradually add more complexity to what I delegate to my staff. Their growth continues and I become a more effective manager.
I observed a partner in a CPA firm who, rather than spend time teaching his staff, preferred to do the simpler work himself because it "saved time". He found himself constantly falling behind because the complex work that only he could do remained in piles on his desk. If this brilliant technician had taken the time to simply teach his staff, he would have been freed up forever. This is the perfect application of the old proverb "Give a man a fish; you have fed him for today. Teach a man to fish; and you have fed him for a lifetime."
Any manager will fall behind schedule when they fail to delegate those things their staff should be doing. Being expedient (I'll just get this done myself) is usually not effective in the long run. Spend 80% of your time doing what only you can do. Delegate the rest.
41 - Clear, unambiguous communication is as rare as competent leadership.
Clear unambiguous communication is rare. Why? Because the initiator of the communication must take time to think. You would think that providing direction or clearly defining what someone must deliver is worth the careful thought required. When time is given to clearly specify what is wanted and what successful delivery looks like, all ambiguity surrounding the communication is removed.
And, sometimes in spite of careful preparation, a message sent is not the one that is received.
This brings us to step two of unambiguous communication: Receiving feedback to verify correct receipt of a message. Feedback is a simple way of ensuring your message was communicated exactly as you meant it to be. This critical second step does take a little more time than just giving directions and saying, "You figure it out." Without the second step, people will sometimes get it right, but usually they don't.
Poor communication is yet another reason why companies frequently miss plan and fail to achieve their objectives on time and budget. You might be saying, "I don't see this attention to communication very often." The reason you don't is that clear unambiguous communication is very rare, as rare as competent leadership.
42 - Two important predictors of management ability are self esteem and self confidence.
I have already stated my belief that competent managers are rare indeed. The percentage of really good managers at best is only about 5% of all those in actual management positions. Yet, this small group of competent managers typically has two important characteristics in common: high self esteem and strong self confidence.
These two important characteristics can be defined as:
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Self esteem: my true inward feelings about myself - absolute truth. If I like who I am, respect myself enough to set appropriate boundaries, can forgive myself when I make mistakes and do not need to pat myself on the back, I have a healthy self esteem. This is the person I regard as having their head on straight.
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Self confidence: my outward reflection of my self esteem - close to truth. A healthy self esteem results in a healthy (not out of balance) self-confidence that is reflected in a manager's ability to 1) gain commitment from and hold those who report to them accountable 2) measure and take on reasonable risk 3) not blame others but take responsibility for results.
Because management requires achieving goals and meeting due dates on time and on budget through and with other people, success is difficult and challenging during the best of times. When a manager lacks confidence in her ability to deliver, she won't. And those who report to such a manager are rarely happy.
Those companies which consistently do a good job of identifying people with high levels of self esteem and self confidence will be rewarded with well managed companies! |
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I hope you have benefited from our Newsletter. Do not hesitate to contact me if you have any questions about what you heard or read in this Newsletter.
Sincerely,
Mark Lauber
VP of Marketing
Paradigm Partners 281-558-1700 X-105
www.ParadigmLP.com |
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