Fortifying Construction Sites: Tips for Preventing Equipment Theft

Fortifying Construction Sites: Tips for Preventing Equipment Theft

The National Equipment Register (NER) places the annual cost of losses due to equipment theft at up to $300 million for residential construction sites and $1 billion for commercial sites, with a $30,000 average price tag per theft. Beyond the actual cost, equipment theft can significantly add to the challenge of completing a project on time and in budget; hurt your reputation; drive up insurance; tie up cash and credit renting or buying replacements; and cause you to miss out on future business opportunities. While there are no guarantees, having a comprehensive anti-theft plan can turn the odds in your favor.

According to TheRepublic.com, “The people who do the stealing range from individuals committing small-time, spur-of-the-moment thefts to organized crews who go from state to state, hitting construction sites and then blowing town.” Top heavy equipment thefts according to Tenna.com include skid steers; wheeled and tracked loaders; towables; backhoes; tractors; wheel loaders; utility vehicles; UTVs; excavators; forklifts; bulldozers; rollers; generators; welders; and compressors.

Especially if the work site is in a remote location or the job timeframe includes extended periods of inactivity (i.e., a long holiday weekend), a comprehensive strategy can help reduce the chance of equipment theft. Here are some tips to consider:

  • Create a job site security plan and assign security-related responsibilities. Have your team spend time at the start of a project identifying and addressing potential security weaknesses.
  • Prequalify contractors before hiring them. According to LevelSet, most theft happens internally and subcontractors can easily identify your weak spots.
  • Have a system to ensure only approved personnel enter the work site (i.e., photo ID badges).
  • “Mark your equipment with an identification system, such as a driver’s license number (state initials, number, followed by DL). This is the only traceable number in all 50 states. Put numbers in two spots: one that’s obvious and one that’s hidden.” (Source: Great American Insurance Group.)
  • Take inventory. For all equipment and tools that will be used at a site, create an inventory including a photo, name, description, serial number/VIN, date of purchase, worksite, and who is approved to use it.
  • Invest in equipment-related technology. GPS asset tracking hardware, operating systems, video telematics (with forward and rear-looking dash cams), and geolocation technology as a standard feature on new equipment (OEMs are increasingly offering it) can help you see where equipment is, get alerts when it turns on or moves, and more.
  • Register heavy equipment with the National Equipment Register (NER), an organization that manages a database with detailed information about equipment ownership and potential matches with theft reports to help facilitate information sharing with insurers, equipment owners, and law enforcement.
  • For smaller equipment, create a storage area. Assign and label a space for each piece so you can quickly and easily see when something is missing.
  • Disable or make large equipment difficult to remove from a site. ConExpoConAgg suggests removing fuses and circuit breakers; and installing fuel shut-off equipment, wheel locks, battery switches, ignition locks and other deactivation devices. Also park equipment in a wagon-train circle and place easier to move pieces like generators in the middle.
  • Create a check-in/check-out procedure. Have workers sign out equipment as they use it and sign it back in when finished.
  • Set a policy to report any theft or vandalism to management immediately, so there’s a greater chance of recovery (which is said to happen only 25% of the time).
  • Adopt additional security measures. Security cameras, fencing and access control systems, lighting and security guards help deter theft and can provide proof should a theft occur. Engaging local law enforcement and crime stopper groups to report anything suspicious outside of normal hours of operation can also help.
  • Create an end of day security checklist. Is all equipment properly locked away/secured? Are lights, motion sensors, and security equipment turned on and working? Is the perimeter fence solid and secured? Have all entryway locks been closed and double-checked?
  • Train employees and contractors on your equipment management plan and security protocols.

While developing a plan to keep an eye on your worksite equipment and machinery, you can count on RBT CPAs to keep an eye on your accounting, tax, audit, and business advisory needs. Interested in learning more? Give us a call.

 

RBT CPAs is proud to say all of our work is prepared in the U.S.A. – we never offshore. As a result, you get peace of mind that your operation’s financial and confidential information is handled by full-time, local staff who have met our high standards for quality, ethics, and professionalism.

Seven Tips to Recruit and Retain Drivers

Seven Tips to Recruit and Retain Drivers

What is it that makes a driver choose to apply to and work at one employer over another?

Find the right answers and you’ll be better to compete for and win this highly sought-after talent despite the shrinking talent pool and tight labor market.

  1. Create a culture people want to be part of. Whether you have 1 driver or 100, creating a work environment that shows you value input; care about safety; respect individuals; uphold high ethical standards; recognize employees; and more can earn your business a reputation as a place people want to work for.
  2. Offer competitive wages. Go onto any job board and search for driver positions to see how much others are willing to pay for the same talent you’re trying to attract. Search for other hourly positions (i.e., warehouse or restaurant worker) in your area to see how your pay scale compares, as you may be competing with these employers as well. Remember, the pay scale you adopt will send a message. If you can’t afford to sweeten hourly pay, consider exploring periodic payroll incentives, whether that’s in the form of a sign-on bonus or based on meeting quarterly or annual performance expectations.
  3. Offer benefits that matter. Medical, dental, vision, and mental health coverage are commonplace, as are plans to build income for retirement and even tuition reimbursement. In addition, to look at how you can build flexibility into scheduling (i.e., home daily or four days on/three days off) and consider including paid time off, especially if you’re looking to hire female drivers (a valuable talent pool worth considering).
  4. Formalize training and career development. Younger generations want more than a job – they want opportunities to grow and make a difference. Meet these needs by formalizing driver training and career development If you don’t have the bandwidth in-house, consider partnering with a local driving school or providing online training (by doing this, you may also be able to access new talent pools like students graduating from these schools).
  5. Be honest and transparent in your job description and posting. How much does the job pay? What benefits are offered? What does the job involve (i.e., activities and hours)? Even if you don’t get many responses, at least you’ll know the ones that applied are genuinely interested in moving forward.
  6. Keep the recruiting and hiring process moving. If you take too long, someone else may beat you to the finish line, and you will have to start all over again.
  7. Put equal effort into Once you find and hire the right employee, keep the momentum going. Maintain open and frequent communications. Ask for employee feedback, input, and ideas. Look for opportunities to recognize and reward stellar performance. Give professional growth assignments (i.e., driver representation on a task force or at important meetings). Check in periodically to make sure all is good. Go back to the first point on this list.

One last tip: know when to ask for help. RBT CPAs affiliate, Visions Human Resource Services, helps clients fill open positions or enhance their internal recruiting, hiring and retention processes. Give them a call. At the same time, remember, RBT CPAs is here to handle your accounting, tax, audit, and business advisory needs. Let us know what we can do to help your business succeed.

 

RBT CPAs is proud to say all of its work is prepared in the U.S.A.  We never outsource outside the U.S.A.  To learn more about the accounting, tax, audit, and business advisory services our local team members can provide for your business, give us a call.

Show Me the Money! IIJA, NY Budget & Funding Updates

Show Me the Money! IIJA, NY Budget & Funding Updates

With less than 20% of the Infrastructure Investment and Jobs Act (IIJA) funds being allocated since the $1.2 trillion legislation was signed into law on November 15, 2021 (according to ConstructionDive.com), some of the novelty about potential construction opportunities has waned. However, a renewed effort to hasten IIJA funding, the newly approved NYS 2023 Fiscal Budget, and upcoming funding opportunities may be just what’s needed to get projects off the ground.

In a press release issued on May 19th, the New York Building Congress launched the Infrastructure Action Council (IAC) to drive infrastructure advocacy by meeting with government leaders in Albany and Washington D.C. to get shovels in the ground.

According to Carlo A. Scissura, Esq., President and CEO of the New York Building Congress, “More than a year and a half since President Biden’s signing of the historic $1.2 trillion Infrastructure Investment and Jobs Act, we’re still sitting on billions of unspent federal dollars that we can use to improve the lives of millions of Americans.” He continues, “The Infrastructure Action Council unites leading voices in our nation’s building industry to advance our ongoing efforts to fund transformative projects across the state.”

Just a few weeks earlier, New York’s 2024 Fiscal Year budget was approved and although a proposed housing compact didn’t make it in, there is $23.2 billion allocated for key capital projects across the state, including:

  • $1.3 billion for road and bridge projects
  • $417 billion for Bronx River Parkway upgrades and bridge replacements
  • $43 million to replace the US Route 20 bridge over Cazenovia Creek
  • $51 million for rehabilitation and replacement of Hudson Valley Bridge
  • $2.4 billion to maintain and upgrade SUNY/CUNY campuses
  • $1.7 billion towards the Wadsworth health facility – a new public health lab on the Harriman State Office Campus Complex in Albany
  • $890 million for expanding mental health housing
  • $500 million to help deliver clean water to NY communities
  • $455 million for the Belmont Redevelopment Project
  • $400 million to the Environmental Protection Fund
  • $224 million for the South Shore Staten Island Seawall
  • $150 million to Regional Economic Development Councils
  • $135 for NYC’s Housing Authority
  • $105 million for State Emergency Operations Center upgrades
  • $100 million to buy and renovate a new State Police satellite crime lab
  • $50 million to fund a Homeowner Stabilization Fund for home repairs in 10 low-income communities
  • $30 million towards NY aquaria, botanical gardens, and zoos
  • $17.5 million for the Mamaroneck/Sheldrake River Flood Risk Management Project

(Source: MacLennan, Robin. FY 2024 budget includes $23.2 billion for capital projects across NY. May 5, 2023. NewYorkConstructionReport.com.)

Concurrently, NY funding opportunities have been announced for the Mid-Hudson Momentum Fund (here are the guidelines and application) and Round XIII of the Regional Economic Development Council initiative. The consolidated funding application for 30 different programs is available here; the deadline is July 28 @ 4 p.m. Be sure to visit the Mid-Hudson Regional Economic Development Council webpage for more information and resources, and to sign up for informational webinars underway.

While you’re identifying and evaluating opportunities for your construction company, remember, RBT CPAs is here to lighten your load by providing accounting, tax, audit, and advisory services. We’ve been proudly serving the Hudson Valley (and beyond) for over 55 years and complete all work locally – we never outsource or offshore. To learn more about how RBT CPAs can support and contribute to your success, give us a call.

Construction Opportunities in the NYS Budget and Federal Acts

Construction Opportunities in the NYS Budget and Federal Acts

The New York Fiscal Year 2024 budget was worth the wait for construction businesses thanks to over $23 billion for infrastructure and capital projects across the state. At the same time, the budget makes history with the most progressive legislation on building decarbonization, continuing to incentivize the move to sustainable buildings with climate-friendly, clean, and affordable energy and complimenting certain Inflation Reduction Act tax deductions and credits.

On May 2, New York’s Fiscal Year budget was approved. While a housing compact that would have resulted in 800,000 housing units being built didn’t make it across the finish line, the budget does include $23.2 billion for capital projects that touch a variety of industries and fields.

The New York Department of Transportation’s five-year plan enters its second year with more than $7 billion budgeted for road and bridge projects.

State and City University of New York (SUNY and CUNY) campuses will see $2.4 billion in transformations, preservation and upgrades including building envelope, interior, electrical, HVAC and utility projects.

Design options for a new Wadsworth Public Health Laboratory for research in Albany will be funded with $1.7 billion so lab operations currently handled in several locations can be consolidated into one.

In addition, $1 billion is budgeted for healthcare capital projects; $890 million for mental health housing; $500 million for clean water projects; $446 million for the third phase of the Hunts Point Interstate Access Improvement project; $224 million for a seawall project on the South Shore of Staten Island; $135 million for New York City Housing Authority projects; $105 million for State Emergency Operations Center upgrades; $100 million for a State Police satellite crime lab; $51 million for Hudson Valley bridge replacements and rehabilitations; $50 million for a Homeowner Stabilization Fund to finance home repairs in 10 communities; $17.5 million to design and construct the Mamaroneck and Sheldrake River Flood Risk Management project; and more.

The new budget also makes New York the first state to advance comprehensive legislation for zero-emissions for new buildings and homes seven stories and under starting December 31, 2025, and all new buildings by December 31, 2028 (there are some exceptions and exemptions).

What’s more, $200 million is allocated to the NYSERDA EmPower Plus Home Retrofits Program to help 20,000 low-income families retrofit homes with insulation, energy efficient appliances, and clean energy solutions. Another $200 million is set aside for critical infrastructure projects at New York Parks.

This comes on the heels of the Inflation Reduction Act’s January 1, 2023 effective date for 179D Commercial Buildings Energy Efficiency Tax Deduction enhancements and new 45L tax credits for homebuilders.

For 179D, when prevailing wage and apprenticeship requirements are met and a building reduces annual energy and power costs by at least 25%, there is a $2.50 square foot deduction. For each additional percentage that annual energy and power costs are reduced, the deduction increases by $.10, up to $5.00/square foot (up from $1.88/square foot in 2022). The deduction is available every three years for commercial buildings; every four for municipalities, tribal governments, and non-profits. What’s more, municipalities, tribal governments, and non-profits can allocate to the deduction to the person/people who create the energy-efficient commercial building property installation technical specifications.

For IRC Sec 45L, there are two tiers of credits – $1,000 or $5,000 – for eligible new or substantially reconstructed homes and dwelling units (that are part of a building) that meet certain ENERGY STAR and Department of Energy Zero Energy Ready Home (ZERH) program requirements. The credit is available for homes/dwellings acquired after December 31, 2022 through December 31, 2033. (For details, visit 45L Tax Credits for Zero Energy Ready Homes at Energy.gov.)

Between state and Federal efforts, one thing is clear: a lot of opportunities exist – and undoubtedly there will be more to come – for construction companies and builders that embrace clean energy and climate-friendly practices and materials.

Succession Plan: What’s Yours?

Succession Plan: What’s Yours?

As counter-intuitive as it may seem, at the same time that you’re developing and executing plans to grow your business, you should also be working on your exit plan, which can impact business decisions today and be a make-or-break factor in achieving your long-term goals.

According to Investopedia.com, “Data from the Bureau of Labor Statistics (BLS) shows that approximately 20% of new businesses fail during the first two years of being open, 45% during the first five years, and 65% during the first 10 years. Only 25% of new businesses make it to 15 years or more.”

At the same time that you’re striving to pass these milestones, there are more hurdles ahead. According to Score.org, as family businesses are handed down, 30% survive the transition from first to second generation; 12% survive from second generation to third; and just 13% of family businesses are still in the family after 60 years. That may not be bad news – if transitioning ownership outside the family was your plan all along. The important word here is “plan.”

Succession planning is a critical business owner responsibility that helps ensure your legacy continues the way you want. Even if you are not sure what that legacy is just yet, succession planning can help you figure that out, too. Then, as situations change and evolve, you can adjust succession plans accordingly.

There are two types of succession plans: one focuses on what will happen to your business and the other focuses on the talent you need to lead your business. They are closely inter-related – what you do with one has a big impact on the other, and vice-versa.

Business succession plan options are pretty straight forward: close it; sell it to outsiders or to your employees; or transition it to the next generation of your family. That doesn’t mean it’s easy to decide – each has its pros and cons, and each will enable a different legacy over time.

Talent succession plans can be a bit more complicated. You need one as a contingency should a leader (including you) or hard-to-find talent leaves unexpectedly (or even dies). You also need one for the long-term to ensure the next generation of leaders and talent are ready, willing, and able to take the reins once you are ready to pass them on. (When done correctly, long-term succession plans have the added benefit of driving employee engagement by showing employees someone at work cares about them; someone is encouraging their long-term development; and someone is providing them with opportunities to learn and grow.)

Succession planning may require anywhere from five to seven years lead time to develop and execute, as you may need to recruit, hire and acclimate new talent or ensure existing talent has the runway to learn everything needed before take-off. Once you have plans, make sure they stay relevant to changing business decisions and environment by reviewing them and making changes at least once a quarter. Perhaps most important is to get started on your plans now. Not having one has brought big name brands and family relationships to the brink of extinction, while strong, well-thought-out plans have led to success for generations.

One more thought: at the same time that you commit to develop succession plans, also consider getting your estate planning in order. As reported by Craft Brewing Business, “The federal estate tax, which applies to large estates at a rate of 40%, can have a crippling effect on businesses given to heirs without any kind of protections put in place. (Beals, Michael. “How Retiring Brewery Owners Can Protect Their Legacy.” December 2022. CraftBrewingBusiness.com)

RBT CPAs has resources that can help you on all fronts. Our advisory services professionals can help you think through succession plan options for your business. Our Vision Human Resource Services affiliate can help you with talent succession planning, a succession planning process, and recruiting. Plus, our Trust, Estate & Gift experts can help make sure the legacy you’ve worked so hard to build endures according to your wishes.

As always, our tax, accounting, and audit professionals are here to help free you up to focus on other aspects of your business – like succession plans.  To learn more, give us a call.

Are You Using the Right KPIs for Your Brewery?

Are You Using the Right KPIs for Your Brewery?

How do you know if your brewery is performing well, where there may be opportunities for improvement or fixes required, and whether it’s positioned to survive these financially uncertain times? Tracking the right Key Performance Indicators or KPIs can help keep growth and performance on track.

Perhaps one of the biggest challenges is deciding which KPIs will prove most valuable to your business.  There are KPIs that can apply to all businesses and industries; to the food and beverage industry; to specific brewing processes like fermentation; and to breweries in general.

Selecting KPIs that give you insights into big picture performance as a business along with KPIs specific to breweries may provide you the most valuable insights to help you track progress, analyze performance, and make decisions in today’s uncertain economic environment.

Financial KPIs to consider:

  • Cash flow reveals how much cash your business generates and how much money is flowing through your business. It’s calculated by subtracting cash outflow (i.e., taxes, rent, supplier payments, etc.) from cash inflow from customer payments.
  • EBITDA per unit measures profitability over longer periods of time like a month, quarter, or year (rather than a day or week). EBITDA stands for earnings before interest, taxes, depreciation, and amortization. In addition to cost of goods sold (COGS), which reflects the cost of raw materials and packaging, it accounts for all operating expenses (i.e., rent, marketing, salary, benefits, etc.).
  • Gross margin per unit helps measure profitability by determining the percentage margin of a single unit after subtracting total COGS.
  • Break-even point gives insight to profitability, by helping you understand the minimum number of units you need to sell in a time period to be profitable.
  • Days inventory reveals the number of days inventory is in stock before it is transformed and sold as a finished product, which provides insight into your working capital. A significant decrease may point to pending cash flow issues.

Production KPIs to consider:

  • Utilization rate is your brewery’s total production capacity measured as a percentage. When it decreases, production system issues or low orders may be to blame. It can also inform your decisions about scaling production.
  • Cycle time is the average amount of time it takes to produce your product, from start until it is shipped. This KPI gives insight into how efficiently your machines are operating by showing how many days it takes to produce your product from start to finish.
  • Throughput is the average number of units produced within a defined time period (i.e., day, week, month, etc.). This KPI gives insight into your production line’s efficiency. When it decreases, evaluate why and make needed adjustments.

Sales KPIs to consider:

  • Average order value reveals how much each customer typically spends per order, which helps with sales projections, production plans and run rate. If you notice this KPI decreasing, evaluate whether there are improvement opportunities within your sales process.
  • Fill rate measures how quickly total orders are filled and reach a customer’s destination. It provides insight into working capital efficiency and customer satisfaction, while also helping to identify the need for improvements.

For more insights, contact RBT CPAs’ advisory services team. As always, we’re also here to partner on all your tax, audit, and accounting needs so you’re freed up to focus on your business success. Give us a call today.

How Drones Are Changing Construction

How Drones Are Changing Construction

What’s keeping you up at night?

If you’re like most construction company owners, the following are probably somewhere on your list: labor shortage, financial environment, procurement and the supply chain, project progress, worker safety, managing cash flow and costs, and more. Have you ever considered that drones – yes, drones – may help address your biggest concerns?

Drones can do a lot for your construction business.

The growth of their use is skyrocketing. They save time and money; keep projects on track; get certain jobs done faster; increase productivity; decrease on-the-job injuries; promote security of work sites, supplies and equipment; identify issues and course correct opportunities quickly; free up talent to focus on other tasks; possibly provide a competitive and service advantage; and more.

How?

Drone photos, videos and other images help scope out projects, track progress and provide real-time updates that can be viewed remotely. More specifically, drones are used to:

  • Map, survey and project plan According to com, “Drones survey vast acres of land in just 15 to 30 minutes, saving up to 20x the cost of creating topographic maps” and “Teams can use drone software to stitch maps into 3D models for analysis and project planning.” Ultimately, they can help with feasibility, design, course corrections, and project timelines, and budgets.
  • Manage projects and clients Is the project progressing according to plan? Have you identified issues that can be rectified to stay on track? Are designers, engineers, and construction staff able to access data in real-time to collaborate and problem-solve? Will providing images of progress offer additional peace of mind to clients, especially if they’re at a remote location?
  • Monitor supplies How much gravel is left? What about lumber? A drone can help you get images to keep track and order accordingly.
  • Manage equipment Where is the equipment? Is it operating effectively and, if not, what’s going wrong? Is it secure and protected from potential theft? Are you done with it/should it be returned to avoid additional charges? Drones can get you the answers in real-time.
  • Promote safety Drones help capture measurements and images in high and hard to reach places in lieu of risking worker falls and other injuries. They can also help identify and fix potential risks – like loose or unstable equipment.
  • Conduct inspections View and analyze images without the safety risks. Heat leaks, cold spots, and electrical images can be identified with thermal sensors.

As noted on ForConstructionPros.com, “Think of a modern drone as a flying rack onto which you can attach or swap the latest technologies — multispectral sensors, high-definition cameras, and machine learning software capable of creating 3D maps from topographical data, able to be captured from virtually anywhere…By using drones and sophisticated software, planners can combine, match, and overlay their own data vis-a-vis terrain and property lines. Third-party software can then do much of the grunt work, taking advantage of existing data and resources, utilizing these most efficiently while avoiding pitfalls.”

Interested in learning more about how drones can help your construction business, not to mention help you get a better night’s sleep? Check out these resources:

If you’re interested in learning how to account for drone training, licensing, and equipment, give RBT CPAs a call. We’re a leading accounting, tax, and audit firm in the Hudson Valley and beyond, and believe we succeed when we help you succeed. Give us a call today.

If you’re interested in learning how to get a drone program off the ground in 2023, watch for our next thought leadership article coming in January.

Examining 179D Deductions through the Eyes of the IRS

Examining 179D Deductions through the Eyes of the IRS

If you are looking to take a 179D Deduction as the official designer of a government-owned property or a commercial property owner, take note! Recently, the IRS Large Business and International (LB&I) Division released an updated its training with guidelines for IRS staff to perform examinations for 179D deductions. While this serves as a job aid for IRS staff, it also provides important insights to architects, engineers, and contractors looking to take advantage of 179D deductions.

179D tax deductions took effect in January of 2006 and became permanent as part of the Consolidated Appropriations Act of 2021 (signed into law December 27, 2020). Basically, 179D deductions enable eligible building owners to claim a tax deduction for installing qualifying systems that reduce energy and power costs by 50% or more. Qualifying systems include interior lighting; building envelope; heating, cooling, ventilation, or hot water systems.

This year, the deduction can equal up to $1.88 a square foot. So, if the qualified building is 100,000 square feet, that could mean up to a $188,000 tax deduction for the work completed.

Commercial building owners and designers of government-owned buildings are eligible for 179D tax deductions; however, the updated IRS training places more emphasis on what to watch for during government-owned building examinations.

Since government buildings are non-taxable, government building owners can allocate 179D tax deductions to the building designer, namely the person who created the technical specifications for a new building or an energy-efficient commercial building property addition. This may include an architect, engineer, contractor, environmental consultant, or energy services provider; it does not include a person who installs, repairs, or maintains a system. However, it is the IRS examination – not the building owner – that determines whether a taxpayer meets the definition of designer.

An allocation letter from a government building owner alone is not enough to establish a taxpayer as a designer eligible for the 179D deduction. Examiners determine eligibility by reviewing who contracts designate as responsible for design. To establish designer status, a designer must provide the contract along with technical specifications, stamped or sealed drawings, and any other relevant documentation.

Government building owners that do provide an allocation letter may be interviewed by agents to ensure they have the authority to make the allocation. Also, to claim the deduction, certification by properly licensed individuals is required.

IRS examiners are encouraged to determine the Designer of Record by reviewing stamped or sealed drawings; however, this excludes shop drawings used to make sure a building conforms to an architect’s or engineer’s design requirements. Technical specifications created by the architects and engineers take precedence over shop drawings, increasing the likelihood that architects and engineers will qualify as project designer(s). While not explicitly addressed in the IRS training, it seems likely that contractors engaged to provide both design and construction services can also meet designer status requirements.

In addition to these efforts to clarify who is considered an eligible designer, the IRS training emphasizes tax-exempt and non-profit organizations cannot allocate 179D deductions to designers. For example, a state university that places some buildings under a private foundation cannot allocate 179D deductions.

The examination’s final step focuses on whether penalties for taxpayers are warranted based on adjustments. If an adjustment results in underpayment or an excessive refund or credit, agents will consider accuracy-related penalties (i.e., for negligence or substantial underpayment or an erroneous claim for refund).

For 2023, the Inflation Reduction Act significantly increases certain reimbursements and enhances flexibility to take advantage of 179D deductions. Watch for more information in the weeks ahead. In the meantime, if you need help understanding, securing, and certifying 179D deductions, RBT CPAs – a leading accounting firm in the Hudson Valley and beyond – can help. Visit rbtcpas.com or contact the office closest to you:

  • Hudson 518-828-4616
  • Lake Katrine 845-336-7183
  • Newburgh 845-205-7482; 845-567-9228
  • Poughkeepsie 845-262-4338; 845-485-5547
  • Wurtsboro 845-260-6138; 845-888-2789

(Source: Aberin, CJ. “IRS updates guidance on tax deductions for energy efficient buildings.” AccountingToday, July 15, 2022, https://www.accountingtoday.com/opinion/irs-updates-guidance-on-179d-tax-deduction-for-energy-efficient-commercial-buildings.)

New York State Unemployment Interest Assessment Surcharge: What Businesses Need to Know

New York State Unemployment Interest Assessment Surcharge: What Businesses Need to Know

Starting this month, don’t be surprised if you receive a bill for an Interest Assessment Surcharge (IAS) from the government. It’s for interest New York State owes the federal government on loans it took out to maintain unemployment and pandemic benefits between March 2020 and September 2021 for COVID-related programs.

New York’s Unemployment Insurance Trust Fund loan amounted to $9.2 billion. The Department of Labor (DOL) has already paid back 11% or more than $1 billion and is working with state leaders to aggressively reduce the principal balance. State law requires employers who make unemployment insurance contributions to pay the IAS on the federal loan annually, until all interest has been paid off.

Notifications about the surcharge started going out to employers, with information about the IAS rate (.23%), the annual charge for 2022 (about $27.60 per employee), and how to pay. Payment must be made within 30 days of date of the notice (and by September 30, 2022 at the latest).

If you have an account on NYS Online, you can find your payment amount on NYS-45, line 6: “UI Previously underpaid with interest.” If payment is not made when e-filing your 2nd quarter 2022 NYS-45, make a check payable to NYS Unemployment Insurance. We recommend noting your NYS Unemployment Insurance Employer Number and “IAS” on the memo line. Then mail it to:

NYS Unemployment Insurance
P.O. Box 4301
Binghamton, NY 13902-4301

For more details and information, visit the New York State DOL website’s IAS page. If you have questions, call the NYS DOL’s Employer Hotline at 1-888-899-8810 (select One for Main Menu, and then One for Employer Accounts Adjustment Section of the Unemployment Insurance Division).

As always, you can reach out to your person at RBT CPAs, LLP/Sickler, Torchia, Allen & Churchill CPAs, P.C. if you need any additional assistance with this or other accounting, tax, and auditing matters.