The IRS has released much-anticipated temporary and proposed regulations on the capitalization of costs incurred for tangible property. They impact how virtually any business writes off costs that repair, maintain, improve or replace any tangible property used in the business, from office furniture to roof repairs to photocopy maintenance and everything in between. They apply immediately, to tax years beginning on or after January 1, 2012.

These so-called “repair regulations” are broad and comprehensive. They apply not only to repairs, but to the capitalization of amounts paid to acquire, produce or improve tangible property. They are intended to clarify and expand existing regulations, set out some bright-line tests, and provide some safe harbors for deducting payments.

The regulations are an ambitious effort to address capitalization of specific expenses associated with tangible property. The regulations affect manufacturers, wholesalers, distributors, and retailers—everyone who uses tangible property, whether the property is owned or leased. The rules provide a more defined framework for determining capital expenditures.

Most taxpayers will have to make changes to their method of accounting to comply with the temporary regulations and will need to file Form 3115. Taxpayers who filed for a change of accounting method following the issuance of the 2008 proposed regulations will probably have to change their accounting method again.

The IRS has promised to issue two revenue procedures that will provide transition rules for taxpayers changing their method of accounting, including the granting of automatic consent to make the change. The regulations require taxpayers to make a Code Sec. 481(a) adjustment; this means that taxpayers will have to apply the regulations to costs incurred both prior to and after the effective date of the regulations.

The new regulations provide rules for materials and supplies that can be deducted, rather than capitalized. The rules provide several methods of accounting for rotable and temporary spare parts, and allow taxpayers to apply a de minimis rule so that they can deduct materials and supplies when they are purchased, not when they are consumed.

Costs to acquire, produce or improve tangible property must be capitalized. The regulations address moving and reinstallation costs, work performed prior to placing property into service, and transaction costs. Generally, costs of simply removing property can be deducted, but costs of moving and then reinstalling property may have to be capitalized.

To determine whether a cost incurred for property is an improvement, it is necessary to determine the unit of property. Generally, the larger the unit of property, the easier it is to deduct expenses, rather than have to capitalize them. The regulations provide detailed rules for determining the unit of property for buildings and for non-building tangible property. For buildings, the IRS identified eight component systems as separate units of property, requiring more costs to be capitalized. However, the new rules also provide for deducting the costs of property taken out of service, by treating the retirement as a disposition.

The new regulations require virtually every business to review how repairs, maintenance, improvements and replacements are handled for tax purposes, with both mandatory and optional adjustments made to past treatment as appropriate.

Please feel free to call this office for a more targeted explanation of how these new regulations impact your business operations.

The fate of the employee-side payroll tax cut along with a host of tax extenders and other expired provisions could be decided in coming weeks. A conference committee of House and Senate members is negotiating a full-year extension of the payroll tax cut and could add some or all of the tax extenders to a final package. Lawmakers also could extend the payroll tax cut without acting on any tax incentives.

Payroll tax cut

The Temporary Payroll Tax Cut Continuation Act of 2011 extended the employee-side OASDI tax cut through the end of February 2012. The employee-share of OASDI taxes is 4.2 percent for the two-month period, rather than 6.2 percent. The employer-share of OASDI taxes remains at 6.2 percent for the two month period. Self-employed individuals also benefit from a two percentage point reduction in OASDI taxes.

Unless extended, the employee-share of OASDI taxes is scheduled to revert to 6.2 percent after February 29, 2012. The White House and the leaders of the two parties in Congress agree that the payroll tax cut should be extended a full-year. They disagree, however, how to pay for the extension; even if it should be paid for at all.

Congress could extend the two-month payroll tax cut through the end of 2012 without paying for it. The 2011 payroll tax cut was unfunded. Congress appropriated to the Social Security trust funds amounts equal to the reduction in payroll tax revenues. The 2011 payroll tax cut was estimated by the Congressional Budget Office cost approximately $111 billion. Extending it through the end of 2012 is estimated to cost just as much if not more.

House Republicans reportedly have proposed a number of revenue raisers to offset the cost of extending the payroll tax cut through the end of 2012. One GOP proposal would extend the current pay freeze for employees of the federal government. Another GOP proposal would require higher-income individuals to pay increased Medicare premiums.

One possible revenue raiser, increasingly under discussion by Democrats, is a change in the taxation of so-called carried interest. Current law generally taxes carried interest as capital gains and not as ordinary income. Past efforts to change the tax treatment of carried interest have failed to pass Congress.

Extenders

The so-called tax extenders, popular but temporary tax provisions, expired at the end of 2011. Many taxpayers are surprised to learn that their particular tax break, whether it be the state or local sales tax deduction, the teachers’ classroom expense deduction, or the research tax credit, are temporary. The extenders have been routinely revived many times in the past. This year, however, could be different. Faced with record federal budget deficits, lawmakers may decide to extend only some of the expired provisions.

President Obama’s FY 2013 proposals

President Obama is expected to release his fiscal year (FY) 2013 federal budget proposals in early February, which will reignite debate over the Bush-era tax cuts. President Obama is expected to urge Congress to allow the Bush-era tax cuts to expire after 2012 for higher-income taxpayers, which President Obama defines as individuals earning more than $200,000 or families earning more than $250,000. In recent weeks, there has been speculation that President Obama may revisit those definitions in his FY 2013 budget, possibly raising the amounts.

Few Capitol Hill observers expect Congress to take any action on the Bush-era tax cuts before the November elections. Instead, Congress may take up some of President Obama’s other proposals. As in past budgets, President Obama will likely propose to extend some energy tax breaks for individuals and businesses, extend tax incentives for education and provide some targeted-tax breaks to businesses. President Obama has also promised to introduce proposals to encourage U.S. companies to “insource” jobs at home.

On some issues, such as energy and education, lawmakers may find common ground but negotiations are likely to go down to the wire. Our office will keep you posted of developments.

If you have any questions about the payroll tax cut, tax extenders or the various tax proposals under discussion, please contact our office.

The IRS reopened its offshore voluntary disclosure program in early 2012 in response to what the government described as strong interest among taxpayers. The reopened program, the third of its type in recent years, encourages taxpayers with unreported foreign accounts to make full disclosures in exchange for a reduced penalty framework. Like its predecessors, the terms and conditions of the reopened program are very complex. The IRS has promised to provide more details. In the meantime, the prior offshore disclosure programs are guides to how the IRS intends to implement the third, reopened program.

Previous disclosure programs

The IRS launched two previous offshore disclosure initiatives: one in 2009 and another in 2011. Both programs offered reduced penalties in exchange for full disclosure. In early 2012, the IRS reported it received 33,000 voluntary disclosures from the 2009 and 2011 offshore initiatives. The government has collected over $4.4 billion from the 2009 and 2011 programs. The IRS predicted it will collect more revenue as it continues to work cases.

Reopened program

The reopened program operates very similarly to the 2009 and 2011 programs but with some key differences. The previous programs were temporary. The 2011 program ended in mid-September 2011. The reopened program has no set end date. The IRS cautioned, however, that it could close the program at some future date. The decision to end the program is solely at the discretion of the IRS.

The reopened program requires taxpayers to file all original and amended tax returns and include payment for back-taxes and interest for up to eight years as well as pay accuracy-related and/or delinquency penalties. Additionally, taxpayers must pay a penalty of 27.5 percent of the highest aggregate balance in foreign bank accounts/entities or value of foreign assets during the eight full tax years prior to the disclosure. In comparison, the highest penalty in the 2011 program was 25 percent. IRS officials have said that the penalty was increased because the agency does not want to reward taxpayers who did not participate in the 2009 or 2011 disclosure programs because they anticipated that a future penalty would be lower.

In limited circumstances, taxpayers may qualify for a 12.5 percent penalty or a five percent penalty. Generally, taxpayers whose offshore accounts or assets did not surpass $75,000 in any calendar year may qualify for the 12.5 percent penalty.

The requirements for the five percent penalty are very narrow. The IRS has explained that taxpayers must meet four conditions: (1) The taxpayer did not open or cause the account to be opened; (2) the taxpayer exercised minimal, infrequent contact with the account, for example, to request the account balance, or update account holder information such as a change in address, contact person, or email address; (3) except for a withdrawal closing the account and transferring the funds to an account in the United States, the taxpayer did not withdraw more than $1,000 from the account in any year for which the taxpayer was non-compliant; and (4) the taxpayer can show that all applicable U.S. taxes have been paid on funds deposited to the account (only account earnings have escaped U.S. taxation).

The penalty amounts in the reopened program are not set in stone, the IRS cautioned. It may eventually increase penalties in the program for all or some taxpayers or defined classes of taxpayers.

Quiet disclosures

One goal of the three programs is to caution taxpayers against so-called “quiet disclosures.” A quiet disclosure occurs when a taxpayer files an amended return and pays any tax delinquency without making a formal voluntary disclosure. The IRS warned taxpayers making quiet disclosures that they risked being sanctioned to the fullest extent allowed by law.

Critics

The offshore disclosure programs were not without their critics. The National Taxpayer Advocate recently told Congress that the IRS should streamline what is a very complicated process. The National Taxpayer Advocate also reported that IRS examiners were assuming that all violations were willful unless a taxpayer presented evidence to the contrary. It is possible that the IRS may revisit some of the terms and conditions of the reopened program in light of the National Taxpayer Advocate’s report.

If you have any questions about the reopened offshore voluntary disclosure program, please contact our office.

Taxpayers with children should be aware of the numerous tax breaks for which they may qualify. Among them are: the dependency exemption, child tax credit, child care credit, and adoption credit. As they get older, education tax credits for higher education may be available; as is a new tax code requirement for employer-sponsored health care to cover young adults up to age 26. Employers of parents with young children may also qualify for the child care assistance credit.

Dependency Exemption

In addition to the personal exemption an individual taxpayer may take for him or herself to reduce taxable income (Line 42 on Form 1040), that taxpayer may also take an exemption for each qualifying dependent who has lived with the taxpayer for more than half of the tax year. A dependent may be a natural child, step-child, step-sibling, half-sibling, adopted child, eligible foster child, or grandchild, and generally must be under age 19, a full-time student under age 24, or have special needs. The amount of the exemption is the same as the taxpayer’s personal exemption, $3,700 for the 2011 tax year and $3,800 for the 2012 tax year.

Child Tax Credit

Parents of children who are under age 17 at the end of the tax year may qualify for a refundable $1,000 tax credit. The credit is a dollar-for-dollar reduction of tax liability, and may be listed on Line 51 of Form 1040. For every $1,000 of adjusted gross income above the threshold limit ($110,000 for married joint filers; $75,000 for single filers), the amount of the credit decreases by $50.

Child and Dependent Care Credit

If a taxpayer must pay for childcare for a child under age 13 in order to pursue or maintain gainful employment, he or she may claim up to $3,000 of his or her eligible expenses for dependent care. If one parent stays home full-time, however, no child care costs are eligible for the credit.

Adoption Credit

Taxpayers who have incurred qualified adoption expenses in 2011 may claim either a $13,360 credit against tax owed or a $13,360 income exclusion if the taxpayer has received payments or reimbursements from his or her employer for adoption expenses. For 2012, the amount of the credit will decrease to $12,650, and in 2013 to $5,000.

Higher Education Credits

There are two education-related credits available for 2012: the American Opportunity credit and the lifetime learning credit. The American Opportunity credit amount is the sum of 100 percent of the first $2,000 of qualified tuition and related expenses plus 25 percent of the next $2,000 of qualified tuition and related expenses, for a total maximum credit of $2,500 per eligible student per year. The credit is available for the first four years of a student's post-secondary education. The credit amount phases out ratably for taxpayers with modified AGI between $80,000 and $90,000 ($160,000 and $180,000 for joint filers). The lifetime learning credit is equal to 20 percent of the amount of qualified tuition expenses paid on the first $10,000 of tuition per family. The phaseout for 2012 ranges from $52,000 to $62,000 ($104,000 to $124,000 for joint filers). Parents also find tax relief in saving for college though Coverdell accounts, section 529 plans and specified U.S.. savings bonds.

Extended Health Care Coverage

Effective since September 23, 2010, the new health care law requires plans to provide coverage for children until they attain age 26. Further, effective on or after March 30, 2010, children under the age of 27 are considered dependents of a taxpayer for purposes of the general exclusion from income for reimbursements for medical care expenses of an employee, spouse, and dependents under an employer-provided accident or health plan. Therefore, a plan must provide coverage to a child who is still a dependent up to age 26; but can do so up to age 27 without income tax consequences. A child includes a son, daughter, stepson, or stepdaughter of the taxpayer; a foster child placed with the taxpayer by an authorized placement agency or by judgment, decree, or other order of any court of competent jurisdiction; and a legally adopted child of the taxpayer or a child who has been lawfully placed with the taxpayer for legal adoption.

Child Care Assistance Credit (for businesses)

Employers may take up to $150,000 of the eligible costs of providing employees with child care assistance as tax credit. These costs may include a portion of the costs of acquiring, constructing, improving, and operating a child care facility.

If you have any questions about these provisions and how they may benefit you, please contact our office.

The Treasury Department is authorized to offset a taxpayer’s tax refund to satisfy certain debts. A spouse who believes that his or her portion of the refund should not be used to offset the debt that the other spouse owes may request a refund from the IRS.

Offset

If an individual owes money to the federal government because of a delinquent debt, the Treasury Department’s Financial Management Service (FMS) can offset that individual's tax refund (and certain other federal payments) to satisfy the debt. The debtor will be notified in advance of the offset.

A taxpayer’s refund may be reduced by FMS and offset to pay:

• Past-due child support
• Federal agency non-tax debts
• State income tax obligations, or
• Certain unemployment compensation debts owed a state.

FMS advises taxpayers by written notice of an offset. FMS has explained that the notice will reflect the original refund amount, the taxpayer’s offset amount, the agency receiving the payment, and the address and telephone number of the agency. FMS will notify the IRS of the amount taken from your refund.

Form 8379

If a taxpayer filed a joint return and is not responsible for the debt of his or her spouse, the taxpayer may request his or her portion of the refund by filing Form 8379, Injured Spouse Allocation, with the IRS. Form 8379 may be filed with the original return or by itself after the taxpayer is aware of the offset.

The IRS has instructed taxpayers filing Form 8379 by itself to attach a copy of all Forms W-2 and W-2G for both spouses, and any Forms 1099 showing federal income tax withholding to Form 8379. Failure to attach these items may result in a delay in processing by the IRS.

The IRS has reported on its website that it generally processes Forms 8379 that are filed after a joint return has been filed in approximately eight weeks. The timeframe for processing a Form 8379 that is attached to a joint return is approximately 11 weeks (14 weeks if the joint return is filed on paper).

As an individual or business, it is your responsibility to be aware of and to meet your tax filing/reporting deadlines. This calendar summarizes important tax reporting and filing data for individuals, businesses and other taxpayers for the month of February 2012.

February 1

Employers. Semi-weekly depositors must deposit employment taxes for payroll dates January 25–27.

February 3

Employers. Semi-weekly depositors must deposit employment taxes for payroll dates January 28–31.

February 8

Employers. Semi-weekly depositors must deposit employment taxes for payroll dates February 1–3.

February 10

Employees who work for tips. Employees who received $20 or more in tips during November must report them to their employer using Form 4070.

Employers. Semi-weekly depositors must deposit employment taxes for payroll dates February 4–7.

February 15

Employers. Semi-weekly depositors must deposit employment taxes for payroll dates February 8–10.

Monthly depositors. Monthly depositors must deposit employment taxes for payments in January.

February 17

Employers. Semi-weekly depositors must deposit employment taxes for payroll dates February 11–14.

February 23

Employers. Semi-weekly depositors must deposit employment taxes for payroll dates February 15–17.

February 24

Employers. Semi-weekly depositors must deposit employment taxes for payroll dates February 18–21.

February 29

Employers. Semi-weekly depositors must deposit employment taxes for payroll dates February 22–24.

March 2

Employers. Semi-weekly depositors must deposit employment taxes for payroll dates February 25–28.

March 7

Employers. Semi-weekly depositors must deposit employment taxes for payroll dates February 29–March 2.

Estimated tax is used to pay tax on income that is not subject to withholding or if not enough tax is being withheld from a person's salary, pension or other income. Income not subject to withholding can include dividends, capital gains, prizes, awards, interest, self-employment income, and alimony, among other income items. Generally, individuals who do not pay at least 90 percent of their tax through withholding must estimate their income tax liability and make equal quarterly payments of the "required annual payment" liability during the year.

Estimated tax is used to pay tax on income that is not subject to withholding or if not enough tax is being withheld from a person's salary, pension or other income. Income not subject to withholding can include dividends, capital gains, prizes, awards, interest, self-employment income, and alimony, among other income items. Generally, individuals who do not pay at least 90 percent of their tax through withholding must estimate their income tax liability and make equal quarterly payments of the "required annual payment" liability during the year.

Basic rules

The "basic" rules governing estimated tax payments are not always synonymous with "straightforward" rules. The following addresses some basic rules regarding estimated tax payments by corporations and individuals:

Corporations. For calendar-year corporations, estimated tax installments are due on April 15, June 15, September 15, and December 15. If any due date falls on a Saturday, Sunday or legal holiday, the payment is due on the first following business day. To avoid a penalty, each installment must equal at least 25 percent of the lesser of:

-- 100 percent of the tax shown on the corporation's current year's tax return (or of the actual tax, if no return is filed); or

-- 100 percent of the tax shown on the corporation's return for the preceding tax year, provided a positive tax liability was shown and the preceding tax year consisted of 12 months.

A lower installment amount may be paid if it is shown that use of an annualized income method, or for corporations with seasonal incomes, an adjusted seasonal method, would result in a lower required installment.

Individuals. For individuals (including sole proprietors, partners, self-employeds, and S corporation shareholders who expect to owe tax of more than $1,000), estimated tax payments are due on April 15 (April 18 for 2011), June 15, and September 15 of 2011, and January 15 of 2012. Individuals who do not pay at least 90 percent of their tax through withholding generally are required to estimate their income tax liability and make equal quarterly payments of the "required annual payment" liability during the year. The required annual payment is generally the lesser of:

-- 90 percent of the tax ultimately shown on your return for the 2011 tax year, or 90 percent of the tax due for the year if no return is filed;

-- 100 percent of the tax shown on your return for the preceding (2010) tax year if that year was not for a short period of less than 12 months; or

-- The annualized income installment.

For higher-income taxpayers whose adjusted gross income (AGI) shown on your 2010 tax return exceeds $150,000 (or $75,000 for a married individual filing separately in 2011), the required annual payment is the lesser of 90 percent of the tax for the current year, or 110 percent of the tax shown on the return for the preceding tax year.

Adjusting estimated tax payments

If you expect an uneven income stream for 2011 your required estimated tax payments may not necessarily be the same for each remaining period, requiring adjustment. The need for, and the extent of, adjustments to your estimated tax payments should be assessed at the end of each installment payment period.

For example, a change in your or your business's income, deductions, credits, and exemptions may make it necessary to refigure estimated tax payments for the remainder of the year. Likewise for individuals, changes in your exemptions, deductions, and credits may require a change in estimated tax payments. To avoid either a penalty from the IRS or overpaying the IRS interest-free, you may want to increase or decrease the amount of your remaining estimated tax payments.

Refiguring tax payments due

There are some general steps you can take to reconfigure your estimated tax payments. To change your estimated tax payments, refigure your total estimated tax payments due. Then, figure the payment due for each remaining payment period. However, be careful: if an estimated tax payment for a previous period is less than one-fourth of your amended estimated tax, you may be subject to a penalty when you file your return.

If you would like further information about changing your estimated tax payments, please contact our office.

The tax rules surrounding the dependency exemption deduction on a federal income tax return can be complicated, with many requirements involving who qualifies for the deduction and who qualifies to take the deduction. The deduction can be a very beneficial tax break for taxpayers who qualify to claim dependent children or other qualifying dependent family members on their return. Therefore, it is important to understand the nuances of claiming dependents on your tax return, as the April 18 tax filing deadline is just around the corner.

The tax rules surrounding the dependency exemption deduction on a federal income tax return can be complicated, with many requirements involving who qualifies for the deduction and who qualifies to take the deduction. The deduction can be a very beneficial tax break for taxpayers who qualify to claim dependent children or other qualifying dependent family members on their return. Therefore, it is important to understand the nuances of claiming dependents on your tax return, as the April 18 tax filing deadline is just around the corner.

Dependency deduction

You are allowed one dependency exemption deduction for each person you claim as a qualifying dependent on your federal income tax return. The deduction amount for the 2010 tax year is $3,650. If someone else may claim you as a dependent on their return, however, then you cannot claim a personal exemption (also $3,650) for yourself on your return. Additionally, your standard deduction will be limited.

Only one taxpayer may claim the dependency exemption per qualifying dependent in a tax year. Therefore, you and your spouse (or former spouse in a divorce situation) cannot both claim an exemption for the same dependent, such as your son or daughter, when you are filing separate returns.

Who qualifies as a dependent?

The term "dependent" includes a qualifying child or a qualifying relative. There are a number of tests to determine who qualifies as a dependent child or relative, and who may claim the deduction. These include age, relationship, residency, return filing status, and financial support tests.

The rules regarding who is a qualifying child (not a qualifying relative, which is discussed below), and for whom you may claim a dependency deduction on your 2010 return, generally are as follows:

-- The child is a U.S. citizen, or national, or a resident of the U.S., Canada, or Mexico;

-- The child is your child (including adopted or step-children), grandchildren, great-grandchildren, brothers, sisters (including step-brothers, and -sisters), half-siblings, nieces, and nephews;

 -- The child has lived with you a majority of nights during the year, whether or not he or she is related to you;

 -- The child receives less than $3,650 of gross income (unless the dependent is your child and either (1) is under age 19, (2) is a full-time student under age 24 before the end of the year), or (3) any age if permanently and totally disabled;

 -- The child receives more than one-half of his or her support from you; and

 -- The child does not file a joint tax return (unless solely to obtain a tax refund).

Qualifying relatives

The rules for claiming a qualifying relative as a dependent on your income tax return are slightly different from the rules for claiming a dependent child. Certain tests must also be met, including a gross income and support test, and a relationship test, among others. Generally, to claim a "qualifying relative" as your dependent:

-- The individual cannot be your qualifying child or the qualifying child of any other taxpayer; -- The individual's gross income for the year is less than $3,650; -- You provide more than one-half of the individual's total support for the year; -- The individual either (1) lives with you all year as a member of your household or (2) does not live with you but is your brother or sister (include step and half-siblings), mother or father, grandparent or other direct ancestor, stepparent, niece, nephew, aunt, or uncle, or inlaws. Foster parents are excluded.

Although age is a factor when claiming a qualifying child, a qualifying relative can be any age.

Special rules for divorced and separated parents

Certain rules apply when parents are divorced or separated and want to claim the dependency exemption. Under these rules, generally the "custodial" parent may claim the dependency deduction. The custodial parent is generally the parent with whom the child resides for the greater number of nights during the year.

However, if certain conditions are met, the noncustodial parent may claim the dependency exemption. The noncustodial parent can generally claim the deduction if:

-- The custodial parent gives up the tax deduction by signing a written release (on Form 8332 or a similar statement) that he or she will not claim the child as a dependent on his or her tax return. The noncustodial parent must attach the statement to his or her tax return; or

-- There is a multiple support agreement (Form 2120, Multiple Support Declaration) in effect signed by the other parent agreeing not to claim the dependency deduction for the year.

Legislation enacted during the past few years, including the Small Business Jobs Act of 2010 and the more recently enacted Tax Relief, Unemployment Insurance Reauthorization, and Job Creation Act of 2010 (2010 Tax Relief Act), contains a number of important tax law changes that affect 2011. Key changes for 2011 affect both individuals and businesses. Certain tax breaks you benefited from in 2010, or before, may have changed in amount, timing, or may no longer be available in 2011. However, new tax incentives may be valuable. This article highlights some of the significant tax changes for 2011.

New payroll tax cut for wage earners

New for calendar 2011 is a payroll tax cut for wage earners and self-employed individuals. The payroll tax cut, as provided by the 2010 Tax Relief Act, reduces the employee's share of Social Security taxes by two percent, from 6.2 percent to 4.2 percent, for all wages earned during the 2011 calendar year, up to the taxable wage base of $106,800. Future Social Security is not affected by the payroll tax cut.

Many workers can expect to see an average tax savings of more than $1,000 as a result of the new payroll tax cut. For example, a single individual who earns $40,000 annually and is paid weekly will see an extra $15 in her paycheck every week. A single individual who earns $60,000 annually and is paid bi-weekly will see an extra $46 in her paycheck.

Self-employed individuals also benefit from the payroll tax cut. Self-employed individuals will pay 10.4 percent on self-employment income up to the threshold.

Payroll companies and employers are responsible for implementing the payroll tax cut; employees do not need to adjust their withholding or take any other action. However, it is always a good decision regardless to review your withholding to ensure you are not withholding too much or too little.

No more Making Work Pay Credit. The payroll tax cut replaces the Making Work Pay Credit (MWPC), which expired at the end of 2010 and was not renewed for 2011. The MWPC provided a refundable tax credit of up to $400 for qualified single individuals and up to $800 for married taxpayers filing joint returns for 2009 and 2010.

Residential energy improvement credits

For individuals who may be making energy-efficient improvements to their homes in 2011 important changes have taken place for a popular tax credit. The 2010 Tax Relief Act extended the Code Sec. 25C nonbusiness energy efficient property credit for homeowners for one year, through December 31, 2011. However, more restrictive rules apply for 2011 than applied in 2010. Effective for property placed in service after December 31, 2010, an individual is entitled to a credit against tax in an amount equal to:

• 10 percent of the amount paid or incurred for qualified energy efficiency improvements (building envelope components) installed during the tax year, and
• The amount of residential energy property expenditures paid or incurred during the tax year.

The maximum credit allowable is $500 over the lifetime of the taxpayer. The $500 amount must be reduced by the aggregate amount of previously allowed credits the taxpayer received in 2006, 2007, 2009 and 2010. There are certain restrictions on the amounts claimed for certain items as well. The amount claimed for windows and skylights in a year can not exceed $200 less the total of the credits you claimed for these items in all earlier tax years ending after December 31, 2005. The credit also can not exceed:

 -- $50 for an advanced main circulating fan;
-- $150 for any qualified natural gas, propane, or hot water boiler; and
-- $300 for any item of energy efficient property

Energy-efficient credit for contractors

The 2010 Tax Relief Act retroactively extends the new energy efficient home credit for eligible contractors for two years, through December 31, 2011. Eligible contractors can claim a credit of $2,000 or $1,000 for each qualified new energy efficient home either constructed by the contractor or acquired by a person from the contractor for use as a residence during the tax year.

Annuity contracts

Beginning in 2011, taxpayers may partially annuitize non-retirement plan annuity payments they receive from an annuity contract. This partial annuitization applies to amounts you receive in tax years beginning after December 31, 2010 and applies to such an annuity, endowment or life insurance contract. If you receive an annuity for a period of 10 years or longer, or over one or more lives, under any portion of the annuity, endowment or life insurance contract, that portion is treated as a separate contract for purposes of annuity taxation.

FSAs, HSAs and Archers MSAs

The Patient Protection and Affordable Care Act enacted in 2010 places new limits on flexible spending arrangements (FSAs), health savings accounts (HSAs) and Archer medical savings accounts (Archer MSAs). After December 31, 2010, a distribution from an FSA, HSA or Archer MSA for a medicine or drug is a tax-free qualified medical expense only if the medicine or drug is a prescribed drug (determined without regard to whether such drug is available without a prescription) or is insulin. Additionally, for distributions made after 2010, the additional tax on distributions from an HSA that are not used for qualified medical expenses increases significantly, from 10 percent to 20 percent of the disbursed amount. The additional tax on distributions from an Archer MSA that are not used for qualified medical expenses increases from 15 percent to 20 percent of the disbursed amount.

Simple Cafeteria Plans for small employers

Beginning January 1, 2011, certain small employers can adopt "simple cafeteria plans," which provide certain nontaxable benefits to employees. Eligible employers generally include those with an average of 100 or fewer employees on business days during either of the two preceding tax years. Benefits of simple cafeteria plans can include certain medical coverage, group-term life insurance, flexible spending accounts (FSAs), and dependent care assistance.

New electronic filing rules for employers

Nearly all employers must use the IRS Electronic Federal Tax Payment System (EFTPS) for federal tax payments made in 2011. Beginning after December 31, 2010, employers must use electronic funds transfer (EFT) to make all federal tax deposits, including deposits of employment tax, excise tax, and corporate income tax. After December 31, 2010, Forms 8109 and 8109-B, Federal Tax Deposit Coupon, can no longer be used.

Employer payroll tax forgiveness expires

Qualified employers who hired unemployed workers after February 3, 2010 and prior to January 1, 2011 may have been eligible for payroll tax forgiveness. The Hiring Incentives to Restore Employment Act (HIRE Act) provided temporary forgiveness of the employer-share of Social Security tax for eligible new-hires. For each worker retained for at least a year, businesses may claim an additional general business tax credit, up to $1,000 per worker, when they file their 2011 income tax returns.

New broker basis reporting rules

Beginning in 2011, generally all brokers who are required to file information returns reporting gross proceeds of a "covered security" (such as corporate stock), must include in the return the customer's adjusted basis in the security. A broker must report the adjusted basis and type of gain (long term or short term gain or loss) for most stock acquired on or after January 1, 2011.

Reporting is generally undertaken on Form 1099-B, Proceeds from Broker and Barter Exchange Transactions. A "covered security" includes all stock acquired beginning in 2011, as mentioned above, except for stock in a mutual fund (regulated investment company or RIC) or stock acquired in connection with a dividend reinvestment plan (DRP). Reporting for these and other types of securities and options will need to be reported beginning after 2012 and 2013.

Real estate reporting requirements

Beginning in 2011, taxpayers receiving rental income from real estate who make payments of $600 or more during the tax year to a service provider (excluding incorporated entities) must provide an information return to the IRS, as well as the provider, reporting the payments. Typically, the information is to be reported on Form 1099-Misc. Certain exceptions, such as for hardship or active members of the uniformed services or employees of the intelligence community apply.

These are just some of the many important tax changes that expired at the end of 2010 or take effect this year. Please contact our office if you have any questions.

Correctly calculating your estimated tax payments and/or withholding is even more important as the year end approaches. Accurate calculations are especially important as third and fourth quarter payments become due, and your income and expenses for the rest of the year can be more accurately projected.

Estimated tax payments

You are required to pay estimated tax if you receive income from which tax is not withheld, including income from self-employment, dividends and interest, capital gains and losses, rental income, and alimony, and your tax is expected to be $1,000 or more (after subtracting credits and withholding). Generally, individuals who do not pay at least 90 percent of their tax through withholding must estimate their income tax liability and make equal quarterly payments of the "required annual payment" liability throughout the year.

Higher-income taxpayers. For higher-income taxpayers whose adjusted gross income (AGI) shown on the preceding year's tax return exceeds $150,000 ($75,000 for married individuals filing separately), the required annual payment is the lesser of 90 percent of the tax for the current year, or 110 percent of the tax shown on the return for the preceding tax year.

Estimated tax payments are due quarterly. For most individuals, the due dates for the 2010 tax year are: April 15, June 15, and September 15 of 2010, and January 15, 2011. Failing to pay enough estimated tax on each installment date may result in a penalty for underpayment of estimated tax, even if you are due a refund. Therefore, properly calculating your payments is vital to avoid the penalties, including calculating adjustments needed in remaining quarters (including as soon as September 15, 2010 for the third quarter).

Third quarter payments are around the corner – September 15, 2010 – for the period June 1 through August 31. Fourth quarter payments will be due January 15, 2011 for the period September 1, 2010 through December 31, 2010. If your total estimated payments and withholding add up to less than 90 percent of what you owe, you may face an underpayment penalty.

Withholding

With the third and fourth quarter payments becoming due, ensure you are properly withholding and paying enough in estimated tax. Look at your projected year-end tax payments as compared with your expected tax liability to determine if your estimated tax payments need some tweaking. If your payments are expected to be less than 90 percent of current-year tax, you will generally need to increase your withholding or make estimated tax payments.

You may want to file a new W-4 with your employer adjusting your withholding to withhold more from your final paychecks for the year if you are currently underwithholding. This will help avoid being subject to a penalty when you file your return.

Adjusting estimated tax payments

A change in your business's income, deductions, credits, and exemptions may also make it necessary to refigure your estimated payments for the remainder of the year. To avoid either a penalty from the IRS or overpaying the IRS interest-free, consider increasing or decreasing the amount of your remaining estimated payments.

If, during the quarter, you learn that a change in your business's anticipated income, deductions, credits, exemptions, or other adjustments will either increase or decrease your business's tax liability, and therefore affecting your required annual payment for the remainder of the year, you should adjust your remaining quarterly payments accordingly.

Profit Margin 2nd Quarter 2006:
t        Red Ink Warning Signs: Can Your Business Pass the Test?
t        Maximize Your Tax Benefits for Care of Children and Dependents
t        Are You A Pro at Managing Your Money?

Profit Margin 1st Quarter 2006:
t        How to Avoid Identity Theft and What to do if Your Wallet is Lost or Stolen
t        Important Information for Employers who Pay Employees Salary While on Military Duty
t        Time to Sign Up for Medicare's Drug Benefit
t        Automatic Six-Month Extensions Available to Most Taxpayers in 2006

Profit Margin 4th Quarter 2005:
t        Treasury and IRS to Provide More Time to Spend FSA Funds
t        IRS to Accept Facsimile Signatures on Employment Tax Returns
t        Financial Modeling - Helping Businesss Develop and Implement Their Financial Strategy

Profit Margin 1st Quarter 2005:
t        IRS Boosts Base Rate for Mileage Allowances
t        Business Transition Planning
t        IRS Announces Pension Plan Limitations for 2005

Profit Margin 4th Quarter 2004:
t        Do You Qualify for the Research Tax Credit?
t        Recognizing Intangible Assets
t        Fraud Detection and Deterrence
t        New Break for Flexible Spending Accounts
t        Understanding Check 21

Profit Margin 3rd Quarter 2004:
t        President Bush Signs Bill Boosting Small Business Loans by More Than $3Billion
t        Civil and Criminal Enforcement Against Tax Evaders on the Rise
t        Tax Challenges of Hiring Household Employees

Profit Margin 2nd Quarter 2004:
t        Reduce Health Care Costs Now!
t        How Do You "Count" Inventory?
t        IRS to Target Executive Compensation
t        Is It Time To Consider Outsourcing?
t        Will You Die In 2010?

Profit Margin 1st Quarter 2004:
t        IRS Boosts Base Rate for Mileage Allowance
t        EFTPS Users Have Fewer IRS Tax Penalties
t        Real Estate Tax Planning
t        New Procedures Provide Flexibility for Like-Kind Exchanges
t        New Fraud Standards Issued

Profit Margin 4th Quarter 2003:
t        New Audit Standards for Detecting Fraud
t        Valuing Your Business
t        Assets and Earnings Valuation
t        College Funding Regulations Issued

Profit Margin 3rd Quarter 2003:
t        Controlling Healthcare Costs
t        AARP Survey Results
t        Do Not Call
t        Maximize 401(k) Contribution Benefits

Profit Margin 2nd Quarter 2003:
t        Containing Medical Insurance Costs
t        Tax Consideration in Home Refinancing
t        Analyzing Disability Insurance
t        Tax Relief for Some Taxpayers
t        Expensing Allowance Increased
t        Amend Your Pension Plans

Profit Margin 1st Quarter 2003:
t        Retirement Penalty
t        Are You Eligible for Government Benefits?
t        Check Your Discount Terms
t        Preparing a Personal Business Organizer
t        Reasonable Compensation Watch
t        Small Business Facts
t        Money-Purchase Pension Plan Alternative

Profit Margin 4th Quarter 2002:
t        Data Recovery Evaluation
t        Understanding Cash Flow
t        Do You Know Your Performance Standards?
t        IRS Expands Website
t        Planning For Your Retirement
t        Deducting Dollars and Pounds
t        Controlling Health Care Costs

Profit Margin 3rd Quarter 2002:
t        IRA, SEP and Simple IRA Tax Law Changes
t        Bad Debt Formulas
t        Self-Insured Health Coverage
t        Defined Contribution Health Plans
t        Section 529 Plans
t        Sale and Leaseback Transactions

Profit Margin 2nd Quarter 2002:
t        Controlling Labor Costs
t        Retirement Contribution Limits Increase
t        Salary Information Available
t        Protecting Your Privacy
t        Employee Fraud Alert
t        Financial Counseling for Workers

Profit Margin 1st Quarter 2002:
t        Measuring Your Collection Efforts
t        Preparing Your Cash Flow Statement
t        Compensation Tax Strategies

Profit Margin 4th Quarter 2001:
t        Electronic Billing Provides Advantages
t        New Educational Funding Opportunities Available
t        How Safe Is Your Information System?
t        Employee Retention Strategy

Profit Margin 3rd Quarter 2001:
t        Making Mid-Year Plan Elections
t        Streamlining Travel Expense Reimbursements
t        Fraud - Are You Protected?
t        How to Measure Web Site Effectiveness
t        401(k) Disclosure Form Available
t        Health Care Benefit Costs Are on The Rise

Profit Margin 2nd Quarter 2001:
t        Proposed Regulations Address Required
t        Distributions from Retirement Plans
t        Assisted Living Residents Often Can Deduct Their Entire Monthly Fees

Profit Margin 1st Quarter 2001:
t        Worker’s Compensation Insurance Premiums
t        The Graying of America’s Work Force
t        Reducing Risk in Mergers & Acquisitions
t        Proposed Regulations to Limit Retirement Plan Loans

Profit Margin 3rd Quarter 2000:
t        Good Invoicing Procedures Can Accelerate Cash Flow
t        Which Inventory Method Is Best?
t        Door Closed on Charity Tax Shelter
t        Set Up an Advisory Board

Profit Margin 2nd Quarter 2000:
t        Age-Weighted and Permitted Disparity Plans Provide Business Ownership with Greater Retirement Benefits
t        Separate Business From Building
t        You Can Still Open and MSA
t        Choosing the Right Lease

Profit Margin 1st Quarter 2000:
t        Spousal Liability for Tax Refunds
t        Payroll Audits Are Crucial
t        2000 Standard Mileage Allowance Announced
t        2000 Social Security Wage Base Announced
t        Calculate Overtime Pay the Right Way

Profit Margin 3rd Quarter 1999:
t        Effective Income Statements
t        Is an ESOP Right for Your Business?
t        Credit and Liquidity
t        Alternative Minimum Tax Frequently Triggered

Profit Margin 2nd Quarter 1999:
t        Moratorium on Internet Taxes
t        Good Bank Relations
t        Refinancing a Home
t        Retirement Planning for Individuals
t        Home Office Deductions

Profit Margin 1st Quarter 1999:
t        Benefits of Activity-Based Costing System
t        “Back-Door” Tax Increases
t        Develop a Business Plan
t        Use Debt to Finance Your Business
t        Financing Education with an IRA

Profit Margin 4th Quarter 1998:
t        IRS Restructuring and Reform Act of 1998
t        Measuring Your Business Acumen
t        Disposing of a Company Car
t        Cash Is King

Profit Margin 3rd Quarter 1998:
t        Business Process Engineering
t        CSP Settles Dispute Over Worker Classification
t        Tax-Free Distribution or Loan
t        Where are You Going?
t        Home Sellers Must Furnish New Information
t        Retain Earnings Without Penalty
t        Deadline Extended

Profit Margin 2nd Quarter 1998:
t        Inventory Management
t        Tax Impact of Benefits
t        Measure Worker Productivity
t        How Much Will You Need?
t        More Choices for IRA’s
t        Considering Entrepreneurship?

Profit Margin 1st Quarter 1998:
t        So, You Want to Be Rich?
t        Timely Financial Information
t        Storing Records Electronically
t        Understanding Cash Flow Statements
t        Benchmarking Made Easy
t        Develop Budgeting Systems

Profit Margin 3rd Quarter 1997:
t        When the IRS Calls
t        Uncovering Fraud
t        Thinking of Selling Your Business?
t        Is Your Data Protected?
t        IRS Unveils 1997 Audit Plans

Profit Margin 2nd Quarter 1997:
t        Re-Engineer What?
t        Tax Deductions Strategy
t        Give More Than Money
t        Protect Your Computer System
t        Estate Planning Faux Pas
t        Will You Be Audited?

Profit Margin 1st Quarter 1997:
Re-Automating
What Lenders See
Ready to Outsource?
T.I.N.
Fraud Alert
Check Your Coverage

Profit Margin 4th Quarter 1996:
Highlights for Business Owners
Highlights for Individual Taxpayers
Medical Savings Accounts/Long-Term Care Highlights
Retirement Plans/Pension Simplification Highlights
1996 Bookkeeper’s Salary Survey Results

Profit Margin 3rd Quarter 1996:
t        Internal Revenue Service Audit Updates
t        Tax Court Updates
t        Dealerships: Receivables and Constructive Dividends
t        Dealer: Downsizing and Project 2000

Profit Margin 2nd Quarter 1996:
t        Long-Term care Insurance
t        Downsizing’s Downside
t        Computer-Related Fraud
t        Is Your Compensation Reasonable?
t        Split-Dollar Insurance Arrangements
t        Surviving a Credit Crunch

Profit Margin 1st Quarter 1996:
t        Rise in FICA Threshold
t        Monitoring Cash Availability
t        Constructive Dividends vs. Loans
t        Reducing Health Care Costs
t        Should You Refinance?
t        Detecting and Deterring Fraud

Contractor Chronicles 2nd Quarter 2006

t        Preventing Profit Washouts
t        Indirect Job Costs
t        Equipment Costs - Don't Break the Bank

Contractor Chronicles 1st Quarter 2006

t        Surety: A Whole New World
t        2006 Inflation Adjustments Widen Tax Brackets, Change Tax Benefits
t        Six-Month Automatic Extensions Available to Most Taxpayers in 2006

Contractor Chronicles 4th Quarter 2005

t        Are You Complying with Payroll Recordkeeping Requirements?
t        Excise Taxes - Construction Tax Tips

Contractor Chronicles 1st Quarter 2005

t        Valuation Traps for Engineers and Contractors

Contractor Chronicles 3rd Quarter 2004

t        Rules of Ownership
t        Profit Fade
t        Building Profits Through Planning
t        When Strategy Doesn't Work

Contractor Chronicles 2nd Quarter 2004

t        Measure What Matters
t        Like-Kind Exchanges Provide Greater Flexibility
t        Use an Accurate Process for Costto-Complete Projections

Contractor Chronicles 1st Quarter 2004

t        Volume vs. Profit
t        Collecting Receivables
t        Managing Cash Before Earnings

Contractor Chronicles 4th Quarter 2003

t        Controlling Overhead Costs
t        Surviving and Employment Tax Audit?
t        Income Tax - Deductions for Transferred Contracts Denied
t        Federal Highway Vehicle Use Tax
t        Fuel Tax Credits and Refunds

Contractor Chronicles 3rd Quarter 2003

t        50-50 Ownership: Can it Work?
t        Enhancing the Value of Your Business

Contractor Chronicles 2nd Quarter 2003

t        50-50 Ownership: Can it Work?
t        Enhancing the Value of Your Business

Contractor Chronicles 1st Quarter 2003

t        Forecasters Say Construction Industry's Outlook is Positive
t        Less May Be Better: Fewer Presenations Yield More Work
t        Track Revenues and Costs
t        C Corporation Sales Strategy

Contractor Chronicles 4th Quarter 2002

t        Sucession Planning: Launching the Next Generation
t        Strategic Planning: More Trouble Than It's Worth?
t        Growing Needs for Consulting Services
t        Are ESOPs for You?

Contractor Chronicles 3rd Quarter 2002:

t        Equitable Distribution for Your Heirs: Can It Be Done?
t        Contractor Killers

Contractor Chronicles 2nd Quarter 2002

t        An Industry in Turmoil: How You Can Protect Yourselves
t        Identify Problem Areas to Increase Your Profit Margin

Contractor Chronicles 1st Quarter 2002:

t        Fraud: Is It Costing Your Company Money?
t        How You Can Have A Thriving Business In A Shrinking Economy
t        Tips For Helping Your Business Grow

Contractor Chronicles 4th Quarter 2001:

t        Internal Revenue Service Issues Targets More Contractors
t        Internal Revenue Service Unveils New Website
t        Contractor Killers

Profit Drivers Volume 4, Issue 1

t        Deferred Compensation - The IRS Extends Deadlines for Compliance With Nonqualified Deferred Compensation Rules
t        IRS and Treasury Provide Guidance to Hybrid Manufacturers
t        Employee Retirement Plans
t        Do Your F & I Practices Comply

Profit Drivers Volume 3, Issue 4

t        Dealer Performance Hinges on Asset Management
t        Reduce Your Exposure to Payment Packing
t        Sales Tax Audits on the Rise

Profit Drivers Volume 3, Issue 3

t        The FACTA "Disposal Rule" Kicks In
t        Treasury and IRS to Provide More Time to Spend FSA Funds

Profit Drivers Volume 2, Issue 4

t        Pay for Performance
t        Automotive Sales Industry

Profit Drivers Volume 2, Issue 3

t        Controlling Insurance Costs

Profit Drivers Volume 2, Issue 2

t        Parts Management
t        GLB Act Secures Financial info

Profit Drivers Volume 2, Issue 1

t        What is Your Dealership Worth?
t        Tax Planning Strategy
t        IRS Targets Dealerships

Profit Drivers Volume 1, Issue 4

t        Customer Receivable Control

Profit Drivers 3rd Quarter 2003

t        Service Department Retail Pricing Strategy
t        Change of Accounting Method for Trade Discounts, Factory Incentives and Advertising Charges Can Result in Significant Tax Reductions for Auto Dealers

Profit Drivers 2nd Quarter 2003

t        Cost Segregation Studies Create Savings that Flow Right to the Bottom Line
t        Can You Benefit from a Cost Segregation Study?
t        Audit-Proofing Your Automotive Dealership

WITH THIS ISSUE AUTO FOCUS CHANGED ITS NAME TO: "PROFIT DRIVERS:

Profit Drivers 1st Quarter 2003

t        Fraud - Don't Be A Victim
t        Business Planning for Success
t        Buy-Sell Land Mines
t        

Auto Focus Winter 2003

t        Answering the Call of New Telephone Technology
t        Sucession Planning Crucial for Dealerships
t        Dispute Arbitration No Longer Mandatory
t        Avoiding Employee Fraud

Auto Focus Fall 2002

t        Are Service Advisors Eligible for Overtime?
t        Save Money by Outsourcing Loaners and Rentals
t        IRS Open Door to Tax Savings for Dealers
t        Dealer Fraud Alert

Auto Focus Spring 2002

t        Dealer Fraud Alert
t        Spot Delivery: Are They Worth the Trouble?

Auto Focus Winter 2002:

t        Profiles of a Fraud Perpetrator
t        Asset Management Critical to Dealer Performance
t        Complying With Federal Privacy Regulations

Auto Focus Fall 2001:

t        Employee Demo Vehicles and the Tax Law
t        I Disclosure Rules Under the Truth and Lending Act
t        Weighing Floor-Plan Options

Auto Focus Summer 2001:

t        Can Your Dealership Survive an IT Disaster?
t        Avoid Minimum Wage Trap When Paying Salespeople

Auto Focus Spring 2001:

t        Simplified Method Under Section 263A Could Result in Tax Savings
t        I Can Pick Up Income Slack
t        Dealer Fraud Alert

Auto Focus Summer 2000:

t        Benefits of a Well-Negotiated Computer Contract
t        Wean New Salespeople Off Salaries
t        Selling Advantages of Leasing

Auto Focus Spring 2000:

t        Increase Profits by Removing Wall Between Parts and Service
t        Used Cars: Tips for Managing Excess Inventory
t        Turn Inventory While Economy is Good
t        Website Helps Dealers Shed Old Inventory

WITH THIS ISSUE DEALER NEWS CHANGED ITS NAME TO: "AUTO FOCUS"

Auto Focus Winter 2000:

t        Court Rejects Valuation of Cars Offered as Fringe Benefits
t        Dealer Fraud Alert
t        Cost Segregation Study Can Save Taxes

Dealer News Summer 1999:

t        Profitable Body Shop Requires Financially Savvy Manager
t        To Measure Service Department Profitability, Count Technicians’ Labor as Inventory
t        Service Department Open Longer
t        Web Site Helps Define Your Marketing Strategy

Dealer News Spring 1999:

t        Major Setback for Dealer Parts Inventories
t        Do You Have an Internet Strategy?
t        Is the Estate Tax on Its Deathbed?
t        Y2K Update: Contingency Planning is Critical
t        Watch Out for Independent Contractor Tax Trap

Dealer News Winter 1999:

t        Incentive Payments Aren’t Wages, IRS Says
t        Dealership Real Estate: Consider the Family Limited Partnership
t        Automotive Industry Resource on the Internet
t        Benchmarking Your Performance
t        Should You Consider a Strategic Roll-Up?

Dealer News Fall 1998:

t        Be Prepared for Form 8300 Audit
t        Dealer Alert: Hot IRS Exam Issues
t        What’s Your Profitability Point?
t        LIFO Relief Extended to Medium and Heavy-Duty Trucks
t        Choose 401(k) Administrator with Care

Dealer News Summer 1998:

t        The Year 2000 Is Approaching: Are You Ready?
t        Focus on Fraud
t        Valuing an Auto Dealership

Dealer News Spring 1998:

t        Employee Use of Demo Vehicle
t        Auto Dealers Targeted for Minimum Wage Compliance
t        Public Companies Continue to Acquire Privately Held Dealers
t        LIFO Conformity Alert

Dealer News Winter 1998:

t        Finding Better Ways to Serve Consumers
t        Consult Advisor Before Embracing REIT
t        Legal and Tax Briefs
t        Give Your Sales Force a Tune-Up

Dealer News Fall 1997:

t        Internal Revenue Service Provides Guidance on LIFO Conformity
t        Taxpayer Relief Act Provides Planning Opportunities
t        Used Cars: Managing Excess Inventory
t        Going Public: An Appropriate Strategy for Auto Dealers?