4Thought Blog

Certified Exit Planning Advisor Andy Kahn, a shareholder with Concannon Miller, was quoted in a recent Lehigh Valley Business article about the current state of business mergers and acquisitions (M&A). Check out his insight and advice below:

The tax laws and accounting policies for construction and real estate development companies are unique and particular. If your accountant doesn’t have the industry experience, you’re likely missing out on some significant tax savings.

Did you incur costs during the building and construction or purchase of your facility? You can likely accelerate some deductions with a cost segregation study, an engineering-based analysis of the costs associated with the acquisition, construction, or renovation of a building.

No matter how your construction or construction-related company is set up tax wise, the new federal tax reform rules should offer your company some significant tax benefits.

If you’re a C Corporation, the biggest benefit is the reduction of tax rates ranging from 15% to 35% to a flat 21% rate. The Corporate Alternative Minimum Tax also has been repealed.

If you’re the owner of pass-through entity – an S Corporation, partnership or sole proprietorship – there’s also a major new business deduction for you. It’s not as easy to understand, but in some cases may be more beneficial.

And while the new federal tax law includes many benefits for businesses, there are some losses as well. Read on to learn about the most significant changes.

Much is being discussed about the new federal tax law – and rightfully so as it’s the biggest federal tax overhaul in at least 30 years.

But little in the U.S. Tax Cuts and Jobs Act will affect your 2017 return, i.e. the one due this spring. The new federal tax rules should bring significant tax savings for many businesses, but for your return due this spring, you’ll still be operating under the tax rules in effect through year end 2017.

While not as generous as the new tax law, there are still many tax benefits businesses can take advantage of. And with business tax rates dropping in 2018 between the C Corp rate cut and the new Qualified Business Income Deduction for owners of pass-through companies, reducing your 2017 taxable income is even more impactful.

Here are six strategies business executives should be aware of:

Every business wants to maximize profitability.

For general contractors and specialty trade contractors, a great financial tool to analyze job performance and find ways to boost the bottom line is a gain-fade analysis.

Most construction companies prepare work in progress (WIP) schedules, which help determine where a project currently stands on profitability. But for a more in-depth analysis of your profitability over time, a gain-fade analysis is a critical tool.

There are several ways to reward your top employees: promotions, raises, better benefits.

But for your truly top employees there’s another option to consider – equity in the company.

It’s a lot to consider – you’ll be sharing ownership of your company. But there also are a lot of upsides – you’ll be rewarding your best employees. They’ll be personally sharing in your company’s success. And it’s also a great way to start a possible succession plan.

Some CFOs serve as their companies’ directors of operations or administration. But even if administration or operations aren’t your official duties, they’re still areas where CFOs can add value to their companies.

Previously, we talked about the benefits of CFOs participating in strategic planning. But there are significant benefits to actively participating in your company’s daily operations as well.

In today’s business climate, every key management position needs to offer more value, and the Chief Financial Officer is no exception. Due to the broadening scope of the role, it’s crucial for CFOs to go beyond their financial reporting duties and take an active role in their company’s strategic planning.

Your financial expertise is a strength that can be leveraged in multiple scenarios. That knowledge can be used in partnership with identifying the key constraints holding back your company’s growth.

The following seven questions will help you determine those constraints – and how you, as a strategically-minded CFO, can help overcome them:

Small business owners wear lots of hats – in addition to your CEO duties, you may also handle your company’s operations, marketing and hiring. You might even shovel the sidewalks in the winter.

A critical job responsibility that should always be on your mind is that which a CFO handles. Your company may not be big enough to warrant having a CFO, but that doesn’t mean you shouldn’t think like one.