Federal Tax Watch Special Edition 2009

Mid-Year Tax Planning for 2008

Federal Tax Watch

General Business/Management Strategies

How to place fair value on minority interests
One plus one equals two, right? If we can agree on this, we can also say that the sum of the parts equals the whole. But, as logical as this theory may seem, it may not hold true when determining the value of a shareholder’s minority interest in a business.

Use wire transfers with care
Moving money by wire transfer eliminates some of the risk of forgery and fraud schemes of using paper checks. But if you don’t have proper procedures in place, it can also be a way that unscrupulous people can move enormous amounts of money out of your accounts, possibly into non-U.S. accounts.

How to reduce stress in the workplace
Stress has been described as America's No. 1 health problem. Some studies suggest that 75 percent of all primary care physician visits are for stress-related problems. Today, concerns about the economy and national security weigh heavily on the minds of employees. While employers can do little to reduce these stressors, they can work to reduce job-related stress by focusing on the most frequent causes.

Family Business/Succession

Difficult employee? Respond wisely
Employees are human. That means they are subject to human foibles and failings. You may even be more aware of this if they are family members. You can live with minor quirks, so you probably overlook them. But when an employee’s difficult behavior begins to affect their job performance or other staff and customers, a manager has a duty to intervene.

Hiring your kids pays off for everyone
If you're like most parents, you probably spend a great deal trying to meet the needs and wants of your growing children. If you run your own business, you have a unique opportunity to provide your children with a sense of responsibility and gain some tax advantages at the same time. The tax law allows you to hire your children as part-time employees of your business. If you give them age-appropriate responsibilities and pay them reasonable compensation for their time and effort, you can deduct their pay as a business expense.

Trouble with peers? Change your actions
You are a manager. There are other managers – your peers, and perhaps even your relatives – with whom you do not get along. You may view them as "difficult." They may view you as difficult, too. But you have to work with them. What can you do to ease the conflict and improve cooperation?

Manufacturing

Creativity key to assigning extra work
When you have to spread an absent employee’s duties around, how can you ease the load for the bearers of that burden? What might bolster team morale and motivation? Here are some ideas.

Where to cut employee expenses
Cutting expenses may be necessary during an economic downturn. At some point, you may have to make tough choices to keep your business viable.

Don't fall victim to procurement fraud
Procurement fraud extends across many industries, and the types vary in sophistication. It arises from contract management and the outsourcing of goods and services. Identifying the risks of procurement fraud will aid in safeguarding your organization from falling victim.

Construction

Investors find relief from like-kind limbo
There is now relief for property owners who couldn't complete a like-kind exchange because their qualified intermediary entered into bankruptcy or receivership. You may now use a special safe harbor method to report gain or loss, and the IRS won’t treat you as being in receipt of the exchange proceeds.

Old concept still works: Manage by walking around
In 1982, Tom Peters and Robert Waterman published an acclaimed business book called "In Search of Excellence." They espoused a practice of “management by walking around” as a way to achieve excellence. They were on to something then, and the lesson still applies today.

Property improvements can save you taxes
When selling investment property, sometimes major expenditures, such as a new roof, an addition or remodeling can result in a quicker sale – perhaps at a higher selling price. On the other hand, if you don’t expect the market to yield a price sufficient to recover the additional investment, you may be tempted to forgo the additional cost. But that decision could prove to be shortsighted. Keep in mind that the tax law may act to soften the blow of your pre-sale expenditures.

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