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MARK BLACKWELL: Key legislative issues for business owners

Mark Blackwell

Mark Blackwell

With the mid-term elections behind us and Congress returning to Washington soon, business owners and operators are wondering what the new year may have in store for them.  Here are four key national issues that could affect how you run your business in the years ahead:

Immigration Reform

There’s ongoing debate nationwide over the need to overhaul U.S. immigration rules, especially in light of the President’s recent executive order relaxing the enforcement of many of those rules.  Some business leaders that rely on workers with specific skill sets, such as engineering and construction firms, want to loosen immigration rules further to provide them with better access to a talented or low-cost workforce.  Others see relaxing immigration rules as exacerbating an already high U.S. unemployment rate.  Even though comprehensive reform is unlikely, some key elements of a bipartisan bill passed by the Senate in 2013 will likely continue to be discussed.

» E-Verify is an online government service that allows employers to check if someone is eligible to be legally employed in the United States.  If the Senate bill becomes law, businesses will be required to use E-Verify to check on prospective employees.

» The Senate bill would create two new types of entrepreneur visas available to foreign business people who reach specific thresholds, including the amount of capital they raise for their ventures, the number of jobs their new company would create, and the revenue generated.

» H-1B visas allow workers with specific skills to come to the United States for temporary work assignments.  The Senate bill would raise the number of H-1B visas granted every year and loosen their restrictions.

Taxes

Many high-earning business owners saw their income and investment taxes rise in 2013, but some politicians want to reduce the burden on small-business owners or make large corporations pay more.  Here are some of the issues being considered:

» Among the dozens of small business tax reform bills floating through Congress, the one receiving the most attention is a proposal to require all businesses to use accrual accounting rather than cash accounting.  This could especially impact service industry professionals such as doctors, engineers, and attorneys.

» There have been increased calls to lower the corporate tax rate in an attempt to stem the flow of so-called inversions, in which U.S. corporations reduce their taxes by acquiring or merging with an overseas company.

» In July, the House voted to make the “bonus depreciation” temporary tax credit permanent in hopes of encouraging business investment, whereas the Senate is considering a two-year extension.   The credit allows a business to immediately deduct half the cost of many capital investments.

» A proposed online sales tax law may be back in play.  A bipartisan group of senators introduced the Marketplace and Internet Tax Fairness Act, which would allow state and local governments to collect sales taxes from out-of-state companies that sell and ship products into their state, even if they don’t have a physical presence there.

Minimum Wage and Other Regulatory Matters

Although there has been little movement in Washington on President Obama’s call to raise the minimum wage to $10.10 per hour, several cities and states have already raised their base wage above $9 — and several others are considering it.  Meanwhile, other regulatory proposals and recent changes likely to take center stage as the 2016 election season heats up are stricter greenhouse gas rules from the EPA and proposed changes to the Clean Water Act.  These would impact certain industries more than others, particularly utilities, farming, and construction.

Federal Healthcare Reform

While the future and implementation of the Affordable Care Act will continue to be debated in Congress, small-business owners still have to ensure they’re following the current laws.  Here are some recent developments with the ACA:

» In February 2014, the Obama administration pushed back some of the deadlines for employers to provide health coverage to workers.  Companies with 50 to 99 full-time employees now have until 2016 to provide coverage under Obamacare – a year later than expected.  Companies with 100 or more employees must offer insurance in 2015, but only to 70 percent of their full-time employees.

» Businesses with fewer than 25 employees may be eligible for the Small Business Health Care Tax credit.  The maximum credit for tax year 2014 and beyond is 50 percent of the premiums paid for qualified employee health insurance.

And if all that isn’t enough, the change in congressional leadership following the mid-term elections and the President’s willingness to issue additional executive orders could further complicate the legislative and regulatory environment for small-business owners in 2015!

» Mark Blackwell is a Certified Wealth Strategist® and the Mississippi Area Executive for Regions Private Wealth Management.  He can be reached at mark.blackwell@regions.com. 

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