Day: August 19, 2022

What AI & Robots Can Do For Your Construction Business

Thanks to the Infrastructure Bill construction is positioned to benefit from an abundance of work over the next several years.

With $100 million budgeted for advanced digital construction management systems and related technology solutions, no doubt Artificial Intelligence (AI) and robotics will play an important role in rebuilding America’s infrastructure.

Especially when dealing with the restrictions put in place during the COVID pandemic, a growing number of construction companies were compelled to use new AI and robotics in various capacities to keep work going. Unexpectedly many found a new way to address staffing challenges, while transforming the way they work. As one of the least automated industries, huge potential lies ahead.

So, what are construction companies currently using/planning to use AI and robots to do? Here’s a sampling…

Architectural planning

Drones help map out projects before they begin and identify things like terrain elevations and water tables so plans can be adjusted to avoid issues later.

Ceiling drilling and overhead work

After identifying ceiling work as one of the most strenuous and stressful aspects of construction, a mobile drilling robot was created to work alongside installation teams drilling ceiling holes and using building information modeling (BIM) to promote accuracy.

Compacting/rolling

Primarily used in road construction, an autonomous roller is operated via computer or a geofence defining the area to be rolled. The operator can select the layer thickness, measure material stiffness, and monitor the force required to achieve desired results.

Creating concrete structures

Robot assisted technology uses an automated prefabrication process to create a 3D steel-mesh structure that gets filled with a concrete mix without formwork. It can be used to customize and optimize concrete structures and for producing complex forms for building.

Demolition

Remote controlled demolition robots can demolish buildings with a variety of robotic arms designed to break, crush, and drill through materials.

Emergency response

Drones can monitor bad weather events and provide valuable information to emergency response teams to aid with disaster response.

Excavating/hauling/loading

Heavy machinery – like excavators, dozers, and loaders – can be operated remotely to dig trenches, load and haul debris, and more. Some of the biggest manufacturers of heavy machinery already incorporate these capabilities into their equipment, while others are creating ways to retrofit existing equipment. For smaller sites, an Automated Track Loader can see where it’s going and measure material excavated using a combination of GPS, satellites, and onsite base stations.

Impact protection

For both road and building construction, specially equipped trucks can be programmed to drive autonomously and protect crews from other vehicles.

Laying bricks

One bricklaying robot works with two masons – one to maneuver it and load its materials while the other conceals wall ties, removes excess mortar, and lays bricks in hard-to-reach areas. Another type of robot uses 3D CAD models to build walls and block structures.

Layout and measurement

A robot navigates a construction site to do layout and measurement tasks using CAD drawings or BIM models.

Lifting and moving materials

Exoskeletons that workers wear and self-propelled equipment make lifting, moving, and drilling easier and safer, while also boosting productivity.

Post construction monitoring and maintenance

AI can help building managers collect information to monitor performance, identify potential issues, and decide when preventative maintenance is needed.

Safety and security

Drone technology can conduct repetitive security risk assessments, quality control inspections, and safety checks and then relay information via a mobile device or app to a project manager in a safe location.

Site/project/building inspections and monitoring

Field robotics can be used to check for a variety of issues so they can be addressed before escalating. They can examine buildings, structures, and work sites for issues (i.e., cracks and water infiltration) and structural defects. There’s even a robotic dog that can travel almost anywhere on a construction site while carrying scanning and data collection software to help ensure on-time and in-budget projects.

Tying rebar

A robot can continuously tie rebar with one person overseeing its work. A counterpart robot is in development to carry and place up to 5,000 pounds of rebar.

There are other solutions doing everything from automating piling rigs to painting and finishing drywall and paddings.

These solutions deliver a variety of benefits from decreasing waste, shortening project timelines, decreasing carbon footprints, and reducing errors to boosting productivity and quality, while saving money and other resources. While there are still challenges that need addressing – like the cost of new systems and equipment, variability from site to site, lack of regulations, and quickly scaled errors – many suggest the pros far outweigh the cons.

While you focus on your operations, you can count on RBT CPAs to focus on your tax, audit, and accounting needs. Give us a call today.

Get a Tax Credit for Hiring Targeted Workers

If your organization is struggling to find talent – a common position given the Great Resignation of 2020/2021 and a continuously tight labor pool, you may want to tap into groups that have traditionally faced significant barriers to employment. While helping you address staffing challenges and boost workforce diversity, it may also result in valuable federal tax credits through 2025 – a worthwhile proposition given the escalating benefit and payroll spending you may be experiencing as you compete for talent.

The Work Opportunity Tax Credit (WOTC) has been around in various forms for decades. The Federal government updated it during the COVID pandemic to encourage employers to keep targeted workers on payroll and to encourage hiring them to rebuild staff following the worst of the pandemic. The WOTC was set to expire in 2020 but has been extended until December 31, 2025. It is jointly administered by the Internal Revenue Service (IRS) and the Department of Labor (DOL).

Targeted groups covered under the WOTC for taxable businesses include qualified IV-A recipients; qualified veterans (including disabled veterans); ex-felons; designated community residents; vocational rehabilitation referrals; summer youth employees; Supplemental Nutrition Assistance Program (SNAP) recipients; Supplemental Security Income recipients; long-term family assistance recipients; and qualified long-term unemployment recipients. For tax-exempt organizations, qualified veterans are the only group eligible. Employees related to the employer or certain owners of the employer are not eligible. (For definitions of eligible targeted groups, click here.)

On or before the day a job offer is made, you and the applicant must complete Form 8850, along with ETA Form 9061 or ETA Form 9062. Within 28 days of hiring an employee, you must submit the forms to the state workforce agency to verify the employee is a first-time qualifying member of a targeted group. You’ll receive confirmation on whether the employee meets eligibility criteria. Then, you can file for a tax credit ranging from $2,400 to $9,600 for each targeted worker through 2025.

Taxable employers claim the tax credit as a general business credit against income taxes on Form 3800. The credit cannot exceed business income tax liability.

Qualified tax-exempt organizations claim the credit against payroll taxes using Form 5884-C. The credit cannot exceed Social Security taxes owed.

(For auditing purposes, all forms should be retained for a period of four years.)

There is no limit on the number of employees you can claim credits on, but there are limits on the value of credits. At a for-profit employer, a WOTC credit equals 40% of the first $6,000 of a targeted employee’s qualified first year wages for 400+ hours of service, for a maximum credit of $2,400. If an employee completed less than 400 hours of service but at least 120 hours, the credit is up to 25% of the first-year eligible wages or $1,500. A different maximum credit calculation may apply for qualified veterans and summer youth employees. Note! Certain wages – like federally funded on-the-job training – do not qualify for the WOTC credit.

At a not-for-profit employer, a WOTC for a qualified veteran equals 25% of qualifying first-year wages for 400 hours of service or 16% for at least 120 hours of service but less than 400.

To learn more, visit the DOL website, which has a fact sheet, reference guide, and more information on definitions of targeted groups. The IRS website has complete details, FAQs, links to forms, and more. The NYS Department of Labor website has additional information and resources.

If you have any questions or need assistance on this or any accounting, bookkeeping, tax, or audit requirements, RBT CPAs are here to help. Give us a call.

How Inflation Is Impacting 2023 Benefits & Compensation Planning

With four and a half months remaining in 2022, benefits and compensation planning are high on the list of priorities for everyone from Chief Financial Officers (CFOs) and Human Resources (HR) teams to Total Rewards staff, and for good reason.

In the past, it was common for employers to ask employees to share the burden in a tightening economy by foregoing pay increases and/or absorbing more of the cost of benefits and out-of-pocket costs (David Ried, “The Impact of Inflation on Your Business’ Benefits,” Forbes). However, as companies plan for 2023 compensation and benefits, it seems the Great Resignation and tight labor market are taking things in a different direction. To boost recruitment and retention, many companies are looking to enhance pay and limit the impact higher benefit costs may have on employee income.

According to the Bureau of Labor Statistics, consumer prices rose 9.1% from June 2021 to June 2022 – that’s a 41-year high. As reported by Goldman Sachs/AYCO, “Real hourly earnings (which is wage growth minus inflation) have actually declined 3% since last May—meaning many employees have effectively gotten a pay cut this year.”

Mercer’s Global Talent Trends 2022: Rise of the relatable organization revealed enhancing total rewards packages are among the top three HR priorities, which makes sense considering employees surveyed ranked their priorities as job security, remote work, pay, fair reward practices, vacation/time-off, and medical insurance.

Gartner surveys conducted in early 2022 found 20% of firms are planning more frequent salary reviews, while 15% are exploring four-day workweeks and alternative schedules. In Mercer’s Global Talent Trends 2022: Rise of the relatable organization, top strategies for talent retention were identified as offering more rewards and compensation; increasing compensation for those below benchmarks; proactively adjusting pay to promote internal equity; increasing employer benefit costs so employee take-home pay increases; increasing retention bonuses; offering more personalized rewards packages; and more.

Other compensation strategies companies are pursuing include one-time market adjustment bonuses; minimum wage increases; pay increases for a specified period (i.e., six months); having more frequent merit pay reviews; increasing average raises, and more.

When it comes to benefits, companies are pursuing a variety of strategies for their 2023 programs. Financial, mental, and emotional wellness budgets are increasing. Some employers are offering lifestyle accounts, giving employees hundreds or thousands of dollars to use as they please on a variety of expenses. Paid Time Off policies are being modified to allow employees to convert time for cash and 401(k) contributions. Four-day workweeks and remote work flexibility are on the radar, as are other benefit programs (i.e., pet insurance, ID theft insurance, childcare/eldercare assistance, student loan help, legal services, financial planning support, and more) and discount programs (which provides employees with price breaks at retail stores restaurants, and more).

One major point of caution: While inflation has increased dramatically over the last year, certain segments of the economy – like healthcare – typically lag when it comes to showing the impact. This is due to several factors including when/how medical contracts are negotiated and renewed. As reported in a McKinsey & Company article, COVID-related costs, supply chain pressures, general inflation, and pay hikes for medical staff will be reflected in 2023 renewals, with potential increases approaching 17%. In turn, these cost increases will be passed onto employers and employees via higher out-of-pocket costs and premiums and lower, more restrictive benefits.

In Mercer’s report, The CFO perspective on health, CFOs indicate healthcare costs are one of their top five concerns; however, they seem to be balancing the impact on their bottom line with the impact a mass exodus of employees could have. It seems the latter is even more concerning as CFOs indicate most are moving ahead with pay and benefit enhancements (or at least limiting the impact of increasing costs on employees).

There is no quick fix or easy answer when it comes to compensation and benefits planning for 2023; the sooner your organization starts, the better. RBT CPAs can help. Our Visions Human Resource Service Affiliate offers benefits and compensation analyses (along with a variety of other services). To free you up to focus on your compensation and benefits strategies, you can count on RBT CPAs to address all your tax, auditing, and accounting needs.

Inflation Reduction Highlights

On Sunday, August 7, after nearly 16 hours of deliberation that started on the Saturday night prior, the Senate passed a new bill known as the Inflation Reduction Act. This past Friday, the House voted and passed the bill sending it to President Biden’s desk for signature. Now after months of negotiations surrounding the agreement, it’s official – President Biden signed the bill into law yesterday afternoon. During the signing ceremony at the White House, President Biden referred to this legislation as “one of the most significant laws in our history.”

The bill has extensive provisions related to climate, health care, and taxes. While we navigate the 700 plus pages of legislation included in this newly enacted bill, here are some highlights of the key provisions:

Corporate Alternative Minimum Tax – This provision creates a minimum tax of 15% for corporations (not including S corporations) and is generally applicable to those corporations with average financial statement income exceeding $1 billion.
Excise Tax on Repurchase of Corporate Stock – A tax of 1% will be assessed on the fair market value of any stock repurchased by a corporation whose stock is traded on an established securities market.
Funding the Internal Revenue Service and Improving Taxpayer Compliance – Nearly $80 billion would be allocated to the IRS over the next 10 years to fund taxpayer services, enforcement, operations support, systems modernization, etc. This section of the bill is not intended to increase taxes on taxpayers or businesses with below $400,000 in taxable income.
Prescription Drug Pricing Reform – Allows Medicare to negotiate lower drug prices and imposes an excise tax on prescription drug manufacturers, producers, and importers that don’t enter into drug pricing agreements with the government on selected drugs.
Affordable Care Act Subsidies – Extends the health insurance related Premium Tax Credit, that was previously made under the American Rescue Plan Act of 2021, through 2025.
Energy Security and Clean Incentives – Provides various tax credits for individuals and businesses for the use of green energy and purchasing new and used clean-energy vehicles. Many existing renewable energy credits are extended or expanded.
Reinstatement of Superfund Excise Taxes – Previously expired in 1995, the bill reinstates the Hazardous Substance Superfund imposing an excise tax on crude oil received at a US refinery and petroleum products entering the US for consumption, use, or warehousing, at a rate of 16.4 cents per barrel.
Increase in Research Credit Against Payroll Tax for Small Businesses – Increases the maximum research credit that may be applied against payroll taxes for qualified small businesses from $250,000 to $500,000.
Extension of Limitation on Excess Business Losses – Extends by two years the limitation on amount of business losses that can be deducted in a taxable year by noncorporate taxpayers.

While many tax provisions originally being discussed did not make it into this final bill, this still represents significant changes affecting taxpayers. Over the coming days and weeks, we will provide more information about the tax implications of this new law. As always, we’re committed to sharing information as it becomes available and supporting your tax, accounting and audit needs going forward. If you have any questions, please give us a call, and watch for additional information in the weeks ahead.

New York to Restart Federal School Accountability Standards

New York State is finalizing its federal school accountability system standards, which will apply to its more than 700 school districts in the 2022-2023 school year.

Started as part of the Every Student Succeeds Act in 2015, schools were held accountable for collecting and reporting data that showed students’ progress in reading, math, and science, as well as college and civic readiness. States use this data to measure and hold schools/districts responsible for raising student achievement; recognize high-performing schools/districts; and provide interventions for struggling schools/districts.

When COVID hit, these federal requirements were put on pause so as not to adversely impact schools. After being denied the ability to forego compliance for another school year, the New York State Education Department (NYSED) recently completed the public comment period on its proposed plans, to be submitted to the U.S. Department of Education for approval and the Board of Regents to update regulations for implementation effective for the 2022-2023 school year.

The NYSED modified its plans for the 2022-2023 school year to account for COVID disruptions and to support the state’s schools going forward. Proposed amendments for New York’s accountability system in the 2022-2023 school year include using data from the 2021-2022 school year; modifying accountability indicators (i.e., some tests that haven’t been administered since 2020), revising the methodology for determining accounting identifications, plus modifying exit criteria for certain schools. (Details are available on the NYSED website.) The intent is to use this system for one year, while continuing to have discussions about future plans.

Earlier this month, New York Commissioner of Education Betty Rosa stated in a message to New York Parents and Families: “Accountability is a two-way street and for the process to be effective, there must be a system that focuses on continuous improvement through a sustainable partnership between our Department and schools and districts. New York’s proposed plan to restart the accountability system accounts for the realities of the past three school years during the pandemic and how it affected the state’s ability to collect data on student learning. The accountability restart plan is required by federal law, and we will use it as a basis to continue to provide supports and resources to those schools and districts that most need them.”

To get things started, the NYSED will make available to schools, teachers, parents, and the public state assessment data, including Regents exams results, this month so everyone is equipped with student information earlier than in the past.

School districts may want to set the stage for the reinstatement of the accountability system and to help parents understand this is a transitional year for New York State to reflect the impacts COVID had on our educational system, and that more is to come. The NYSED has developed fact sheets to help schools and districts inform parents and teachers about the accountability system in 2022-2023.

To help free you up to focus on the accountability standards, as well as all the other post-COVID school year activities, you can count on RBT CPAs to partner with you on all your accounting, audit, and tax needs. We have been part of the Hudson Valley for over 50 years and are known for our professionalism, ethics, and commitment to getting things right the first time.

Collaborating on Climate Change

Collaboration between municipalities is growing in popularity and proving highly beneficial, especially for smaller cities or municipalities.

One area showing good potential for positive results stemming from collaboration is climate change action planning.

In the face of increasing flood dangers that have plagued many counties across the state, the Westchester County Board of Legislators is one of the latest local governments putting climate change at the forefront of their agendas.

The Board unanimously passed a measure at a meeting earlier this summer which will go into effect in mid-August to require property owners to disclose the flood history of a building prior to the signing of a lease with a tenant. The measure applies to both residential and commercial leases.

In 2021, Suffolk County and Westchester County announced a shared services partnership to procure electric vehicles (EV) to tackle climate change and reduce fossil fuel consumption. The two counties seek to partner with additional counties and local governments across New York that want to participate in this green initiative and combine purchasing power to save taxpayer dollars.

Martha Sauerbrey, President of the New York State Association of Counties describes this partnership as an example of how counties are at the forefront of public policy in New York.

“This innovative collaboration between two of New York’s largest counties to invest in zero-emission vehicles is an exciting example of the vital role counties play in reducing greenhouse gas emissions and helping the state meet its ambitious clean energy goals,” said Sauerbrey. “Initiatives like this, coupled with enhanced rebates that counties fought for in the budget, can provide local governments with the financial resources and incentives needed to convert their substantial fleets to zero-emission electric vehicles.”

The Suffolk County Energy and Climate Action Office, for one, identifies opportunities for improved energy policies for the County and coordinates with the Department of Public Works to execute and implement those policies, a coordinated effort many other communities are looking into. Many parts of the state are also joining the Climate Smart Communities program, which enables localities to act on climate without mandating which programs or policies they should adopt. The program offers free technical assistance, grants, and rebates for electric vehicles. In September 2020, Beacon became the first city in Dutchess County to be named a silver-certified Climate Smart Community.

The overarching theme as we approach 2023 is a heightened awareness of climate change and the impact it has on a local level, especially in light of recent federal climate legislation. As local governments continue to engage and educate residents, it will become even more fiscally beneficial to consider all tools and programs available to further the goal of reducing energy costs and making county buildings and fleet more energy efficient.

It is these forward-thinking government investments that lead to an increase in the overall quality of life for county residents, support for the growing green energy sector of the local economy, and energy cost reduction to the taxpayers. If your municipality is ready to explore cost savings options our dedicated team of professionals is here to help with strategic planning, assistance with cash management, debt management, and everything in between. Give us a call today.