Month: February 2024

HUD Introduces Free Benchmarking and Green and Resilient Retrofit Program (GRRP) Updates

In a matter of weeks, HUD introduced free water and energy benchmarking services for multifamily property owners and updates to the Green and Resilient Retrofit Program (GRRP). Here are the highlights…

Free Benchmarking

How much water and energy is a multifamily property using? How does that compare to similar properties? Are there ways to save water and energy while promoting a healthier environment? What funds are available to help upgrade water and energy systems? HUD-assisted multifamily property owners may get answers via HUD’s Free Energy and Water Benchmarking Service.

Owners of properties participating in in HUD’s multifamily assisted housing programs, including Section 8 project-based rental assistance, Section 202 housing for low-income elderly, Section 811 housing for low-income persons with disabilities, and Section 236 preservation programs are eligible to take advantage of HUD’s free energy and water benchmarking service.

Program participants receive information about a property’s energy and water consumption, how they compare to similar properties’, and savings recommendations; Energy Star Portfolio Manager benchmarking analytics; and training, technical assistance, and other resources.

Data can help property owners identify ways to improve energy efficiency, foster a healthier living environment, and promote green investments. It can also help identify upgrades that may be eligible for GRRP grants and loans, as well as other funding sources. Finally, it may help satisfy benchmarking requirements for multifamily properties implemented by local jurisdictions and as part of the general GRRP benchmarking requirement.

HUD is estimating that up to 9,000 properties may participate. Leidos, HUD’s contractor, will be reaching out to eligible property owners over the coming months. Property owners and management agents can also email their interest in participating and property ID(s) to MFBenchmarking@hud.gov. Then, watch for official communications from Leidos.

GRRP Updates

On January 8, HUD issued Housing Notice 2024-01 increasing the flexibility and administrative ease of the GRRP. It applies to current GRRP award recipients and those selected during upcoming application periods. Changes allow for more funds to be available during construction; update Surplus Cash Loan terms; provide guidance on the purchase of renewable energy credits; specify when Davis-Bacon wage rates lock in and provide guidance for owners entering into project labor agreements with unions; and include administrative updates, and more.

2024 GRRP application deadlines are January 31 and April 30 for Leading Edge; February 28 and May 30 for Comprehensive; and March 28 and July 31 for Elements. For more information and details, including new FAQs, visit GRRP on HUD.gov. For background on the GRRP, click here.

As you focus on these HUD programs and updates, remember that you can count on RBT CPAs when it comes to accounting, tax, audit, or business advisory needs. Please feel free to give us a call.

RBT CPAs is proud to say 100% of its work is prepared in America. Our company does not offshore work, so you always know who is handling your confidential financial data.

Serve Up Savings with Tax Credits for Your Business

A tax credit reduces the amount of taxes you owe, dollar for dollar. Tax credits are available at the federal and state levels. Here are some highlights about of two tax credits every brewer/distiller/distributor business should explore.

New York’s Alcoholic Beverage Production Credit

Starting tax years beginning on or after January 1, 2023, distributors may be eligible for a higher Alcoholic Beverage Production Credit than what was available in the past. Registered distributors who produced beer, cider, wine, or liquor in New York are eligible if during the tax year 60 million or fewer gallons of beer; 60 million or fewer gallons of cider; 20 million or fewer gallons of wine; and 800,000 or fewer gallons of liquor were produced.

For the first 500,000 gallons produced in the state, the tax credit equals:

$.14/gallon of beer or cider
$.30/gallon of wine
$2.54/gallon of liquor with alcohol by volume (ABV) not less than 2% and not more than 24%
$6.44/gallon of liquor with an ABV above 24%

For amounts in excess of 500,000 gallons, the credit equals $.045/gallon up to 15 million additional gallons of beer, cider or wine and up to 300,000 additional gallons of liquor. During an audit you may be required to prove entitlement to the tax credit by providing copies of various forms (click here for a list.) For more information about the credit, click here.

Federal R&D Tax Credit

The Federal R&D tax credit reduces federal tax liability dollar for dollar; unused amounts can be carried forward for 20 years. It can apply to a range of qualifying research activities (QRAs) in all size businesses and across numerous industries. Qualified small businesses can use the R&D credit to offset quarterly payroll taxes up to $500,000.

When it comes to breweries and distilleries, they may be eligible for R&D tax credits for activities relating to brewing and distillation processes that result in product changes; updating fermentation processes or changing ingredients to develop new flavors; streamlining processes for product improvements, waste reduction and efficiencies; new sustainable and eco-friendly practices; and more. Credits are based on money spent on employees’ time; contractor expenses; related supplies and equipment; and more.

For more information from the U.S. Chamber of Commerce, click here. (Kubiak, Lauren. “How to Qualify for and Claim the R&D Tax Credit.” November 13, 2023. www.uschamber.com.)

Please note: the preceding information provides highlights related to tax credits; there’s a lot more involved impacting eligibility, documentation, and such. RBT CPAs accounting, audit, tax, and business advisory professionals can help you make the most of the tax credits available to your business. To learn more, give us a call.

RBT CPAs is proud to say 100% of its work is prepared in America. Our company does not offshore work, so you always know who is handling your confidential financial data.

Last-Minute Moves to Maximize Section 179 Tax Advantages

Have you been thinking about purchasing new or used equipment to enhance services? How about upgrading technology and software?

With end of year approaching, you have limited time left to consider whether to purchase, lease, or finance certain assets to take advantage of Section 179 tax benefits. It’s also a good time to consider how Section 179 may play into your business and tax strategy for 2024.

Section 179 uses first-year expensing. That means you can deduct the expense for an eligible asset immediately, rather than depreciating it over time. It serves as an incentive for a business owner to invest in the business and enhance its capabilities and services with the purchase and installation of capital equipment.

One big caveat: You must put the asset you purchase into service the year that you plan on taking the deduction. With just weeks left in 2023, it will be important to account for this in your planning.

Most small and mid-sized business owners qualify for Section 179 deductions. Qualifying purchases can include dining room furniture and kitchen equipment; POS systems, computers, and software; certain vehicles (some with annual deduction limits); machinery; and more. Security systems, HVAC systems, roofs, fire protection systems, and other structural improvements to non-residential buildings may also qualify for a Section 179 deduction.

Equipment can be new or used (as long as you weren’t the prior owner). It can be purchased outright, financed, or leased. So, let’s say you want to purchase qualifying equipment for $1 million and you have $250,000 for the down payment and finance the remaining $750,000. As long as the equipment is put into service this year, you can deduct the full $1 million this year.

Through 2026, there’s an added bonus. For expenses not eligible for the Section 179 deduction, there’s a bonus depreciation allowance in year one. For 2023, bonus depreciation is 80% — remember, that’s in addition to regular depreciation. The bonus depreciation decreases for the next three years (60% for 2024, 40% for 2025, 20% for 2026). Starting in 2027, this additional benefit will no longer be available. Because of this phase out, businesses benefit the most by making capital purchases sooner rather than later.

Section 179 numbers to know for 2023:

Maximum 179 deduction: $1,160,000
Phaseout threshold begins at $2,890,000 and ends at $4,050,000. (So, if you buy eligible assets that cost more than $2,890,000, your maximum 179 deduction is reduced dollar for dollar by amounts over $2,890,000. Purchases above $4,050,000 are not eligible for a 179 deduction, but bonus depreciation can still apply.)
Bonus depreciation: 80%

If you need help determining whether to act quick to take advantage of Section 179 this year or whether to make it part of your tax strategy for 2024, your RBT CPA client manager can help – reach out to him/her today. Please remember RBT CPAs is here to help with your accounting, tax, audit, or business advisory needs. Interested in learning more? Give us a call today.

RBT CPAs is proud to say 100% of its work is prepared in America. Our company does not offshore work, so you always know who is handling your confidential financial data.

An Update on New York’s Minimum Wage to Take Effect January 1

Earlier this year, Governor Hochul announced annual increases to New York’s minimum wage to help low-wage employees keep up with the rising cost of living.

Beginning January 1, 2024, New York’s minimum wage will increase to $16 in New York City, Nassau, Suffolk, and Westchester. For all other areas in the state, it will increase to $15.

In addition, we are awaiting final word on whether the NYS DOL will approve proposed changes to hospitality wage orders as published in the State Register October 4, 2023. If approved as is (which is expected), effective January 1, 2024, wages for food service workers in:

NYC, Long Island and Westchester will be $16 for minimum wage; $10.65 for cash wage; $18.65 for overtime cash wage and $5.35 for tip credit.
All other parts of New York will be $15 for minimum wage; $10 cash wage; $17.50 for overtime cash wage and $5 for tip credit.

Starting January 1, 2027, increases will be tied to inflation and based on the three-year moving average of the Northeast Region’s CPI for Urban Wage Earners and Clerical Workers (CPI-W). This is intended to help maintain the purchase power of workers’ wages from one year to the next.

As of when this article was written (December 15), we are still awaiting final word on whether the NYS DOL will approve proposed changes to hospitality wage orders as published in the State Register October 4, 2023. This will result in changes to wages for food service workers (as noted above), wages for hospitality service employees, meal credit and uniform allowance. Finally, there are proposed changes to the salary exempt threshold effective January 1, 2024.

We will let you know when these proposed adjustments are approved. In the meantime, it’s a good idea to consult your employment or labor attorney to ensure compliance.

To free you up to focus on these and other important aspects of running your business, please remember RBT CPAs is here to help with your accounting, tax, audit, or business advisory needs. Interested in learning more? Give us a call today.

RBT CPAs is proud to say 100% of its work is prepared in America. Our company does not offshore work, so you always know who is handling your confidential financial data.