If you bid on or provide services for a public works project, you need to be aware of how prevailing wage and an amendment related to the hauling of aggregate supply construction materials (a.k.a. the 50-mile radius provision) may impact your business effective July 1.

Prevailing Wage

New York’s labor law requires contractors and subcontractors to pay prevailing wage for employees working on a public works project, based on the locality where the work is performed. Public works include construction, maintenance, and improvement projects funded and executed by a federal, state, or local government.

The NYS DOL sets the prevailing wage based on hourly wage and fringe benefit data for similar jobs and distinct job classifications in a region. It equals the sum of a base hourly wage rate plus a fringe benefit rate. 2024 prevailing wage schedules by county for general and residential projects were released July 1 and can be found here.

Prevailing wage applies regardless of union status, although it is usually equivalent to union wages and benefits.

The New 50-Mile Radius Provision Effective July 1

New York’s 50-mile radius provision of 12 NYCRR 222.2(c) took effect July 1. Contractors and subcontractors must factor this into their labor costs on all public works projects solicited on or after July 1.

Of particular note is an amendment related to the hauling of aggregate supply construction materials. The amended rule reads:  “Prevailing wage shall be paid for work performed on a public works worksite pursuant to this section for any work involving the delivery to and hauling from such worksites of aggregate supply construction materials, as well as any return hauls, whether empty or loaded and any time spent loading/unloading.”

Visit the NYS DOL website and scroll down to “Hauling of Aggregate Supply Construction Materials” for more information. Please note that RBT CPAs is not a law firm. We are sharing this information to ensure you are aware that the provision took effect on July 1. Additional guidance is supposed to be forthcoming. In the meantime, if you have any questions or need direction or advice, we strongly suggest you contact your legal counsel.

On a Related Note…

During the New York legislative session that had just ended, a new bill was introduced regarding prevailing wage and the delivery and supply of construction materials. It would expand existing prevailing wage requirements in Nassau, Suffolk, and Westchester counties to include the delivery and supply of concrete and asphalt, and would take effect immediately upon its passage. While the legislative session ended with the bill in the Senate’s Committee Assembly, we just want to make sure you’re aware of it in case it moves forward in the future.

As you focus on the many aspects of running a successful business, including compliance,  remember that RBT CPAs is always here to support your accounting, advisory, audit, and tax needs. Contact us any time to learn how we can be Remarkably Better Together.

Please note: RBT CPAs is not a law firm and this article is for informational purposes only. Should you need legal advice, contact your legal counsel.

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 information.

Everywhere you look, there’s an article discussing how artificial intelligence (AI) is transforming construction.

Once reserved for the largest commercial construction businesses, AI solutions are evolving and becoming more accessible to businesses of all sizes. Here’s an overview and some tips on how to get started using AI in your business.

AI is software that analyzes a variety of data to help you achieve better results. AI can provide you with insights and information to make strategic decisions, make work easier through automation, and identify potential issues before they escalate. AI systems are impartial, promoting accuracy while minimizing bias, and ultimately boosting productivity and performance.

So, how can you use AI in your construction business?

Before construction.

There are AI software solutions to help with everything from bidding, contracts, regulations, building codes, and permits to project planning, supply chain, and more. Use them to operate more effectively and enhance the value you offer potential clients.

During construction.

Robotic bricklayers, layout, welding, autonomous equipment, and drones do certain jobs so staff is freed up to focus on other work. Using data from past projects, workflow related to activities like rebar placement can be simplified and maximized for productivity. Sensors and cameras can alert crews to safety hazards, detect defects and weaknesses, and boost quality. Predictive maintenance extends the longevity of equipment.

Backroom operations.

Think of any business activity and you can likely find an AI solution to do it faster and more accurately. For example, AI integrated with an ERP may help reduce days sales outstanding; find and fix billing errors; and detect anomalies and potential fraud. There are AI systems that evaluate market opportunities, help strengthen sales, improve customer service, and streamline project management.

Staffing

Yes, this is part of backroom operations but considering today’s challenges finding experienced talent, it warrants its own discussion. AI solutions can boost the effectiveness of your recruiting and hiring process. Perhaps equally important is that AI solutions allow you to use the staff you do have effectively. Instead of paying someone for simple repetitive tasks on a work site or in an office (i.e., data entry, order tracking, invoicing, and more), AI can automate and free up staff (or your budget for staff) to focus where they can add the most value.

With one study predicting up to 30% of construction work will be automated by 2030, it’s the right time to explore opportunities for your business.

Start by thinking about your biggest “pain points.” What is constantly causing you angst, creating problems, or diverting attention and resources from more important tasks? What is costing your business money, time, employees, suppliers, and/or customers? What are customers or potential customers asking for that you just can’t deliver…yet?

Ask your team for input and to validate the top two to three pain points. Then, research AI systems that can help. Industry organizations, peers, people you work within the business (including suppliers and insurance agents, for example), and, of course, the Internet can help you identify potential solutions.

Don’t settle on the first AI system you find. There is a growing list of options and features available. You may want to explore three to five AI systems and compare their features and costs. Once you make a decision to move forward, be ready for some growing pains including testing and training. After launching, monitor and make adjustments as needed.

As you focus on what’s best for your business’s future, let RBT CPAs focus on you. Our business advisory, accounting, audit, and tax professionals are available to help support and drive success. We look forward to showing you how we can be Remarkably Better Together.

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.

As a general contractor, you likely have multiple employees at multiple worksites incurring expenses related to meals, communications, travel, accommodations, and more. It’s important to understand your responsibilities and tax-related options for these expenses, and how they impact employees.

In general, you can handle expenses using an accountable plan and/or a non-accountable plan.

With an accountable plan, reimbursement for eligible expenses is not treated as part of payroll, so they aren’t taxable for you or your employees. What’s more, you get to deduct payments made to employees as a business expense (meal expenses are subject to the 50% limit). To qualify, an accountable plan must meet all of these criteria:

• Exist to reimburse employees for allowable business expenses paid or incurred in their performance of services as employees;
• Clearly identify plan payments;
• Require any expense being reimbursed to be substantiated with information about the amount, time, place, and purpose of the expense; and
• Require employees to return any portion of an allowance for days or miles of travel not substantiated within a reasonable time.

An accountable plan allows you to reimburse eligible expenses directly, per diem (at or below rates set by the U.S. General Services Administration each fiscal year – otherwise, amounts above those rates are treated as taxable income – and only for certain types of expenses), or with company assets.

If the arrangement does not meet all of the accountable plan criteria, it is considered a non-accountable plan. In this case, you provide a flat dollar allowance for expenses. Employees do not have to account for how the allowance is used (so no expense accounts or receipts are required). Sounds simple, but there are trade-offs.

The allowance is considered part of compensation. You can deduct it as part of payroll, but you are also on the line for withholding and FICA taxes. What’s more, any pay-related coverage like workers’ compensation insurance may cost more to reflect the additional “pay.” For employees, the allowance is considered taxable income and appears on their W-2s. Through 2025, employees cannot deduct any of these expenses on their personal income tax returns.

Important Note! You can no longer claim any miscellaneous itemized deductions that are subject to the 2%-of-AGI limitation, including unreimbursed employee expenses.

In addition to understanding the different types of business expense reimbursement plans, it’s important to know that there are a lot of rules for different types of expenses. Take mileage, for example. Not all miles for work-related travel are reimbursable. Instead, eligibility depends on whether work is at a regular workplace (a place where an employee performs work for longer than a year); a temporary workplace (work is expected to be performed for a year or less); an indefinite workplace (work is expected to take more than a year); or multiple locations.

Mileage is considered an eligible business expense for:

• Travel from an employee’s regular work location to a temporary work location
• Travel from home to a temporary work location if the employee has a regular work location
• Travel between multiple work locations

Mileage is not considered an eligible business expense for:

• Travel between an employee’s home and regular work location
• Travel from home to a temporary work location if the employee has no regular work location (unless travel is outside of the normal work area)

If a company-owned vehicle is provided for travel, a whole other set of considerations apply. There are also several layers of rules for the reimbursement and tax treatment of lodging and fringe benefits.

One closing thought – having the right software solution (i.e., Expensify, Docyt, and Navan) to help your employees track and submit receipts and expenses is critical. Without proper documentation, an income tax or workers’ compensation audit may lead to the identification of expense reimbursements as additional employee compensation.

Your current and future business plans and goals play an important role in determining how to handle employee expenses. RBT CPAs business advisory and tax professionals are available to work with you to evaluate your options and determine the best strategy for your business and employees. Let us know if you want to get the process started and see how we can be Remarkably Better Together.

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.

This past Monday, the Department of Labor’s (DOL’s) final rule on how to analyze whether a worker is classified as an employee or independent contractor under the Fair Labor Standards Act (FLSA) took effect.

Considering the growth of the gig economy, the number of people operating as independent contractors or freelance workers has skyrocketed. While this has opened opportunities to “be your own boss,” there has been growing concern about businesses misclassifying workers as contractors to gain an unfair competitive advantage and avoid the higher costs associated with actual employees (i.e., minimum wage, overtime pay, benefits, and other employment protections). The DOL final rule on classifying employees seeks to rectify the situation. It is more consistent with judicial precedent and more clearly delineates when a worker qualifies as an employee versus a contractor under the FLSA. Here are the highlights…

Who is subject to the rule?

Employers subject to the FLSA are impacted by this rule. So, it applies to private sector employers, as well as federal, state, and local government employers.

What does it entail?

The final rule rescinds the 2021 independent contractor rule and restores the multifactor analysis previously used by courts to determine an employee’s classification based on their relationship with an employer. The six factors include:

• Any opportunity for profit or loss a worker might have;
• The financial stake and nature of any resources a worker has invested in the work;
• The degree of permanence of the work relationship;
• The degree of control an employer has over the person’s work;
• Whether the work the person does is essential to the employer’s business;
• The worker’s skill and initiative.

No factor is weighted higher than another – the total circumstances of the employment relationship is considered. For more details about the six factors, as well as examples and FAQs, the DOL’s Small Entity Compliance Guide is a terrific resource. Access it by clicking here.

When does the final rule take effect?

March 11, 2024.

Where can I learn more?

• Click here for the Final Rule.
• Click here for DOL FAQs.
• Call the Wage and Hour Division’s (WHD) Division of Regulations, Legislation, and Interpretation at (202) 693-0406 if you have questions about the final rule.
• Contact your local WHD District Office with questions about employment classification of a work/group of workers.

Why should employers ensure compliance?

Failure to comply can result in having to pay unpaid wages owed to an employee, liquidated damages, civil penalties, and lawyers’ fees. In addition, fines may be levied by federal and state governments if misclassification occurs.

If you have questions or need assistance with employee classifications and Final Rule compliance, Visions Human Resource Services – an RBT CPAs affiliate – is available to help. Contact a client manager at info@VisionsHR.com or call 845-567-3978.

And, as always, if your organization needs any accounting, audit, tax, or advisory services, you can continue to count on RBT CPAs to do the job professionally, ethically, on-time and within budget. Give us a call to learn more.

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.

While there are several reasons for U.S. construction businesses to be cautiously optimistic about 2024, there are also a number of reasons to simply be cautious.

In the U.S. overall, there’s an expectation for some growth (but not as strong as last year), with a hope that inflation and interest rates will decrease. Wages are up and unemployment is hovering around 3.5% to 4%. Lending is tightening and consumer spending is slowing down. The likelihood of a recession is anyone’s guess, although it seems less likely than it was a year ago. The situation is fragile, for lack of a better word, considering escalating geopolitical tensions and the fact that we’re in a presidential election year.

It feels like we’re playing Jenga and while we’re doing a good job keeping the business environment balanced, all it will take is one false move and everything can tumble. Moving slow and steady is key.

When it comes to construction, the Associated General Contractors (AGC) and Sage annual Construction Outlook Survey Results released last month provide valuable insights to help guide your business strategy for the year ahead.

As I reviewed the results, I didn’t see any big surprises, and I think the assessment of opportunities and challenges are right on target, based on what we’re hearing from clients and seeing in the industry overall.

Results show 64% of respondents are worried about rising interest rates and financing costs; 62% are worried about a recession or economic slowdown. Costs in general are among the top concerns for 2024, with both labor costs and material costs on the rise. Rising costs, interest rates, and reduced funding resulted in over 70% of respondents experiencing project postponements or cancellations in 2023.

When it comes to labor, 69% of respondents plan on adding staff and 77% are having challenges filling open positions. Last year, many raised pay, enhanced benefits and contributions to benefit costs, and added or increased incentives. Considering rising wages across industries, construction companies are likely looking at having to do even more to attract and retain talent, while addressing growing concerns about safety due to workforce inexperience.

While a growing percentage of respondents are investing in technology like drones, AI, and modular construction, the majority still aren’t on board. Does this mean there are still a lot of opportunities for construction firms to address staffing challenges by using technology to work more efficiently and effectively?

A higher percentage of respondents, but still not a majority, are also continuing to invest in software for accounting, project management, document management, and estimates. Again, this may open opportunities to eliminate non-value-added activities while operating more effectively.

I do appreciate that survey results are also broken down by region and state, as it does highlight differences by geography. For example, when calculating the net percentage of respondents expecting the value of warehouse projects to be higher or lower, results show an anticipated 10% net increase nationally; an anticipated 10% net decrease in the Northeast; and a 29% net increase in New York.

Some other differences to note…based on survey results, NY staffing challenges appear to be slightly lower than the national average. While both national and New York results show the top response to supply-chain issues is to accelerate purchases after winning contracts, nationally the second most popular response is to turn to alternative suppliers but in New York respondents are more likely to have specified alternative materials or products.

When it comes to project postponements or cancellations, New York respondents appear to be facing more challenges than most:

• Nationally, 34% of respondents indicated no projects scheduled to start in 2023 or 2024 were postponed or canceled; in New York, the result drops to 24%.
• Nationally, 37% of respondents indicated projects postponed in 2023 were rescheduled; in New York that drops to 24%.
• Nationally, 36% of respondents indicated projects that were postponed or cancelled in 2023 were not rescheduled; that jumps to 45% of respondents in New York.

Interestingly, nationally, a greater percentage of respondents indicated owners postponed/cancelled projects slated to start in 2024 than in New York. If you’re a glass-half-full person, you could take this as things may be looking up in New York…maybe.

As 2024 unfolds, please remember the professionals at RBT CPAs are here for you. Please don’t hesitate to give us a call and find out why businesses across the Hudson Valley and New York have entrusted us with their accounting, tax, audit, and business advisory needs for over 50 years. Hint: We’re Remarkably Better Together.

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.

The commercial real estate sector is approaching a critical juncture with approximately $400 billion in loans set to mature. This situation is further intensified by the persistence of high interest rates. As a commercial real estate owner, it is crucial to anticipate what’s next and take proactive steps to manage risks and leverage opportunities. Consider the following…

1. Determine how the maturation of loans will impact your financial status and plans. Depending on the terms of your loan, you may need to pay a significant amount when the loan matures. Discuss with your banker about your repayment options and any potential for refinancing.
2. Anticipate what is going to happen with interest rates. High rates may increase your repayments, leading to financial strain. Your banker should provide clarity on current rates, the bank’s forecast on how they might change, and how these changes could impact your loan repayment schedule.
3. In a high-interest environment, paying off a loan early can save considerable money. However, some loans come with prepayment penalties, making early repayment less beneficial. Ask your banker about the possibility of these penalties and consider this in your financial planning.
4. Explore refinancing. With impending loan maturities, it is prudent to lock in a new loan at a favorable rate before interest rates climb any higher. Refinancing can provide the much-needed capital for property improvements, debt consolidation, or to fund new investments. However, it is essential to conduct a thorough analysis of the potential savings against the costs of refinancing to determine the feasibility.
5. It’s an opportune time to review your property portfolio. Consider selling non-core assets and investing in properties with higher yields. While selling can be a tough decision, especially in a high-interest rate environment, the liquidity provided can help reduce the risk of default on maturing loans. It also allows you to reallocate resources to more profitable ventures.
6. Consider deleveraging. When interest rates are high, it becomes costly to service debt. Reducing the debt in your portfolio can increase your equity, making your investment less risky. It’s crucial to weigh the benefits of deleveraging against the potential returns from maintaining a higher debt level.
7. Building relationships with multiple lenders can provide additional financing options. Diversifying your lending relationships can provide flexibility in negotiating terms and may enhance your ability to secure financing at favorable rates.
8. Focus on improving property performance. High occupancy rates and rental income can increase the value of your property and its attractiveness to lenders. Investment in property improvements can attract quality tenants, ensuring a reliable income stream.

The maturing of $400 billion in loans amidst a high-interest rate environment presents both challenges and opportunities for commercial real estate owners. Timely refinancing, portfolio review, deleveraging, diversifying lending relationships, and enhancing property performance are strategic moves that can help navigate this landscape.

Remember, every financial decision has its risks and rewards. It is advisable to seek professional advice before making significant financial decisions. Proper planning and strategic action can help ensure the sustainability of your commercial real estate portfolio amidst these market conditions.

Should you have any questions, please don’t hesitate to contact your RBT CPAs client manager. Our experts are also available to help with your accounting, audit, tax, and business advisory needs throughout the year. Give us a call to learn more.

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.

Creating winning project bids is a science onto itself. Do it right and you end up profitable and productive. The secret is to invest the time and attention to show the buyer why your business is the best for the job. In truth, that’s easier said than done, but there is some work you can complete before ever submitting one bid to promote your chance at success.

Define your business goals.

A commonly cited statistic asserts that your bidding process can be considered successful if you receive at least one job for every five bids submitted. As an accountant and a business advisor that feels random. To add structure, consider the big picture. What are your overall sales, profit, and cash flow goals for the year, quarter, and month? Can your answers guide your bidding activities, pointing to when you need to make more bids or set goals for improving your hit (win) rate?

Develop your brand.

A brand reflects your business’ identity or reputation. It’s what distinguishes your business from your competitors’, and it sums up the experience a client can expect when he/she awards you a job. Are you known for professionalism, quality, financial stability, safety, customer satisfaction, project management, environmental awareness, or something else? If so, you should be saying that, consistently, every time you submit a bid. If you need help, consider engaging a marketing firm or freelancer to summarize your brand and provide standard language you can use for bids (as well as marketing channels like your website, social media, and more).

Know your strengths and weaknesses.

Not every bidding opportunity is going to be a good fit. Consider creating a checklist – based on past work – to identify the types of projects that are worth your time and align with your business goals and outcomes. Similarly, a checklist of attributes to avoid can help you quickly decide whether it’s better for your business to forgo a bid.

Evaluate software, online tools, and services that can boost accuracy and productivity.

At the very least, an online search can help you find a variety of free construction bid proposal templates. If you’re looking for more, software and services are available to support the entire bidding process, cost estimations, work breakdowns, project management, proposal generation, takeoff accuracy, and more.

Prequalify subcontractors.

Since you should submit bids by the deadline, if not sooner, prequalifying subcontractors you may use on jobs can save you time and promote peace of mind that the people you’re engaging align with your brand, as well as your quality and performance standards. You may also review licenses and certificates of insurance to make sure the subcontractors have what you need when the time for a bid/job comes.

Expand your pipeline for learning about bids.

In addition to getting leads on projects from trade organizations, referrals, and suppliers, consider subscribing to a lead generation service. Evaluate which markets are served, client size, geography covered, success statistics, service options, and prices. Also look for features that would be of value to you – like getting an email when a new bid is opened.

By putting the time and effort in before ever making a bid, you are in a better position to choose and submit bids – and win projects – when the opportunity arises.

To free you up to focus on bids and all other 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.

The U.S. Department of Labor’s Occupational Safety and Health Administration (OSHA) Improve Tracking of Workplace Injuries and Illnesses reporting rule takes effect January 1, 2024. As a result, more employers will be required to submit detailed data about workplace injuries and illnesses.

The final rule was issued July 21, 2023. It reverts from provisions adopted in 2019 largely to what was effect in 2016. OSHA is hoping this helps reduce workplace injuries and illnesses in high hazard industries. It will use the data for strategic outreach and enforcement. It also intends to make the data collected available online to the public.

According to the Department of Labor (DOL), “This will enable the agency to interact directly with these establishments, through enforcement and/or outreach activities, to address and abate the hazards and improve worker safety and health. These same data will also allow OSHA to better analyze injury trends related to specific industries, processes, or hazards.”

The DOL also asserts that by making injury and illness data public, potential customers, employees, and others will have more information to make decisions about health and safety at a particular establishment.

Under the final rule, once a year, establishments – meaning a physical work location, not a company as a whole – with:

• 100 or more employees in certain designated industries* must electronically submit information from OSHA Forms 300 and 301.
• 20 to 249 employees in certain designated industries* will continue to electronically submit information from 300A annual summary to OSHA.
• 250 or more employees, regardless of industry, are required to keep records under OSHA’s illness and injury regulation and electronically submit Form 300A information.

*Industries are defined in Appendix A and Appendix B in the Final Rule.

March 2 is the deadline for submitting prior year data. So, data from 2023 must be submitted by March 2, 2024. Covered establishments will submit data via OSHA’s Injury Tracking Application.

It’s important to note that the rule directly applies to OSHA states, but not state plans (although state plans are required to adopt similar requirements within six months of the Final Rule). New York does operate an OSHA-approved state plan, but it only covers state and local government workers. Private sector employers and their workers are covered by federal OSHA.

If you have any questions about the Final Rule or its implementation, it’s in your best interest to contact legal counsel. RBT CPAs is not a law firm; we specialize in accounting, tax, audit, and business advisory services. 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.

Whether you currently own commercial real estate or are considering whether to jump into the market, of the many pros and cons you evaluate, don’t forget to take a look at related tax and investment benefits. Here are a couple that stand out:

Depreciation deductions on income taxes.

As a physical asset that will wear down over time, CRE investors can deduct a defined amount from income taxes each year for depreciation. Residential buildings can be depreciated over 27.5 years, while commercial buildings can be depreciated over 39 years. So, if you buy a commercial building for let’s say $5 million, your income taxes can be reduced by $128,000 each year for depreciation.

If you want larger depreciation deductions over a shorter period of time, you can do that, too, by engaging an engineering firm to conduct a cost depreciation study to identify parts of the property that can be depreciated in less time.

Again, going back to the commercial building you buy for $5 million, let’s say the cost depreciation study identifies $1 million in parts that can be depreciated in 10 years rather than 39. You’ll be able to pay a $100,000 depreciation deduction each of the first 10 years you own the property. Between this portion of the deduction plus depreciation deductions for the rest of the property, for the first 10 years your depreciation deductions will equal about $202,000. That amount goes down to $102,000 for each of the remaining 29 years.

Bonus depreciation.

With the Tax Cuts and Jobs Act (TCJA) of 2017, there is bonus depreciation to qualified improvement property put in service before year-end. Up through 2022, the bonus depreciation was up to 100% of a property’s value the year the property was placed in service. The bonus depreciation is phasing out, dropping to 80% in 2023; 60% in 2024; 40% in 2025; 20% in 2026; and 0% in 2027.

1031 exchange.

This allows you to defer capital gains taxes if you exchange one property for a “like-kind” commercial property in a defined period of time. The new property must be worth the same or more than the first property. After the new property is sold, capital gains taxes are due in full (unless you want to do yet another 1031 exchange, which will defer those taxes even longer).

Diversification.

Diversification is a strategy investors take to manage risk and minimize losses. By diversifying or spreading investments across several different options (i.e., CDs, bonds, stocks, mutual funds, etc.), you hope that if one tanks the others will make up for it. Unlike traditional investment options which typically have a similar reaction during recessionary times, there is another one that may help stabilize a portfolio: CRE. While there are no guarantees against losses, diversifying into CRE may help minimize risk.

Inflation hedge.

One way to protect your investment against a decrease in the purchasing power of your money is to “hedge” against “inflation.” Typically, when inflation rises, so do property values and rents; in turn, real estate returns go up.

There are other deductions associated with CRE investments, including transportation costs, employee wages, professional fees, contractor costs, and more. If you take a business loan to buy a CRE, you may also be able to take a 30% deduction on taxable income for equipment, technology, building repairs and materials, and renovations.

To ensure you take advantage of all the deductions that may be available to you as a CRE owner, make sure to work with a tax professional, like the ones you’ll find at RBT CPAs. We believe we succeed when we help our clients succeed. Want to learn more? Give us a call.

NOTE: This article is for informational purposes only and should not be construed to be advice or direction. If you are interested in learning more about purchasing CRE as an investment, be sure to speak with a CRE realtor and attorney.

RBT CPAs is proud to say all of our work is prepared in the U.S.A. – we never offshore. As a result, you get peace of mind that your operation’s financial and confidential information is handled by full-time, local staff who have met our high standards for quality, ethics, and professionalism.