Are you aware of the 3% Withholding Tax?
If not, and you are a contractor who procures construction contracts with federal, state and/or local governments, this is a topic that you should be aware of. This tax will impact the cash flow of your company and adequate planning is needed to cope with the possibility of this tax taking effect. Continue reading »
U.S. Department of Transportation announces audit for Dulles Corridor Metrorail Project
Dulles Metrorail Project
An audit has been requested for the Dulles Metrorail Project as announced by the U.S. Department of Transportation on June 21, 2011. Reps. Frank Wolf (R-Va.) and Tom Latham (R-Iowa) have requested the audit, which will also review the Metropolitan Washington Airports Authority’s (MWAA) overall management of local roadways, Dulles International Airport, and Ronald Reagan National Airport. The Dulles MetroRail Project alone has an estimated value of approximately $6 billion, which is a major contributing factor in the audit request. The board of MWAA has come under scrutiny following a decision to build an underground station at Dulles International that may cost taxpayers an estimated $330 million to build more than an above ground equivalent, which is another contributing factor in the audit request. Continue reading »
AIA Billing Index Decreases in May
The American Institute of Architects (AIA) released its May Architecture Billings Index (ABI) today which reflects a continued decrease in the ABI score from the previous decrease in April. This score represents a potential decrease in future construction spending, which is troubling for a construction industry that has continued to struggle since the 2008 economic downturn. Even more troubling in this release from the AIA is that their report indicates that inquires for new projects has dropped to the slowest pace of growth since early 2010. You can read the full press release for the May ABI at the AIA website.
Revenue Recognition Proposals to be Re-Exposed by FASB
There are multiple business developments and issues facing construction contractors in 2011, and amongst the most notable is how the industry will adapt to potential revenue recognition changes currently proposed by the FASB. The FASB and the IASB are currently “re-exposing” their joint proposal for comment as released by the FASB on June 15. You can learn more about the this release by visiting the FASB website and/or reviewing the revenue recognition exposure draft issued a year ago.
Tax Incentives for Contractors – Fixed Asset Acquisitions
The recently enacted included a wide-ranging assortment of tax changes generally affecting business. Two of the most significant changes allow for faster cost recovery of business property. These consisted of enhanced expensing under Section 179 and an extension of 50% bonus depreciation. The bonus depreciation provisions, however, quickly became outdated with the enactment of the 2010 Tax Relief Act, where the bonus depreciation provisions became even more taxpayer friendly. Continue reading »
