Masonry Magazine February 1989 Page. 44
TAX MATTERS
continued from page 42
With a penalty for underestimating their tax. But the new law gives you (or your corporation) a break by waiving any estimated tax penalties for 1988 underpayments created or increased because of the new law. This waiver applies for individual taxpayers to any period of underpayment before April 16, 1989 and March 16, 1989 for corporations.
Business Meal Deduction Changed
The 1986 Tax Reform Act generally disallows any deduction for business unless the taxpayer or the taxpayer's employee is present at the meal. The new law allows the IRS to authorize two additional exceptions to to the general rule. First, a business could deduct reimbursements made to job applicants who eat alone while traveling to a job interview. Second, a new rule would permit deductions for the cost of meals paid by your family while moving to your new job location, even though you traveled at a different time or by a different route or method. The effective date of the new rules goes all the way back to January 1, 1987.
Of course, only 80 percent of the meal is deductible. Under the new law, the employer, retroactive to 1987, can deduct 100 percent of the reimbursement. The employee who receives the reimbursement for the job-related moving expense can only deduct 80 percent of the meal. The net result is that for each $1 the employee is reimbursed, he or she will realize 20 cents of income.
The new law makes it even more important to take advantage of areas in the old law that were not changed. What to learn how? Read my special reports: "How to Take Out of Your Closely Held Corporation" and "A New Tax
ARE BRICK CLEANING
PROBLEMS GIVING YOU FITS?
WITH KEM-O-KLEEN PRESSURIZED ACID/HOT WATER EQUIPMENT YOU CAN START A MASONRY JOB WITHOUT WORRYING ABOUT HOW TO CLEAN IT
Call us today and let us show you how to save time and money on your next job.
Visit Us In
#700 & #702
For further information write or call:
KEM-O-KLEEN, INC.
700 W. MISSISSIPPI AVE., #B3
DENVER, CO 80223
(800) 525-8962
DISTRIBUTOR INQUIRIES INVITED
Superstar... S CORPORATION." Send $25 for one or $39 for both to: Blackman Kallick Bartelstein, 300 South Riverside Plaza, Chicago, IL 60606.
Lombardo Memorial Scholarship
The Mason Contractors Association of Connecticut recently awarded the 1988 Santo Lombardo Scholarship to Miss Maria Rinaldi, a first year student at the St. Mary's School of Nursing in Waterbury, Connecticut. The scholarship is awarded on a competitive basis to offspring of members of the Connecticut Bricklayers and Allied Trades Unions in memory of Mr. Santo Lombardo, principal in Lombardo Brothers Mason Contractors and a founder of the Mason Contractors Association of Connecticut. (Pictured from left are: Joseph DeLuca, J. DeLuca Construction Co. of Fairfield, Connecticut and president of the Mason Contractors Association of Connecticut, Maria Rinaldi, scholarship recipient, Julia Lombardo, widow of Santo Lombardo, and Sebastian Lombardo, Lombardo Brothers Mason Contractors, Hartford, Connecticut.
AED Forecast For 1989
Construction equipment distributors expect customer demand for equipment rentals and good used equipment to produce a modest 3.6% increase in gross sales for the first half of 1989 over the first six months of 1988.
That's the forecast from a business outlook survey conducted by Associated Equipment Distributors (AED) in late autumn 1988. An even 300 AED distributor members in the United States and Canada participated in the survey.
While distributors are cautiously optimistic, they are also looking at a projected economic slowdown or downturn in the United States in the last half of the new year. As one distributor put it, "The challenge will be to maintain proper equipment inventory balance in view of long lead times from manufacturers and uncertain economic projections for second-half '89 and beyond."
The AED forecast continues the focus on rentals and used equipment that distributors noted a year ago when they predicted an average 5.2% increase in sales. Results proved the forecast accurate as distributors at mid-year 1988 reported sales were moving along at a 5.5% higher rate.
About half of the AED survey participants plan to add one or more new product lines to their mix of equipment. Nearly 25% of the distributors expect to open new facilities in 1989 to serve customers, and another 41% will upgrade or expand their existing facilities.
At the same time, distributors are concerned that continuing manufacturer mergers may affect their ability to meet customer needs. A manufacturer merger or buyout can cause problems in product availability and support, price restructuring and availability of financing for equipment inventories and floor plans. One distributor pointed out that product development may suffer when manufacturers are involved in mergers and buyouts.
44 MASONRY-JANUARY/FEBRUARY, 1989