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Budget Impasse Resolved

December 18, 2009

Budget Impasse Resolved

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Concluding two months of consideration, the Ohio Senate approved a budget corrections bill pretty much as it was initially proposed by the Governor.  House Bill 318 fills an $851 million budget hole mostly by delaying by two years a final 4.2% income tax rate reduction. 

The Senate revisions  stripped a provision to cut state legislator pay, implemented a new pilot project to evaluate public construction contracting reforms, and adopted an amendment clarifying the ability of school districts to obtain waivers from all-day kindergarten requirements enacted earlier in the year.  Five Republican Senators  joined with all Democrats to deliver the necessary 17 votes to approve the budget fix. 

Watch a replay of the rancorous debate.

Federal HUBZone Program Improved for Small Businesses in Distressed Communities

December 4, 2009

Federal HUBZone Program Improved for Small Businesses in Distressed Communities

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The Federal Historically Underutilized Business Zone Program or “HUBZone” Program, administered by the Small Business Administration (“SBA”), has the purpose of increasing employment opportunities, encouraging economic development and investing in distressed areas by giving a 10% price evaluation preference to small businesses, by SBA standards, whose principal offices are located in a HUBZone, if at least 35% of the employees live in any HUBZone area.  To see if your operation is in a HUBZone, go to the SBA website.   

The SBA has recently liberalized the guidelines it will use to determine whether an employee should be counted for purposes of determining whether 35% of the employees reside in a HUBZone.  The SBA will look at the “totality of the circumstances” to determine whether an employee should be counted.  The new rule clarifies that leased or temporary employees obtained through temporary agencies, professional employee organization arrangements, or union agreements should be counted.  An employee must work a minimum of 40 hours per month to be considered.

To apply for certification to participate in the HUBZone Program, the SBA uses an electronic application process.    Please direct your inquiries to Barbara A. Duncombe,  Attorney, with OMA Connections Partner, Taft Stettinius & Hollister LLP at (937) 228-2838.

OMA Environment Committee Materials – 11/19/2009

November 19, 2009

Tax Management 2009 Archive

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Senate Budget Alternative Apparently Flops for Now

November 19, 2009

Senate Budget Alternative Apparently Flops for Now

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Senate Budget Alternative Apparently Flops for NowAfter numerous false-starts Senate Majority Republicans gaveled the Senate Finance Committee to order on Thursday to unveil an alternative budget corrections proposal.  Republican senators have made clear they do not favor House Bill 318, which delays for two years the final scheduled 4.2 % reduction in personal income tax rates.  The delay was proposed by Governor Strickland to fill a biennial budget shortfall of $851million.

The Senate Republican alternative included nearly thirty new provisions.  Included in the proposal are provisions related to drilling for oil and gas in Salt Fork State Park, casino licensure fees, school district report cards, workers’ compensation reserves, ROTC high school credits, prison sentencing reforms, a study of privatizing state government functions, a study of privatizing workers’ compensation, a study of a state government restructuring plan, and a study of the possible fiscal effects of state government moving to a four-day work week.

Democrats united against the Republican proposal.  And, it has been reported, the alternative plan lacks support within the GOP caucus itself.  Thus, senators scrubbed plans to pass the bill this week.  This will require the body to return in December to try again.   

CPAs Produce Ohio Budget Fix Recommendations

November 17, 2009

CPAs Produce Ohio Budget Fix Recommendations

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An Ohio Budget Advisory Task Force of the Ohio Society of CPAs this week released a report  with tax and budget recommendations for state policymakers.  The society applauded government leaders for making “hard decisions to cut costs and operate as efficiently as they deem possible without endangering essential or core services.  As a result of these changes, the current biennium budget is approximately $3 billion lower than the 2012-13 biennium.”

“Ohio remains in a position of unsustainable spending,” the CPA group says.  “Our state faces a shortfall estimated to be between $4 and $8 billion for the 2012-13 budget.”  The group made a series of recommendations “to improve state revenue growth and reduce expenses.”  Among the recommendations were agency performance audits, governmental unit consolidation, various possible tax changes to raise revenue, and school district consolidation.

The society found that “(O)f the various immediate remedies available to state government, delaying the last 4.2% of the state income tax decrease for two years is likely the least painful and easiest to implement.  But it cannot be the only immediate change Ohio makes.” 

Tax Committee Considers New Audit Requirement

November 13, 2009

Tax Committee Considers New Audit Requirement

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Members of the OMA Tax Policy Committee met yesterday to review current events impacting the tax environment.  The link provides the materials reviewed by the committee.

Representatives of the Ohio Attorney General’s Office described the new audit requirement imposed on recipients of economic development incentives.  OMA members can learn about compliance by participating in an upcoming December 3rd webinar featuring program administrators in the Attorney General’s Office.
OMA members also heard a presentation by OMA Connections Partner Plante & Moran on the significant tax consequences (Part One) (Part Two) of pending federal health care legislation and shared an online liquidity stress test calculator tool the firm has developed for manufacturers to gauge cash flow stress. 

Ohio Mega Tax Conference

November 13, 2009

Ohio Mega Tax Conference

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If you’re a tax professional, you won’t want to miss the Mega Tax Conference presented by the Ohio Society of CPAs.  With more than 20 sessions, this two-day event covers the latest tax developments and features some of the Society’s most popular speakers.  OMA Members may take advantage of the Society’s member rate by registering by phone at (888) 959-1212.  

Time to Take a Closer Look at the IRS Code 199 Tax Break?

November 5, 2009

Time to Take a Closer Look at the IRS Code 199 Tax Break?

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Businesses with “qualified production activities” can take a tax deduction of 6% from net income for 2009 and 9% for 2010. This is a tax break pure and simple. In a nutshell, businesses engaged in manufacturing and other qualified production activities implement cost accounting mechanisms to accurately calculate their Domestic Production Activities Deduction.

For more information, contact Bernie Ostrowski with OMA Connections Partner, Plante & Moran, at (614) 222-9053 or Bernie.ostrowski@plantemoran.com

Tracking Investment in Ohio

November 5, 2009

Tracking Investment in Ohio

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The Ohio Economic Development Association makes a request of OMA member companies:

“There is nothing that can help encourage business confidence and new investment in Ohio as much as knowing that other companies are making significant new investments in the State. It is important for all business and government leaders to know that many companies were continuing to invest in the future despite the recession in 2009.

We hope that you will take the time to report your company’s new investment and job creation projects for 2009. The deadline for reporting this year’s projects is November 20th! 

To qualify, the project must involve an investment of $1 million, or involve a building investment of 20,000 square feet or more, or involve 50 new jobs.

For more information on the criteria and to report your projects, go here.  Please also report your projects to the Ohio Department of Development here.  If you have any questions, you can contact Mr. Jim Kell at the Ohio Department of Development here

We sincerely appreciate your time and effort to help us recognize the important business investments that occurred in Ohio in 2009! “

House Democrats Propose $894 Billion Health Care Reform Bill; $557 Billion In Revenue Raisers

November 5, 2009

House Democrats Propose $894 Billion Health Care Reform Bill; $557 Billion In Revenue Raisers

Homepage » Communities » Tax Management » Archive » 2009 » House Democrats Propose $894 Billion Health Care Reform Bill; $557 Billion In Revenue Raisers

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House Democrats revealed an $894 billion overhaul of the nation’s health insurance system on October 29, including a new surtax on higher-income taxpayers.   From OMA Connections Partner, Plante Moran