Developments in Tax and Business
Towns Mandating ENERGY STAR as Code
Here's a trend worth watching if you are a homebuilder: Some municipalities are requiring that every new home built in their communities be ENERGY STAR compliant. (ENERGY STAR is a joint program of the U.S. Environmental Protection Agency (EPA) and the U.S. Department of Energy.) Reactions to the requirement are mixed, with some homebuilders' associations supporting the measure and others opposing it on the grounds of cost.
Employment-tax Audits Coming Your Way
Contractors should be aware that the IRS plans to launch a new audit program targeted at federal employment-tax returns. While the IRS intends to examine all lines on the returns, it says that it will focus on fringe benefits, reimbursed expenses, the classification of workers (employee versus independent contractor), and officer compensation.
Buy New and Save Taxes
Contractors who have plans to buy a vehicle this year for business use could save taxes if they buy a new vehicle instead of a used one. The maximum first-year deduction for depreciation or Section 179 expensing for a business-use-only new luxury car purchased in 2009 is $10,960, compared to $2,960 for a used vehicle. The maximum write-off for a new light truck or van is $11,060, whereas it's $3,060 for a used vehicle.
