NEWS FROM BP&S

New Employee

BPS welcomes the following new employee:

Philip Simoneaux has joined the Firm’s audit staff. Philip graduated from the University of South Carolina in May 2005 with a BS degree in accounting. Philip is a big-time sports fan and enjoys playing basketball, baseball, football and golf.

Looking for Outstanding Professionals

Our practice continues to grow (thanks to our clients) and we continue to look for additional outstanding staff.  If you know of someone who might be interested in working with us, please have them send a resume to Tom Pietras

Softball Update

You may recall that the Firm’s softball team, The Balance Sheets, finished in second place last season (we have a plaque on the wall to prove it).

Having lost our coach and star player, Daniel Crowson, we knew this would be a re-building year.  We have some new faces in the line-up:  Paige Maxwell made her softball debut in our opening game and once she found second base, she turned in a good performance;  Tommy Kassekert and Philip Simoneaux have brought some actual softball talent to the team; and several ringers friends have agreed to play on our team this year.

Despite the new talent, this year’s team has gotten off to a rocky start.  We lost both of our games so far this year.  By a lot.  Despite the losses, everyone is having a good time and the fans keep coming to the games.

In-House Seminars

We will again be hosting continuing education seminars this Fall.  Our seminars are scheduled for Friday, September 23 and Friday, October 28.

As in the past, seminars will be four hours followed by lunch.

If you are interested in the best free CPE around, contact Tom Pietras.
 

TELECOM INDUSTRY SEMINARS
BACK BY POPULAR DEMAND!

In October, we will again be presenting our wireless telecommunications industry seminar in Las Vegas, presented in association with CoBank and Moss Adams. Please contact Chris Stormer if you are interested in attending.

TECHNICAL ISSUES

Independent contractors can help limit your liability

One of the easiest ways for a business to limit liability is to use independent contractors instead of employees. Of course, merely calling employees "independent contractors" will not make those individuals independent contractors.

Control
The determination of whether a worker will be considered a contractor or an employee is a question of control. If the worker determines his or her own fees (usually per job), sets his or her own working hours, and provides his or her own tools, he can reasonably be considered an independent contractor. If the worker does not control his or her hours worked or wages, and uses tools provided for him or her by the employer, the worker is probably an employee.

There is a 20-factor common law test that can help determine if a worker is an independent contractor. It is important to work through the factors to determine whether the correct classification for the worker has been chosen, as the classifications have distinct consequences.

Benefits
The difference between independent contractors and employees is stark, and is not simply limited to the label of the worker.

Independent contractors need not be included in retirement plans. You will only have to pay the contractor gross pay, rather than withholding wages for tax purposes. As you need not pay Social Security, Medicare or unemployment insurance for an independent contractor,  record keeping is much simpler.

Independent contractors are also responsible for their own tort and contract liability. If an independent contractor commits a tort, in most cases the contractor will be solely liable.

Proceed with caution
Use extreme caution when labeling workers. Mislabeling workers can lead to serious problems.

You could be responsible for back employment taxes, which are often considerable when interest and penalties attach. You could also be liable for damages in a tort claim decided against the mislabeled worker.

Tort liability for a mislabeled worker can have repercussions beyond the payment of the damages. If the worker is deemed to be an employee, the use of contractors instead of employees for liability limitation is lost, which can impact whether the business was operated in such a manner as to limit liability on the whole.

Using independent contractors can be a smart business move but without careful planning, you could be in for some expensive tax consequences. Give our office a call and we'll take a look at your options.

Energy Tax Incentives Act of 2005

The Energy Tax Incentives Act of 2005 contains a series of tax breaks aimed at encouraging conservation and fuel efficiency by individuals and manufacturers. Broadly speaking, the Act provides tax incentives for consumers to buy energy efficient assets and for manufacturers and builders to provide them. Here's a summary:

• New tax credits for the purchase of hybrid, fuel cell, advanced lean-burn and other alternative power vehicles. The size of the credit varies depending generally on the weight class of the vehicle and the rated fuel economy. The credit applies to vehicles placed in service after 2005, with termination dates varying with the type of alternative power vehicle. Additionally, the pre-Energy Tax Act law deduction for certain clean fuel vehicles and refueling property now sunsets after 2005 (instead of after 2006, as was originally scheduled).
   
• New 30% tax credit for the purchase of qualifying residential solar water heating, photovoltaic equipment, and fuel cell property. The maximum credit is $2,000 (for solar equipment) and $500 for each kilowatt of capacity (for fuel cells). The credit applies for property placed in service after 2005 and before 2008.
   
• New 30% business tax credit for the purchase of fuel cell power plants and a 10% credit for the purchase of stationary micro-turbine power plants, effective for periods after December 31, 2005 and before January 1, 2008, for property placed in service in tax years ending after December 31, 2005.
   
• New 10% personal tax credit for energy efficient improvements to existing homes. The lifetime maximum credit per taxpayer is $500 and applies for property placed in service after December 31, 2005 and before January 1, 2008.
   
• New business tax credit for contractors for the construction of new energy efficient homes. The credit is either $2,000 or $1,000 per home, depending on the type of home and the energy reduction standard it meets. The credit applies to homes whose construction is substantially completed after December 31, 2005, and which are purchased after December 31, 2005 and before January 1, 2008.
   
• New deduction for energy efficient commercial buildings meeting a 50% energy reduction standard. The deduction (generally $1.80 per square foot, but 60¢ per square foot for certain separate building systems) is effective for property placed in service after December 31, 2005 and before January 1, 2008.
   

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