Employer Notice: IRS Issues Federal Tax Reform Paycheck Withholding Guidance

On Jan. 11, 2018, the Internal Revenue Service (IRS) released Notice 1036, which provides guidance on tax withholding from employees' paychecks under the new tax reform legislation that was signed into law late last year. The IRS is “instructing employers to implement the new withholding tables by February 15, 2018”. 

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    Full text of the IRS notice is available here

    GCP leadership and staff worked closely with Congressional leaders to preserve key economic development tools, like the New Market Tax Credit and Historic Tax Credit, in the tax reform package that was approved.

    In addition, the newly revised tax code states:

    • C Corporations will be taxed at a flat rate of 21%, down from the previous 35% rate.
    • A new 20% deduction for eligible pass-through business income will be available through 2025.
    • Temporary tax rate cuts will be enforced on nearly all individuals through 2025, the top rate is lowered from 39.6% to 37%.
    • Business expensing will be expanded by raising the cap on deductible business investments and making HVAC equipment installed in commercial buildings eligible. 

    Supplementary tax guidance, from federal authorities, is expected in the weeks and months ahead.

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    Next up: Employer resource coming to aid business owners in navigating state regulations

    Employer resource coming to aid business owners in navigating state regulations

    In last week’s newsletter, the Greater Cleveland Partnership and COSE made it known to all our readers that we plan to unveil a state regulatory toolkit for business owners in the near future.  While most understand that a certain degree of regulatory requirements can be a part of doing business, our members frequently convey to us how important it is that they are created and enforced in a way that does not pose an undue burden. Unfortunately, many businesses are not aware of the fact that resources are available to them when they are confronted with a state rule or regulation that impacts their operations in a negative way.

    In last week’s newsletter, the Greater Cleveland Partnership and COSE made it known to all our readers that we plan to unveil a state regulatory toolkit for business owners in the near future. 

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    While most understand that a certain degree of regulatory requirements can be a part of doing business, our members frequently convey to us how important it is that they are created and enforced in a way that does not pose an undue burden. Unfortunately, many businesses are not aware of the fact that resources are available to them when they are confronted with a state rule or regulation that impacts their operations in a negative way.

    Through in-depth discussion with our membership and with our partners at institutions like Ohio’s Common Sense Initiative (CSI), a solution was born and we’re busy putting the finishing touches on the final product. By producing a user-friendly online application—or a state regulatory toolkit—it will allow interested parties to directly connect businesses with resources that can help in this space.

    Stay tuned in the coming weeks, to learn more about how your business can stay informed, participate, provide feedback, and offer solutions when faced with a state regulatory challenge.

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    Next up: Employers Welcome Delay on Department of Labor Overtime Rule

    Employers Welcome Delay on Department of Labor Overtime Rule

    On November 22, a federal judge in Texas issued a preliminary injunction against the Department of Labor’s (DOL) overtime rule which was set to go into effect December 1, and would have doubled the current threshold under which employees must be paid overtime. 

    On November 22, a federal judge in Texas issued a preliminary injunction against the Department of Labor’s (DOL) overtime rule which was set to go into effect December 1, and would have doubled the current threshold under which employees must be paid overtime. 

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    Therefore, the implementation deadline will not be enforced and there is no need for employers to comply by December 1.

    In his temporary ruling, Judge Mazzant stated that, “…the Final Rule exceeds the Department’s authority,” signaling he is likely to permanently overturn the rule.   

    Business organizations from around the country have strongly opposed the overtime rule as it represents an economic burden and it would add new layers of complex regulation for America’s small businesses.

    Learn more about COSE and GCP’s advocacy efforts.

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    Next up: Energy Efficiency Bill Signed Into Law, Endorsed by COSE

    Energy Efficiency Bill Signed Into Law, Endorsed by COSE

    For almost two years, COSE has supported bipartisan federal energy efficiency legislation introduced by U.S. Senators Rob Portman (R-OH) and Jeanne Shaheen (D-N.H.) designed to provide incentives for small business manufacturers to install more energy efficient technologies at their facilities and to cut energy use in commercial buildings, manufacturing plants, and homes. President Barack Obama signed a version of that original bill this spring, the first energy bill to be signed into law this Congress. The Energy Efficiency Improvement Act of 2015 the President signed is made up of three simple provisions that include no mandates and was scored by the Congressional Budget Office to be budget neutral.

    For almost two years, COSE has supported bipartisan federal energy efficiency legislation introduced by U.S. Senators Rob Portman (R-OH) and Jeanne Shaheen (D-N.H.) designed to provide incentives for small business manufacturers to install more energy efficient technologies at their facilities and to cut energy use in commercial buildings, manufacturing plants, and homes. President Barack Obama signed a version of that original bill this spring, the first energy bill to be signed into law this Congress.

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    The Energy Efficiency Improvement Act of 2015 the President signed is made up of three simple provisions that include no mandates and was scored by the Congressional Budget Office to be budget neutral:

    1. Establishes a voluntary, market-driven approach to aligning the interests of commercial building owners and their tenants to reduce energy consumption. 
    2. Exempts certain electric resistance water heaters used for demand response from pending Department of Energy regulation.
    3. Requires that federally-leased buildings without Energy Star labels benchmark and disclose their energy usage data, where practical.

    COSE appreciates Senator Portman’s leadership on this issue. And, as part of the National Small Business Association’s (NSBA) Washington Presentation, COSE members had an opportunity to discuss energy, tax reform, health care, and trade issues with the Senator. Senator Portman informed the group that he will continue to work for passage of his larger bill and a national energy strategy that boosts American workers while protecting the environment. 

    For more information on the Energy Savings and Industrial Competitiveness Act of 2015, video can be found here of the Senator discussing it at a hearing in the Senate Committee on Energy and Natural Resources.

    COSE has been at the forefront of energy efficiency issues related to small businesses for years and helps small business owners boost efficiencies with energy assessments and retrofits. For more information on how you can take advantage of COSE energy services click here.

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    Next up: Entrepreneur Pilot Program Passes Ohio Legislature, Aims To Improve State Agency Processes for Small Businesses

    Entrepreneur Pilot Program Passes Ohio Legislature, Aims To Improve State Agency Processes for Small Businesses

    The Ohio Senate passed an amended version of House Bill 218 (HB 218) last week and today the Ohio House concurred; the bill aims to provide for enhanced communication and understanding between state agencies and small business employers through an entrepreneur-in-residence (EIR) pilot program. 

    The Ohio Senate passed an amended version of House Bill 218 (HB 218) last week and today the Ohio House concurred; the bill aims to provide for enhanced communication and understanding between state agencies and small business employers through an entrepreneur-in-residence (EIR) pilot program.  The amended version of this legislation would align the program with LeanOhio practices; LeanOhio’s stated mission is to make government services in Ohio simpler, faster, better, and less costly.  Using continuous improvement methods such as Lean and Six Sigma, LeanOhio - with the help of Ohio's state agencies - hope to cut red tape, remove inefficiencies, improve customer service, and achieve measurable results.  LeanOhio is housed in the Ohio Department of Administrative Services and the legislators that drove HB 218 believe that LeanOhio currently has the necessary infrastructure to execute an entrepreneur-in-residence initiative effectively. 

    So, what will an entrepreneur-in-residence pilot program actually do? It will help address the need to provide small business owners with the necessary resources and support offered by an agency, from an experienced small business person who understands the unique challenges they face.  More specifically, and according to the newly amended language, the duties of an entrepreneur-in-residence are to:

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    1. Assist the LeanOhio office in facilitating and developing the scope of lean process improvement events throughout state government;
    2. Assist the LeanOhio office in holding follow-up meetings to ensure the improvements developed at lean process improvement events are implemented;
    3. Participate in strategic planning efforts for the LeanOhio office or other areas of state government;
    4. Assist the LeanOhio office with presentations on opportunities for state government to become more efficient and effective;
    5. Facilitate meetings with businesses, state agencies, and local governments that may be affected by process improvements recommended by the LeanOhio office;
    6. Assist the LeanOhio office in providing continuous improvement training to state employees;
    7. Make “reasonable efforts to market the entrepreneur-in-residence program across the state and attract participation from entrepreneurs with various backgrounds, including female entrepreneurs, minority business enterprises.”

    As a non-partisan, member-driven organization COSE continually engages our members in a dialogue regarding the impact and need for synergy between state government and the business community. Having a small business representative work with state agencies as this program suggests, will allow for areas of excellence and improvement to be identified.

    “Small business owners wear many hats and are laser focused on achieving their own idea of success,” stated Council of Smaller Enterprises (COSE) President & Executive Director Steve Millard. “By including one of their own in the conversation on how government agencies processes can be improved to better serve the small business community, an entrepreneur-in-residence program can help close the gap between regulators and reality.”

    COSE appreciates the attention being paid to this important issue and we welcome the opportunity to work with LeanOhio, DAS, and all stakeholders to connect them with prospective entrepreneurs-in-residence and small employers in need of assistance in anticipation of the implementation of this program in order to achieve an even friendlier small business climate in Ohio.
     
    Now that this legislation has been approved by the state legislature, it will move to the Governor’s desk for final approval.


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    Next up: Entrepreneur-in-Residence (EIR) Program Accepting Applications Today

    Entrepreneur-in-Residence (EIR) Program Accepting Applications Today

    Are you an entrepreneur interested in strengthening the connection between small business and state government? Then this pilot program could be for you. Beginning in September, select small business professionals will work in-house with LeanOhio through an entrepreneur-in-residence (EIR) program where they will spend one year assisting with Lean Six Sigma projects, events, and meetings involving state government agencies. The goal is to strengthen the connection between small business and state government. And, Ohio agencies will gain insights into private sector best practices and challenges – while entrepreneurs and their businesses will gain experience and tools from leaders in process improvement.

    Are you an entrepreneur interested in strengthening the connection between small business and state government? Then this pilot program could be for you.  

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    Beginning in September, select small business professionals will work in-house with LeanOhio through an entrepreneur-in-residence (EIR) program where they will spend one year assisting with Lean Six Sigma projects, events, and meetings involving state government agencies. The goal is to strengthen the connection between small business and state government. And, Ohio agencies will gain insights into private sector best practices and challenges – while entrepreneurs and their businesses will gain experience and tools from leaders in process improvement.

    For an overview of the program see here or below for more information:

    What’s in it for you and your small business?

    • Lean Six Sigma Green Belt certification
      • Strengthened employee leadership and Lean Six Sigma skills
    • Learning and networking with a network of Lean practitioners
    • Improved understanding of government programs, processes, and resources
      • Exposure to multiple state agencies
      • An insider’s perspective on how government works

    Who is eligible for the entrepreneur-in-residence program?

    • Must be a resident of Ohio
    • Must be a small business professional
    • Must have approval from his/her company to participate in the EIR program
    • Must successfully complete a background check for determination of suitability for state government
    • Must have private-sector leadership experience in identifying continuous improvement efforts and managing project teams and sub-projects that cover all phases of project management
    • LeanOhio will make reasonable efforts to attract participants from entrepreneurs of various backgrounds, including female entrepreneurs, MBEs (Minority Business Enterprises), and EDGE businesses (Encouraging Diversity, Growth and Equity).

    For a timeline, including the responsibilities of an EIR see here

    To apply to be an entrepreneur-in-residence click here; applications will be accepted through July 10, 2015. 

    COSE supported legislation (House Bill 218) that allowed for this pilot program. The bill passed the Ohio General Assembly on November 19, 2014 and Governor John Kasich signed it on December 2, 2014.     


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