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Category: Auto Dealerships

December 28, 2019

2019 Bonus Depreciation Update for Auto Dealers

Tax reform increased first-year bonus depreciation to 100% for most long-term assets placed in service after September 27, 2018. When using bonus depreciation, eligible assets are not subject to an annual dollar limit; except for listed property, the asset does not need to be used 50% of the time for business; and they are not limited to annual business profit. The generous depreciation percentage remains in effect from September 27, 2017 until January 1, 2023, after which it is scheduled… Read more ›

December 28, 2019

Affordable Care Act Compliance: IRS Forms and Important Due Dates

CBM has published guidance for businesses that receive a notice from the IRS (Letter 226J) relating to penalties associated with compliance with the Affordable Care Act. Click here to read our guidance. Please also keep in mind the important deadlines below. Don’t Miss Early 2020 Due Dates February 28, 2020 – Paper copies of Forms 1094-C and 1095-C must be filed with the IRS by this date. Employers with less than 250 employees can paper file. March 2, 2020 –… Read more ›

December 28, 2019

Affordable Care Act Compliance: What Do I Do If I Get IRS Letter 226J?

The IRS is currently issuing the Letter 226J proposed employer-shared responsibility payment (ESRP) notice to businesses they suspect of having not complied with the 2017 tax-year Affordable Care Act requirements. The Letter identifies the amount of the proposed penalty that the business would be responsible for paying— an amount which can be steep. CBM has seen penalty amounts ranging from $3,160 to over a million dollars. CBM advises businesses that receive such a letter to respond promptly, especially since Letter… Read more ›

December 28, 2019

Recapture LIFO at a Lower Tax Rate While You Can

The LIFO (last-in, first-out) accounting method for inventory valuation is one of the few business tax deferrals permitted by the IRS. Intended to benefit businesses through times of economic inflation, LIFO allows companies to include the effect of inflation in their cost of goods sold, thus lowering their taxable income. Many, but not all, auto dealerships use LIFO as a tax deferral strategy, not a permanent tax deduction. Dealers should invest their annual LIFO tax deferral each year to have… Read more ›

October 15, 2019

The U.S. Department of Labor Finalizes the New Overtime Rule

The U.S. Department of Labor (DOL) has released the finalized rule on overtime exemptions for white-collar workers under the Fair Labor Standards Act. The rule updates the standard salary levels for the first time since 2004. While it is expected to expand the pool of nonexempt workers by more than 1 million, it’s also more favorable to employers than a rule proposed by the Obama administration in 2016. That rule would have expanded the pool by more than 4 million… Read more ›

September 20, 2019

When It Comes to Rebounding from Disaster, Planning is Everything

When disaster strikes, it can severely affect your dealership operations. According to an analysis by Cox Automotive, approximately 1 million vehicles were damaged by Hurricane Irma and Hurricane Harvey. The effect of natural disaster on a business is catastrophic, sometimes resulting in a total loss. But what about other forms of disaster? Power outages, water leaks, fire, server crashes and cyber-attacks are threats as well. Statistics vary, but the consensus is that the survival of your business depends on how… Read more ›

August 23, 2019

Keep a Pulse on Your Dealership with these Four Metrics

When it comes to measuring success, dealerships often point to the most obvious indicator on the lot, car sales. But measuring success goes much deeper than totaling up the number of cars sold in a particular week, month, or quarter. Reading and interpreting reports with a variety of metrics is a critical step to catching the hazards that threaten your dealership’s bottom line. For instance, inefficiencies are usually small enough to fly under the radar but over time are large… Read more ›

June 20, 2019

John Comunale Elected to Board of Directors of the Montgomery County Students Automotive Trades Foundation

The Montgomery County Students Automotive Trades Foundation elected John Comunale, Senior Vice President at Councilor, Buchanan & Mitchell, P.C. (CBM), to its board of directors effective July 1. CBM, a full-service accounting and advisory firm with offices in Bethesda, MD and Washington, DC, has served auto dealerships throughout the Washington, DC metropolitan region and up and down the U.S. eastern seaboard since 1921. MCSATF, a not-for-profit organization, represents a collaborative effort between the Montgomery County business and professional community, and… Read more ›

June 18, 2019

Electric Cars: The Good News and the Bad News

Electric Vehicles: The Good News and the Bad News As of March 26, 2019, General Motors, LLC (GM) crossed their appointed electric car (EV) threshold of 200,000 EVs sold, marking their official entry into the race to the tax credit finish line. The GM tax credit, issued through the Energy Improvement and Extension Act of 2008, started at its peak value of $7,500. Hitting the 200k threshold signals a year-long phase-out, dropping to $3,750 for every EV sold from April… Read more ›

May 23, 2019

Auto Dealer Succession Planning, What Are You Waiting For?

Succession planning is a process that every dealership owner thinks about; however, identifying and developing new leaders is easier said than done. According to The National Alliance of Auto Dealer’s (NAADA) 2016 National Dealership Succession Planning Survey, Auto dealers are pushing succession off by 5+ years, The number one inhibitor to succession planning is timing and the current owner’s willingness to step back One-third of dealership owners do not have a succession plan in place Nearly 50% of dealerships know… Read more ›