PROFESSIONAL CONSTRUCTION SERVICES OVERVIEW
Charlie Muracco CEO & Principal Consultant CLM Advisors
A 2021 survey of CPAs found 70% had advised their Garden State clients to move due to the high cost of living and doing business.
( ) transfer tax laws allow each person to transfer $11.7 million free of federal estate and gift tax to either their heirs or intended beneficiaries. That amount is slated for expiration by Dec. 31, 2025, reverting to $5 million per person, adjusted for inflation. The Biden administration could change this, however. It is expected that Congress will enact new tax legislation within the 2021-22 time frame to reduce the federal estate tax exemption amount to as low as $3.5 million before the 2025 deadline. What is more, new legislation could be enacted to eliminate the favored step-up for income tax purposes of someone’s assets at death. It is no wonder then that estate planning is witnessing red-hot demand. In the case of New Jersey, the state has not collected estate taxes after death since January 1, 2018. However, it continues to collect an inheritance tax of up to 16%. Also, New Jersey residents are still subject to the federal estate tax. The state’s high-tax environment has long been a cause of consternation for businesses and high-net-worth individuals. In fact, the New Jersey Society of CPAs found 70% of professionals surveyed in May 2021 had advised their clients in the Garden State to move due to the high cost of living and doing business. New Jersey has one of the highest tax structures in the United States, which can be highly disadvantageous especially in the event of an unforeseen downturn such as that brought about by COVID-19. High property taxes and corporate tax rates were mentioned as primary concerns among the CPAs surveyed in the May poll. Despite the challenges, there were still encouraging announcements that were testaments to the demand in the region for wealth management services. K2 Placements and Wealth Advisor Growth Network (WAGN) joined forces to create Advisor Insurance, an insurtech platform for wealth managers purchasing business insurance to protect their firms. New Jersey bank Peapack-Gladstone Financial is looking to bring in more fee revenue that is less vulnerable to interest rate fluctuations, making wealth management firms a prime
What makes the South Jersey region an attractive location for you and your firm? In our business, you want to be in a place where people feel like they have opportunity. That shouldn’t be taken for granted – there are regions of our country that have been hard-hit economically and that can have a psychological effect on business owners. South Jersey has kept growing through the years; obviously, our proximity to a major metropolitan city and to the Jersey Shore are big factors. We’re based in Gloucester County and the big story there has been the enormous growth of Rowan University over the past 10-15 years. Its transformation into a top regional university is one big driver of commerce in this area; plus, it feeds the skilled labor pool. What are the main challenges your clients and businesses are facing? As we emerge from the economic slowdown caused by the pandemic, there are a couple of lingering problems – and they are big problems. The first is the state of the labor pool. Over and over, I’m hearing my clients complain that they can’t find good people. I understand some of the safety-net measures that the government put in place to help keep people on their feet but we also must recognize that the overall work ethic has diminished. Good-paying jobs are available but the motivation of the labor pool hasn’t quite returned yet. Very large businesses are just going to invest in more automation but the small businesses can’t do that as much. We want to help our clients think through this problem and be ready to offer attractive compensation packages. People will come back to work but first their incentive to stay home will have to be reduced. The second major problem is the supply chain. These are strange times – availability of products and materials can vary widely and that is causing some distortions in the economy. To run a small business now – especially in manufacturing and distribution – you have to accept some unusual trade-offs and plan ahead as much as possible. www.capitalanalyticsassociates.com
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