January 2013
Fiscal Cliff Agreement: WOTC and Bonus Depreciation Renewed On January 1, H.R. 8, the American Taxpayer Relief Act of 2012, was enacted into law. The legislation stopped many automatic tax increases which were scheduled to go into effect immediately, temporarily averting the so-called budgetary “fiscal cliff” in Washington. The automatic spending reductions of the fiscal cliff were not addressed in the bill, but will be revisited by the new Congress before the deadline in two months. Among the many provisions of H.R. 8 was the reauthorization of the Work Opportunity Tax Credit (WOTC) through the end of 2013 (and retroactively covering 2012). These tax credits allow hoteliers to hire disabled and disadvantaged workers, youth, veterans, and other at-risk individuals. Generally the credit is equal to 40 percent of the first year of wages up to $6,000. Also included in the legislation was the renewal of bonus depreciation, also known as section 179 expensing. This allows hoteliers to immediately take deductions on purchases of capital equipment rather than depreciate them over a period of time. The maximum deduction for 2012 and 2013 is $500,000, and the asset limit is $2 million. Also, 50 percent of what is spent for capital equipment can be expensed in the first year. The tax rates as they have been known for the past decade are mostly intact and would be permanent going forward. They will increase at the very top rates but at an income level that neither party had previously suggested. • Democratic campaign proposals suggesting increases on those with incomes over $250,000 and recent Republican concessions of rate increases over $1 million were both rejected. A compromise level of $450,000 for families ($400,000 for individuals) is the new income level for a top marginal income tax rate of 39.6 percent. • The 15% capital gains and dividend tax rate apparently remains the same at income levels noted above ($400k individual/$450k family), but rises to 20% for incomes above that threshold. • Provisions that have phased out the personal exemption and limited itemized deductions above certain income levels would be reinstated on taxpayers making over $250,000 and families earning over $300,000. The estate and gift tax rules will remain relatively close to the levels that existed this past year, with minor modifications, and would be permanent going forward. Instead of reverting to a 55% rate for estates over $1 million (as it was prior to 2001), the estate tax would rise to 40% from its 2012 level of 35%. The first $5 million in assets continue to be exempted ($10 million per couple). The AMT would be "patched" permanently as part of the deal. The AMT (alternative minimum tax) was not originally indexed for inflation, and therefore had to be "patched" annually to prevent an increasingly large number of middle-class taxpayers from becoming a part of this complicated provision. This deal indexes AMT levels permanently. Restaurant depreciation, the WOTC and food-donation deduction are in: The 15- rather than 39-year depreciation schedule for restaurant improvements/new construction, the Work Opportunity Tax Credit (WOTC), and the deduction for charitable contribution of food inventory by S corporations are maintained retroactively for 2012 and prospectively in 2013. The National Restaurant Association successfully led a coalition of retail and other interests pushing for inclusion of the 15-year depreciation
Story Continued on page 2... Page 1
Fiscal Cliff Story Continued...
provision, WOTC and charitable food contribution provisions as part of a package of traditional "tax extenders" for inclusion in the final fiscal cliff tax deal. In addition, one more year of 50% bonus depreciation for certain equipment is included in the package. Some tax breaks that have existed the past couple of years will expire and will not be renewed. In particular, the 2% payroll tax "holiday" for individuals enacted as part of the several stimulus steps to help battle the recession is not being renewed or extended, so Social Security payroll tax rates will revert from 4.2% to 6.2% on the first $113,700 in earnings. Certain lower-income and family tax credits are extended for five years, including the American Opportunity Tax Credit, which can be claimed for college-related expenses; the Child Tax Credit; and the Earned Income Tax Credit. Unemployment insurance for long-term unemployed is also extended for one year. The provision enacted as a part of the health care law that that taxed investment income an additional 3.8 percent on those earning more than $250,000 a year will - as of right now - still go into effect in 2013, although significant number of Democratic senators have indicated their support for agreeing with most Republicans to eliminate that tax increase. A one-year extension of the farm bill is included, extending current policy through Sept. 30, 2013. (The current farm bill
expired Sept. 30, 2012.) This gives the House and Senate nine months to forge a compromise on new commodity programs. This averts in particular a steep increase in milk prices (the "Dairy cliff," as it's recently been referred to in DC) that would have occurred if the current law was not extended or reformed, due to the underlying 1949 dairy price support policies. Sequester cuts TBD: While the framework for the tax portion of the fiscal cliff is largely worked out, there are still significant disagreements on the ways to avoid - or if to avoid - the automatic across-the-board spending cuts to defense and non-defense spending programs (a.k.a. the "sequester"). The Senate-passed legislation includes a 2-month delay in the implementation of the sequester cuts. This gives Congress and the White House enough time to potentially negotiate a different set of spending cuts. Congress is not done. They will need to pair whatever details from the "cliff" deal are left (primarily the spending cuts) with another vote on the debt limit in early 2013. An increase in the debt limit -- which was the major impetus for negotiations in the summer of 2011 -- was NOT included in the fiscal cliff fix deal under consideration right now. Treasury Secretary Geithner has indicated that the federal government has technically met the debt ceiling as of today, and that he will have approximately two months' worth of tools at his disposal before further action on the debt limit becomes imperative. Lastly, how much of the deal, if agreed to, is maintained in the long run will remain to be seen, since Congress will likely address comprehensive tax reform in 2013.
The 2012 Economic Census is Here Response is Due By February 12, 2013 Nearly 4 million businesses have received forms for the 2012 Economic Census, the U.S. Government’s official five-year measure of American business and the economy. By law, these businesses must respond by February 12. And because recipients include many of your members, or readers, here’s some important information for them: • Get help with forms and report online at econhelp.census.gov • Learn all about the Economic Census at business.census.gov
President Signs ATM Legislation Into Law WASHINGTON, D.C. -- President Barack Obama has signed into law new legislation aimed at cracking down on what the industry has called frivolous lawsuits regarding posted ATM fees. The bipartisan measure sponsored by U.S. Rep. Blaine Luetkemeyer (R-Mo.), eliminates the requirement that ATMs display duplicative signs disclosing their fees in an effort to reduce fraud and protect consumers. Luetkemeyer filed the legislation after learning that one person in Missouri visited five ATMs, and had threatened to sue over missing fee-disclosure stickers and settled the cases for more than $100,000. The Electronic Funds Transfer Association previously reported that more than 500 cases have been filed against banks, credit unions and retailers that have ATMs and in some cases there were suspicions that an individual may have actually removed the signs on stickers from the ATMs, according to a release from the congressman's office. The new law amends the Electronic Funds Transfer Act (EFTA) to maintain the on-screen fee notice requirement, but no longer requires operators to post the duplicative signs on or near ATMs. Before the change, ATM operators were required to post both a notice of a transaction fee on or near the ATM and provide an on-screen notice of the fee during the transaction. Page 2
IRS Gives Some Businesses an Extra Year on Service-Charge Compliance
Endorsed Providers
The IRS announced that in limited cases it will give businesses an extra year (until Jan. 1, 2014) to come in line with new IRS guidance reaffirming the difference between tips and service charges. The extension of time is intended to apply in very limited facts and circumstances, and may be used only by businesses that must update their systems and amend their business practices in order to comply with the updated IRS policy on service charges. For all other businesses, IRS enforcement of the policy remains effective immediately and is applicable retroactively. --BACKGROUND--The IRS in June instructed its examiners to start enforcing IRS Revenue Ruling 2012-18, issued June 25, starting Jan. 1, 2013. While the revenue ruling doesn't reflect a big change in current rules on service charges, IRS activity is a sign that that the agency intends to take a closer look at whether restaurateurs are misclassifying service charges as tip income. In response to comments the NRA and others submitted this fall, the agency decided to push off enforcement in limited cases until Jan. 1, 2014. IRS Announcement 2012-50 delaying enforcement for some businesses (Dec. 2012) http://1.usa.gov/V55ebS , IRS Revenue Ruling 2012-18 (June 25, 2012) http://1.usa.gov/QCAeLw , IRS interim guidance to examiners (June 25, 2012) http://1.usa.gov/P1EB1t , NRA comments to IRS (Sept. 24, 2012) http://bit.ly/QCAkTo
Labor Department to Delay Health Care Notification Rule The delay will give employers more time to prepare for the requirement The federal government will delay a mandate that requires employers to notify employees about their health care coverage options under the 2010 health care law, the Labor Department (DOL) announced Jan. 24, 2013. In a Q&A posted on its website, the agency said that it would postpone the Mar. 1, 2013 notice requirement for businesses until late summer or early fall. This date would be closer to the Oct. 1, 2013 deadline that states face to begin allowing millions of individuals and small businesses to enroll in health benefit plans for 2014 through state-based "exchanges." The 2010 health care law requires states to set up the exchanges, or health insurance marketplaces to make it easier for Americans to shop for health benefits. Starting in 2014, federal law will for the first time require individuals to either obtain health insurance or pay a penalty.
The 2010 law gave states the option of running their own exchange, operating a joint exchange with the federal government, or deferring to the federal government to run the exchange. State plans remain in flux; it's likely that only 17 states will operate their own exchanges in 2014. The employee-notification rule that was due to take effect Mar. 1, 2013 will require employers subject to the federal Fair Labor Standards Act to tell employees about the services that exchanges provide, explain how employees can contact exchanges, and tell employees about their potential eligibility for tax credits to help them buy insurance through an exchange if they can't find affordable, minimum-value coverage through their employer or another program. The DOL said it is postponing the notice requirement in part to give employers more time to prepare, and in part because the federal government has not yet finalized or educated people about critical regulations to implement the law. The DOL says it's looking at providing model, generic language that employers could use to satisfy the notice requirement.
Page 3
2013 HOOSIER HOSPITALITY CONFERENCE
MARCH 12-13, 2013 @ HILTON INDIANAPOLIS HOTEL & SUITES
LAUREN FAULKNER Hotel Industry Overview STR presentations provide current and historical aggregate hotel supply, demand, revenue, occupancy, average daily rate and revenue per available room & forecast statistics for the total U.S. and the top 25 U.S. markets. This session will also focus on the top 25 U.S. markets, the state of Indiana and key markets throughout the state. Tuesday, Mar. 12, 1:45 - 2:45 PM
JIM KNIGHT Coaching that Rocks This highly interactive breakout session is effectively designed to provide best practices to Coaching & Counseling employees. Having uncomfortable conversations with others is never fun and tends to be confusing about the right approach to get employees back on track…or let them go
HHC 2013 HOTEL INFORMATION Hilton Indianapolis Hotel & Suites 120 West Market Street Indianapolis, IN 46204 Discounted hotel room rate $129 plus tax Reserve your room by February 14 Reservations: 1-317-972-0600 or Toll-Free at 1-800-HILTONS Please mention the Hoosier Hospitality Conference when making reservations.
HHC IS BROUGHT TO YOU BY:
Wednesday, Mar. 13, 11:00 AM 12:00 PM
TITLE SPONSOR
PREMIERE SPONSORS
Questions? Contact Stephanie Higgins at 800.678.1957 or 317.673.4211 ext. 135 or email SHiggins@LMVconsulting.com
SEE FULL SCHEDULE AND SPEAKER LIST ONLINE AT:
WWW. HOOSIERHOSPITALITYCONFERENCE.COM Page 4
2013 HOOSIER HOSPITALITY CONFERENCE MARCH 12-13, 2013 @ HILTON INDIANAPOLIS HOTEL & SUITES CONTACT INFORMATION
REGISTER BY FEB. 19 & SAVE!
Business Name
Contact Name
Address City
State
Phone (
Zip
)
Fax (
Second Registrant Name
Third Registrant Name
WHAT INDUSTRY ARE YOU IN?
Restaurant
Indiana Hotel & Lodging Association Member
Lodging
Tourism
Meetings
Indiana Restaurant Association Member
)
Other ________________________
AICVB / CVB Member
IMPI Member
Membership forms are available at www.hoosierhospitalityconference.com if you want to take advantage of member discount pricing for HHC Conference Registration.
RATES AFTER FEBRUARY 19, 2013 FULL CONFERENCE RATES (Includes all functions and meals.) Member Rate 1st registrant $244 Non-Member Rate $264 1 DAY RATES (Includes all seminars and lunch.) Member Rate Tuesday $148 Member Rate Wednesday $118 Non-Member Rate Tuesday $168 Non-Member Rate Wednesday $138
EARLY BIRD RATES
REGISTER BEFORE FEBRUARY 19 AND SAVE!
EARLY BIRD FULL CONFERENCE RATES (Includes all functions and meals.) Member Rate 1st registrant $199 Member Rate 2nd registrant +$179 Member Rate 3rd+ registrant +$149 Non-Member Rate $219 EARLY BIRD 1 DAY RATES (Includes all seminars and lunch.) Member Rate Tuesday $129 Member Rate Wednesday $99 Non-Member Rate Tuesday $149 Non-Member Rate Wednesday $119
STUDENT RATE Tuesday sessions only. Excludes food. Wednesday sessions only. Excludes food. Total
Total DINE AROUND: Tuesday, March 12th 7:00 PM Weber Grill
120 West
Buca di Beppo
St. Elmo’s Steak House
Capital Grille
Undecided
$25 $25
Not Participating
(please select your preference) Register Now! Limited Space Available
PAYMENT METHOD To receive advance registration rate, this form must be postmarked on or before February 19, 2013. Payment must accompany registration to be processed.
Enclose check for $________________ (make payable to Hoosier Hospitality Conference) Mail to: Hoosier Hospitality Conference, 200 S. Meridian St., Suite 350, Indianapolis, IN 46225 Credit Card Payment. Fax form to 317.673.4210 Total $ __________ American Express Card #
MasterCard
Visa
Discover
CID _______
(3-digit # found on the back of the card on the signature line)
Exp. Date
Name on Card Signature
If you have a special dietary or accommodation need, please list below: ___________________________________________________.
Confirmation/Cancellation Refunds: All registrations received will be confirmed by fax and/or mail. If you must cancel for any reason, notify us in writing by Feb. 26, 2013 to receive a 90% refund. No refunds will be given for cancellations received after Feb. 26, 2013.
REGISTER ONLINE AT WWW.HOOSIERHOSPITALITYCONFERENCE.COM
Questions? Call 800.678.1957 toll free, 317.673.4211, or e-mail info@hoosierhospitalityconference.com or visit www.hoosierhospitalityconference.com
Food-Allergic Guests and The ADA After media reports created some confusion over the Justice Department’s stance on how the Americans with Disabilities Act applies to food-allergic customers, DOJ published a Q&A last week reaffirming that the ADA does NOT require all restaurants to provide gluten-free or allergen-free foods. But DOJ indicated that the ADA may require restaurants to take "reasonable steps" to accommodate people with celiac disease and other food allergies, as long as the accommodation doesn't result in a "fundamental alteration" of the restaurant's operations. For example, the DOJ said the ADA may require restaurants to answer questions about menu ingredients and omit or substitute certain ingredients upon request if the restaurant normally does this for other guests. However, a restaurant would not be required to "alter its menu or provide different foods to meet particular dietary needs." DOJ Q&A http://1.usa.gov/VRhgVz The agency's Q&A came in the wake of a December agreement between the Justice Department and Lesley University, Cambridge, Mass. The school agreed to provide gluten-free and allergen-free food options as part of the university’s meal plan, and take other steps to accommodate students with celiac disease and other food allergies. In this case, the meal plan was mandatory for all students living on campus. Food-allergic students filed the ADA lawsuit to force the school to modify the plan. Similar school foodservice programs are scrutinizing that agreement closely. DOJ/Lesley University agreement http://1.usa.gov/WrNWGf
Access the NRA's Jan. 17 Health Care Webinar
THIS PRE-RECORDED WEBINAR OFFERS INSIGHTS ON NEXT STEPS EMPLOYERS SHOULD TAKE TO PREPARE The NRA hosted an educational webinar for NRA members, on Jan. 17th during which they highlighted the changes ahead and how restaurateurs can prepare for them. In order to access the recording of the webinar, you'll need your NRA member login. To listen to the webinar and view the slides, go to http://www.restaurant.org/Events-Networking/Events/Webinars/HealthCare-Law-Next-Steps-for-Restaurateurs. The webinar, which lasted for approximately 90 minutes, was moderated by the NRA's Michelle Neblett. The NRA plans to host additional webinars on topics related to health care reform as more government agencies issue proposed regulations.
New Edition of Managing Front Office Operations Features Online Component The American Hotel & Lodging Educational Institute (EI) has published the ninth edition of its best-selling textbook, Managing Front Office Operations. Written by Michael L. Kasavana, Ph.D., NAMA Endowed Professor of Hospitality Business at Michigan State University, this textbook provides an in-depth look at management of the front office and how this department interacts with other hotel departments to create a memorable guest experience. The ninth edition features a new section on payment card industry (PCI) compliance. It also features hundreds of small but important changes throughout the book to reflect today’s new computer, Internet, self-service, and telephone technologies. Because the front office is such an important part of any hospitality operation, Managing Front Office Operations is a required course in several of EI’s curricula, including the Rooms Division Area of Specialization, International Hotel Management Area of Specialization, Hospitality Fundamentals Program, Hospitality Operations Certificate, and Hospitality Management Diploma. As with the previous eighth edition, this textbook is available with an online component, the Front Office Manager program. This program puts learners in control as they explore the many tasks and responsibilities of working a hotel’s front office. The 10-hour, interactive, online program outlines the interactions between the front office and other hotel departments that are required to create a positive guest experience. To order Managing Front Office Operations, call +1.800.349.0299 or +1.407.999.8100 or visit www.ahlei.org. U.S. academic customers should contact Pearson Higher Education, EI’s academic distribution partner. About the American Hotel & Lodging Educational Institute Established in 1953 as a nonprofit educational foundation of the American Hotel & Lodging Association, the Educational Institute’s mission is to continue being the preferred provider to the lodging industry, hospitality schools, and related hospitality industries by developing and providing quality resources to train, educate, and certify hospitality professionals worldwide.
Page 6
ADA Pool/Spa Accessibility Compliance Effective January 31 The deadline for pool and spa accessibility under the Americans with Disabilities Act (ADA) is now in effect and we urge members to review their properties for compliance. AH&LA was able to secure a one-year extension for compliance to January 31. According to current Department of Justice (DOJ) guidelines, all existing pools and spas at lodging facilities must do the following if it is "readily achievable": • Provide at least one means of entry (pool lift or sloped entry) as long as it is readily achievable. Pools with 300 linear feet or more of wall must have a pool lift or entry, and one additional means of entry which can be one of the following: pool lift; sloped entry; transfer system; transfer wall; or pool stairs. • Have the pool lift out in position and ready for use all hours the pool is open. • Each body of water (e.g. pools, spas) must have a separate means of entry (there are special rules for clusters of spas). • Pool lifts must be attached to the pool deck or apron in some manner unless it is not readily achievable to affix them. • If a pool is not opened to the public on January 31, access is not required until the pool is opened. An analysis of the DOJ guidelines is available to AH&LA members by going to www.ahla.com. Additionally, AH&LA’s 2012 ADA Guide, covering pool accessibility compliance and the other 2010 standards hoteliers must meet, is available online at www.ahla.com (login required). For more information, contact AH&LA Senior Vice President of Governmental Affairs Kevin Maher at (202) 289-3147.
Discover Professional Certification Widely recognized as the preeminent leader in hospitality certification, the American Hotel & Lodging Educational Institute (EI) strongly supports and encourages the certification of hospitality professionals in all facets of the industry, including: • • • • • •
hotels food & beverage establishments trainers hospitality educators hotel suppliers spas
In order to become certified by the EI, you must meet the knowledge requirements, the experience requirements and successfully complete a certification examination. Certification examinations are available through EI year-round using computerized adaptive testing or traditional print testing. For more information on Professional Certification through EI please visit: http://www.ahlei.org/certification/
New Federal Crib Standards Effective December 28 hotels may only utilize cribs that meet recent standards laid out by the U.S. Consumer Product Safety Commission. For a poster specifically addressing concerns for the lodging industry, go to www.ahla.com. New Crib Standards: Prohibit the sale of traditional drop-side cribs; immobilizers and repair kits are also not allowed; Require stronger wood to prevent slat breakage; Require anti-loosening devices to keep hardware secure and prevent detaching; Strengthen mattress supports; and Require more rigorous safety testing. Hotels, motels, and other places of public accommodation are required to provide only cribs that meet the new federal standards All cribs made, sold, or resold after June 28, 2011 must meet new crib standards. You may not resell, donate or give away a crib that does not meet the new crib standards. Page 7
Do you own or manage a Hotel or Restaurant? Are you buying your natural gas from Citizens Gas Company? Do you know that you can reduce your heating bills by up to 41%? You are entitled to a FREE program called "Citizens Select", which will cut your bills by hundreds, if not thousands of dollars per year
For a FREE audit and savings report, call right now!
Call - 877-902-1389
Page 8