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Week Three Negative

   
Independent grocers reported that their same store sales in the third week of May were 4.67% lower than they were during the same period in 2015.

Tomorrow the Bureau of Labor Statistics releases its May unemployment report. Initial estimates indicate that hiring will be around the same levels as April, which was a below average month.
Same Store Sales        
% Change from last year
Same Store Sales – Previous Months

BGBC Partners, LLP Tax Update
Presidential Candidates’ Tax Plans (Part I)
In the midst of all the mud-slinging going on with this year’s Presidential election, we thought that it might be a good idea to focus on one of the more important substantive issues, namely – Where do the candidates stand on tax policy matters?  In this segment of our Tax Update, we evaluate Hillary Clinton’s tax proposals.  In the next segment we will look at Donald Trump’s.
 
Let’s start with
Individual Tax Matters.  Hillary Clinton proposes the following
  • Imposing the "Buffett rule" requiring taxpayers earning more than $1 million per year to pay at least 30% in taxes, and "broadening the base of income subject to the rule."
  • Enacting the "Fair Share Surcharge"—i.e., an extra 4% surtax on taxpayers who make more than $5 million per year.
  • Cutting taxes for "hard-working families.
  • Establishing a 20% "caregiver credit" to help taxpayers offset up to $6,000 in caregiving costs (for a maximum credit of $1,200) for their elderly family members
  • Modifying the treatment of capital gains for taxpayers in the highest bracket by implementing a graduated holding period where the rate decreases, from 39.6% to 20%, over a 6-year period, to promote long-term investment.
  • Limiting the tax benefit of itemized deductions (except the charitable deduction), tax exempt interest, excluded employer-provided health insurance, and contributions to tax-preferred retirement accounts to 28%, for those in the 33% or higher tax brackets.
     
As far as Business Tax Matters, the Clinton proposals include:
  • Restricting corporate inversions by increasing, from 20% to 50%, the post-merger threshold of foreign shareholder ownership for an American company to be considered foreign.
  • Imposing an "exit tax" on companies that undergo an inversion to ensure that U.S. taxes are paid on unrepatriated earnings held overseas
  • Cracking down on earnings stripping.
  • Creating a $1,500 "apprenticeship tax credit" for every new worker that a business trains and hires.
  • Providing for a new 15% tax credit for employers that share profits with their workers.
  • Creating tax incentives to encourage investment in communities that have faced (or are about to face) significant manufacturing job losses
  • Simplifying tax filing and providing targeted tax relief for small businesses
  • Modifying and reauthorizing the "Build America Bond" program
  • Imposing a risk fee on large banks and financial institutions (generally, those with more than $50 billion in assets and/or which have been designated by regulators for "enhanced oversight").
  • Imposing a tax on high-frequency trading
  • Ending "wasteful tax subsidies" for oil and gas companies.
Regarding Estate Tax Matters, Ms. Clinton would modify the estate and gift tax system by:
  • Exempting the first $3.5 million of an individual's estate from estate tax ($7 million for married couples), without adjustment for inflation.
  • Increasing the top rate to 45%.
  • Capping the lifetime gift tax exemption at $1 million.
Other tax reform proposals of Ms. Clinton include:
  • Providing a tax credit of up to $5,000 (per family) for consumers buying health coverage on Affordable Care Act exchanges, to offset a portion of out-of-pocket and premium costs above 5% of their income.
  • Enhancing the premium tax credit so that taxpayers eligible for it will pay less of a percentage of their income than under current law, and ensuring that families purchasing on the exchange won't spend more than 8.5% of their income for premiums, and fixing the "family glitch" (i.e., under which affordability of employer-provided care is determined at the individual level despite the fact that family plans often cost significantly more).
  • Ending the "carried interest" loophole (under which private equity and hedge fund managers are taxed at capital gains rather than ordinary income rates on fund income).
  • Preventing tax avoidance by closing the "Bermuda reinsurance" loophole (essentially, a way to divert investment income to an insurance company set up in a low-tax jurisdiction like Bermuda).
  • Closing the loophole under which taxpayers essentially avoid IRA contribution limits by undervaluing contributed assets, and preventing taxpayers with "mega IRAs" from contributing further
  • "Asking the wealthiest to contribute more" to Social Security, including "options to tax some of their income above the current Social Security cap, and taxing some of their income not currently taken into account by the Social Security system.”
As we all know, what candidates say, and what they actually do (or are able to do) can be two different things.  However, we hope that this series will help you make an informed choice!
 
BGBC Partners, LLP is a full service certified public accounting and business consulting practice.  

For more information, contact
Brad Bell, CPA or Steve Reed, CPA/ABV/CFF at BGBC Partners, LLP (317-633-4700).
For More Information,
Contact Mark Ehleben
877-435-9400 x1402
marke@fmssolutions.com
8028 Ritchie Highway | Suite 212 | Pasadena, MD 21122


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