Issue link: http://www.insightdigital.biz/i/104912
The rules are complex and revolve around whether a project resulted in a betterment or restoration to the underlying business system or unit of property. But, thousands of manufacturers have already determined that their prior capitalization policies provide an opportunity for catch-up deductions in 2012, spurring a flood of paperwork to the IRS for this change in tax accounting method. The state of Wisconsin also has enacted legislation including a tax credit for production activities in Wisconsin, which goes into effect this year. The manufacturers and agricultural credit, once fully phased in, will be 7.5 percent of Wisconsin manufacturing (and agricultural) based income. This credit will be phased in beginning this year when the credit rate is 1.875 percent, and rises to 7.5 percent for taxable years beginning in 2016. The Wisconsin facilities must be properly classified for property tax purposes as either manufacturing facilities or agricultural in use in order to qualify for this credit. The credit is phased-in as follows: �� ax years beginning this year: 1.875 percent T �� ax years beginning in 2014: 3.75 percent T �� ax years beginning in 2015: 5.526 percent T �� ax years beginning in 2016: 7.5 percent T The state also has a program that provides tax credits for companies that are expanding their workforce, facilities, Premier Thermoformer in the Fox Cities We manufacture trays, clam shells and blisters and training offered to employees. The key to obtaining these incentives is to work with your representative from the Wisconsin Economic Development Corporation early in the planning stage of any job creation project. In addition, there is a job creation income tax deduction that is either $2,000 or $4,000 per employee depending on gross receipts. Wisconsin continues to provide credits for research and development. The credits available are: expense credit, super research and development credit, facilities credit, and, effective Jan. 1, 2012, a sales tax exemption for purchases of tangible personal property used by companies primarily engaged in manufacturing and biotechnology. It is anticipated that Gov. Scott Walker will introduce tax reforms as part of his 2013-2015 biennial budget because it appears that Wisconsin���s current biennial budget ending June 30 could have a budget surplus between $125 million and $500 million. These reforms could include reductions in the income tax rates, among other items. Rick Stezenski is a CPA and federal tax services partner at Grant Thornton���s Appleton office. He can be reached at (920) 968-6722 or rick.stezenski@us.gt.com. Steven Koritzinsky is a CPA, state and local tax director, in Grant Thornton���s Milwaukee office. He can be reached at (414) 2776410 or steve.koritzinsky@us.gt.com. F INVESTING IN GOOD LEADERS PAYS OFF Engaging employees throughout their career is critical to organizational success. The Leadership Academy addresses skill development at every level of an individual���s career. s Serie 1 FOUNDATIONAL SERIES This series delivers high-performance strategies to increase the personal effectiveness of employees and establish leadership skills at all levels of your organization. s Serie 2 INTERMEDIATE SERIES This series takes it to the next level by enhancing an individual���s ability to function in teams and prepare them to manage others within your organization. Sessions begin March 6, 2013 Limited space available. Register today! ALL ABOUT INNOVATIONS & SOLUTIONS See our new VeriShel�� EASY-OPEN & RECLOSABLE clam shell design! 920.924.3449 training@morainepark.edu morainepark.edu/leadership Thermoforming ��� Structural & Graphic Design Printing ��� Fulfillment & Distribution (800) 446-1552 ��� www.aapack.com w w w.in s i g h t o n m f g . c o m PERFORMANCE-MINDED BUSINESS SOLUTIONS January 2013 ��� Insight on Manufacturing | 25