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Our news articles are posted on a regular basis to give our clients relevant and timely information about matters pertaining to our financial services. Browse through our current and archived articles to learn more.

Category: Small Business News

Commercial Insurance :: No, You Are Not Covered: Some Gaps That a Business Owner Policy Does Not Cover

The last thing a business owner wants in the event of an incident is for the claim not to be covered. In most cases, successful business owners need to have more than one policy type to properly protect themselves; however, this depends on the type of business and exposures that you have.


Your business is your career; properly protecting it means the continuation of your livelihood, while not having the certain policies in place may result in bankruptcy and closure of the business. For this reason, it is vital to understand what liability coverages and policies are available so as to protect your business from costly lawsuits.


…Because each business is different,
it is important to review all potential exposures

with your agent as well as legal counsel to determine
the best way
to address each potential liability exposure.

Most business owners are required to have General Liability (GL) coverage to satisfy their lease requirement. GL coverage, which is typically the first policy that a business purchases, is often purchased in a package, sometimes referred to as a Business Owner’s Policy (BOP). A GL policy covers injuries caused to others and damage to the property of others; it may also cover personal and advertising injury coverage, such as incidents caused by libel or slander. Many (but not all) of these policies include products liability, which covers defective products that may cause injury or property damage.

The following paragraphs discuss some types of exposure that are not covered by a BOP or a General Liability (GL) policy, as well as possible solutions to get coverage:

Employment Practices Liability (EPLI)
EPLI insurance is becoming more and more necessary for both large and small employers. EPLI provides protection against employee lawsuits regarding issues such as discrimination, sexual harassment, failure to employ, and many others. This coverage generally does not pay for punitive damages, but it will pay for the company’s legal costs associated with a covered lawsuit.

Errors & Omissions (E&O) Coverage
Also known as malpractice insurance, E&O provides coverage to individuals and firms who provide some form of expertise and/or counseling to their clients. When a professional receives payment in exchange for services, they are held to a high standard by both the client and the legal system. While incidents are not common, those that do occur are very costly. Having the right insurance coverage in place helps to allow the continuity of a practice by transferring potentially huge financial burdens to the insurance company.

Directors & Officers (D&O) Liability
This type of insurance is used to protect a company’s directors and officers from legal action, which can come from competitors, government agencies, creditors, employees, stockholders, or other third parties. Any firm with a board of directors (e.g., privately held companies, non-profit organizations, and homeowners’ associations) needs this coverage. Anyone serving on a board without this coverage is putting their personal assets at risk.

Pollution Liability
This type of insurance policy covers environmental liabilities excluded by standard General Liability insurance. Specifically, this coverage helps to protect contractors in the event of pollution incidents, such as contaminated soil disposal or the accidental release of fuel oil, chemicals, or toxic gases from broken pipelines, utilities, or stationary or mobile fuel tanks.

Auto Liability
Even a business that does not own any vehicles should not neglect getting Auto Liability. If an incident occurs during working hours and the injured employee was using his or her personal vehicle for business use, the business may be named as a party to legal action on any injury or property damage that may result. If the business uses personal vehicles on the job full time, it is probably best to have those vehicles insured through the company to make sure the company has coverage against legal action due to an automobile incident.

Workers Compensation
This type of coverage, which covers injuries on the job, is required by state law for businesses with employees, and employers can be fined for not carrying it. It also protects you from being legally liable should an injury occur.

Products Liability
This type of coverage is often, but not always, included under a General Liability policy. If it is excluded and you manufacture or sell products, you will not be covered unless you have a separate Products Liability policy. The significance of this coverage is that if a product originates from your business – regardless of whether you are the manufacturer, retailer or anyone in between – you will probably be named in the event of a lawsuit regarding that product. Products Liability does not cover recalls, but it does cover property damage or injuries caused by a product.

Because each business is different, it is important to review all potential exposures with your agent as well as legal counsel to determine the best way to address each potential liability exposure. Having insurance in place helps to bring more certainty to your business. Since all you pay is the premium, you do not need to worry about losing your business as a result of spending huge amounts of money on claims that most people have no idea how to handle. Although insurance does not cover every possible exposure, the more coverage you get that applies to your business, the more you will be helping to avoid the possibility of future financial insolvency.


Contact G.R. Reid Insurance to review potential exposures that may impact your business.

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Accounting & Tax :: New York’s Metropolitan Commuter Transportation Mobility Tax Upheld

On January 14, 2014, the New York Court of Appeals, the state’s highest court, declined to hear a challenge to the Metropolitan Commuter Mobility Tax, the payroll tax levied in counties served by the Metropolitan Transit Authority. The decision permits the continuance of the tax, which was enacted in 2009, and helps fund the region’s mass transportation.


The tax is imposed on certain employers, self-employed individuals and partners in a partnership conducting business within the Metropolitan Commuter Transportation District, including the counties of Duchess, Orange, Putnam, Rockland, Westchester, Nassau, Suffolk and the boroughs of New York City.


Local county executives have fought hard to reverse this tax declaring it an undue burden on local businesses, especially those whose employees never use MTA services such as railroads, subways and buses. The MTA states that the fees are necessary to reduce costs. The tax imposes an up to 34-cent tax for every $100 of payroll for large companies with an annual payroll more than $1.25 million and on self-employed individuals and partners.


This tax was first challenged in August 2012 when the New York State Supreme Court found the tax unconstitutional. New York State immediately appealed this decision and in June 2013 the New York Appellate Court reversed the Supreme Court finding the tax to be constitutional. The final appeal to the Court of Appeals and their decision to not hear the case, essentially leaves the tax as a valid tax and good law. All taxpayers and employers must continue to comply with this law as it is in full force and effect.


The State had previously implemented a streamlined appeal process to handle protective refund claims that were anticipated as uncertainty about this tax continued during the appeals process. All of these claims are now null and void.

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Accounting & Tax :: 2013 Schedule D Forms and Form 8949 Contain Sales/Exchange Reporting Changes

Final versions of the 2013 Forms 1040 Schedule D, 1120 Schedule D and 8949 have been released by the IRS. There have been a few changes to the aforementioned forms regarding how sales and exchanges of capital assets are reported. Form 8949 is used to report sales and other dispositions of capital assets. Unlike schedule D, Form 8949 lists every sale/disposition and separates the totals based on how they were reported to the taxpayer. The totals on Form 8949 are then brought forward to Schedule D. In 2013 both individuals and businesses can look for the following changes to these forms:


• Certain Transactions can be omitted from Form 8949
In previous years, Form 8949 has required that every sale/disposition be reported separately, notwithstanding the following exceptions:


1. Taxpayers can attach a separate statement with the transaction detail in a format prescribed by form 8949.

2. Corporations, exempt organizations and partnerships with a large number of transactions were allowed to omit the detail and indicate “Available upon request.”

3. The third exception has been added for the 2013 tax year. Taxpayers may aggregate and report qualifying transactions directly on line 1a (Short-Term Transactions) or line 8a (Long-Term Transactions) of Schedule D. In order to be deemed a qualifying transaction, the following criteria must be met:

a. The taxpayer must receive a Form 1099-B (or substitute statement) that shows basis was reported to the IRS and does not show a nondeductible wash sale loss in box 5.

b. There may also be no adjustments made to the basis or type of gain or loss (short-term or long-term) reported on Form 1099-B (or substitute statement).

Taxpayers who qualify to use this new exception and who also qualify for Exception 1 or Exception 2 can use both (i.e., Exception 3 plus either Exception 1 or Exception 2).

• Change in Reporting by Electing Large Partnerships
Prior years required both corporations and electing large partnerships to report their share of gains and losses from pass-through entities on Form 8949. In 2013, electing large partnerships will report their share of gain or loss on Schedule D.

• Estates and Trusts Must Use Form 8949
Filing Form 8949 for estates and trusts has not been a requirement until 2013. Estates and trusts will now be required to report capital gain transactions on Form 8949. In previous years, all capital transactions at the estate and trust level were reported on Form 1041 Schedule D.

The 2013 changes to Forms 1040 Schedule D, 1120 Schedule D and 8949 allows taxpayers a simplified method for reconciling capital gain transactions.

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Healthcare & Benefits :: Final Regulations Issued on Employer Penalty

GRR Health Image

On February 10, 2014, the IRS released final regulations implementing the Employer Shared Responsibility provision under the Affordable Care Act (ACA) for 2015 (the “employer penalty”). This guidance is lengthy and provides helpful clarification in many areas.


We are in the process of reviewing the guidance, but you will find some key aspects of this rule below:

  • The employer penalty will apply to employers with 100 or more full-time equivalent employees starting in 2015. For employers with 50-99 full-time equivalent employees, there is a one-year delay and the employer penalty provision will start in 2016.
  • Most of the transition relief offered under the proposed regulations is extended to 2015, including some relief afforded to non-calendar year plans that may delay the application of a penalty until the first day of the 2015 plan year.
  • For 2015 only, applicable large employers will avoid the penalty that applies for failing to offer health insurance coverage if coverage is offered to at least 70% of full-time employees. Beginning in 2016, coverage must be provided to at least 95% of full-time employees to avoid this penalty.
  • The final rule provides clarification around certain occupations and whether these employees are viewed as full-time, including specific rules on seasonal employees, volunteers, and adjunct faculty.


We are in the process of reviewing the regulations in detail and will provide further details soon.

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Commercial Insurance :: Why Your Business Needs an Umbrella Liability Policy


Undoubtedly, you have worked extremely hard to build your business, and it represents your livelihood. Unfortunately, all it takes is one liability claim to put you out of business. You have surely heard the stories on a regular basis, and while the odds may be against such a thing happening in your business, not everyone is fortunate enough to play the odds and win.


Most small businesses need
at least a $5 million umbrella policy,
while medium-size, large, and high-risk businesses
need significantly more.


Here are examples of real-life cases that cost millions to settle:

  • $1,750,000 Premises Liability – Fall Down – Plaintiff falls on icy patch in parking garage – Traumatic Brain Injury – Latent Post Traumatic Stress Disorder from military service is triggered – Loss of consciousness.
  • $3,626,400 Gross Verdict  Reduced By 25% Comparative Negligence – Landlord’s Negligence – Sawdust  and wood shavings left throughout  apartment. Landlord removed  built-ins – Plaintiff slips and falls – initial lumbar bulge progresses  o herniation, then extrusion – Surgery seven years later – Resolving cervical herniation.
  • $4,842,000 Verdict – Failure of housing authority to repair clogged drain in dark boiler room. Fall – aggravation of  prior soft tissue injuries which were superimposed on spondylosisthesis- cervical herniation – inability to work- Plaintiff’s family allegedly required to relocate to native Greece because of inability of plaintiff to provide for family.
  • $4,000,000 Confidential Recovery – Motor Vehicle Negligence – Intersection Collision – Plaintiff’s vehicle is struck by the defendant’s truck when it rides through stop sign at intersection – Brain injury alleged – Post Concussive Syndrome – Concussion – Herniated discs.


Successful business owners practice risk management because they know things like this can happen.
By having adequate insurance, including an umbrella liability policy, business owners can run their businesses with minimal disruption. If, on the other hand, a business has insufficient insurance – such as a $1 million per occurrence liability policy when faced with a $4 million claim – this will result in serious financial and possibly reputation-related issues that need to be resolved.

Most small businesses need at least a $5 million umbrella policy, while medium-size, large, and high-risk businesses need significantly more. As illustrated in the cases listed above, it is not uncommon for incidents to run into the millions. For many business types, having a multi-million-dollar umbrella policy is not expensive and is well worth the protection it provides. In addition, most policies come with unlimited defense, which provides legal defense with attorneys who are experienced in settling similar cases.

The cost of not having sufficient coverage for a given claim is huge, and it has the potential to put you out of business. In addition, it can be next to impossible to sell a business with a pending legal incident. Bankruptcy due to a lawsuit can also ultimately put you out of business as well as deplete your net worth and ability to sell the business. For these reasons, an umbrella should always be discussed when putting together your business insurance program. Simply having a policy is not enough; it is vitally important to ensure that you get the right coverage.



G.R. Reid Insurance Services works to educate our clients about the risk factors that surround their industry so we adequately safeguard unforeseen
exposures to their business operation. Contact us to discuss your risk management and insurance needs.

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Commercial Insurance :: Understanding How Experience Rating Works

Many people wonder why it is necessary to use experience rating to predict future losses if workers’ compensation rates are designed for this purpose. Experience rating can benefit employers. The prospects of both bad credits and debits are implicit in the majority of risk-specific programs dealing with experience rating. Since it gives an employer some influence in how much the final premium will be, this gives an incentive for them to develop their loss prevention strategies. It is also good for them to form incentives that encourage injured employees to return to work as soon as they are able. When this happens, experience rating can be beneficial to employers by increasing occupational safety and health.

 Experience rating shows a refinement in processes of premium determination. It creates a net premium cost for employers, which means their costs will be appropriate for the provided coverage. Experience rating shares or spreads the cost of a loss with all group members who are likely to go through similar losses. Although the probability and cost of injuries for an entire group as a whole may not be accurately predictable, it is not possible to decide which member of the group will ultimately be responsible for costs.

This is why there is insurance. If it were possible or easy to predict, group members who do not experience loss would not have any incentive to purchase coverage. Meanwhile, the premium charge for members experiencing losses would need to include the loss costs. Serious injuries to individuals are usually rare, but the totals can be minor amounts or reach well into the millions. For workers’ compensation, the easiest rating method is manual rating. With this system, employers are categorized according to business classifications or operations. Group losses are estimated and then added as an average.

 Employers are assigned to specific classifications to make sure the rates they receive are reflective of the costs all similar employers have. While each classification comes with similar risks, individual ones are different in some ways. However, experience rating is designed to reflect individual differences. Insurance providers would be able to look for employers with lower costs and avoid ones with higher costs if the rating system were only manual. The system needs to be refined to avoid such a scenario, and experience rating falls under that category.

With workers’ compensation experience rating, individual employers’ loss and payroll data are analyzed over time. The most recent three years of data is reviewed against similar groups’ risks to determine the experience modification. An employer that has better experience ratings will be given credits, but those with less will be given debit ratings.

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Accounting & Tax :: Sales & Use Tax

Sales and use tax can be a considerable burden for any company. These taxes can be imposed on nearly every transaction and the cost to comply with the myriad of rules can be significant. Add to this fact, that in recent years state taxing authorities have become increasingly more aggressive in both legislative changes and audit enforcement efforts. The likelihood of being audited has increased so businesses need to be prepared for challenges. Let’s face it, you are a revenue collector for the state, your objective is to collect as much as you can, as soon as you can.


Sales and use tax laws change constantly,

posing complex and distinct challenges.

It affects all of us – from individual consumers

to the largest businesses – regardless of the applicable jurisdictions or types of transaction at issue.

Through skillful planning, and analysis,

you should prepare yourself for what may

someday be inevitable – a sales and use tax audit.

Will you be ready when the sales tax auditor comes knocking at your door?

There are several steps you can take to ensure you are.

Generally, the following sales and use tax compliance issues
are applicable to all businesses:

Maintaining adequate records
Adequate records means that every book and record is in place that is needed to trace a transaction from its inception to inclusion on a tax return. In other words, there is a discernible “audit trail”. All states’ sales and use tax laws require that adequate records be maintained. When they are not, auditors are permitted to use alternative audit methods to determine the accuracy of returns under audit. It is then up to the taxpayer to prove that the auditor’s methods were unreasonable and resulted in an incorrect tax due.

Lack of exemption certificates
Generally when a taxable product or service is sold and sales tax is not charged the vendor must obtain a properly completed exemption certificate. The key is not only to obtain the certificate, but it must be properly completed and you must maintain it in your files. Auditors may disallow non-taxable sales that are not supported by properly completed exemption certificates. This results in sales tax imposed on a non- taxable sale.

Test periods
Most state sales and use tax laws allow for the use of a test period in lieu of a detailed review of all sales and/or purchase transactions. A test period is a review of a specific time frame within the audit period. The result of the test period is then projected (applied) throughout the entire audit period. Test periods work well and save time when the period chosen is representative. Therefore, it is imperative that a test period contain the same type of transactions that occur throughout the entire audit period. Selection of a non-representative test period could result in a significant over assessment of sales and use tax.

Responsible person liability
Sales and use tax is a trustee tax, therefore sales and use tax laws include provisions that allow a state to hold individuals who are deemed to be “responsible persons” personally liable for sales and use tax due. Generally, a responsible person is anyone who is under a duty to act for the business.

Use tax
Use tax is the complement of sales tax and is due when sales tax is not paid at the time of a purchase. Generally, everything subject to sales tax is subject to use tax. Everyone, including individuals, are subject to use tax and are required to voluntarily pay such upon the filing of their sales tax returns (if a registered vendor), or a use tax report. In the case of an individual use tax may be due upon the filing of a personal income tax return.

Filing requirements
Generally, if you sell tangible personal property you must be registered for sales and use tax and comply accordingly. Most states require sales and use tax returns be e-filed either monthly, quarterly or annually depending upon sales and sales tax volume.

Lack of adequate sales/use tax policies
Many companies do not have formal sales and use tax policies or procedures to capture the information needed to meet their sales and use tax responsibilities. This often leads to inadequate and lost records which can cause misstatement of tax due. Failures here often lead to outsized assessments on audit.


Businesses in specialized industries

are often subject to additional scrutiny:


Issues include Nexus determinations, affiliate nexus issues and click-through nexus issues; taxability of hardware/software and related services; taxability of printed promotional materials; proper inclusions and exclusions in taxable selling price and determination of sales tax rates; inaccurate product and service tax matrix; lack of trained sales and use tax personnel; not properly structuring transactions up front to minimize taxes; and failure to properly manage sales and use tax audits.

Issues are generally the same as above but one must also consider the impact the Marketplace Fairness Act (“Act” or “MFA”) will have on their business if enacted. The Act will allow states to require remote sellers to collect their sales and use tax, regardless of whether the seller has a physical presence in the state. The Act does not negate existing nexus rules; rather it will add an additional layer of rules which must be reviewed if you are a remote seller. Don’t be fooled, the Act will apply to any business which sells remotely, i.e. telephone solicitation, catalog sales, TV shopping channels, etc. not just businesses that sell over the Internet.

Issues include construction costs associated with building improvements; taxability of production machinery, equipment, parts and supplies; taxability of hardware and software and related services; installation of production equipment; nexus determination; overpayment of sales tax on exempt transactions; drop shipment rules and exemption certificate management;

Issues include product and service taxability; nexus determination; invoice preparation to minimize tax consequences; cloud computing, ASP, and SaaS; and taxability of purchases.

Issues include capital improvements vs. taxable repairs; taxability of building material purchases; use tax responsibilities; overpayment of sales tax on materials purchased for use in exempt organization jobs, taxable jobs, or where installed out-of-state; contractor or retailer determination, i.e. self-use of manufactured products; nexus determination; failure to properly claim refund/credit for tax overpaid on exempt purchases or paid on materials installed in taxable jobs; taxability of materials consumed by contractor vs. transferred to customers; and government contractor rules.


Action steps you can take now

to prepare for what may be the inevitable:


Be proactive
Don’t wait until the auditor comes knocking to determine your sales and use tax responsibilities. Sales tax should always be on your radar so you can properly comply. Once a state contacts you, your options are greatly reduced, you are relegated to playing defense.

Conduct a review of your sales activity in each state and determine where you have established nexus. States have aggressive nexus teams who identify businesses conducting business in their state, but yet aren’t properly complying with the state’s sales and use tax rules. When returns are not filed there is no statute of limitations this allows states to go back to the very first day you conducted business in their state. The resulting tax assessment can easily impact a business’s cash flow, in some cases may even cause a business to close.

Understand the rules
Once you know where you have nexus, know how sales and use tax applies to your activities in those states. Register and comply accordingly. Sales tax is a consumer tax which you collect and remit. Don’t let it become your expense.

Sales tax automation
Using automated processes increases accuracy, saves time, mitigates errors, creates a trail and can increase profitability.

Understand now how the MFA may affect you
As noted, should the MFA become law, it will grant states authority to require remote sellers to collect their state sales and use tax. Will you be caught in this new nexus net? Don’t wait until the last minute to find out.

Implement formal sales & use tax policies
Personnel must be properly trained. Every company should have formal sales and use tax policies and procedures in place. Only then can staff understand and follow the processes established to insure compliance.

Learn from past mistakes
If you were audited in the past and it resulted in a large liability or refund you must improve your sales and use tax function by implementing changes that will prevent the same mistakes from happening again.

Self-audit on a regular basis
You should review both sales and purchase transactions on a regular basis to ensure that sales and tax is being handled correctly and that proper books and records are maintained. A self-audit will also identify refund opportunities that may exist.

Voluntary disclosures
If you realize after following some of the recommendations above that you have sales and use tax exposure in a particular state consider participating in that state’s voluntary disclosure program. Most programs will limit the look-back period, waive penalties and impose minimum interest. These programs encourage non-filers and filers with problems to come forward voluntarily and become current. Significant penalty and interest savings are possible.

Sales and use tax laws change constantly, posing complex and distinct challenges. It affects all of us – from individual consumers to the largest businesses – regardless of the applicable jurisdictions or types of transaction at issue. Through skillful planning, and analysis, you should prepare yourself for what may someday be inevitable – a sales and use tax audit.


Don’t wait, put sales and use tax on your radar now. Avoid surprises, make sure your staff and processes are in order and you have minimized your audit exposure before the sales tax auditor comes looking for you.

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Commercial Insurance :: Underreporting Payroll for Workers Comp: Real Life Case

Some business owners think they can hide or under-report payroll data as a way to save money on taxes and workers’ compensation premiums. There are several different ways they can hide payroll data, but it is still a crime that very few prosecutors will turn down. Although this is done to save money, the price of self defense in criminal court and the repercussions of having a criminal record are both costly. In addition to this, the risk of ending a business career can compromise a person’s long-term income. The following is a case where a business lost about $100,000 by trying to dodge workers’ comp premium obligations.


The owner of a building company was convicted of workers’ compensation insurance premium fraud for not reporting some of his employees to his insurer or the Employment Development Department. The owner’s daughter was convicted of misdemeanor insurance fraud. Another member of the owner’s family who worked there was convicted of felony insurance fraud.


Experts say fraud is an enterprise that brings in billions of dollars, but it provides artificial inflation costs to insurance companies and consumers. In a collaborative effort by the local district attorney’s office and the Department of Insurance, the investigation on the business owner started after an employee was injured. The owner paid his workers in cash in order to avoid paying insurance premiums. However, the investigators found evidence that all three of the convicted parties had worked together to convince workers to take cash payments.


“If an employee is injured, employers should remember

that any under-the-table agreements will likely be exposed.”


The employee who was injured required surgery, but the business owner tried to dispute the worker’s claim. Instead, the owner offered the injured worker a disability application form for state assistance, and he instructed the worker to claim the injury occurred at home. The company was ordered to pay more than $45,000 in premium restitution, about $30,000 in EDD back taxes and more than $35,000 in restitution to the injured worker.


It is not easy to hide payroll information, and employees will be vocal if they are injured. In addition to this, there are other ways to track this type of fraud. If an employee is injured, employers should remember that any under-the-table agreements will likely be exposed. Injured employees must look out for themselves and their families. Many other cases are worse. Employees may accumulate higher bills for hospital stays and rehabilitative services. The cost of paying their bills could be much higher than $100,000, and the cost of business disruptions and legal fees would run into the hundreds of thousands. Recovering from an incident such as this is also difficult, and most business owners have to start over from scratch. In comparison with the cost of such a mess, the cost of workers’ compensation insurance premiums is minimal. Every employer should remember that it is not worth the risk.


G.R. Reid Insurance Services offers a wide range of commercial insurance services, personal insurance, employee benefits, and risk management services. Contact us to discuss your commercial insurance needs.

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Accounting & Tax :: START-UP NY Program Updates

The START-UP NY Program will create statewide tax-free zones in order to provide major incentives for businesses to relocate, start up or expand in New York State.


This past Summer, the NYS Governor, Andrew Cuomo, unveiled, START-UP, a new job creation program. Businesses will have the opportunity to operate state and local tax-free for ten years on or near academic campuses, and their employees will pay no state or local personal income taxes.
Employees pay no state income taxes on their wages for the first five years on income up to $200,000 of wages for individuals, $250,000 for a head of household, and $300,000 for taxpayers filing a joint return. In addition, businesses may qualify for additional incentives.



What businesses are eligible for START-UP NY?

Many different types of businesses are eligible to apply to the program. In order to participate, businesses need to support the academic mission of the college or university. Every business must create new jobs in order to participate by:

1. Being a new start-up company;
2. Being a company from out-of-state relocating to New York State; or
3. Expanding as an existing New York State company.

In New York City, Long Island and Westchester County, businesses must be start-ups or high-tech companies. Certain types of businesses are excluded from the program, including retail and wholesale businesses; restaurants and hospitality; professional practices like law firms and medical practices; and energy production and distribution companies.

How many jobs must a business create to be eligible for START-UP NY?

There is no minimum requirement for the number of net new jobs that must be created, but all participating businesses must create jobs to receive the program’s benefits.


What tax benefits will participating companies receive?

START-UP NY will provide new and expanding businesses that create new jobs the opportunity to operate completely tax-free including no income tax for employees and no sales, property or business tax while partnering with higher education institutions. Business and employee tax benefits will be available for up to ten years. (After five years, certain NYS high-earners will be limited on the amount of employee earnings exempted from the Personal Income Tax).



G.R. Reid Associates is a full-service accounting firm with experience and knowledge in business formation. Obtaining financing can be crucial in getting your new venture started. Contact us today to discuss your needs.



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Employment Practices Liability Insurance: Is Your Company Prepared for a Wrongful Termination Lawsuit?

Is Your Company Prepared for a Wrongful Termination Lawsuit?
When employees must be fired or laid off, there is always a chance they will try to file a lawsuit. For employers, the problem is that they are always the responsible parties for dealing with any allegations.


“…employment practices liability insurance is not something all businesses have enough of.
This coverage keeps employers from having to pay out of pocket for expensive legal fees and substantial judgments. Having insufficient coverage could result in the need to come up with millions of dollars or close the business. EMPLI covers judgments, court costs and legal representation.”

In the following case, employers thought they were terminating a worker for not appearing on the job, but the jury decided otherwise. 

A truck driver filed a lawsuit against his employer after refusing to return to work while a severe thunderstorm was in effect. The employer did not acknowledge any wrongdoing in firing the truck driver for his refusal and claimed the employee was only embellishing details to avoid work. The plaintiff worked as a hazardous materials tanker truck driver, delivering gasoline and diesel to many commercial businesses in California and Nevada. His duties included filling generators and vehicles from the tanker.

On the day the incident happened, there was a severe thunderstorm in the area where the truck driver was working. During the storm, the driver made several deliveries. However, he also contacted dispatch multiple times to complain about the hazardous weather. He requested to return back to base, and he had to work for eight hours before being allowed to clock out and leave. Three hours after leaving, he was contacted by representatives from his workplace who said he had to return to work.

Reiterating the threat of inclement weather, the driver refused. He also said that he had been drinking after work, so returning to the job to drive was dangerous. On the following morning, the driver was fired after 13 years of employment. He filed a lawsuit citing violations of his rights and asking for damages. Before the trial, an offer of $100,000 was made. During the trial, there were several witnesses and experts called in to analyze the severe weather conditions described by the truck driver.

The company that fired the driver argued that it was right to dismiss him, and representatives claimed that he fabricated events to prevent himself from returning to work to do his job during the storm. They also claimed that he made unreasonable complaints about his driving route and did not believe he had really been drinking after work. Although the company claimed the driver did not complete his deliveries, they failed to show documentation to back their claim. Within one month of the worker’s termination, personnel had destroyed a considerable portion of his records. One record did show that the plaintiff called and stated he had been drinking. 

In the end, the jury decided unanimously that the company was at fault for wrongful termination. The plaintiff was awarded over $160,000 for past damages and $2.5 million for mental suffering and non-economic damages. On the following day, the jury returned and awarded the driver well over $3.5 million in punitive damages. The total verdict was more than $6.2 million and included all fees and awards.

These types of cases are certainly not something any employer wants to deal with, but they are a very real possibility. In addition to this, many employers do not know which attorneys are best to hire, and employment practices liability insurance is not something all businesses have enough of. This coverage keeps employers from having to pay out of pocket for expensive legal fees and substantial judgments. Having insufficient coverage could result in the need to come up with millions of dollars or close the business. EMPLI covers judgments, court costs and legal representation.


To learn more about this type of coverage or to review an existing policy, contact G.R. Reid Insurance Services.


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