To help our members make sense of the recent federal tax changes, Brian Stratton and Mike Easton of the Horty CPA firm presented a seminar on March 13, 2018.
Although tax laws and discussion of such can be a dry subject, it seemed to keep everyone paying attention for 90 minutes, with lots of Q&A. Afterward one member even thanked us for the seminar, proclaiming “I believe it was very helpful to a lot of member companies”. Kudos and our thanks to Brian and Mike of the Horty Group for their presentation.
Anyone wishing to obtain a copy of the distributed information should ……. Click for Horty Tax Seminar Handout
The Home Builders Association of Delaware Along With National Association of Home Builders Meet With Governor John Carney!
The Home Builders Association of Delaware along with Jerry Howard and Isabel Shocket of National Association of Home Builders met with Governor John Carney to discuss training a workforce in building trades in Delaware. Our youth, at-risk youth, veterans and prisoners are all potential candidates for building trade training and job placement. Let's get to work on the economy of Delaware.
Home Builders Association of Delaware members donated supplies and their expertise to the students of St. Georges Technical High School in Middletown so they can design and construct sheds. In mid-April, the HBA will raffle off the sheds as a fund raiser for the school. Raffle tickets are 1 for $25 or 5 for $100 and can be purchased at the Home Builders Association Office located at 1600 N. Little Creek Road Dover, DE 19901. The drawing will take place April 14, 2018 at the St. Georges Technical High School "Portraits of Excellence" Gala. You can read more information about this gala by clicking here.
With the labor shortage affecting builders and remodelers throughout the state, “We see this as a great opportunity to get local kids involved in the industry, said HBA president Jim McCulley. This video tells the story.
Click here to view the video!
Thank you to the following for supporting this great event by donating supplies and/or their time:
Apex Home Loans
Beeline Services LLC
Best Stoneworks, Inc.
Geo-Technology Associates, Inc.
Leon N. Weiner & Associates, Inc.
Middletown Kitchen and Bath
Sundance Custom Homes LLC
The landmark tax reform legislation that took effect Jan. 1 created significant changes in the tax code that will affect the housing industry and our small business members.
To help NAHB members understand how these changes could impact their business, NAHB is hosting a members-only webinar, Tax Reform and Your Bottom Line, at 1 p.m. ET on March 5.
The webinar will feature NAHB tax experts and outside tax counsel who will focus on the specific changes that will most directly impact small businesses, including the 20% pass-through deduction, limitations on the business interest deduction and new depreciation guidelines. Register for the March 5 webinar at nahb.org/taxwebinar (log-in required). If you are not able to join the webinar, a replay will be posted on nahb.org. You can learn more about the new tax law, and NAHB’s influence during the legislative process, at nahb.org/taxreform.
There are currently over 50 of the country's leading Manufacturer brands participating in the Member Rebate Program offering the same rebates as the "Top 5 Builders" receive regardless of your volume.
When it comes to a website for your building or remodeling company, there’s only one measure of success: Whether that site makes you money.
Myers Barnes, president, and Chip Johnson, CEO, of Builder Designs talked about how to build a successful website at an NAHB International Builders’ Show “Techbytes” session last week.
“I don’t care about analytics, I care about sales. Does the website turn into cash for you? That’s the only thing that matters. If it’s not, you’re wasting your time,” Barnes said.
When studies show that a whopping 96% of buyers start shopping for their new home on the web, and that fully 75% of them start about a year before they make the actual purchase, by the time they walk through the door of your model home, “they aren’t ‘just looking,’ they are buying. They spend more time digitally than physically with your brand.”
That means that clever posts on Instagram and constant attention to your Facebook page will only go so far. “Without a website, digital marketing doesn’t exist.”
That website has three components — and each one is vital, Barnes said.
Mobility. Seventy percent of your buyers begin their searches on their cellphones. “Mobile trumps desktop,” Barnes said. Most buyers won’t sit down to peruse your site on their desktops or laptops unless they are “doing a super deep dive,” he said. That means that savvy home builders won’t bother with a desktop-based website design that’s developed to transition seamlessly to a smaller mobile version, or what’s known as responsive design in the trade. Instead, the website must be designed with the mobile user in mind, without complicated menu bars, sliding graphics or other distractions. “We prefer a mobile-first site. From the phone, we build it up” rather than the other way around, Barnes said.
Images. Today’s buyer is extremely visual. That means that home builders must invest in dynamic, well-lit and professional photography if they expect to attract and then capture potential buyers’ interest. “They don’t care about your “About” page,” he said. Buyers don’t want to waste time navigating your site to get an idea of what your homes look like. Pictures of homes on websites that have been taken by professional photographers have a 47% higher asking price, “and take you to the promised land of profitability,” Barnes said.
Attendees with a paid full registration to IBS also get a complimentary 1-year subscription to IBS Education on Demand and can download recording and handouts to Building Killer Websites that Actually Attract Buyers and other sessions. Visit BuildersShow.com/ondemand to learn more.
On December 20, Congress finally sent H.R. 1, the Tax Cuts and Jobs Act, to the President’s desk for signature.
After significant improvements made during the legislative process, and due to the robust engagement efforts of NAHB and its membership, NAHB issued our support for the final tax bill.
Changes to the tax code will take effect for the tax year starting January 1, 2018, and include the following provisions of note to NAHB’s membership:
· Mortgage interest deduction. Retains the mortgage interest deduction and the deduction for second homes, but reduces the mortgage interest cap from $1 million to $750,000.
· State and local property taxes. Allows taxpayers to deduct up to $10,000 of state and local taxes, including property taxes and the choice of income or sales taxes.
· Capital gains exclusion. Maintains existing law that allows home owners to exclude up to $250,000 (or $500,000 for married couples) in capital gains on the profit from the sale of a home if they have lived in the house for two of the last five years.
· HELOC. Eliminates the deduction for interest on home equity loans.
· Private activity bonds. Retains private activity bonds (PABs), which will enable the Low Income Housing Tax Credit to maintain its effectiveness as the most indispensable tool for the production of affordable housing. Without PABs, we would face the loss of more than 788,000 affordable rental units over the next decade.
· Alternative Minimum Tax. Eliminates the Alternative Minimum Tax (AMT) for corporations and increases the AMT exemption amounts and phase-out thresholds for individuals.
· Individual tax brackets. Retains seven tax brackets, with rates ranging from 10% to 37%. This will provide tax relief for individuals and small businesses and represents a tax cut for most taxpayers.
· Estate tax. Doubles the estate tax exemption.
· Carried interest. Retains existing carried interest rules, but assets must be held for three years.
· Pass-through deduction. Allows most taxpayers with pass-through income to deduct 20% of that income based on wages or on wages plus a capital element.
· Business interest deduction. Provides the taxpayer a choice of making a one-time election for a deduction limited to 30% of adjusted gross income; or for real estate, a 100% deduction for business interest, but with certain tradeoffs.
· Like-kind exchanges. Preserves the benefit for real estate investors to make tax-free exchanges of property, commonly referred to as “like-kind” exchanges.
· Multifamily depreciation. Gives the taxpayer the choice of taking 27.5- or 30-year depreciation, depending on how they elect to treat their business interest.
· Individual tax provision sunsets. Almost all individual tax elements – mortgage interest, state and local property taxes, individual brackets, etc. – expire at the end of 2025. Unless Congress acts, starting in 2026 these modifications will revert back to the tax code as it exists today in 2017.
President Trump today signed into law landmark tax reform legislation.
“NAHB commends President Trump and members of Congress for their hard work and dedication in crafting this once-in-a-generation overhaul of the nation’s tax code,” said NAHB Chairman Granger MacDonald. “Providing tax relief for hard-working families and creating a more favorable tax climate for small business will make the economy more vibrant and competitive. In turn, this will boost the housing sector, which represents roughly one-sixth of the U.S. economy. Housing not only equals jobs, but jobs mean more demand for housing.”
Throughout the tax reform debate, NAHB and our grassroots were at the forefront of the legislative process. We held several meetings with House Ways and Means Committee Chairman Kevin Brady, along with other committee members and staff, while builders engaged with key House and Senate lawmakers in their home districts and at their offices on Capitol Hill.
Thanks to the efforts of the entire Federation, NAHB achieved significant victories on the real estate exception to the business interest deduction, second homes, private activity bonds, the capital exclusion, and many other provisions.
Under the new law, the majority of taxpayers will receive a tax cut, including working class home owners and renters, small business owners and our members who are engaged in all aspects of the residential construction sector. Lower tax rates will spur job and economic growth, and that is good for housing.
An overview of the Tax Cuts and Jobs Act, with all changes taking effect for the tax year starting Jan. 1, 2018:
New subdivisions are more likely to include both detached and attached units, shared amenities and open space, and restricted access points (for example, gated communities).
When coupled with declining revenue as it competes with private express carriers and online order delivery services, it means the United States Postal Service (USPS) now favors the installation of less-expensive cluster box units over traditional door-to-door or curbside delivery in new single-family developments.
In 2012, the USPS updated its Postal Operations Manual to reflect that preference and recommends that developers and builders plan for centralized mail delivery installations during a project’s design phase.
The first step for all developers and builders: Identify your regional coordinator by emailing Delivery.Growth@usps.gov. Contact the coordinator before finalizing plans and site plats with planning and zoning authorities.
The USPS will not begin mail delivery until the regional coordinator has approved modes of delivery and box locations. However, it will work with builders, developers and owners at any stage of development if cluster box units are not feasible.
The USPS has provided NAHB with a webpage with more details about this change — and how it can be an advantage for developers and their buyers. USPS representatives will also give a presentation to the NAHB Land Development Committee before the 2018 International Builders’ Show in Orlando and plan to have a booth during the show to answer questions about the policy.
For more information on centralized delivery, please contact Claire Worshtil.