Employers need to take certain legal and administrative steps when the death of an employee occurs. Here are some of the human resource and accounting tasks come into play after an employee dies:
Tax Policy & Finance
In a significant win for employers, the United States Supreme Court recently invalidated a judicial inference that union retiree health insurance benefits are vested for life in the absence of specific language to the contrary. The Supreme Court’s unanimous opinion in M&G Polymers USA, LLC v. Tackett, issued on January 26, 2015, gives employers more freedom to alter, reduce, or eliminate retiree insurance benefits for employees who were represented by a union before they retired.
Almost all employers have employees labeled as exempt salaried employees who are not entitled to overtime for hours worked over 40 in a work week. Many challenges to exempt status arise from claims of misclassification – employees who claim that they are not performing exempt duties. Employers must take care to ensure that employees designated as exempt salary are indeed performing exempt duties and are not misclassified. Equally important, employers must also ensure that their exempt salaried employees are properly paid a salary as defined by the Fair Labor Standards Act (FLSA).
Reform of Michigan’s Unclaimed Property Act (UPA) – and the way in which this obscure law is administered – has long been a focus of the Michigan Chamber. Compliance with the UPA is a significant hidden cost of doing business and Chamber members particularly dislike the state’s continued use of contingency-fee paid auditors!
Unclaimed property is any financial asset that has been left with a “holder,” such as a bank, insurance company or other business or organization and has gone unclaimed beyond the dormancy period. Examples of unclaimed property include uncashed payroll checks, inactive stocks, dividends, checking and savings accounts as well as many other property types.
This past year has continued to provide updates to Michigan's Unclaimed Property laws. These two legislative changes provide holders significant benefits:
The new exemption is complicated and even counterintuitive.
First, the exemption applies only if more than 50% of the personal property (measured by cost) at your location is used either for industrial processing or in direct integrated support of that processing.
Second, even if you pass that 50% hurdle, only new property (in service in 2013 or later) and old property (in service at least 10 years old as of 2016) will be exempt. Anything in the middle will be taxed.
Personal property tax reform was assured with last August’s state-wide referendum. Now that the political campaign is over, the sound-bite style of describing the new law has died down.
You will soon need to apply this complicated set of new rules to your company’s tax filings. Let’s see how the reality of this new law differs from the sound bites you’ve heard this year.
Sound bite #1: All personal property will be exempt from tax.
No matter what department you work for within a business, the finance and accounting functions touch every aspect of your role and the organization. For employees that do not work directly in the finance function, it can sometimes be challenging to understand how the financial and accounting concepts and policies affect their daily tasks and department goals.
Michigan business entities, as well as individuals, may have significant known and unknown liability for use tax on purchases subject to the sales tax, but where payment of the sales tax cannot be proven. This is due to the Andrie Michigan Supreme Court use tax decision.
Seller paper, SBA financing and buyer cash often comprise the three major components of a business purchase. However, what happens when a really good buyer (as perceived by the seller) wants to buy the business, but a gap persists between what the buyer is willing to pay and what the seller will take?
Under the above scenario (which is fairly common), a business broker or other facilitator must get creative in conceiving other sources of payments to the seller which are palatable to the buyer. Let’s discuss some to them…