SHRM-Atlanta

For the next two weeks we will be highlighting Speakers from our upcoming 2012 SHRM-Atlanta and SEBC Benefits Conferencebeing held on Thursday, August 23. This will be a content filled day of both healthcare and retirement tracks — with takeaways you can immediately take back and apply in your workplace. Be sure to stay after for our SHRM-Atlanta August Chapter Meeting for more valuable learning and networking!!

Health Plan Design Options

How do you determine what is best for your company and your employees from both a coverage and cost perspective? Is consumer driven healthcare, ACOs or other structures viable options for you?

The benefit world as we know it is changing, and changing dramatically. For most of our long history, the simple truth about health benefit plan design is that our major motivation was to contain and control costs for the employer. We accomplished this in a variety of ways, from the traditional and historic measures of greater cost sharing in terms of deductibles and co-insurance and increased employee contributions, to the more “modern” approaches of increased consumerism and behavioral change (wellness and wellness incentives). Even now, as we hear the drumbeats of value based benefit design and Accountable Care Organizations, will these be enough to maintain a health plan for employees with Health Care Reform looming out there?

The answer to this question should be a resounding yes – unfortunately, in our haste to “control costs” we have become too limited in our world view. Instead of solely looking at what our plan costs were and what they will be, and then defining success as keeping this change near flat (but at least below what others report!) we need to look more broadly at our health plan to make sure it is viewed as a benefit – that our carriers and vendors are helping our employees access care and not as a barrier to care and also, for the more progressive employer, as an agent of productivity management.

Admittedly, negotiating care under the current crop of designs can be complex, but there are tools that can be layered in to ease this burden for employees and their families. Time spent trying to get a claim paid or obtaining a referral for service is time typically lost during the work day – both in terms of resolving the issue and then exacerbated in the countless retelling of the issue by the water cooler.

Further, our ability to quantify and measure productivity has reached new heights, but by failing to look at productivity gains in the workforce as an outgrowth of healthier employees, we are forcing the discussion back to a comparison of year over year gains. As reform looms ahead of us, the more progressive and higher performing companies will look to invest more dollars in care delivery when they can see greater returns in employee productivity. The data is out there, as are the benchmarks for measurement, we just need to do a better job in defining our objectives.

Bill Danish is a Senior Client Executive with Seacrest Partners. He is known in the benefit community for his direct, forward thinking approach towards employee benefits. Mr. Danish is frequent lecturer and guest speaker at industry conferences and has authored several articles on cost-control strategies for employee benefit plans. Come learn more at Bill’s session at the 2012 SHRM-Atlanta and SEBC Benefits Conference!

How wellness and advocacy keep employees focused on their jobs

It’s not “new news” to hear the staggering statistics on the time employees spend on personal matters at work.  Estimates range from 45 minutes per day, up to 3 hours.  In dollars and cents, we’re talking about millions in lost pay each year.   So what are employees doing with their time, and how can you help them… help themselves?

How healthcare & insurance complicate life

Think about the number of complexities we’ve introduced to employees over the past 15 years.  Co-pays and co-insurance came first.  Then high deductible plans, HSAs, HRAs.  Let’s not forget COBRA, FSAs, HIPAA.  Then add in a healthy serving of PHI and an SOB (that’s a Statement of Benefits!) Finally, top it all off with the crème de la crème – healthcare reform.

Voila!  We’ve created a system of healthcare (and access to care) that’s about as easy to understand as quantum physics. As human resource executives, you have a leg up.  You understand the complexities and you’ve got access to information employees don’t have.  Or do you?  I’d venture to say that even the most well-schooled among us have our own challenges weeding through healthcare and benefits issues.  So, we have to empathize with the average Joe.  Have we failed to make available resources to help employees navigate this complex territory?  After all, good health is the most fundamental and pivotal factor in productivity.  So we all stand to gain by keeping employees healthy and happy.

Why good health can be hard to come by

Even with the best intentions, taking good care of yourself and your family isn’t always easy.  There are a number of things that get in the way.  The most important factor that keeps many of us from peak health status is time.  Quite simply, there’s not enough of it.  And when you’re taking care of yourself and a family, and dealing with a down economy, making time for good health comes at a premium.  Many of our employees are taking care of parents and in-laws, and if they too have health issues, that’s incredibly time consuming to manage.

Would you venture a guess at how much work time is used to handle health or benefit issues?   In an average day, a cross-section of your employee population is trying to handle these problems.  And they are doing it on work time – because time is at a premium.

Huddled in their cubicles, or in their cars in the parking lot, you can hear the quiet clamor, each employee with a different story:  “Why was this claim denied?  I owe you what?  Asthma?  How will I find the right specialist in-network? Mom’s moved in… I need to find all new doctors to treat her diabetes close to our home.”  How incredibly stressful for employees who want to do their job well, and balance work with family!  Can you say, “PRESENTEEISM?”

How HR can help

When you stop to think about it, there’s a huge gap to be filled.  Your staff is at capacity.  But if you’re like me, you’re serious about taking good care of your employees.  And that means, even though you’ve got a line out your door, you won’t install a “Take a Number” dispenser.

High performing companies have HR leaders who are thinking about the future. They are delivering CEOs strategies for keeping employees focused.  Many are enrolling the help of care management and advocacy services to get employees back in the game.  These companies work on behalf of your employees and are typically paid on a per employee per month basis.   Care management firms put a third party partnership in place, so there’s no issue with HR staff and PHI.  An added advantage is that it’s all confidential, and employees feel comfortable knowing that.  They extend your resources in their areas of expertise, so you can focus on reaching your strategic goals.

They provide both benefits expertise, as well as clinical resources like health coaches, nurses and dieticians.  These partnerships can help design your population health strategy and incentive structure, set up health screenings and follow-up plans, help research claims issues, clarify benefits, help an employee understand a recent diagnosis and even coordinate care for elderly parents.

The idea is to get employees healthy, give them resources to help them reach their personal goals, and take down the barriers that are keeping them from being able to be fully engaged and productive.

As you look ahead to 2013, you’ll implement key strategies to impact your employees’ productivity and your companies’ profitability.  Consider affordable alternatives to adding staff – - while saving time, and actually improving employee health.

Be sure to Doug’s session, Be the Best – Learnings for HR Leaders to Create a Best Places to Work Company, at the 22nd Annual SHRM-Atlanta HR Conference at the Cobb Galleria Centre in Atlanta, March 13-14th, 2012.

Douglas Layman is the Executive Vice President and Chief Sales and Marketing Officer at Gilsbar, Inc., one of the country’s largest and fastest growing privately-held health and benefit management organizations.  He is responsible for Gilsbar’s corporate direction, vision and sales strategy for its three divisions:  Health & Benefit Management, MedCom Care Management and Care Advocates.

Mr. Layman shares his expertise in human resources leadership, creating a culture of health, and population health management at conferences across the country.  He was recently interviewed by SHRM Online and National Public Radio (NPR), authored an article in Human Resource Executive magazine titled “More HR Reach and Employee Focus”, and co-authored a recent article in CDHC Solutions magazine titled “Engaging Employees Vital to Health Care Strategy.”  His speaking resume includes events such as world Health Care Congress, Society of Human Resources Management, the International Institute of Research, and the National Business Group on Health.  Mr. Layman currently serves on the Board of Directors for the Louisiana Association of Health Plans.  He earned his degree at Spring Hill College in Mobile, Alabama.

When you have a toothache, having comprehensive dental coverage becomes vital.  The Surgeon General reports that more than 64 million work hours are lost each year because of untreated dental problems.  Treatment of dental issues can help reduce the risk of more severe, and costly, medical conditions.  Routine dental visits are the key to prevention.

Dental benefits are worth more than you may think.

Studies have shown that there is a direct relationship between your oral health and medical health and dental care helps lower your organization’s medical costs.

An oral infection such as a cavity, or gum disease can put employees at risk for serious medical problems like cardiovascular disease, diabetes, osteoporosis, and Alzheimer’s disease.  Periodontal disease in pregnant women is linked to low birth weight and premature births.

Here’s the cost for common dental procedures with and without insurance.  The costs are based on average out-of-pocket payments.*

Procedure                    Insured (average cost)                Uninsured (average cost)
Filling                                $141                                                  $288
Filling repair                       $149                                                  $265
Extraction                          $317                                                  $501
Crown                                $563                                                $1,018
Root canal                          $593                                                $1,201
Gum treatment                   $598                                                   $972
Bridge                               $1,479                                              $2,698
Implant                              $2,825                                              $3,938

*Source: Consumer Reports National Research Center

A periodic oral exam, series of x-rays, and a routine cleaning will cost an average of $250.  Most plans cover this at 100%, with $0 out-of-pocket costs.

How much of your organization’s budget is allocated to medical premiums today?

Your employees are less likely to seek preventive care and treatment when they don’t have dental benefits.  Which means, if they have an issue, it gets worse, and the treatment gets more invasive and more expensive.  This not only impacts employee sick days, but poor oral health can lead to, and exacerbate, a number of health issues including heart disease, stroke, increased issues for diabetics and premature birth.

Without insurance, Americans will not go to the dentist unless they are in pain, putting them at risk for dental-driven health conditions. According to an Empirica survey of 1,000 adults in May 2010, 74% of Americans without dental insurance only go to the dentist when they believe there is a problem. Of those without insurance, they attributed two main factors for failing to go to the dentist: Cost (77%) and not knowing what the cost would be (73%).[1]

What About The Kids?

According to the American Dental Association, in 2008, 4.6 million children went without needed dental care because their families lacked the financial means to pay for it.[2] Scheduling a regular exam not only helps keep teeth picture perfect, but also reduces student sick days.

Did you know: Approximately 51,679,100 million school hours are missed annually by school-aged children due to a dental problem or visit, according to the Surgeon General. Tooth pain keeps many children home from school or distracted from learning. Despite recent improvements in dental care in the United States, tooth decay is still the most common childhood disease, reports the ADA. It is five times more common than asthma and seven times more common than hay fever.

All Dental Plans are Not Created Equal

Each carrier has their own DNA. Important things to consider when searching for dental benefits:

• Network:  Will your employees have access to a large number of quality dental practices in the areas in which they work and live?
• Network Discounts:  It is important that your employees are saving when utilizing a participating provider.  Otherwise, where is the value?
• Plan Design:  Most dental plans cover regular check-ups, x-rays, and routine cleanings at 100%.  There are a couple of other common scenarios that should be reviewed to determine an employee’s out-of-pocket costs.
  • How much would it cost if an employee needed a filling?  What if they would like a resin (white) filling on a posterior tooth?
  • How would an emergency visit, root canal, and crown be covered under the plan?

• Account Retention Rate: It is not unheard of that a carrier will “buy” business, only to make up revenue at the next renewal.  Switching carriers frequently can disrupt treatment plans, doctor/patient relationships, and be a headache for HR at open enrollment.

Keeping your company ahead in the race for talent.

The latest National Association of Dental Plans (NADP) statistics show less than 40% of Georgians have private plan dental coverage. Comprehensive dental benefits will be a key component in recruiting and retaining satisfied employees.

FOR IMMEDIATE RELEASE 
Mary Lynn Miller, Chief Operating Officer
404.869.2568
mmiller@shrmatlanta.org

FOR ADDITIONAL INFORMATION
Jean Yahres, Association Director
404.760.8129
jyahres@shrmatlanta.org

Georgia’s Largest Human Resources Conference to Gather Hundreds for Education & Networking:  Hosted by SHRM-Atlanta October 17-18

Atlanta (September 15, 2011) – SHRM-Atlanta, the Atlanta Chapter of the Society of Human Resources Management, hosts the 21st Annual SHRM-Atlanta Human Resources Conference on October 17 and 18 at the Cobb Galleria Centre. Human resources professionals and other individuals with an interest in human resources from all over Georgia are invited to attend this two-day conference to network, learn and share ideas with other HR practitioners, as well as earn continuing education credits from the Human Resources Certification Institute (HRCI). The event is the largest gathering of the human resources community in Georgia this year; last year’s conference drew over 1,000 participants. Kat Cole, president of Cinnabon, presents the keynote address, “Transformational Leadership: Building Teams for Success through Times of Rapid Change,” on Monday, October 17 at 9:40 a.m.

The theme, “Working for a Better Atlanta,” spotlights Atlanta’s position as a vital economic center and the role of human resources professionals in shaping a more prosperous future. “The SHRM-Atlanta community has really come together to produce an unparalleled opportunity to meet and explore the critical issues – and opportunities – the HR profession currently faces,” said Mary Lynn Miller, SHRM-Atlanta’s chief operating officer. “Legislative changes and compliance, using social networking for recruiting, tackling recruitment and retention as the cost of providing benefits increases… we’re gathering the experts under one roof so HR practitioners at all levels find new insights and tools to improve their personal and company performance.”

Over 60 concurrent breakout sessions organized into seven educational tracks are planned. Confirmed speakers include leaders from MetLife, Merrill Lynch, Cox Enterprises, AARP and a number of other prominent corporations, consultancies and law firms. Tracks include: Business Acumen & Leadership, Law & Legislation, Total Rewards, Organizational Evolution, Talent Management, Diversity & Inclusion and HR Leveraging Technology.

The Resource Partner Showcase opens on Monday, October 17 at 9 a.m. and features over 100 exhibitors providing products and services to help human resources professionals work more efficiently. For the second year, the Technology Association of Georgia (TAG) presents “Tech Row,” a series of vendor booths representing TAG’s member companies providing products and services to the HR community. Admission to the Showcase is free and open to the general public.

A highlight of the agenda is the 2011 SHAPE Awards, taking place Monday, October 17, to recognize individual HR professionals and teams who exemplify the highest professional standards in the industry. Networking opportunities also include a roundtable breakfast held Tuesday, October 18 where conference attendees share ideas and knowledge about specific topics or areas of expertise.

Full-access, student and one-day registration rates are available, ranging from $230 – $650. Group discounts for five or more participants from the same organization are available. Admission to the Resource Partner Showcase (exhibition hall) is free. For detailed rate information, the full agenda and additional information regarding the 21st Annual SHRM-Atlanta Human Resources Conference, visit shrmatlanta.org.

About SHRM-Atlanta
SHRM-Atlanta, the Atlanta Chapter of the Society for Human Resource Management, was founded in 1965, and has current membership of over 2500 individuals. SHRM-Atlanta seeks to promote the professionalism of the Human Resources Management field by offering members a wide variety of professional development opportunities and a common forum in which to share ideas and experiences. Serving the Atlanta HR professional, SHRM-Atlanta provides opportunities for career development and community involvement both inside and outside of the Chapter. SHRM-Atlanta – Working for a Better Atlanta!
www.shrm-atlanta.org

On Twitter: @shrmatl
Conference hashtag: #shrmatl11

When a crisis creates uncertainty, markets often become volatile, especially when the scope of the disaster isn’t clear. A crisis is like Janus, the Roman god with faces that looked forward and back. For some investors, it may represent a threat; for others, it may spell opportunity. Not every crisis requires a reaction; sticking to a long-term plan is still the best strategy for most people.

Here are some examples of factors that investors sometimes overlook when considering which face of Janus to focus on during a crisis.

Watch the global supply chain

Companies and economies increasingly operate in a global context. The more heavily an industry or company relies on global partners, the more it might be affected by crisis conditions. Think not only about companies that are affected directly by turmoil, but about other companies that rely on them.  For example, China has become in many ways the world’s factory floor, and many information technology services are now outsourced to India. How would a crisis in either country affect global supply chains or communications infrastructure? Might competitors not affected by the crisis pick up at least some of the slack?

How might a particular industry be hit by shortages of parts or raw materials? Is a large multinational so geographically spread out that a crisis in one part of the world may have little impact on its overall operations? Oil is perhaps the most obvious example of how a crisis can affect global supply chains. A perceived threat to supplies can affect prices of other assets.

Consider currency fluctuations

Currency fluctuations are another factor to consider. Crises in one part of the world can affect that region’s currency. That in turn can affect companies located elsewhere. The 2010 panic over potential default by several eurozone countries strengthened the dollar, and though that may sound like good news, a stronger dollar can hurt U.S. exports.

Currency issues are also important because of what’s called the “carry trade.” This happens when investors use money from a country where interest rates are relatively low–the Japanese yen and the U.S. dollar have been prime examples in recent years–to invest elsewhere at a better rate of return. However, if the cheaper currency suddenly increases in value, the carry trade can reverse as investors put their capital back into the so-called funding currency. That can affect assets denominated in other currencies. For example, the yen soared as investors anticipated that money would be repatriated to deal with Japan’s earthquake/tsunami/nuclear disaster. Some investments denominated in other currencies suffered when investors sold them to invest in yen.

Think both long term and short term

Nothing lasts forever. A crisis could create opportunities that eventually peter out, or challenges that later seem trivial. Or it could have little short-term impact but mean profound change over a period of years. When considering whether a crisis represents a challenge or an opportunity, think both short term and long term.

A crisis with potentially long-term opportunities or harmful consequences may mean you may be able to take more time with a decision. If the window of opportunity is smaller or the potential devastation more short term, remember that there are alternatives to an all-or-nothing approach. For example, you could take a small position and see how your investment thesis plays out before committing more. Even if the window of opportunity slams shut, new opportunities often emerge during even the worst of times; missing one now doesn’t mean you won’t find others later. If you’re worried about a potential downturn, you could use other investments to hedge your exposure while retaining a long-term stake, or take profits to protect part of your holdings but leave some money invested in case the crisis is short-lived.

Note: Any investment approach involves some type of risk, including the possible loss of principal, and there’s no guarantee any strategy or technique will be successful.

This article was provided by Jim Bridges, CFP®, Associate Vice President, Morgan Keegan. Jim is a co-chair (along with Julee Brunson, Georgia’s Own Credit Union) for the SHRM-Atlanta Total Rewards Community. If you are interested in following more on the total rewards community, please join our LinkedIn Total Rewards subgroup; if you are interested in following more on the legislative affairs community, please join our LinkedIn Legislative Affairs subgroup.

“Companies have long set aside resources to develop and market consumer brands. Now, some are finding that to attract and retain the best job candidates, they need to put similar resources into their so-called employer brands.” (Wall Street Journal, May 16, 2011, pg. B9) How is your organization targeting potential employees to make it a desirable place to work? Furthermore, how is your company retaining its valued employees?

Here are a few statistics for you to consider:

• There are approximately 78 million people in the baby boom generation who will be retiring sooner or later (Maybe, later than sooner but they will be retiring), but only 46 million in Gen X, approximately 32-47 years old to fill those spots. Big labor shortages are coming as is the talent war.
• By 2012, 70% of the workforce will be women and minorities. By 2014, 48% of the workforce will be women.
• The MetLife Inc. ninth Annual Study of Employee Benefit Trends indicated that employees have “grown more dissatisfied and disloyal, to the point where a startling one in three employees hopes to be working elsewhere in the next 12 months.”

Have I got your attention now?  As Human Resource experts, we have our work cutout for us. We need to become an even stronger strategic influencer at the organization table.

How do we play that role well?

1. Bring the near-term future scenario to the table, including the above cited statistics, in order to light a fire within the power players. Senior leaders may have put this issue on the back-burner because it has been an employer’s market over the last several years. Come equipped with the longer-term picture to add emphasis that this is not just a short-term issue. Know the specifics for your industry.
2. Educate senior leaders about the motivations of each generation, what they are looking for in work. Senior leader Boomers need to understand that Gen Xers and Millenials are not motivated by the same things that motivate them. Creating the right culture can do more to attract this talent than compensation packages.
3. Scrub your company’s approach to recruiting. The logo and products or services are not enough to attract talent. For example, include video profiles on your careers website of actual employees. What hard-to-fill positions are available that potential candidates might not know are opportunities in your organization? Appeal to these technology-savvy generations by leveraging LinkedIn, Facebook, Twitter and iPad apps.
4. As more women move into the ranks of leadership and accept more responsibility, the potential for stress levels to rise is inevitable. Keep in mind, women manifest stress very differently than men. Stressed-out men are Type A (the stress syndrome we have heard about all these years). Women become Type E, everything to everybody, a very different set of behaviors. What is your organization doing to help these high potential women cope? If nothing, these talented women may just find a company that is more work-life balance friendly.

So, what are you and your organization doing to shine its image as a great place to work? Would you advise your best friend (given the appropriate skill set) to work there? Better yet, if you had to do it over again, would you work for your company? Why or why not is a good place to start the discussion to ensure your organization is able to attract and retain the right talent to sustain it. Then, onto a shiny employer brand…

Dr. Jane Goldner, president of The Goldner Group, is one of the nation’s leading authorities on talent retention and trusted advisor to Fortune 100 Companies, government and military organizations, and to mid-sized businesses. She is the author of Driven to Success: A 10-Point Checkup for Achieving High Performance in Business, a step-by-step business guide for leaders. Dr. Goldner is a highly rated adjunct professor at Kennesaw State University Coles College of Business. She is a recovering Type E Woman who focuses on helping other women recognize and address their Type E behaviors.

Buying insurance is about sharing risk. For example, health insurance will cover some of the cost of getting and staying healthy. Homeowners insurance will assume the risk of loss in case your home is damaged or destroyed. But oftentimes, we think we’re covered for losses by insurance when, in fact, we’re not. Here are some common coverage
gaps to remember when reviewing your own insurance coverage.

Life insurance
In general, when coupled with savings and income, you want to have enough insurance that will allow your family to continue to live the lifestyle to which they’re accustomed. But changing circumstances may leave a gap in your life insurance coverage.

For example, if you have life insurance through your employer, changing jobs could affect your insurance coverage. You may not have the same amount of insurance, or the policy provisions may differ. Your coverage may have decreased, or the type of insurance may have changed. Where your prior employer may have provided permanent life insurance, now you may have term insurance that will expire on a predetermined date. Review your income, savings, and expenses annually and compare them to your insurance coverage. Changing circumstances may require more insurance.

Your financial professional can help you determine if you have enough coverage to meet your family’s future income needs.

Homeowners insurance
Homeowners insurance can be tricky as to what perils are covered and how much damage will be paid for. Clearly, it’s important to know what your homeowners policy covers and, more importantly, what it doesn’t cover.

You might think your insurer would pay the full cost to replace your home if it were destroyed by a covered occurrence. But many policies place a cap on replacement cost up to the face amount stated on the policy. You may want to check with a building contractor to get an idea of the replacement cost for your home, then compare it to your policy to be sure you have enough coverage.

Even if your policy states that “all perils” are covered, most policies carve out many exceptions or exclusions to this general provision. For example, damage caused by floods, earthquakes, and hurricanes may be covered only by special addendums to your policy, or in some cases, separate insurance altogether. Also, your insurer may not cover the extra cost of rebuilding attributable to more stringent building codes, or your policy may
limit how much and for how long it will pay for temporary housing while repairs are made.

To avoid these gaps in coverage, review your policy annually with your agent. A face-to-face meeting is always best with the policy right there in front of both of you. Also, take heed of notices you may receive. While it looks like boilerplate language, it could actually be changing your coverage significantly. Don’t rely on your interpretations–seek an explanation from your insurer or agent.

Auto insurance
Which drivers and what vehicles are covered by your auto insurance? Most policies provide coverage for you and family members residing with you. So your child who is living in a college dorm is probably covered, but living in an off-campus apartment might exclude your child from coverage. If you and your spouse divorce, which policy insures your children who are living with each parent at different times during the year? Notify your insurer about any change in living arrangements to avoid a gap in coverage.

Other gaps include no coverage for damaged batteries, tires, and shocks. And you might not be covered for stolen or damaged cell phones or other electronic devices (e.g., MP3 players).

Your policy may also limit the amount paid for a rental while your vehicle is being repaired.

In fact, insurance coverage for rental cars also poses many gaps in coverage. For instance, your own collision coverage may apply to the rental car you’re driving, but it may not cover all of the damages alleged by the rental company, such as loss of use charges. If you’re leasing a car long-term, your policy may only cover the replacement cost if the car is a total loss or is stolen. But that amount may not cover the outstanding balance of your lease. Gap insurance can cover any difference between what your insurer pays and the balance of your lease.

Policy terms and conditions aren’t always well defined, and you may not understand what’s covered until it’s time to file a claim. So review your insurance coverages with your financial professional to be sure you’ve filled all the gaps in your coverage.

This article was provided by Jim Bridges, CFP®, Associate Vice President, Morgan Keegan.  Jim is a co-chair (along with Julee Brunson, Georgia’s Own Credit Union) for the SHRM-Atlanta Total Rewards Community.  If you are interested in following more on the total rewards community, please join our LinkedIn Total Rewards subgroup.

Recent legislation includes changes that will affect small businesses in 2011. Here are some of the changes worth noting.

Depreciation
If you’re a business owner, you probably know that you’re allowed to deduct the cost of capital assets that you purchase for your business. Typically, part of the cost is deducted each year based on the useful life of the
property, according to a depreciation schedule.  Special rules allowed an accelerated “bonus” 50% first-year depreciation deduction for qualifying property placed in service during 2008, 2009, and 2010. This accelerated
depreciation deduction is allowed for purposes of the alternative minimum tax (AMT) calculation, as well as for calculating regular tax.

The Tax Relief, Unemployment Insurance
Reauthorization, and Job Creation Act of 2010 increased the bonus depreciation percentage allowed to 100% for qualifying property acquired and placed in service after September 8, 2010, and before January 1, 2012. This change enables business owners to significantly accelerate the deductions that result from new capital expenditures. (Note: one of the requirements for the accelerated depreciation deduction is that the “original use” of the property must commence in the specified time period–i.e., previously used property doesn’t qualify.)

IRC Section 179 expensing
Internal Revenue Code (IRC) Section 179 allows you to elect to deduct (or “expense”) the cost of depreciable tangible personal property that you acquired for use in your business in the year that you purchase it, rather than over time through depreciation deductions. As a result of legislation passed in September 2010, the maximum amount that can be expensed under IRC Section 179 for 2010 and 2011 increased to $500,000 (reduced when the total cost of qualifying property placed in service during the year exceeds $2 million). This legislation also temporarily expands the definition of property that qualifies for a deduction under IRC Section 179 to include some real property, including certain improvements made to nonresidential buildings and retail property, as well as qualified restaurant property. However, the maximum Section 179 expense limit that applies to real property is $250,000.

Other considerations

• Health care reform legislation passed in early 2010 established a tax credit for small businesses that offer health insurance coverage to their employees. For 2011, the maximum credit is 35% of employer premium expenses. To be eligible for the credit, you must have the equivalent of fewer than 25 full-time employees for the year; average annual wages must be less than $50,000; and you must contribute at least 50% of the premium cost of the qualifying health plan you offer to employees. (Note: The full 35% credit is available only if you have 10 or fewer full-time employees with average annual wages of $25,000 or less.)
• New “simple cafeteria plans,” created by the 2010 health care reform legislation, can be established starting in 2011 by businesses that have employed an average of 100 or fewer employees during the prior two years. If you’re eligible, such a plan can allow you to offer valuable benefits to employees (e.g., group term life insurance, dependent care assistance program) while automatically meeting nondiscrimination rules that normally apply to cafeteria plans.
• Beginning this year, many employers will begin reporting the cost of employer-provided health-care coverage on employees’ W-2s for informational purposes only (this is optional in 2011, mandatory in 2012). While the amount reported is not included in employees’ income, and will not affect their tax liability, you’ll want to be prepared to answer employee questions.

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This article was provided by Jim Bridges, CFP®, Associate Vice President, Morgan Keegan.  Jim is a co-chair (along with Julee Brunson, Georgia’s Own Credit Union) for the SHRM-Atlanta Total Rewards Community.  If you are interested in following more on the total rewards community, please join our LinkedIn Total Rewards subgroup; if you are interested in following more on the legislative affairs community, please join our LinkedIn Legislative Affairs subgroup.