Major tax reforms become law

At the end of 2015, Congress passed and the President signed into law tax reforms for our industry:
  • Restaurant depreciation: Will permanently allow restaurant improvements and new construction to be depreciated over 15 years opposed to 39 years. This has been one of PRLA's top federal priorities for several years and we are pleased to see the change occur.
  • Bonus depreciation: Normally, businesses recover capital investments through annual depreciation deductions. Bonus depreciation of 50 percent has been renewed through 2017 and retroactively cover 2015. These depreciations allow businesses to write them off more quickly.
  • Section 179 expensing: Small business expensing in effect from 2010-2014 have been permanently extended and indexed for property placed in service during 2015 and forward.
  • Work opportunity tax credit: This credit is extended through 2019 and will promote the hiring of individuals who quality as a member of a target group and will provide a tax credit to those businesses that hire these individuals. An employer can qualify for a tax credit up to 40 percent on the first $6,000 in wages and a 25 percent credit for short-term employees.
  • Charitable food donation tax credit: This deduction is permanently extended. In addition, the deduction is increased from 10 percent to 15 percent of the taxpayer's AGI.

Federal overtime regulations

The deadline to submit comments regarding the change in federal overtime regulations has passed and now the Department of Labor (DOL) will review the hundreds of thousands of comments it received. The primary focus of comments from the hospitality industry consist of the following:
  • Making no changes to the “duties test”, which is the general description of responsibilities used to classify which employees are management and, therefore, exempt from overtime pay.
  • The DOL states that bonuses can be considered part of an employee’s overall pay, but it cannot be larger than 10 percent of an employee’s weekly salary. We believe all bonuses should be considered part of the overall wage. The current regulations state that the salary threshold will be increased to $50,400—our hope is that the threshold will be a more reasonably and justifiable $35,000.
  • Comments have also been submitted to oppose the automatic indexing included in the regulations.

We expect final regulations to be released in the fall of 2016.

Music licensing

The National Restaurant Association has joined other business groups in asking the Department of Justice to bring SESAC under the same legal scrutiny as BMI and ASCAP. SESAC is currently not subject to the same regulations that block abusive practices in collecting royalties from venues that have music. The coalition, that PRLA supports, is to ensure fair treatment of both artists and venues.   

EMV Liability Shift 

As of October 1, the liability for credit card fraud shifted from the credit card company to the business unless the business has installed EMV chip-reading technology. If you have a breach and do not have EMV technology, you will be held responsible.

Affordable Care Act

PRLA is committed to making common sense changes to the Affordable Care Act, most importantly, changing the definition of full-time from 30 to 40 hours per week. 

NRLB ambush elections

PRLA is opposed to the recent regulations and rulings that have been released by NRLB in the past year.