By Maurie Cashman
There is a new republican majority after this yearâ€™s election. A significant driver of this election was the desire to reduce the burden of government regulation from U.S. businesses. However, nothing will change unless it is followed up by action, and in the short term bureaucrats may be trying to get their rules in place before the new administration takes office. Here are a few issues that you might consider writing to your Senator and Representative about.
Minimum Wage: This is an issue that is popular but has many sharp edges. Will raising minimum wage really have any benefit to workers or will it simply accelerate the export of jobs? Would it provide a better standard of living or will it force low margin businesses to automate faster to eliminate low-wage jobs? Will raising the minimum wage usher in a wage spiral when workers up the line demand an increase as they fall into the minimum wage category?
Overtime Regulations: The federal government apparently does not believe that U.S. business owners know how to run their businesses. And it also does not believe the U.S. worker knows when they need to move into a better career situation. Will changes in overtime regulations help workers trying to work their way up or will they prevent employers from hiring into early-stage management positions? Will regulations of this sort give employees a better quality of life, or will they prevent them from capitalizing on their work ethic to advance and develop themselves into future leadership roles? Will young innovators have the time to develop and implement if they are punching a clock?
Estate Taxes: The IRS currently has a proposed rule that would severely impact the tax burden on families trying to pass a business to the next generation. Under the proposed regulations, contained in Section 2704 of the IRS code, the IRS would single out family owned businesses and make them subject to a new valuation standard that is not applicable to transitions within non-family businesses. The gist of the proposed regulation change is to eliminate valuation discounting for minority interests being sold to family members. This will have a severe impact on the estate planning of many families with family-owned businesses and family farm partnerships. There is legislation proposed in the [Senate (S. 3436)][House (H.R. 6100)] to defeat the IRSâ€™ plan to increase taxes through regulatory action, referred to as The Protect Family Farms and Businesses Act.
Iâ€™ll have more comments on this particular proposal in future issues of Cashmanâ€™s comments.
Fiduciary Rules Proposed by Department of Labor: This rule sets a so-called fiduciary standard for financial brokers who sell retirement products, requiring them to put clients’ best interests ahead of their bottom line. State Farm Insurance has already instructed all of its agents to discontinue providing investment advice. Will this rule protect investors or prevent low- and middle-income Americans from saving for retirement or getting access to advice?
These regulations have been or are being implemented by regulatory bodies. These agencies are subject to Congressional oversight. Consider each of these items and let your elected representative know what your position is on each of them.
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