By the time you read this, spring is either in the rearview mirror or straight ahead. For the sake of this article, let’s just say 2020 is blooming. My original plan was to provide an update on the current tax filing season. However, there were no major changes to the tax law since my article in the fall issue of Western Equipment Dealer.
Instead, let’s look at some things we are seeing in the industry and ways EDC and WEDA helps its members.
We are still seeing plenty of activity in the world of mergers and acquisitions. We’re actually seeing more mergers these days than straight acquisitions. Although acquisitions are occurring, the dominant arena is mergers. If either is on your radar, EDC and WEDA can help with the valuation piece, tax questions, and the processes needed for a smooth transition.
Merger Frequency
Mergers are occurring more frequently and the biggest issue in a smooth transition is the processes set forth before and after the merger. The processes after the merger are key and often overlooked or forgotten because everyone is going different directions. WEDA’s Dealer Institute trainers can make sure the processes are occurring, staying on course, and being followed by all employees.
These trainers have seen many mergers, been involved with companies they have owned, merged with another dealership, or sold their business. The DI trainers have experience with both the farm equipment and construction industries.
Valuations
Equipment Dealer Consulting can help with the valuation process in a merger to make sure all parties are treated equally. EDC is a third-party voice and it works for the new company being established. EDC can assist in tax strategy. Moreover, with the partnership the association has with its legal counsel, Seigfreid Bingham, WEDA can assist with all legal documents necessary for the newly formed company.
Estate Planning
EDC continues to work with dealers who are interested in estate planning and succession planning.
EDC can help with the valuation report needed to accompany the estate tax return or gift tax return filed with the IRS. We have done several this year and with the growth of more dealerships, we are seeing more inquiries into gifting and transitioning over to the next generation.
Mergers are occurring more frequently and the biggest issue in a smooth transition is the processes set forth before and after the merger… WEDA’s Dealer Institute trainers can make sure the processes are occurring, staying on course, and being followed by all employees.
Equipment Dealer Consulting also helps dealers with audits, reviews, and 401(k) limited scope audits. Companies that have more than 100 participants in their 401(k) plan need a limited scope audit done each year. We are here to help in that process.
Tax Preparation and Returns
Of course, EDC provides corporate tax preparation and returns for individuals, trusts, gift taxes, and nonprofit taxes. WEDA’s hotline, which is 800-762-5616, also lets members use EDC for legal, tax, or other issues. Equipment Dealer Consulting helps dealers with income tax, sales tax, human resources, issues related to mergers and acquisitions, and succession planning.
We are seeing more activity in sales tax audits in various states since everyone is looking for a source of revenue. We are also seeing different interpretations of the sales tax laws in various states by their own sales tax auditors. So, dealers who may be experiencing these issues are encouraged to give the association a call.
A Helping Hand
Equipment Dealer Consulting has been noticing an increased need for controllers and bookkeepers for the farm equipment industry. Many controllers and bookkeepers have been with most companies for many years and some have begun to exit the industry. EDC can help provide a smooth transition to a new person, especially with reconciliation of manufacturer statements, contracts in transit, and other items that are unique to this industry.
If you have any of these issues come up during 2020, please give Equipment Dealer Consulting or WEDA a call. We are here to help. Enjoy a successful spring and keep it going throughout the year.
Article Written By Curt Kleoppel
CURT KLEOPPEL, CPA, CVA, is the treasurer of the Western Equipment Dealers Association. He also serves as president of Equipment Dealer Consulting, LLC, a long-term association partner. The consulting group was created to provide financial services to association members. For information, visit www.eqdealerconsulting.com or write to curt@ westerneda.com.
