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Tax Law Implications for Facility Managers

The newly passed federal tax law brought swift reaction from CEOs and business owners across the company. This new law aims to save American businesses money while laying the foundation for their growth and prosperity. In particular, the new tax law is expected to make these notable impact with facilities managers.

Investment in the Business

The upcoming tax cuts will allow business owners and CEOs the opportunity to put more money back into their businesses. Until recently, many corporate owners and executives had to save money to pay their yearly taxes. They had little money left over to sink back into their businesses or to share with their employees.

The new tax law, however, will save American businesses more than $400 billion over the course of the next decade. This staggering amount of money means that more CEOs and small business owners will have more cash to reinvest into their companies. Since they are paying less in taxes, they also will have more revenue to share with employees in the way of bonuses or wage increases.

Debt Reduction

The high tax rates of the past put a tremendous burden on business owners who wanted to pay off their corporate debts. Many of them could only pay the minimum balances or face carrying their debts over from year to year. The value and integrity of their businesses suffered because of this financial burden.

The corporate tax cuts should allow more business owners to pay off their debts faster, however. As the corporate tax rate drops from 35 percent to 21 percent, more owners will have extra money in their cash flows. They can use this cash to pay off what they owe and free themselves from crippling corporate debt.

Freeing themselves from debt also should allow business owners and CEOs to expand their businesses and inventory lines. They will have the financial resources to expand their companies into new markets, improve their existing structures, and offer more products and services to customers.

The tax cuts will allow them to expand their brands to new audiences. The tax cuts also have convinced companies like Apple to move their operations back to the U.S. instead of staying situated in countries like China. The influx of companies coming back to the U.S. is expected to generate more revenue for the American economy and increase American consumer confidence.

Increased Hiring

The new corporate tax law aims to make it easier for American businesses to create more jobs and hire more people. In the last decade, businesses cut jobs and laid off workers to save money. The high corporate tax rate made it difficult for them to create new positions and to pay to hire more people.

As the tax rate drops by 14 percent, American companies are expected to have more money left over in their coffers.

Many corporate executives have already announced their intention to hire more workers for the new positions that the businesses plan to create. Many of the new jobs expected to come from the tax cuts will be full-time positions with benefits like 401ks and health insurance. They also will pay more than the federal minimum wage. The influx of workers going back into full-time jobs is expected to strengthen the economy.

The Trump federal tax plan is perhaps the most lauded piece of legislation to go through Congress in recent years. It has already been well-received by American CEOs and business owners.

However, the new federal tax cuts are expected to have several noteworthy implications for facilities managers across the country. The tax savings will translate into extra savings that will allow more workers to be hired and companies to be expanded to new markets. Facilities managers along with business owners and CEOs will experience the impact of these tax cuts savings over the course of the next decade as businesses save more than $400 billion in taxes.

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