Clyde Snow

The Bottom Line: How the Tax Cuts and Jobs Act Impacts Your Business

by | Apr 16, 2018

With tax season upon us, many Americans are being forced to learn what the Tax Cuts and Jobs Act (the “Act”) (deemed the most consequential tax reform in a generation) really entails and its impact on a business’ bottom line. While the changes in income tax brackets has been most heavily covered in the media, many employers are surprised to learn that a number of provisions in the Act may also affect a company’s employment practices. Below is a summary of the effects of the Act that most directly impact employers:

Deduction/Credit Pre-Tax Cuts and Jobs Act Post-Tax Cuts and Jobs Act
Family and Medical Leave Credit
  • None.
  • 12.5% credit for wages paid to employees on leave. Wages paid must be 50% or greater than regular pay rate.
  • 12.5% credit increases by .25% for each percentage point that the wage rate exceeds 50%. Amounts to a max credit of 25%.
  • All qualifying full time employees have to be given at least two weeks of leave.
  • For 2018 & 2019, a written policy is required.
Meals & Entertainment Expenses
  • 50% limit for meals and expenses.
  • 100% of meals provided to employees for the convenience of the employer and in-house employer cafeteria meals.
  • 50% still allowed for business meals.
  • Entertainment is now non-deductible.
  • Company-wide events are still fully deductible.
  • 50% limit for meals provided to employees for the convenience of the employer and in-house employer cafeteria meals.
  • In 2026, meals provided for employer’s convenience will be non-deductible.
Sexual Harassment Costs Subject to Nondisclosure Agreements
  • Deductible business expense.
  • No deduction is allowed if subject to a non-disclosure clause.
  • Applies to attorneys’ fees in addition to any settlement or payout amount.
Qualified Bicycle Commuting Exclusion
  • Bicycle commuting reimbursements excluded from employee wages.
  • Exclusion suspended, so now included in employee wages.
Exclusion for Moving/Relocation Expense Reimbursements and Moving/Relocation Expense Deduction
  • Qualified moving expenses reimbursed by employer can be excluded from employee wages.
  • Qualified moving expenses deducted for Adjusted Gross Income.
  • Suspended with an exception for active duty military.
  • Suspended with an exception for active duty military.

For assistance navigating how the Act may affect you and your company, contact the Labor & Employment Group at Clyde Snow & Sessions at 801.322.2516 or vbf@clydesnow.com.

This material has been prepared for informational purposes only, and is not intended to provide, and should not be relied on for, tax, legal or accounting advice. You should consult your own tax, legal, and accounting advisors before engaging in any transaction. Nothing in this communication is intended or written by us to be used, and cannot be used, for the purpose of (i) avoiding penalties that may be imposed by any governmental taxing authority or agency, or (ii) promoting, marketing, or recommending to another party any matters addressed herein.

Sign up for our latest updates.


Recent Posts

Ripple Effect 151: Discover Ag. Podcast

Tara Vander Dussen, Co-Host of the Discover Ag. Podcast, joins us for a lively and informative discussion about agricultural news and information. We dive into the presence and impact of social media, themes and trends, and why the new “food curious” movement is...

Ripple Effect 150: Colorado River Authority of Utah

Amy Haas, Executive Director of the Colorado River Authority of Utah, talks us through the inception of the entity, how it executes its mission to protect and defend Utah’s portion of the Colorado River, and where the Authority is leading out in tackling hard...

Ripple Effect 149: Watershed Improvements for Carbon Credits

Alex Johnson, Chief Strategic Officer for Virridy, walks us through this Company’s unique, and very innovative, platform to merge monitoring water quality improvements with selling carbon credits on the voluntary carbon market. Hint – treating water is energy...

Ripple Effect 148: Scaling Up! H2O – from Host to Guest!

In this very special episode, Emily joins the podcast not as a host, but as a guest! Join us as our beloved host Emily Lewis takes the spotlight on an entirely separate water podcast - 'Scaling Up! H2O.' Here's your chance to get personal with our host....

Ripple Effect 147: Snow Report 2023-2024

Jordan Clayton, Supervisor for the Utah Snow Survey at NRCS, joins us to discuss the status of Utah’s snow year and our water supply. Good news – after a slow start, the State is overall at 102% of normal. Bad news – we have a long way to go in the water year and we...

Ripple Effect 146: 2024 Legislative Preview!

Jeff Gittins joins us to discuss upcoming bills for the 2024 Legislative Sessions. A couple key bills, notes, and lots of follow-up tweaks for the last couple years of policy. As always, a great discussion; and check-out Jeff’s Utah Water Law and Water Rights blog.

Ripple Effect 145: 2024 Water Preview: Its Going to be Awesome!

Shaina Shay, Owner and Editor of The Water Report, shares her insights as to what will be big in 2024! PFAS, the Energy Water Nexus, Colorado River, Technology, and Aging Infrastructure all make an appearance. Shaina always brings thoughtful commentary and a unique...

Related Posts