Among the many responsibilities you have as a business owner is to keep up with the latest laws that affect your company. Each year seems to bring change, and keeping up to date can be difficult, which is why we’ve outlined everything for you in this article.
Minimum Wage Laws
There are 18 states that have higher minimum wage requirements in 2018. Eight of these are due to increases linked by law to the inflation rate: Alaska, Florida, Minnesota, Missouri, Montana, New Jersey, Ohio and South Dakota. The other 10 states passed laws raising their minimum wages: Arizona, California, Colorado, Hawaii, Maine, Michigan, New York, Rhode Island, Vermont and Washington State.
The salary threshold under the Fair Labor Standards Act will probably rise in 2018. This is the threshold on the maximum salary subject to the federal minimum wage for all hours worked and overtime pay at time and a half. The threshold stood at $23,660 at the start of 2018, but we await the new figure due sometime this year.
One other thing that should be on your radar is the crackdown on companies that steal wages from employees. Prosecutors have been winning stiff penalties and jail time for companies that underpay their workers. For example, a Texas chain restaurant was found guilty of working their employees 12 hours a day and paying them less than minimum wage. Three of the chain operators are now serving time in prison.
Taxation and Deductions
The 2018 tax brackets have been lowered, with the corporate tax rate dropping from 35 percent to 21 percent. Corporations can also deduct state and local taxes. If you are a business owner, you’ll likely find your personal tax bill lower in 2018 due to the lower top rates. And certain small business, especially LLCs, are eligible for a 20 percent tax deduction on their gross income.
One other change pertains to the Section 179 deduction. This deduction allows small business to immediately expense the full price on leased or financed equipment and off-the shelf software rather than depreciating the cost over several years. The change for 2018 is that the deduction limit doubles to $1 million.
There are a slew of new state laws and regulations that could affect your business in 2018. Check your state’s department of state for new rules affecting:
- Equal pay for equal work laws: These laws outlaw the gender-based pay gap.
- Paid leave: Several states have passed paid leave laws for employees seeking family or sick time.
- Posting requirements: States frequently update their job posting requirements that allow current employees to apply for different jobs within the company.
- Predictive scheduling: More states are climbing on the predictive scheduling bandwagon. Predictive scheduling laws oblige businesses to provide employee schedules ahead of time. The law usually applies to selected industries such as food services, hospitality and retail, but the rules vary by locale.