Planning for Multiple Scenarios is Key to Surviving Tax Uncertainty

WTP Advisors Outlines Best Next Steps for Companies With Capital Investment Concerns

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Nov 02, 2010, 10:38 ET

WHITE PLAINS, N.Y., Nov. 2, 2010 /PRNewswire/ -- Given the current climate of unparalleled tax uncertainty -- as evidenced by last Friday's push by President Obama to move his business investment and hiring plan through Congress, and a total unwillingness of Republican and Democrats to yet come to any agreement on the issue -- WTP Exchange, an affiliate of WTP Advisors, counsels companies to prepare for multiple scenarios that may enable them to save money no matter the legislative outcome.

If passed by Congress, Obama's plan allows businesses to expense for tax purposes 100 percent of capital investments through 2011. Although immediate expensing is attractive at first glance, many businesses are worried that their taxes will go up in other places to cover the $30 billion cost of the tax break.

"To avoid having to rely on the whims of our legislators, a lot of companies have been implementing repetitive, Like-Kind Exchange (LKE) Programs in order to reduce taxes," says Ron Hodgeman, Tax Director with WTP Exchange, who is working with companies to prepare for sundry outcomes.

Generally, if you exchange business or investment property solely for business or investment property of a like-kind, no gain or loss is recognized under Internal Revenue Code Section 1031[1], also known as a Like-Kind Exchange (LKE). The 1031 Exchange has been in the tax law for almost 90 years and is viewed as a permanent solution that allows companies to save taxes and increase cash flow.

Any company that routinely disposes of assets such as vehicles, heavy equipment, machinery, and computer equipment can realize substantial benefits from a LKE Program.

"Organizations need to know that they don't have to let DC lawmakers dictate their tax planning. For many, the best answer is to start a 1031 Exchange because it is a lasting solution that will be around long after the current Congress," says Hodgeman. "These uncertain times can also serve as an opportunity for organizations to find an even better, less expensive LKE program provider."

Organizations need a blend of the right software, tax expertise and a qualified intermediary (QI) in order to institute a LKE program that will help them realize the biggest savings.

"This is why we are ahead of our competitors. WTP Exchange is the only firm in the world to offer a fully-integrated LKE Program solution. In addition to our world-class software, we provide LKE tax consulting services, and Qualified Intermediary services to our clients," says Scott Davis, EVP of Business Development at WTP Exchange. "On top of that, we are finding that our fees are often substantially less than the fees charged by the big accounting firms, even though we are delivering unparalleled quality," he added.

The tax professionals within the WTP Exchange LKE team have been implementing LKE Programs for almost 15 years, and for a variety of industries, including large heavy equipment dealers, banks, rental car companies, and leasing companies throughout the United States.

"Clients don't hire us on price; they hire us because we are the best LKE program out there. The cost savings is just another unintended benefit, and in light of fundamental shifts in the LKE industry, it is important for companies to understand that we offer a superior solution," Hodgeman says.

In addition, owing to its ease of use, Hodgeman envisions that WTP Exchange software will appeal to companies that are already running an LKE Program.

"We are currently in the process of working with an equipment dealer that has been running an LKE Program for years but wants to switch to our software. We can make it easy for a client to make the change to our offering," says Ron Hodgeman.

For more information, please contact Scott Davis, EVP of Business Development at WTP Exchange. Scott can be reached via phone (303-379-2855) or email ([email protected]).

About WTP Exchange and WTP Advisors

WTP Exchange, an affiliate company of WTP Advisors, is a leading provider of like-kind exchange ("LKE") solutions. WTP Exchange is the only company to integrate and provide all three of the necessary components to a successful LKE Program solution: (1) expert LKE and tax consulting services, (2) LKE software, and (3) Qualified Intermediary services.

WTP Advisors is a leader in tax and business advisory services for a global marketplace. Our highly skilled professionals equipped with years of industry experience, coupled with our cutting-edge technologies, make substantive and long-term differences to an organization's profitability. WTP Advisors is headquartered in White Plains, New York, with offices across North America, Asia and Europe.

[1] http://www.irs.gov/businesses/small/industries/article/0,,id=98491,00.html

SOURCE WTP Advisors