Faster, Bigger, Quieter: Dallas-based Southwest Airlines launches Boeing 737 Max 8 Aircraft to make history

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Yesterday, Dallas-based carrier Southwest Airlines launched nine Boeing 737 Max 8 jetliners, making it the first North American company to use the new Max 8 aircraft in commercial flights. The aircraft departed from six different airports, with the first taking off from Dallas Love Field for Houston and then San Antonio, a route reminiscent of Southwest’s “Texas Triangle” route in 1971. Southwest hopes to expand from nine to 14 of the Max 8 jetliners by the end of 2017.

The introduction of the Max 8 aircraft marks a new chapter in Southwest history. Earlier this weekend, Southwest retired 30 of their Boeing 737-300 jetliners, affectionately dubbed the “Classics”. Though a trailblazer when first introduced in 1984, the Classics have proven outdated in recent years due to their louder engines and lack of Wi-Fi connectivity. The Classics’ fuselage was also infamous for its safety hazards. In July 2009, a huge hole at the rear of the plane forced an emergency landing. In April 2011, two people were injured when a 5-foot-long gash opened in the fuselage mid-flight.

In contrast to the Classics and other Boeing models, the new Max 8 aircraft is safer and more fuel-efficient. With its nacelles that curb noise, v-shaped winglets, and powerful Leap-1B engine, the Max 8 is quieter, uses 14 percent less fuel, and travels 500 nautical miles farther than the Boeing 737-800. The Max 8 aircraft also has wider seat dimensions in economy class than any other plane on the North American market and can carry up to 175 passengers, 32 more than the Classic aircraft

The Max 8 was designed with the long-term future in mind. Unlike the Classic jetliner, the Max 8 aircraft is connected to satellite-based Wi-Fi. Southwest, notably, did not include television monitors to the Max 8 design. Instead, customers are encouraged to use their personal devices on board. This was a cost-effective measure since maintaining television monitors can be expensive and according to Mike Van de Ven, Southwest’s Chief Operating Officer, technology is constantly evolving and the television monitor may be outdated one day. After all, he noted how airplane seats once had telephones attached to them.

As Chairman & CEO Gary Kelly told Business Insider on Sunday, “Today, we begin a new chapter in Southwest’s history by introducing the Boeing 737 MAX 8 to our Customers and Employees. The MAX 8 is the future of the Southwest fleet, and we look forward to connecting Customers to the important moments in their lives through our legendary service delivered with this more fuel efficient aircraft designed to produce less noise in the communities we serve.” [sic]

Are you conducting R&D to improve aviation and the passenger experience like Southwest Airlines? You may be eligible for the R&D tax credit. If you would like to find out how your company could benefit from R&D Tax Credits, please contact a Swanson Reed R&D Specialist today.

Swanson Reed regularly hosts free webinars and provides free IRS CE credits as well as CPE credits for CPA’s.  For more information please visit us at www.swansonreed.com/webinars or contact your usual Swanson Reed representative.

2017: The Best Year for Texas Manufacturing Despite Hurricane Harvey

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As the month of September comes to a close, the Federal Reserve Bank of Dallas (Dallas Fed) released its monthly Texas Manufacturing Outlook Survey earlier this week. Even in the aftermath of Hurricane Harvey, September’s survey results were clear: the manufacturing industry in Texas is still going strong.

Industry executives throughout Texas contribute to the survey on the monthly basis, providing data for indicators such as employment, orders, prices, output, and so forth. Dallas Fed then calculates this data and releases an index for each indicator to reveal the health of the state’s economy. Any index below zero demonstrates a decrease while a score above zero means growth.

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Texas startup on mission to cure wine hangovers

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Research has shown that after drinking wine, up to 75% of adult consumers may experience hangover-like symptoms such as headaches, flushed skin or congestion.  PureWine is a Texas based startup that has created a new filter that removes ingredients (specifically, histamines and sulfites) from wine prior to drinking, aiming to prevent hangover like symptoms.  

PureWine’s co-founder, David Meadows, and his son started researching this system, referred to as a ‘Brita filter for wine’, over five years ago. Today, the company has successfully developed a wand-shaped filter that absorbs the chemical compounds, or ingredients, from the drink, preventing the dreaded hangover.  The wand filter has been designed to cover multiple beverage platforms, including beer and champagne.

The R&D Tax Credit is available to PureWine and other companies developing new and improved products and processes, allowing a credit of up to 14% of eligible spending.

If you would like to find out how your company could benefit from R&D Tax Credits, please contact a Swanson Reed R&D Specialist today.

The Best and Worst CyberStates for 2017

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The Computing Technology Industry Association (CompTIA) is a leading not-for-profit technology association. Their 18th edition of the Cyberstates report aims to provide a representation of the size and scope of the US tech sector. The report analyses the industry and workforce by state and uses metrics such as tech patents, venture capital funding, business establishments and job postings.

Here is a summary of the results by state:

Tech Industry Employment

There were around 6.9 million US tech workers in 2016, up from 6.7 million in 2015.

Top 5

  1. California
  2. Texas
  3. New York
  4. Florida
  5. Massachusetts

Bottom 5

  1. Wyoming
  2. South Dakota
  3. Alaska
  4. North Dakota
  5. Montana

Tech Patents Granted

Top 5

  1. California
  2. Texas
  3. Washington
  4. New York
  5. Massachusetts

Bottom 5

  1. Alaska
  2. South Dakota
  3. Mississippi
  4. Montana
  5. West Virginia

Innovation Score Per Capita

The number of tech startups and new tech establishments grew to 36,508 in 2015. Many were IT services covering data processing, hosting and web search portals.

Top 5

  1. California
  2. Massachusetts
  3. Washington
  4. Colorado
  5. New Jersey

Bottom 5

  1. West Virginia
  2. Mississippi
  3. Arkansas
  4. South Dakota
  5. Ohklahoma

Tech Gross State Produce (GSP) As A Percent of Total State Product (in billions)

Top 5

  1. Oregon
  2. Washington
  3. Massachusetts
  4. California
  5. Colorado

Bottom 5

  1. Wyoming
  2. Louisiana
  3. Oklahoma
  4. Mississippi
  5. West Virginia

Average Tech Industry Wages Rank

The average tech sector wage was 105 percent higher than the average national wage of $53,130 in 2016.

Top 5

  1. California
  2. Washington
  3. Massachusetts
  4. New Jersey
  5. New York

Bottom 5

  1. South Dakota
  2. Mississippi
  3. Wyoming
  4. West Virginia
  5. Montana

The full report is available at Cyberstates.

US tech companies undertaking qualified activities can apply for the state and/or federal R&D tax credit. To check whether your projects meet the necessary criteria, contact a Swanson Reed representative today.

Top States for Doing Business 2016

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How does your state rank for doing business? CNBC ranked all 50 states for business using a range of publicly available data.  They used a points-based system for each of the 10 categories of competitiveness.

Here are the results:

Workforce

Rating based on education level of the workforce, the numbers of available employees, and the states’ demonstrated abilities to retain college-educated workers.

Top 5

  1. Colorado
  2. Massachusetts
  3. Virginia
  4. North Dakota
  5. Arizona

Bottom 5

  1. Maine
  2. Missouri
  3. Hawaii
  4. Vermont
  5. Kentucky

Cost of Doing Business

Rating based on the competitiveness of each state’s tax climate, as well as state-sponsored incentives that can lower the cost of doing business. Utility costs can add up to a huge expense for business, and they vary widely by state. Also considered was the cost of wages, as well as rental costs for office and industrial space.

Top 5

  1. Indiana
  2. Iowa
  3. Mississippi
  4. South Dakota
  5. Kentucky

Bottom 5

  1. Hawaii
  2. California
  3. Maryland
  4. Connecticut
  5. Massachusetts

Infrastructure

Rating based on the vitality of each state’s transportation system by the value of goods shipped by air, waterways, roads and rail. The availability of air travel in each state, the quality of the roads and bridges, and the time it takes to commute to work was taken into account, as was the condition of each state’s drinking water and wastewater systems.

Top 5

  1. Indiana
  2. Tennessee/Texas
  3. Tennessee/Texas
  4. Georgia
  5. Minnesota

Bottom 5

  1. Rhode Island
  2. New Hampshire
  3. Maine
  4. Connecticut
  5. Hawaii

Economy

Rating based on economic growth, job creation, consumer spending, and the health of the residential real estate market. Each state’s fiscal health was measured by looking at its credit ratings and outlook, as well as its overall budget picture. Also considered was the number of major corporations headquartered in each state.

Top 5

  1. Texas
  2. Colorado
  3. Utah
  4. Florida
  5. Oregon

Bottom 5

  1. Mississippi
  2. Maine
  3. Alabama
  4. West Virginia
  5. Louisiana

Quality of Life

Rating based on livability, including several factors, such as the crime rate; inclusiveness, such as antidiscrimination protections; the quality of health care; the level of health insurance coverage and the overall health of the population. Also evaluated were local attractions, parks and recreation, as well as environmental quality.

Top 5

  1. Hawaii
  2. Minnesota
  3. Vermont
  4. New Hampshire
  5. Maine

Bottom 5

  1. Arkansas
  2. Missouri
  3. Oklahoma
  4. Louisiana
  5. Tennessee

Technology and Innovation

Rating based on support for innovation, the number of patents issued to their residents and the record of high-tech business formation. Also considered were federal health, science and agricultural research grants to the states.

Top 5

  1. Washington
  2. California
  3. Massachusetts
  4. New York
  5. Maryland

Bottom 5

  1. Mississippi
  2. West Virginia
  3. Wyoming
  4. Arkansas
  5. Louisiana

Education

Rating based on the number of higher-education institutions in each state, as well as long-term funding trends for higher education. Also evaluated were several measures of K–12 education, including test scores, class size and spending, as well as digital and lifelong learning opportunities in each state.

Top 5

  1. Massachusetts
  2. Minnesota
  3. Wyoming
  4. Illinois
  5. Virginia

Bottom 5

  1. Nevada
  2. Idaho
  3. Mississippi
  4. Arizona
  5. Alabama

Business Friendliness

Rating based on the freedom each state’s legal and regulatory frameworks provide for business.

Top 5

  1. New Hampshire
  2. South Dakota
  3. Virginia
  4. North Dakota
  5. Idaho

Bottom 5

  1. California
  2. West Virginia
  3. Illinois
  4. Mississippi
  5. Hawaii

Cost of Living

Rating based on cost of housing, food and energy.

Top 5

  1. Mississippi
  2. Kentucky
  3. Arkansas
  4. Alabama
  5. Tennessee

Bottom 5

  1. Hawaii
  2. New York
  3. Delaware
  4. California
  5. Connecticut

Access to Capital

Rating based on venture capital investments by state, as well as small-business lending on a relative basis.

Top 5

  1. Illinois
  2. North Carolina
  3. California
  4. Michigan
  5. New Jersey

Bottom 5

  1. Wyoming
  2. Vermont
  3. West Virginia
  4. Delaware
  5. New Mexico

Many US businesses can take advantage of the state and/or federal R&D tax credit. Please contact a Swanson Reed representative to find out what is available in your state and whether your business qualifies.

How Does Your State Rank on the Innovation Scale?

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Innovation Is Key

Innovation is crucial to sustainable economic growth, but for innovation to occur businesses must have both the incentive and the capacity to invest.

As innovation is key to the United States’ economy as a whole, many U.S. states are showing off while others are falling short when it comes to patents, R&D, venture capital and academics.

So which states are excelling in innovation and which ones are lacking, you ask?

Patents

The top states in patents per population include:

  1. Wisconsin
  2. Washington
  3. Texas
  4. Utah
  5. California
  6. Massachusetts

The bottom five patented states include:

  1. Alaska
  2. Mississippi
  3. Tennessee
  4. West Virginia
  5. Wyoming

Venture Capital

The top states for venture capital are:

  1. Massachusetts
  2. California
  3. Utah
  4. Washington
  5. Colorado

The lowest are:

  1. Arkansas
  2. Alaska
  3. Hawaii
  4. Wyoming
  5. Iowa
  6. South Dakota

R&D Spending

The leaders in R&D spending are:

  1. Delaware
  2. Michigan
  3. California
  4. Connecticut
  5. Massachusetts

The states that spent the least on R&D include:

  1. Arkansas
  2. Wyoming
  3. Louisiana
  4. Alaska
  5. Mississippi

Academics

As for academics, the top states include:

  1. New Mexico
  2. Maryland
  3. Rhode Island
  4. Massachusetts
  5. Alabama

The lowest academic rankings were for:

  1. Louisiana
  2. Arkansas
  3. Delaware
  4. Wyoming
  5. Nevada

If you are a U.S. based company conducting R&D you may be eligible for the federal and/or state research tax credit. Please contact a Swanson Reed representative to find out further information.

Which Texan City is Exceeding Tech Job Growth?

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From 2015 to 2016, tech jobs in Texas increased by 1.9%, producing 11,000 new jobs. Yet the standout city was Dallas, creating 2,978 jobs last year, mainly due to strong growth in computer systems design, telecommunications services and IT services.

With the exception of California, Texas hires more tech workers than any other state. Last year, 2,196 tech jobs were generated in Houston, 974 in Austin and 843 in San Antonio, bringing the total number of tech employees in the state to 592,960. These cities are among the fastest-growing metro areas in the US. Popular tech jobs include computer user support specialist with almost 5,000 workers in San Antonio alone, followed by application software developer with 4,620 employed.

Interestingly, Austin ranked 1st for start-up hubs based inland and 6th in the US overall, demonstrating that entrepreneurial activity is now occurring away from the typical coastal regions and well-known technology hubs. In actual fact, start-ups are now being formed in every state, in what has been termed, “The Rise of the Rest.” This is significant as high-growth start-ups provide the most potential for employment growth; they tend to create jobs faster than more established organizations.

Nationally, the tech sector grew by almost 3% in 2016, with California, New York, Florida and Massachusetts also among the top states for tech jobs. Tech job gains were largest in California, New York, North Carolina, Texas and Michigan.

Today, there are more US workers in tech jobs than in finance, transportation or construction. Since 2010, there has been a 2.7% gain each year for the sector. Technology is transforming every industry, as businesses become more and more reliant on IT for growth. Tim Herber from CompTIA, declared that, “Organizations of all sizes are embracing cloud-based technology solutions, expanding their mobile presence, fortifying cyber defenses and driving decision-making through advanced data analysis.”

The federal and state R&D Tax Credit is available to technology companies who are developing new or improved software, products, formulas or processes, among other activities. To find out whether your company is eligible, contact Swanson Reed R&D Tax Specialists.

What You Need to Know About Claiming Your R&D Tax Credits in Texas

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If you are currently running your own company in Texas, you may be eligible for the Research and Development (R&D) tax credit. At Swanson Reed, we are here to help you with anything that you may need in relation to claiming this tax credit for your business. We can simplify the complex process involved in R&D tax relief by processing your claim and getting your business a rebate in less time than you would have thought possible.

R&D Tax Credits in Texas

In the state of Texas, the R&D tax credit is called the Texas Research and Development Tax Credit. Any corporations and flow-through entities can apply, and unused credit can be carried forward 20 years. Beginning with any tax returns filed after January 1, 2014, Texas taxpayers can claim the state-wide R&D tax credit to offset a portion of their franchise tax. Taxpayers may also choose to use it towards sales and use tax exemption on the purchase or lease of depreciable, tangible property, which is used in qualified research in Texas. The credit rates for the Franchise Tax Credit are 2.5% for companies who have less than 3 years of QREs and did not work through a university. The credit rate is 3.125% for those companies who have less than 3 years of QREs, but actually did work though a university. In contrast, this credit rate is 5% for companies who have 3 years of QREs, but didn’t work though a university. Finally, the rate is 6.125% for any company that has 3 years of QREs and also worked through a university. The Franchise Tax Credit for any one period, including any amounts that are carried forward, cannot surpass 50% of the franchise tax liability for that period.

Assessing Eligibility for the R&D Tax Credit

It is a common misconception that the R&D tax credit may be difficult to qualify for—but it is untrue. Our R&D Eligibility Tool is a good place to start if you think your company might be working on eligible R&D activities.. The R&D tax credit is specifically designed to reward those companies who have risked their investments by placing the importance on research and development. Such risks make this country more competitive and attractive to potential new investors. If you are not in the technological sector, there is no need to worry! Technology includes a wide range of processes, including: medicine, science, manufacturing, engineering, gaming, and architecture. If your company is working on improving a product or process, then you could be eligible for this credit.

How Swanson Reed Can Help

Our trained and friendly staff is here to help you with any potential dilemma that you run into while applying for the R&D tax credit. Once determining your eligibility, we can move onto the process of compiling your claim. Our tax advisors will help corporations, small startup companies, and any other business professionals in between. We can help make your business more profitable by reducing the tax bills that you need to pay. We will ensure that you receive your just rewards for your continued participation and dedication to innovation technologies. If you would like to learn more about claiming R&D tax credits for your business, contact us at 512-333-2076 or fill out our online form.

Trump’s Proposed Tax Reforms

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After a dramatic election season the proposed tax reforms of US President Elect, Donald Trump, are currently a topic of great interest for businesses. While pre-election reform plans may not necessarily become legislation, Trump will be supported by Republican chambers of commerce, making passing legislation more likely in absence of strong opposition.

How Might This Affect R&D?

In an attempt to decrease corruption due to the influence of special interests, Trump plans to eliminate special interest outlays and most business tax credits such as the domestic production activities deduction and the work opportunity credit which currently supports veterans among other groups. These points are controversial as many of the expenditures he proposes to eliminate relate more to public policy concerns than they do to special interests.

However, one positive position maintained through Trumps reforms is the continuation of the Research and Development (R&D) tax credit. This influences greater innovation and improvement of existing systems or processes within industry. As Trump promotes the repatriation of labor and production, an increase in R&D support could be a possibility. Some predict that Trump may use the incentive as a maner of influencing larger percentages of manufacturing, not just research, within the U.S.

If  you would like to discuss the R&D Tax Incentive further, please do not hesitate to contact one of Swanson Reed’s offices today.

Financial Benefits of IC-DISC and R&D Tax Credits for U.S. Manufacturers [FREE WEBINAR]

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Is your manufacturing company one of the many in the United States that is experiencing a rapid increase of exported goods?  Exporting creates an opportunity to use a tax savings strategy by creating an Interest Charge – Domestic International Sales Corporation (IC-DISC). Not just for large C-Corporations, an IC-DISC applies to small/medium pass-through entities as well. However, while over 6000 small and medium businesses take advantage of the tax incentives of the IC-DISC, thousands more that are eligible are failing to do so.

Likewise, another tax incentive frequently overlooked by manufacturing companies is the R&D Tax Credit, who presume they must have on-site laboratories or breakthrough ‘white-lab coat’ research to claim the credits. Comparatively, others distress that they will face complex tax calculations or that it will trigger an IRS audit. However, many small businesses can claim the R&D tax credit. Moreover, with the changes to the permanency of the R&D tax credit and the PATH Act, the credit is now more easily available to smaller companies and start-ups.

Therefore, to elaborate on these often disregarded tax incentives, Swanson Reed has teamed up with Export Advisors to provide a FREE Webinar next week on the tips and tools you need for claiming the R&D tax credit and the  IC-DISC in the manufacturing sector. This webinar also includes an interactive Q&A session at the end to answer any questions you may have.

WHEN: Tuesday, August 23, 2016 from 1:00 PM to 2:00 PM (CDT) Add to Calendar
Cost: Free

Structure:
1:00pm – 1:25pm CDT
 – R&D Tax Incentives for the Manufacturing Industry
Presenter: Cherie Jones, Tax Director – Swanson Reed
1:25pm – 1:50pm CDT – IC-DISC for the Manufacturing Industry
Presenter: Dave Spray, President – Export Advisors
1:50pm – 2:00pm CDT – Interactive Q&A Session

To ensure you don’t miss out, register for our free webinar on EventBrite:  https://www.eventbrite.com/e/financial-benefits-of-ic-disc-and-rd-tax-credits-for-us-manufacturers-tickets-27137424768