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Copyright © Margaret Michaels 2008 All rights reserved
No part of this copy may be reproduced, stored in or introduced into a retrieval system or transmitted in any form or by any means without prior written permission from the author.

Client:  Cytec Engineered Materials
Business:  Advanced scientific products, business to business
Project:  Excerpts from quarterly employee newsletter

Composites technology comes of age
Boy Scouts earn composites merit badge

Gayleen Pigretti, senior technical service engineer at CEM Greenville, Texas, stepped up to assist a customer with an unusual request. Bryan Williams, 737 TR Operations Manager at Spirit Aero Systems in Wichita, Kan., asked for her help in pulling together materials for a class that would culminate in a composite materials merit badge for Boy Scouts. In a fortunate twist, Pigretti had just presented a workshop on composites for her niece's high school chemistry and physics classes. She was able to give Williams a book of fabrics labeled for various weave styles and applications and a kit provided by Cytec Carbon Fibers with metal and composite rods that could be used to demonstrate material strength.

"The kit is always a big hit with high school students," said Pigretti. "The small rods are made from steel, aluminum and composite materials but they vary in size because they are all the same weight. This approach makes it very easy to make weight, flexibility and strength comparisons between the different materials. It's fun to have the students bend the metal rods and then ask the class clown to try to bend the 'plastic' rod. Watching the student struggle to bend the composite draws in the entire audience, and I have everyone's attention for the remainder of the presentation. I am amazed that kids actually know so much about composites from hearing about them and reading articles about them in automotive and sporting goods applications. The high-tech aspect of composites and their use in 'cool things' makes this technology fascinating."

Williams, who serves as assistant scoutmaster, taught the class with the help of Pigretti's prepared aides. As part of the merit badge requirements, the boys embarked on their own composites manufacturing project by impregnating a two-part epoxy into fabric. Collectively repairing a broken snow shovel and individually crafting a small bowl were the two "build with composites" projects they selected. The scouts would have preferred to utilize prepreg materials but lacked some of the equipment—including a curing oven. Fortunately an epoxy that cures at room temperature was available at a local auto supply store. One of the foremost principles that Pigretti and Williams stressed was "safety first," so protective gear was in place at all times.

In Pigretti's experience, the subject of composites seems to perk up everyone's ears—not just those of gold-star students. "Even kids who have trouble paying attention in school are mesmerized with this process," she said. "We are starting to hear references to composites in everyday conversation, and interest in composites is definitely on the rise. My mention of the Boy Scout merit badge project to one of my co-workers was passed along to her husband—who is also a Boy Scout leader. Now he is anxious to set up a similar class for interested boys in his troop."

A course on composite materials is also on the roster for the third annual "merit badge college" offered at Wichita Area Technical College, which attracts as many as 200 scouts. The course will be taught by WATC's own composites instructor with assistance from scout leaders including Williams.  As the supervisor of the composite shop at Spirit Aerospace, Williams is extremely excited about the idea of furthering interest and knowledge in composites. After all, his career revolves around these finely engineered products.

"The future of composites continues to brighten and grow stronger," he said. "The use of carbon composites has expanded from primarily aerospace structures to widespread use in the automotive and sporting goods markets. The scouts are familiar with these applications and get excited about the opportunity to build something that they can use out of this material.”

Gordy  Albright marks 45 years of service

It was a snowy January 11 in 1962 when 18-year-old Gordy Albrecht spent his first day on the job with the Fiberite Corporation in Winona, Minn. The company that would evolve into CEM as part of Cytec Industries was still owned and operated by the original founders, Rudy and Ben Miller. Albrecht even recalls his starting salary as a feeder/muller in the melamine division: $.92 per hour.

Albrecht went on to accept various responsibilities in a number of departments, reporting to different foreman, shift leaders and supervisors. In the preform area, he served as a team leader. Eventually, he joined the shipping department where his exceptional performance earned him a place at the 2006 Summit.

Albrecht currently assists shipping with the timely delivery of materials internally and externally, fabricating many of the boxes himself and working closely with purchasing to ensure the most appropriate packaging for every CEM product. His efforts to establish a pull card system and closely monitor reorder levels have contributed to tighter inventory control, and he also provided useful information that facilitated the work of the label transitions team.  "Gordy's engagement has extended beyond the job at hand to playing an active role in facility initiatives and activities from SAFE to holiday and picnic committees," said Jim Maier, production supervisor.

"It's been a fun ride," said Albrecht. "My co-workers and managers are wonderful people, and I still enjoy getting up each morning and coming to work." Albrecht walks his talk on that point: In 45 years, he has never missed a scheduled work day.  In 2008 Albrecht will be celebrating his retirement as well as his 40th wedding anniversary to wife Noreen. Gardening and spending time with his six grandchildren will be at the top of his list of leisure activities. He also intends to take up a new hobby of studying the stars with the telescope he received as a service gift.  "The Winona Leadership Team and everyone at CEM Winona join me in congratulating Gordy on 45 years of exceptional service," said Ruth Roffler, administrative assistant. "He has truly earned our admiration and respect."

Boeing 787 Dreamliner showcases CEM technology

In an unprecedented move, The Boeing Company invited the entire world to view the rollout event for the ground-breaking 787 Dreamliner. The larger-than-life unveiling was broadcast over the Internet and via satellite television in nine different languages on Sunday, July 8, 2007, with a potential audience of 100 million. The company's partner sites in Japan, South Carolina, Italy and Kansas all participated in live feeds.

Bill Wood, vice president of Americas and Asia Pacific, and Boeing Business Director Lance Parcell joined an international crowd of 15,000 in the largest building in the world—Boeing's manufacturing facility in Everett, Wash. "In a real tribute to Cytec and CEM, our seats were near the very front—even ahead of Boeing's own customers," said Parcell.

Jim McNerney, Jr., chairman of the board, president and chief executive officer of Boeing, shared the podium with Mike Bair, 787 Dreamliner program manager, and representatives from the company's partner facilities. "NBC Nightly News" host Tom Brokaw served as the rollout event host, and Washington State Gov. Chris Gregoire was on hand to congratulate Boeing and offer an expression of statewide pride. "For years, you have been connecting the world," she said. "Today, you are changing the world."

Calming lights cast a blue glow upon the red carpet as Boeing showcased its first new jetliner in more than a dozen years. Boeing describes the Dreamliner as "making the world a smaller place." Airlines are clamoring to get their hands on the Dreamliner for a long list of reasons, not the least of which is significant fuel efficiencies. In addition to fuel savings, the Dreamliner makes it possible for a mid-sized jet to fly non-stop for much longer distances. Continental Airlines, distinguished as the first U.S.-based carrier to order a Dreamliner, is anxious to have the plane in service on routes between New York and Asia.

Other differentiators for this revolutionary aircraft include the dominance of carbon fiber composite structure and its global supply chain—in itself a testament to the resounding success of cooperative effort and shared vision. If advance orders are a measure of success, the Dreamliner boasts another first: The most successful commercial aircraft launch in the history of Boeing—actually, in the history of America and the world. Prior to the Dreamliner's debut, nearly 50 airlines had already placed a cumulative 677 orders for a jetliner they had yet to see. Little wonder that the energy of excitement at the rollout was so electrifyingly palpable.

"The rollout was a spectacular event but not nearly as impressive as the aircraft itself," said Wood. "The word 'beautiful' is completely inadequate to describe this masterpiece of engineering and design. Even the exterior features stunning blue and white transitions and heavy metallic that sparkles in the sunlight. The most dramatic aspects are the upswept wing tips and the contoured trailing edge—in the words of CEM's Shreeram Raj: an incredibly organic design. I am personally very proud to work for a company that provides the technology that makes possible this truly unrivaled achievement."

Client: VistaCare Foundation
Business:  Non-profit support for hospice care
Project:  Excerpts from newsletter sent to current and past donors

Hoe-Down Raises Money and Honors Patient

In true Texas spirit, Tammie Ware and Michelle Madry planned and coordinated the 2nd Annual VistaCare Hoe-Down on October 14, 2003. Both Tammie and Michelle serve as VistaCare Directors of Professional Relations in Lubbock, Texas, where the hoe-down was held. The private party facility of Inside 4 Bar K provided the Western theme for this well-attended event that drew 200 attendees. In addition to enjoying a live band and a delicious barbecue dinner, guests were able to shake hands with several celebrity sports figures. VistaCare Foundation spokesman and baseball hall-of-famer Harmon Killebrew was on hand to sign autographs. Joining him were Texas Tech football players Ryan Aycock, Mike Smith, and Wes Welker as well as Texas Rangers baseball player Laynce Nix.

Beyond raising funds for the VistaCare Foundation, the annual hoe-down honors one of the hospice patients. Tammie explained, "Every staff member had a chance to select our honoree. We work with so many wonderful people, and in a very real sense the hoe-down honors every VistaCare hospice patient. For this special event, we wanted to focus on a patient who reflects the spirit of hospice in warmth, kindness, and caring." One of the high moments of the evening was the presentation of the plaque that dedicated the 2003 Hoe-Down for Hospice to Gary Kenneda. Nearly 15 of Gary's close family members were able to attend the event, along with his hospice medical director.

Tammie and Michelle sought out the support of the community to ensure that the VistaCare Foundation would reap the greatest possible benefit from the fund-raiser. The charge for the venue and fees for media advertising were all donations, and several sponsors defrayed the operational costs. Ticket sales, a silent auction, and raffle tickets boosted the final tally to more than $7,500. Tammie credits a cooperative effort for the grand success, "Our staff sold event tickets, solicited sponsors, and approached vendors about contributing door prizes. The success of the evening has to be shared by all the generous VistaCare employees who were willing to lend a hand."

Wishes Can Come True!

Sam Valdez was surprised last summer when his brother Mike called to ask about the one place that he would most like to visit. Thanks to financial help from the VistaCare Foundation, Mike was able to plan one last vacation with Sam to one of the world's most breathtaking destinations—Yellowstone National Park. In Sam's words, "Death was already knocking on Mike's door, but he overcame every obstacle to spend one weekend of being completely alive with me in God's country."

The story of their weekend trip is a miracle unfolding. During the road trip, Mike was extremely weak, pale, and sick from his battle with cancer. He was just waking from a sleep when they arrived at a place called Bear World, and Mike's eyes lit up like a child's on Christmas morning. The brothers drove through the wildlife reserve filled with bull elk, deer, sheep and rams, and large birds—not to mention bears. Sam remembers the experience vividly, "We stopped to watch some cubs play a game of tag, running up and down in one of nature's comic moments. They were clumsy and awkward with a puppy's playfulness and the uncanny balance of a cat."

Mike's weakness and nausea seemed to lessen with every turn of the winding canyon road. He was pointing out wildlife along the way and building up excitement to see Old Faithful. Sam was amazed at Mike's renewed energy—a miracle he could not explain. Even their fishing experience seemed magical. "I've never seen such aggressive trout!" Sam exclaimed. "My pole was bent with a fighting fish, but others were trying to steal the bait. Mike was so excited to watch the feeding frenzy that could hardly speak." It was Mike who gently placed the prize trout back into the water, watching it swim to freedom.

Sam concluded, "I knew that our glorious adventure would see Mike through his remaining days and would be with me the reminder of mine. My thanks go to the VistaCare Foundation for giving my brother his last wish. Death is a teacher that asks us to stop and appreciate everything around us. Mike's last days were spent noticing and collecting every detail of nature. Take the time to embrace your loved ones every day. 'I love you' can never be said too often."

Holiday Trees Trimmed with Love

Hundreds of VistaCare Hospice patients will be receiving a miniature holiday tree thanks to a project led by volunteer Kathy Thompson. These handcrafted wonders stand only 12 inches high, making them ideal for the smallest of spaces. Kathy began assisting VistaCare Coordinator Nancy Calderwood in 2000 with the idea for the first "tree" project. She laughs at the experience gained and says, "I've learned how to prepare kits for our 'helping elves' and just how many decorations to include. More than 50 volunteers are trimming trees for us this year. Many of our volunteers are VistaCare employees who work on a tree during their lunch breaks or take them home as a family project. The trees give staff members a chance to feel connected to the patients in a more personal way."

Demand for these whimsical gifts continues to grow each year, doubling from last year to an amazing count of 200. Some of the trees are personalized to reflect a patient's special interest or hobby, from butterflies and wolves to sports or crossword puzzles. Every request is met with a creative solution for a true "work of art." Kathy gathers trinkets all year including old jewelry, decorative buttons, party supplies, and small pieces of discarded decorations. Regardless of the theme, each tree features small VistaCare "hearts" and a nesting bird. Kathy explains, "According to legend, a bird resting in the holiday tree brings a special blessing. Our nest is a half-nutshell filled with moss and beads for eggs, and we usually find our doves or small birds in wedding supplies."

VistaCare Volunteer coordinator Marta Davis conveys to Kathy any special tree requests and also coordinates the delivery of each tree—usually through caseworkers and social workers. Marta added, "Because so many VistaCare employees are working on the trees this year, they will have a chance to do some of the deliveries. You can imagine how excited they are to see that first smile on the patient's face." Along with each gift comes a card bearing the VistaCare "hands in a heart" logo and the words:  This item was handmade for you with love by a VistaCare volunteer with material provided by the VistaCare Foundation.

Last Wish Honeymoon

For a couple who had been married for nearly five years but never had the opportunity to enjoy a honeymoon, the chance to spend a weekend enjoying each other's company was a dream come true. VistaCare Hospice patient Marie Barnes is only 37 years old, yet facing the final weeks and months of her life. When the generosity of the VistaCare Foundation made it possible for her to realize her "last wish" of a real honeymoon with her husband Ray, she was thrilled. The couple first planned a short trip away from their hometown of Reno, Nevada; but Ray's employer was unwilling to approve the time away from work. Knowing that the real gift would be quiet moments of relaxation and enjoyment together, Marie and Ray decided to spend Friday evening through Sunday evening at the local Reno Hilton.

VistaCare Social Worker Bobby Vaunn and Case Manager Carol Thompson were touched by the deep appreciation expressed by the couple for a truly "wonderful" weekend. Marie was delighted that she had the strength to do some of the activities, from go-karts to a gigantic swing. Bobby added, "We were able to provide them with limousine transportation, meals in the restaurants, beautiful accommodations, and extra money for a few on-site attractions. The pictures of the happy smiles that Marie brought back to us said it all. We were so grateful to the VistaCare Foundation for making her last wish a reality."

Client:  Camino Real Land Corporation
Business:  Land Development and Sales
Project:  Excerpts from quarterly newsletter to current land owners

Southeast Arizona:  The Perfect Four-Season Climate

Picturesque Cochise County is an enchanting land of dramatic rock formations, scenic mountains, and sweeping valleys. The elevations range from 3,580 feet to Chiricahua Peak's towering 9,798 feet. The beautiful valleys of San Simon, Sulphur Springs and San Pedro cut through the county, offering lovely areas for residential development with breathtaking views. The plants, trees, and wildlife are remarkably diverse in this rare convergence of ecosystems and habitats. Bird watchers around the world recognize Southeast Arizona as a premier destination.

With four distinct and yet mild seasons, Cochise County creates a scenic backdrop for every imaginable outdoor activity. The semi-arid climate in this area is the finest in Arizona and one of the most idyllic in the entire nation. Winters are moderate and summers are warm but not excessively hot, while fall and spring feature brilliant colors. Humidity is low, with summer highs falling in the low 90s and winter highs in the low 60s. Short-lived thunderstorms bring the majority of rain in July, August and September. The average annual rainfall is only 15 inches, with most months receiving less than one inch.

Nestled against the Dragoon Mountains and the famous Cochise Stronghold in the Coronado National Forest, the Sunsites area offers world-class hiking, biking, camping, horseback riding, and nature study. To the east, the Chiricahua Mountains create a "wonderland of rocks" that is protected by a national monument. Tall pines, whispering streams, and the chatter of squirrels take the place of honking horns and traffic jams in this serene corner of Arizona. Organic farms and U-pick farms and orchards dot the landscape, drawing customers to farm-fresh produce. Little wonder that those who visit this spectacular area find themselves wanting to return again and again. As a permanent home, a retirement retreat, or a vacation getaway, Southeast Arizona is a place like no other.

Arizona Tops the Nation in Population Growth!

Drawing newcomers from across the United States, Arizona has taken the nation's lead as the fastest growing state in America. For nearly two decades, Nevada topped the charts. However, 2006 saw Arizona pulling out in front with a 3.6 percent growth rate. With a sunny, mild climate and spectacular natural beauty, Arizona has long been a magnet for retirees as well as relocating families from the Midwest and Northeast. Many who were weary of long, hard winters and seemingly endless months of gray skies sought out job opportunities in Arizona's healthy and growing economy. Today, California is the largest donor state.

"Now, Arizona is also an escape hatch for Californians seeking affordable housing," said William Frey, a demographer at the Brookings Institution, a Washington think tank. And this burst of new development that always accompanies population growth is not confined to Arizona's major metropolitan centers.

"Housing developments are sprouting everywhere, whether they are on former farmland or in the desert," said Tom Rex, associate director of the Center for Competitiveness and Prosperity Research at Arizona State University. "All they can think about is getting the sewer lines out to the new housing and getting the roads in." With available property for development disappearing at such a rapid rate, the truly wise are buying still-affordable land in the path of continued growth—and waiting!

Douglas Recognized in "Top 100" Small Towns

Based on an exceptional quality of life, the Cochise County city of Douglas has attracted national recognition as one of the top 100 places to live in America. Douglas is located along Highway 191 just a short drive past Sunsites and Sunsites Ranches. Bizjournals.com conducted the survey and gave no other Arizona town the same distinction as Douglas. More than 575 communities across the nation were rated in 12 categories, from population and income growth to business growth, affordable housing, and low taxation.

This prestigious award dispels the negative image of Southwestern border towns that has been painted by the media. Douglas is using its proximity to Mexico to foster and support international trade. The city is well-positioned to do even more global business, and the entire development corridor is poised for investment by a number of regional companies. Douglas was particularly honored for the city's commitment to support entrepreneurial growth. The area saw an amazing 57 percent increase in new businesses from 2004 to 2005.

Sunsites Residents Volunteer in the Community

Bill and Linda Hilty built their retirement home just four years ago. They are still thrilled and continue to praise that moving to Sunsites was one of the best decisions they have ever made. After settling into their home on property Unit 5 adjacent to the village, they decided to travel and enjoy their new-found territory.

Bill and Linda recently signed up to volunteer at the Pearce/Sunsites Chamber of Commerce and Visitor’s Center. Even though they had lived in the area for a while, they were astonished at the multitude of places to go and things to do in the surrounding region. “Volunteering at the visitor’s center was another good idea,” related Bill. “We have learned so much more about our community."

Bill and Linda were surprised by all of the National Monuments, scenic hiking trails, and hidden canyons to explore. They were equally surprised at the number of residents and visitors who stop by the center for local information. The Hilty's are looking forward to joining the other volunteers on an upcoming trip to Fort Bowie National Monument. These excursions are a common event for the center, familiarizing everyone with the area so they can share personal “tidbits” with visitors.

An expansion of the Chamber of Commerce, the 25-five year old center is available to assist those who relocate to Sunsites or just visit the area. More than 70 brochures cover a multitude of Arizona attractions. Many visitors ask for information about property and land development, and residents stop by to chat and catch up on local activities. Be sure to stop and visit when you come to Sunsites. Our volunteers look forward to meeting you. The center is located on Frontage Road in the heart off the village. The phone number is 520-826-3535 and the office is open Monday through Friday 9AM to 5PM.

Client:  O’Connor Group
Business: Financial services and business consulting
Project:  Excerpts from newsletter to clients

A Message from Dan O’Connor

Now that another successful tax season has come to a close, The O’Connor Group would like to express appreciation for your confidence in our services.  We hope that we met your expectations with advice and service that helped you navigate the complexities and quagmires of income tax reporting.  We also want to take this opportunity to recognize and thank you for the many referrals we received.  Our business continues to grow as you share your positive impressions and experiences with friends, associates, and relatives.

Although most of us are still enjoying the sense of relief in knowing last year’s tax season is a fading memory, now is the time for proactive planning.  We invite you to sit down with us for a mid-year, tax-planning assessment.  Perhaps your need is general business consulting or the clarification of procedural issues.  Maybe covering all three bases makes the most sense. Tightening the reins and redefining your goals at this juncture may save headaches and dollars down the road.  After all, life presents enough surprises and variables beyond our control.  Remember those times in the past when you lamented, “If I had only known about this six months ago…”  At the rate the calendar pages are dropping, six months is all that remains!

Feel free to call the O’Connor Group with any questions, issues, or concerns.  Our sole purpose is offering the expert guidance and insight that can pave a smoother financial path to your personal and business goals.  As always, any comments and suggestions about improving our services are as welcome as your referrals.

Leasing Versus Buying
Reviewing the Big Picture

Since leasing a vehicle brings higher dealer profits and lower consumer monthly payments, it’s easy to see why leasing accounts for one in three cars in today’s market.  Does that mean that leasing is the best deal for everyone?  Unfortunately, that question has no set or easy answer.  Beyond concrete economics are the intangibles of personal preferences and lifestyle.  Whether the vehicle is for personal or business use becomes a critical issue.  Let’s start by assessing the value of leasing a personal automobile.

Both leasing and purchase agreements require monthly payments. Financial institutions require a monthly payment that will satisfy 100 percent of the vehicle’s purchase price over a specified term.  Leasing payments are calculated to cover the difference between the original cost and the residual value of the vehicle at the end of the lease — plus interest, of course.  For most new cars, and particularly luxury cars, monthly lease payments are lower than purchase payments.  The obvious trade-off is lack of equity.  The best candidates for leasing are those who desire a new vehicle every two years, are not interested in accumulation of equity or vehicle ownership, and drive an average amount of miles per year.  Leasing also offers such buyers the convenience of sidestepping the cycle of “shopping and trade-in.”

Not all leasing agreements are created equal.  In fact, only recently have key leasing terms been disclosed to consumers.  Before signing any lease or deciding upon any terms, shoppers need to consider some critical information that dealers and leasing companies are required to furnish, including month payments and length of lease, any initial payment, and acquisition cost/terms of the vehicle.

Careful research and evaluation of your lifestyle are the best guideposts on the road to the right decision about leasing or buying a personal vehicle.  With vehicles that are used for business purposes, the income-tax advantages of leasing add a new set of variables.  Part or all of the cost of operating a business vehicle may be deducted from income at tax computation time.  These expenses include the payments on a leasing agreement or depreciation and possibly loan interest for a purchased vehicle.  As an alternative to deducting these costs, a standard mileage rate can be used as a deductible automobile expense.

While these deduction opportunities are attractive, they are subject to one very significant limitation.  The IRS maintains its own definition of a “luxury” automobile based on selling price. Have you guessed where this is headed? Of course, the IRS imposes a severe limitation on the depreciation deduction for these higher-priced cars.  Even lease-payment deductions for luxury cars are reduced by an “inclusion amount.”  The only loophole is a passenger vehicle rated at an unloaded gross vehicle weight of more than 6,000 pounds.

How does the limited depreciation of a purchase compare with the leasing inclusion amount?  Limitations on depreciation deductions are fixed, regardless of the automobile price.  At least for more expensive vehicles, lease inclusion amounts don’t seem to be keeping pace with increasing lease payments. In most cases, leasing becomes more attractive as the value of the vehicle increases. If the many variables in the equation still have your head swimming, feel free to contact the O’Connor Group for a detailed analysis of the lease versus buy issue as it applies to your unique situation.  Together, we can sort through the unknowns of negotiation tactics and determine the choice that will make the most sense—and cents!

The Small Business Corner
S Corporations

When it was first created in 1958, the S corporation allowed small businesses to enjoy the advantages of doing business like a corporation without carrying the burden of double taxation on corporate earnings.  The entity itself would not be taxed, only the shareholders.  While regular corporations pay income tax on their own income and utilize their own losses, shareholders of an S corporation pay personal income tax on the corporation’s income and may be able to deduct the corporation’s losses.  In terms of personal liability, S corporations have the status and protection of traditional corporations.

As you can see, the basic concept behind an S corporation was to give domestic small businesses the “best of all worlds” if they agreed to taxation under a particular set of rules.  Over the decades that followed, the popularity of S corporations waxed and waned with variations in the tax rules.  By the early 1990s, most taxpayers starting new businesses were forming limited liability companies (LLCs).  Why an LLC instead of an S corporation?  The answer is simple.  They offered the same one-level tax advantage without the strict rules and limitations in business relations that plagued S corporations.

While LLCs are clearly the choice for most start-ups, many S corporations remain.  The costly and troublesome challenge of converting one to the other requires liquidating the S corporation.  Shareholders are faced with substantial tax gains on appreciated property without the cash to pay those taxes.  The only way to diffuse this negative financial impact requires some patience: Form an LLC and gradually transfer business operations from the S corporation.  This solution is most viable when principal assets are not appreciated property and the relationships with customers and suppliers can be smoothly transitioned and renewed through the new entity.

For S corporations that find it too expensive or difficult to switch to an LLC, the burden of following the rules has definitely lightened.  Recent changes in tax laws and the enactment of the Small Business Job Protection Act of 1996 now offer S corporations greater flexibility in the structure of business operations and the types of entities that quality as shareholders.  Also playing into the equation is a “kinder and gentler” IRS National Office more likely to forgive mistakes.  While these changes hardly bridge the flexibility gap between the LLC and the S corporation, they do offer some valuable concessions.  For more information on S corporations and LLCs, call the O’Connor Group at 602-951-9060.