Hartford Business Journal

34 HARTFORDBUSINESS.COM | May 23, 2022 Expert's Corner Editor's Take Here's what some top business leaders think about the future of work and Hartford T his week's print edition has a human resources focus section, a topic that is top-of- mind for all employers. In fact, I've sat down or chatted with at least a dozen Hartford area business leaders over the past month or so, and the first and most interesting topic of conversation is typically about the state of the current and future workplace, and retaining and attracting talent. Here are a few insights I gleaned from these leaders, who represent various industries from professional services and health care to banking and finance, manufacturing and insurance. I won't identify them by name or company because the conversations were on background only. But many of them shared similar sentiments that are worth summing up because they provide a window into the potential short- and long-term future of the local workplace and city of Hartford. 1. The hybrid work model is here to stay; the five-day, in-office workweek is likely a thing of the past for most employers. 2. Despite offering more flexible work arrangements, top executives and managers want employees in the office more often, at least two or three days a week. However, many employers are hesitant to push their workers too far amid a tight labor market. Coming into the office remains optional for some companies. There are pros and cons to the flexible work environment, these executives said. On the plus side, it's offering workers greater independence and the ability to spend more time with family. However, there are concerns about loss of collaboration and mentorship, especially among younger workers. It's also more difficult to create and maintain company culture. 3. Companies are using free lunches, drinks and other social gatherings to lure people back to the office. One employer rented out space in Hartford's Parkville Market to bring together its workers, who are still largely working remotely. Another offers free lunch on Wednesdays. 4. Many Hartford employers have, or are considering downsizing their office space. One executive whose company occupies about 130,000 square feet of space downtown is looking to consolidate to 75,000 square feet. 5. Privately, leaders are worried about downtown Hartford's future vibrancy, and it's one of the reasons they'd like more workers to return to the office. But they are also concerned about the lack of amenities to draw workers downtown. It's a bit of a chicken-and- egg problem. In order for more restaurants and retailers to open in the city, there needs to be more consistent foot traffic. It will be interesting to see how the city's Hart Lift program impacts downtown's vibrancy. The program is using $6 million in federal stimulus funds to help landlords outfit spaces for new restaurants and retailers. As of April 19, 25 grants were approved totaling nearly $2.5 million. 6. Executives agree downtown must continue building new apartments, but they say the city must add jobs to attract residents who want to be close to where they work. The city has added more than 2,500 apartments over the last decade; one official said it will take another 20,000 units to truly change the city's dynamics, but that would take decades to achieve. It would also likely require the conversion of some Class A office space to residential use. The conventional wisdom has been that 5,000 residential units downtown will help bring more restaurants and retailers. 7. Casual work attire is in vogue. I met one managing partner of a multinational firm who was wearing a golf shirt and jeans. Was it casual Friday? Nope, it's casual everyday at the company's Hartford office, at least when people actually show up. On an average day about 10% of the company's employees are in office; the rest are working remotely. The casual dress code was implemented pre-pandemic as a way to build a more attractive company culture, particularly for younger workers. You know we are in different times when a newspaperman is the best- dressed person in the room. 8. One company executive told me the tight labor market shows no signs of abating, but a recession could shift the dynamics. If companies are forced to tighten their belts later this year, employees brought on at higher-than-usual salaries could be cost-cutting targets. Overlooked tax breaks and deductions for the self-employed By Ben Fuchs T ax season is over for another year, but that's not a reason to stop thinking about retirement planning and how to lower your tax burden. That is particularly true for the rapidly growing number of people who are self-employed. Too often, however, the daily challenges of running a business results in opportunities — and potential savings — being missed. The ranks of the self-employed, accelerated by pandemic-induced changes in the workforce during the past two years, are at levels we've not seen before. Nationwide, nearly 5.4 million applications were filed to form new businesses in 2021 — the most of any year on record, according to the U.S. Census Bureau's Business Formation Statistics. The number of self-employed workers actively at work rebounded strongly as the economic recovery took hold, increasing by 17.6% from the second quarter of 2020 to the second quarter of 2021. That strong rebound from the depths of the pandemic pushed the number of self- employed to 14.9 million, restoring it to 2019 levels, according to a Pew Research Center analysis. For those new to self-employment status, and those who have managed to ride out the impact of the pandemic and regain their financial footing, there couldn't be a better time to take a closer look at the tax- related possibilities. Your business's success is in your hands when you're self-employed, so you need to be knowledgeable about and take advantage of whatever assistance is available — especially when it comes to lowering your tax bill. It's commonly known that the government subsidizes certain personal expenses when you work from home. The key to this deduction is to use a dedicated space regularly and exclusively for business. Additionally, part of your utility bills, phone and internet, and insurance costs may be deductible. You can also write off part of your rent or, if you own your home, depreciation. In recent years, the IRS has come up with a simplified method for figuring out this deduction, allowing taxpayers to deduct $5 for every square foot. Once you start working for yourself, the door also opens to options and choices for tax-sheltered retirement plans. For example, you can contribute pretax money to a simplified employee pension (SEP) or a solo 401(k), both of which have higher annual limits than regular individual retirement accounts. You may also get a tax credit for your retirement plan's contributions if your income isn't too high. It's called the Saver's Credit, and it can trim up to $1,000 off your tax bill ($2,000 for married couples). The credit is worth 50%, 20% or 10% of your contributions, depending on your adjusted gross income. Don't discount the qualified business income deduction (aka, the Section 199A deduction). It's available for owners of S corporations, partnerships, LLCs and other "pass-through entities" as well as those operating as sole proprietors. It's a tricky tax break with several particular rules and restrictions, but the write-off can be sizable if you're able to jump through all the hoops. There are additional tax breaks within reach for small businesses, and determining whether and how you can take advantage of them as a self-employed business owner is worth exploring. At the end of the day, doing so has the potential to improve your prospects to achieve the qualified retirement you're striving for. Ben Fuchs is a certified financial planner and founding principal of Fuchs Financial, with offices in West Hartford and Middletown. Ben Fuchs Greg Bordonaro

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