Arkansas Automobile Dealers Association

AADA representatives participate in the 2023 Truck Industry Forum

AADA Executive Director Greg Kirkpatrick, Arkansas Senator John Boozman, and AADA board member Patrick Jacobs

Recently, Arkansas Automobile Dealers Association (AADA) joined heavy truck dealers from across the country in Washington DC for the 2023 Truck Industry Forum hosted by the American Truck Dealers (ATD). The goal of this event was to meet with members of Congress to advocate for truck dealer legislative priorities. The event focused on the new onerous “Phase 3” EPA greenhouse gas regulations. In response, heavy-duty truck dealers asked their Congressional delegations to sign the bicameral LaMalfa-Pappas letter to EPA (issue brief). Truck dealers also asked members of Congress to oppose the so-called “right to repair” bill (issue brief), cosponsor legislation to repeal the federal excise tax on new heavy-duty trucks (issue brief) and support bills to thwart catalytic converter, diesel particulate filter and diesel oxidation catalyst theft (issue brief).

Patrick Jacobs joined AADA President Greg Kirkpatrick in meeting with the Arkansas congressional delegation to discuss these issues. Patrick is with Carco in Fort Smith and serves on the AADA Board of Directors as the heavy truck dealer representative. Arkansas members of Congress are definitely on board with all our concerns on these key issues, particularly related to the EPA’s proposed regulations. While the trucking industry supports reducing emissions and putting cleaner and greener vehicles on the road, the EPA’s proposed regulations mandate stringent electric adoption targets and timelines that could slow down rather than accelerate electric vehicle investments. A substantial portion of this Forum focused on federal regulatory and legislative advocacy efforts to address this important issue.

AADA board member Patrick Jacobs

AADA is working hard to focus our efforts on issues that impact all Arkansas heavy truck dealers, and we appreciate the work Patrick is doing to further this goal. Keep an eye out for more updates on all the issues we are working on that impact Arkansas truck dealers.

IRS Again Explains Restrictions on Claiming the Employee Retention Tax Credit

Information provided by National Automobile Dealers Association (NADA)

What’s new: In an ongoing effort to curb abuse of the Employee Retention Tax Credit, the IRS recently released a Generic Legal Advice Memorandum (GLAM) to further stress the strict requirements for claiming the Employee Retention Tax Credit (ERTC) based on a full or partial suspension of business operations related to supply chain disruptions.

Background: The ERTC is a refundable credit against certain employment taxes paid by businesses impacted by the COVID-19 pandemic. To claim it, a dealership must have experienced either:

  • A full or partial shutdown due to a government order related to the pandemic, or
  • A gross receipts decline of at least 50% for the same calendar quarter from 2019 to 2020, or at least 20% for the same calendar quarter from 2019 to 2021 (only the first three quarters of 2021 qualify).

Why it matters: The GLAM addresses the first criterion (first bullet above) by describing several scenarios that do not satisfy the requirements for claiming the ERTC. Its analysis specifies that, to claim the ERTC based on a supplier’s inability to deliver critical goods and materials, a taxpayer must show that a qualifying governmental order caused the supplier and the taxpayer to suspend their business operations.

Certain promoters have pushed ineligible businesses to claim the ERTC based on supply chain disruptions that are tangentially related to the COVID-19 pandemic. The GLAM makes clear that the IRS takes a strict view on this type of ERTC claim and IRS Commissioner Danny Werfel reiterated this message recently, noting that the IRS is working aggressively to address a flood of fraudulent and erroneous ERTC claims. Several CPAs have also expressed concern to NADA about the exposure of dealers who claim the ERTC based on a full or partial suspension of their operations.

What’s next: NADA encourages dealers that have claimed the ERTC based on a supply chain disruption, or that are considering doing so, to share and discuss the GLAM with their tax advisor.

Go deeper: Read the IRS GLAM on ERTCs

Webinar Recap: 60-day registration and temporary tag law in effect

On Monday, Arkansas Automobile Dealers Association (AADA) hosted a webinar with employees from the Office of Motor Vehicles to update dealers on new law that extends the time requirements for vehicle registration from 30-days to 60-days. This change also impacts temporary paper tags which will now be 60-days for vehicle sales. The highlights from the webinar are below, and if you would like to download the PowerPoint presentation click here.

Key highlights of the new law:

  • Extends the time requirements for vehicle registration from 30 to 60-days; ​
  • Temporary paper tags will also be extended from 30- to 60-days;
  • This change will affect passenger cars, motorhomes, motorcycles and commercial trucks (excludes motorboats);
  • Trailer temporary tags will continue to expire in 30-days; and,​
  • The 60-day rule will affect vehicles purchased on or after 08/01/23. Vehicles purchased before 08/01/23 are required to be registered within 30-days.​

Reminder on types and uses of temporary tags:

  • 60-day new purchase (cars, commercial trucks, and motorcycles); ​
  • 30-day new purchase (trailers);
  • 14-day loaner (use only when customer’s vehicle is being repaired at the dealership shop);
  • 72-hour demonstration (prospective buyers to take home, does not include test drives); and,​
  • 72-hour transport (use on dealer-owned vehicle for the purpose of transporting).​

In addition to these changes resulting from the new law, we also discussed changes to the SecureETag System. Dealers will notice a new box they must check when issuing a temporary tag:

This box clarifies and reminds dealers that a temporary tag is not required for a courtesy or test driven vehicle that is going to be returned before the end of the business day. Dealers are also allowed to provide an information sheet to the customer in lieu of assigning a temporary tag to the vehicle for this single day use. As a reminder, if the use of this vehicle is going to extend beyond the same day, dealers continue to have the option to issue a 72-hour demonstration tag or a 14-day loaner tag.

AADA anticipates hosting a follow-up webinar as issues are likely to arise that need addressing.

If you have any questions about this law change please don’t hesitate to call, (501) 372-2596, or email [email protected].

AADA president speaks at AAMVA Conference

Left to right: Misty Rucker, Sonja Jaco, Wayne Hamric, Marla McHughes, Greg Kirkpatrick.

Arkansas Automobile Dealers Association (AADA) President Greg Kirkpatrick recently spoke at the American Association of Motor Vehicle Administrators (AAMVA) Region 2 Conference on a panel discussing Interstate Vehicle Transactions.

AAMVA represents officials in the United States and Canada who administer and enforce motor vehicle laws.  They also serve as an information clearinghouse developing model programs and policies in motor vehicle administration, law enforcement, and highway safety.  This year AAMVA is celebrating its 90th anniversary.  Arkansas is in Region 2, and several state officials were on hand for the conference.

Mr. Kirkpatrick spoke about Interstate Vehicle Transactions, which many times involve buyers in one jurisdiction and sellers in another. Consumers and dealers are not afraid to make these long-distance deals but jurisdiction laws, rules, and policies may be challenged by how these transactions have changed vehicle sales and titling governance. Attendees heard from those in vehicle sales, investigations, and legal review to learn how to prepare and adapt for continued growth of vehicle interstate commerce.

AADA enjoys a close working relationship with the Department of Finance and Administration-Office of Motor Vehicles, and this event was a great opportunity to continue to grow this collaborative partnership.

Daniel Pace appointed Director of the Arkansas Motor Vehicle Commission

The Arkansas Department of Labor and Licensing is pleased to announce that Daniel Pace has been appointed as the new Director of the Arkansas Motor Vehicle Commission (AMVC). Daniel has a tough act to follow in retiring Director Sandy Stroope, whose notable leadership and contributions to the Department and the Commission have been greatly appreciated. With an impressive background within state government, Pace brings a wealth of knowledge and a passion for public service to his new role.

“We appreciate Sandy Stroope’s service to Arkansas dealers, and are excited for the appointment of Daniel Pace as the new Commission Director,” said Greg Kirkpatrick, Executive Director of the Arkansas Automobile Dealers Association. “For the last year and half we have gotten to know Daniel, and he has already proven himself to be a tremendous leader in the automotive industry. I look forward to working with Daniel and appreciate his willingness to serve in this critical position.”

A native of Jonesboro, Arkansas, Pace has always had a strong connection to the state and its communities. He attended Jonesboro High School, where he excelled academically and athletically. Passionate about sports, he showcased his talent as a member of the Arkansas State University Baseball Team from 2007 to 2010, demonstrating his dedication and teamwork skills.

Pace’s commitment to education led him to pursue a Bachelor of Arts degree in Criminology, which he earned from Arkansas State University in May 2010. Building on this foundation, he furthered his academic accomplishments by obtaining a Master of Public Administration degree in December 2012, solidifying his understanding of effective governance and policy implementation.

With a decade of experience in state government, Pace has proven his capabilities and dedication to public service. His previous roles include serving as a Motor Vehicle Investigator at the AMVC since November 2021, where he has shown a meticulous approach to investigations and a commitment to upholding the highest standards of the Commission.

Before his time with the AMVC, Pace served as an Investigator in the Public Protection Division of the Office of the Arkansas Attorney General. During his eight-year tenure from August 2013 to November 2021, he exhibited a tireless dedication to consumer protection, showcasing his ability to navigate complex legal landscapes and ensure the well-being of Arkansas citizens.

The appointment of Daniel Pace as the Director of the AMVC is a testament to his exceptional qualifications, unwavering dedication to public service, and commitment to the betterment of the state. His leadership will provide continued excellence and public service to the people of Arkansas and the motor vehicle industry. The Department of Labor and Licensing is proud to announce Daniel Pace as its new Director of the Arkansas Motor Vehicle Commission.