Online Sales Tax May Soon Be Reality

from Brett Lee Shelton, licensed Family Business Lawyer™

A new piece of federal legislation known as the Marketplace Fairness Act has passed the Senate and is now awaiting a House vote that most politicos expect to pass as well.  If the bill becomes law, and your business conducts business over the Internet, you will be expected to collect taxes on all purchases and pay the state accordingly.

Currently, businesses that sell online, by phone or by mail already collect state tax from buyers who live in their own states or in states where the business has a presence.  If the proposed legislation passes, all businesses that sell over the Internet would be required to collect sales tax for each buyer’s state and local governments.

Sound like a logistical nightmare for online sellers?  Each state government will be required to provide free software to businesses to calculate state and local taxes.  Businesses with out-of-state sales below $1 million annually would be exempt from collecting and reporting.

While opponents of the bill predict a bookkeeping and compliance nightmare (an estimated 9,000 separate sales tax entities would need to be accounted for, according to the New York Times), proponents of the legislation said it would level the playing field for brick-and-mortar retailers that must already collect sales tax and that often lose sales to online retailers because consumers don’t have to pay taxes.

If you’re a small or mid-size business owner, call us today at (303)255-3588 to schedule your comprehensive LIFT™ (legal, insurance, financial and tax) Foundation Audit.  Normally, this session is $1,250, but if you mention this article and we still have room on our calendar this month, we will waive that fee.

5 Key Decisions to Make With Your Spouse Before You Retire

from Brett Lee Shelton, licensed Family Business Lawyer™

Retirement decision-making for boomers is very different than it was for our parents, when it was usually just one spouse (Dad) who retired, with Mom sometimes reminding him that, “I married you for better or worse, but not for lunch!”

Now both working spouses must make a decision together on their retirement, and each may have very different ideas of what that retirement will look like.  Here are 5 key decisions you need to make as a couple before you retire:

Timing.  Financial needs and whether or not you enjoy your work are usually the main determining factors in when to retire.  Couples also need to consider how they can maximize Social Security benefits.

Finances.  If one spouse has been handling the family finances, it’s time for both to understand their financial situation and how retirement may impact it.

Lifestyle.  One spouse may want to travel more in retirement, while another just wants to putter around the house.  One may want to move, while the other wants to stay put.  You need to reach a decision together on your retirement lifestyle.

Healthcare.  Both spouses need to have good healthcare coverage, either from Medicare and supplemental plans or, if you will continue to work in retirement, from an employer’s plan.

Long-term care.  Studies show that most of us will need some long-term care during our lifetimes.  Your Personal Family Lawyer® can help you examine the options for long-term care coverage and put a plan together that suits your needs.

If you would like to learn more about retirement planning, call our office today at (303)255-3588 to schedule a time for us to sit down and talk. We normally charge $750 for a Family Wealth Planning Session, but because this planning is so important, I’ve made space for the next two people who mention this article to have a complete planning session at no charge. Call today and mention this article.

A Guide to the Disposition of Your Digital Assets

On April 11, Google introduced its Inactive Account Manager, which allows users to make a choice to either delete their data after a pre-determined length of account inactivity or to name heirs for the data from some of its most popular services, including +1s; Blogger; Contacts and Circles; Drive; Gmail; Google+ Profiles, Pages and Streams; Picasa Web Albums; Google Voice and YouTube.

Many small business owners routinely use Google’s free tools in the daily operation of their business.   The disposition of these digital assets is an important conversation you need to have with your Creative Business Lawyer™, as part of your business succession and estate planning process.

Google users can now access the new Inactive Account Manager on their Google Account settings page.   But what about other major Internet companies that hold most of your online data?  Here is a guide to their current policies:

Facebook – Facebook will remove the account of a deceased person at the family’s request, or even “memorialize” the account (which allows friends and family members to post memorials on that person’s page).  Facebook will not disclose any passwords, transfer account ownership or turn over the contents of the account.

Twitter – Will only disclose account data with a court order; will not disclose account passwords or contents.  Account will be deactivated if family member provides Twitter with a death certificate and notarized statement.

LinkedIn — Will not disclose any passwords, transfer account ownership or turn over the contents of the account unless ordered to do so by a court.  Family members can request that an account be deleted.  Executors and others beyond family members (like an employer) can have the account hidden from public view by reporting the death to LinkedIn if they know the email address that is linked to the account.

Yahoo – Honors requests from family members to access the account of a deceased person only if that request is included in the decedent’s estate plan.  Will also deactivate an account if a death certificate is provided.

Microsoft – For Outlook and Hotmail users, Microsoft will not disclose passwords or transfer account ownership unless a family member has a court order or the permission of the account owner to access the account.  Will deactivate the account if requested to do so by a family member.

If you’re a small or mid-size business owner, call us today at (303) 255-3588 to schedule your comprehensive LIFT™ (legal, insurance, financial and tax) Foundation Audit during which we can look at the disposition of your digital assets if something happens to you.  Normally, this session is $1,250, but if you mention this article and we still have room on our calendar this month, we will waive that fee.

The Digital Afterlife Debate: What Happens to Your Online Assets After You’re Gone

The digital afterlife debate over who owns the online assets of someone who has died has been in the news recently, brought to light by several families whose children have died tragically and who want access to their child’s online accounts to preserve memories and try, in the case of suicide, to make sense of a senseless act.

To date, six states — Connecticut, Idaho, Indiana, Oklahoma, Rhode Island and Virginia — have passed legislation regarding the ownership of digital assets, with legislation pending in a number of other states and at the federal level as well.

At the heart of the debate are concerns over violating privacy laws.  Facebook went to court in California last September to block the estate of a British model from getting access to her Facebook account and prevailed.

On April 11, Google introduced its Inactive Account Manager, which allows users to make a choice to either delete their data after a pre-determined length of account inactivity or to name heirs for the data from some of its most popular services, including +1s; Blogger; Contacts and Circles; Drive; Gmail; Google+ Profiles, Pages and Streams; Picasa Web Albums; Google Voice and YouTube.

Google users can access the new Inactive Account Manager on their Google Account settings page.   But what about other major Internet companies that hold most of our online data?  Here is a guide to their current policies:

Facebook – Facebook will remove the account of a deceased person at the family’s request, or even “memorialize” the account (which allows friends and family members to post memorials on that person’s page).  Facebook will not disclose any passwords, transfer account ownership or turn over the contents of the account.

Twitter – Will only disclose account data with a court order; will not disclose account passwords or contents.  Account will be deactivated if family member provides Twitter with a death certificate and notarized statement.

LinkedIn — Will not disclose any passwords, transfer account ownership or turn over the contents of the account unless ordered to do so by a court.  Family members can request that an account be deleted.  Executors and others beyond family members (like an employer) can have the account hidden from public view by reporting the death to LinkedIn if they know the email address that is linked to the account.

Yahoo – Honors requests from family members to access the account of a deceased person only if that request is included in the decedent’s estate plan.  Will also deactivate an account if a death certificate is provided.

Microsoft – For Outlook and Hotmail users, Microsoft will not disclose passwords or transfer account ownership unless a family member has a court order or the permission of the account owner to access the account.  Will deactivate the account if requested to do so by a family member.

Estate planning for digital assets is evolving, with laws and practices changing all the time.  As a Personal Family Lawyer®, I can help you protect your digital assets and pass them along to heirs in the way you wish to do so.

If you would like to learn more about estate planning strategies for all your assets, not just the digitals, call our office today to schedule a time for us to sit down and talk. We normally charge $750 for a Family Wealth Planning Session, but because this planning is so important, I’ve made space for the next two people who mention this article to have a complete planning session at no charge. Call today at (303) 255-3588 and mention this article.

Is That a Real Employee or a Common-Law Employee?

Is That a Real Employee or a Common-Law Employee?

from Brett Lee Shelton, licensed Family Business Lawyer™

The IRS and the Department of Labor are cracking down on businesses that use contractors but treat them like real employees – or, as the IRS calls them, “common-law employees.”  Before you misclassify that contractor, ask yourself these 5 questions:

1.  Do you control the work? If you direct how and where and at what time someone works for you, then the government says you have an employee, not a contractor.

2.  Do you furnish the equipment? If you have given someone a computer or other equipment on which they will perform work for you, they are likely to be classified as your employee.

3.  Are you in one of these industries? Some industries are audited at a higher rate than others when it comes to employee misclassification, including nail salons, restaurants, cleaning services, security guards, landscaping companies, property management and drywall.  If you are in one of these businesses, you need to educate yourself on employment law with the help of a Creative Business Lawyer™.

4.  Is there anything in writing? Most contractors operate with a contract that spells out the work they will provide and the compensation they will get for it.  We can help you prepare a contract to ensure your contractors are not deemed common law employees.

5.  Do they just work for you? Most contractors are free to work for other people, not just you.  Even if they don’t actually have other clients, it should be clear that they are free to pursue other work without your permission.

If you’re a small or mid-size business owner, call us today at 303-255-3588 to schedule your comprehensive LIFT™ (legal, insurance, financial and tax) Foundation Audit.  Normally, this session is $1,250, but if you mention this article and we still have room on our calendar this month, we will waive that fee.

The Conversation You Must Have With Your Kids and Your Parents

from Brett Lee Shelton, licensed Family Business Lawyer™

The Conversation You Must Have With Your Kids and Your Parents

Every single adult needs to have an advance health care directive written, signed and in place. This includes your children, as soon as they turn 18.  This includes you. This includes your parents.

Without an advance health care directive in place, you would not be able to access your child’s medical records, if they are unable to communicate permission. You would not be able to ensure your health care decisions will be made the way you choose. And your parents lose the ability to communicate their wishes and remain in control as long as possible.

April 16 is National Healthcare Decision Day (NHDD).  Here is what you can do on April 16 – or any other day – to have the conversation you need to have about advance healthcare planning:

1.  Look inward. Before executing an advance healthcare directive with the help of your Personal Family Lawyer®, think about what you do – or don’t – want to happen if you were unable to make your own decisions.  Think about the people you would want to carry out those decisions and if the person you have in mind will follow your wishes.

2.  Talk to your family. One of the most tormenting things for families is having to make healthcare decisions for a loved one by having to guess what they would want.  Communicate your wishes to your family so you don’t put them in this stressful position.

3.  Talk to your healthcare providers. Let your primary physician and any other healthcare provider know about your decisions about your healthcare.  Ask any questions to alleviate any concerns you or your family may have.

4.  Execute your advance healthcare directive.  Once you have decided upon your healthcare options and have chosen an agent, meet with your Personal Family Lawyer® to complete your official advance healthcare directive.  Have copies made for your family and your primary healthcare provider.

In honor of National Healthcare Decisions Day, come into the office anytime the week of April 16 and we will prepare a free health care directive for you, your parent(s) or your adult child(ren). Call 303-255-3588 to schedule before all time slots are full.

What You Can Learn From Three-Time NYC Mayor Ed Koch’s Will About Your Estate Planning

from Brett Lee Shelton, licensed Family Business Lawyer™

Three-time New York City Mayor Ed Koch died on Feb. 1, leaving an estate estimated between $10-$11 million.  And it’s a good thing that “Hizzoner” loved governing, because one-quarter of his estate will be going to the state and federal governments.

During his tenure as Mayor, Koch was famous for asking people on the street, “How’m I doin’?” He would have been better served to ask that same question to a Personal Family Lawyer® before he passed on.

In his will, Koch bequeathed most of his assets to blood relatives – a sister and her husband, a sister-in-law, and three nephews – as well as to his secretary and a charity.  And because Mayor Koch used a Will and didn’t put his assets in Trust, it’s all public. In fact, you can read the details of exactly what Mayor Koch left behind and to who right here.

When the former Mayor died, the federal estate tax exemption was at $5.25 million; and since his estate is estimated at twice that amount, Uncle Sam will net a cool $1.45 million.  New York State has an estate tax exemption of just $1 million, meaning it will receive $1.1 million from the estate, according to a Forbes article.

As Forbes notes, Koch could have made some savvy estate planning moves before he died by:

Creating a trust for the benefit of his nephews, who inherited the bulk of his estate, and their descendants.  Up to $5.25 million that goes into a trust would have been exempt from generation-skipping transfer tax. (And, would have protected those assets for generations upon generations. This was a big oversight.)

Making additional gifts up to $5.25 million right before he died could have significantly reduced his state tax bill, since New York does not have a gift tax.  This would have saved his heirs an estimated $600,000.

And there’s more he could have done as well, but he either didn’t get good counsel or he didn’t heed it.  Now, it’s too late.  And, of course, it’s all public.

If you would like to learn more about strategies to keep your money out of the government and the size of your assets totally private, call our office today to schedule a time for us to sit down and talk. We normally charge $750 for a Family Wealth Planning Session, but because this planning is so important, I’ve made space for the next two people who mention this article to have a complete planning session at no charge. Call (303)255-3588 today and mention this article.

Obamacare Small Business Health Options Program (SHOP) Hits Logistical Speed Bump

from Brett Lee Shelton, licensed Family Business Lawyer™

A logistical speed bump is going to delay the number of insurance plan options for small businesses under Obamacare for at least a year, according to a Wall Street Journal report.

The U.S. Department of Health and Human Services (HHS) is now proposing that small businesses have only one insurance plan option to offer employees starting in 2014 instead of the multiple options that were part of the original plan – a plan designed to reduce costs because multiple options would have created competition among insurers and attracted more participants, leading to lower premiums.

Apparently the government underestimated the time – and technology — it would take to implement the 33 state exchanges and is now proposing 2014 as a transitional year before a full range of plans is offered to the marketplace, saying the government and insurers need “additional time to prepare for an employee choice model.”

HHS noted that the 17 states running their own exchanges could choose to delay the implementation of a full menu of insurance plans into 2015 as well.  A few state exchanges, including California and Connecticut, said they would offer employee choice options beginning next year.

Under the Affordable Care Act of 2010, businesses with 100 or fewer employees will be able to offer employee insurance coverage via the exchanges.  States can limit participation to companies with 50 or fewer employees in 2014 and 2015.  Businesses with fewer than 25 employees are eligible for tax credits for up to 24 months of coverage purchased via an exchange.  Companies with more than 100 employees will be eligible to participate in exchanges beginning in 2017.

If you’re a small or mid-size business owner, call us today at (303)255-3588 to schedule your comprehensive LIFT™ (legal, insurance, financial and tax) Foundation Audit.  Normally, this session is $1,250, but if you mention this article and we still have room on our calendar this month, we will waive that fee.

A Legal Checklist for Starting Your Own Business

from Brett Lee Shelton, licensed Family Business Lawyer™

A Legal Checklist for Starting Your Own Business

Whether you are already a small business owner or the entrepreneurial spirit has grabbed you by the collar and you plan to get your startup off the ground this year, there are certain legal aspects to operating a small business that you just can’t ignore (and we know you want to).

Ignoring the legalities of running a business can lead to some very costly consequences.  A Creative Business Lawyer™ can help you cover all your bases, which should include:

Setting up your business structure. If there were ways you could save time and money just by the selection of how you operate your business –i.e., your “entity” – you’d want to know about that, right?  You need to take time to examine the nature of your business and work with an attorney to put the proper protections in place, as well as structure the business to prevent personal financial liability. And whatever you do, don’t use a legal document service that will only complete part of the job and you won’t know the difference until it’s too late.

Developing your bench. Chances are that sometime in your career you’ve had a mentor or two that has helped you along the way.  Don’t drop that practice just because you’re starting your own enterprise.  Establishing relationships with people who can add value from a financial, legal or marketing perspective can really grow your business.

Financing the enterprise.However you choose to finance your business, you need to be sure that you keep your business accounts separate from your personal finances.  Mixing the two can lead to disastrous legal consequences and open you up to personal liability for business lawsuits.  And, there are many different ways to fund your business that inexperienced entrepreneurs often don’t know about. Contact us to discuss options.

Getting it all in writing.  Whether it’s your office lease or an employment agreement, every business relationship should be set in writing to help define that relationship and avoid legal disputes.  In fact, if you are not investing a substantial amount of time in reviewing and approving agreements, you are likely overlooking an important piece of growing your business.  We can help with that.

If you’re a small or mid-size business owner, call us today at (303)255-3588 to schedule your comprehensive LIFT™ (legal, insurance, financial and tax) Foundation Audit.  Normally, this session is $1,250, but if you mention this article and we still have room on our calendar this month, we will waive that fee.