Shoffner & Associates

Aliana Giordano Denied Custody Because Of Breast Cancer? - Child Custody - The Chicago Family Law Blog

2011-05-13T13:00:00.000-07:00

Aliana Giordano Denied Custody Because Of Breast Cancer? - Child Custody - The Chicago Family Law Blog

Is It Time For A New Estate Plan?

2011-04-28T14:58:00.000-07:00

Can you think of a better thing to do on a lovely spring day than review your estate plan? No, I’m not kidding.

Now it is especially important to review your plan because the way Wills are probated in Massachusetts is about to change.

As of July 1, 2011 the Uniform Probate Code will be the law in Massachusetts.
While the changes will make the probate process faster, it also changes some long-standing rules of inheritance. Now is the time to call us to make sure that your plan will do what you want it to do.

This is just a peek at some of the key features of the new Code. To learn how the new Code affects you, just give us a call and we’ll set up an appointment.

The Informal Probate Option

After July 1, 2011 the informal probate option will shorten the time it takes to start the probate process. As long as all the parties agree, a personal representative can be appointed in a matter of weeks – not months. There are fewer documents to file, which gives the family more privacy.

A good estate plan can save you – and your family – thousands of dollars. Call us to find out how.

If You Don’t Have A Will Your Spouse Can Inherit It All

The way it is now, if you die and don’t have a will, but you do have a spouse and children, your spouse inherits half of your estate and your children get the other half. That can cause quite a few problems.

Under the new Code your spouse will inherit your entire estate as long as your spouse is your children’s other parent.

The best way to make sure that your loved ones receive what you want them to have is to have a well-drafted estate plan. We can help.

If You Get Married Your Old Will Is Still Effective

Under the current law, your marriage usually makes your old Will invalid. The new Code changes that. Marriage no longer revokes a prior will.
Your new spouse will take a share of any part of your estate that you don’t devise to the children you had before the marriage. If you don’t have any children from a prior relationship, then your surviving spouse will inherit a share of your entire estate.
If you have been married more than once, or you have children from a prior relationship, call us and we’ll help you make sure that your Will works the way you want it to work.

If You Have Grandchildren Their Shares Might Change

Today, if one or more of your children predeceases you, your grandchildren will share the portion of your estate that the predeceased parent would have received (unless your Will says otherwise).

Under the new Code, your surviving children each receive the share that your Will provides for them, and your grandchildren who have deceased parents divide the shares of the deceased parents equally.

That’s another reason why it’s important to make a plan that works for you and your loved ones under the new Code.

Estate planning doesn't have to be hard, and it doesn't have to be expensive. The right estate plan will help you family take full advantage of the new Probate Code when the time comes.

At Shoffner & Associates, we know what to do and how to do it right. As always, we are ready, willing, and able to help you. We’ll design a plan that is right for you and your budget. Call us today at 617-369-0111 or send us an email. We’re ready to make it easy.

Help For Struggling Taxpayers

2011-02-28T14:48:00.000-08:00

One of the biggest obstacles for small businesses is dealing with the nearly crushing burden of federal taxes. Often, the business owner ends up filing tax returns late, paying tax obligations late, and incurring terrifying penalties. In an effort to reduce the burden of late payments for individuals and small businesses, the IRS has taken some new steps to help taxpayers get a fresh start. These include:

Significantly increasing the dollar threshold when liens are generally issued, resulting in fewer tax liens.
Making it easier for taxpayers to obtain lien withdrawals after paying a tax bill.
Withdrawing liens in most cases where a taxpayer enters into a Direct Debit Installment Agreement.
Creating easier access to Installment Agreements for more struggling small businesses.
Expanding a streamlined Offer in Compromise program to cover more taxpayers.

Freya Allen Shoffner and the attorneys at Shoffner & Associates are ready and willing to help your business deal with the IRS so that you can focus on success. Call us at 617-369-0111, or send us an email. Anytime.

Don't Forget The Self-Employed Health Insurance Deduction!

2011-02-16T12:57:00.000-08:00

IRS Tax Tip 2011-31

Health Insurance Deduction Reduces Self Employment Tax In 2010, eligible self-employed individuals can use the self-employed health insurance deduction to reduce their social security self-employment tax liability in addition to their income tax liability. As in the past, eligible taxpayers claim this deduction on Form 1040 Line 29. But in 2010, eligible taxpayers can also enter this amount on Schedule SE Line 3, thus reducing net earnings from self-employment subject to the 15.3 percent social security self-employment tax.

Premiums paid for health insurance covering the taxpayer, spouse and dependents generally qualify for this deduction. Premiums paid for coverage of an adult child under age 27 at the end of the year, for the time period beginning on or after March 30, 2010, also qualify for this deduction, even if the child is not the taxpayer’s dependent.

As before, the insurance plan must be set up under the taxpayer’s business, and the taxpayer cannot be eligible to participate in an employer-sponsored health plan. Details, including a worksheet, are in the instructions to Form 1040.

Small Non-Profits May Have Simpler IRS Filing Requirements

2011-01-21T13:13:00.000-08:00

That's right. For tax years beginning on or after Jan. 1, 2010, most tax-exempt organizations whose gross annual receipts are normally $50,000 or less can file the e-Postcard. The threshold was previously set at $25,000 or less.Check our the IRS Website for more information. And, feel free to call or email Freya Shoffner at Shoffner & Associates -- 617-369-0111-- if you have any questions.

Good News From The IRS?

2011-01-10T14:19:00.000-08:00

Actually, the “Tax Relief, Unemployment Insurance Authorization, and Job Creation Act of 2010” does provide some good news.

First, while many had expected income tax rates to rise this year, the six federal income tax rates will remain at the same levels and itemized deductions will continued to be allowed in full.

Second, the social security tax rate was lowered for all wage earners from 6.2% to 4.2% for 2011. This decreased rate replaces the Making Work Pay credit, but we’ll have to wait and see what this tax rate is for 2012.

Third, the 2010 Small Business Jobs Act increased the amount a business can write off for an asset valued between $250,000 to $500,000 that was purchased during the year from for 2010 and 2011. This write-off applies as long as the total assets purchased do not exceed $2 million.

Fourth, the 2010 Tax Relief Act increased the bonus depreciation (for new assets only) to 100% if purchased between Sept. 8, 2010 and Jan. 1, 2012.

Best Of All, the District of Columbia’s new holiday – Emancipation Day – falls on April 15, 2011. That means that the tax processing deadline for your 2010 return is April 18, 2011 – so you have three extra days to prepare and file your return.

Ask Shoffner & Associates, The attorneys at Shoffner & Associates are always ready to help you with your small business questions. Feel free to give us a call at 617-369-0111, or email Freya Allen Shoffner – any time.

Estate Tax. Is There Is? Or Is There Ain’t?

2011-01-07T12:51:00.000-08:00

There Is. At Least For Now.

Seemingly on Christmas Eve, the President signed the Tax Relief, Unemployment Insurance Reauthorization and Job Creation Act of 2010 (short title: 2010 Tax Relief Act ) which effectively extends the Bush-era tax rates for another two years. The law also provides new gift, estate, and generation-skipping taxes for this year and next year. Since they are only temporary, Congress will have to deal with the entire situation again in 2012.

Here are the key estate and gift tax provisions of The Act:

Beginning January 1, 2011, the estate, gift and generation-skipping tax exemption is $5 million per taxpayer ($10 million per couple) and the tax rate is 35% (beginning in 2010).
Heirs will receive a step-up in basis of up to fair market value at the date of death.
The estate tax exemption for a deceased spouse is portable. That means that a surviving spouse can use the unused estate tax exemption of the “last deceased spouse.”
The lifetime gift tax exemption increases from $1 million to $5 million, which means that the gift tax exemption is unified with the estate tax exemption.
Two year GRATs are still permitted.
For decedents dying in 2010, executors can apply the 2011 tax rates or choose to use 2010’s carry-over basis approach. The due date for the estate tax return and/or the return reporting carry-over basis is now nine months following date of the enactment of the Act (September 17, 2011), and not nine months from the date of death.
The rates and exemptions are temporary and apply only in 2011 and 2012, at which time the law will need to be revisited again.
The 15% tax on qualified gains and dividends will remain in place. Those in the 10-15% tax brackets will have a no capital gains tax on gains or dividends.

Now What?

Don’t delay. Review your estate plan with your attorney and make the changes necessary so that your plan will work today, tomorrow, or next year. As always, Freya Allen Shoffner and the attorneys at Shoffner & Associates are ready to help.

Is There a Sales Tax When I Sell My Home?

2010-11-22T14:17:00.000-08:00

Lately, a number of my clients have asked whether the Patient Protection and Affordable Care Act (the PPACA, or “Obamacare,”) imposes a 3.8% sales tax on the sale of your home.

The answer is: “Kind of. In a way. Sort of. Maybe.”

This tax will be imposed starting in 2013.

Here’s how it works. According to Michael Maye, who wrote in the October 25, 2010 edition of “The Street,” the Medicare Investment Income tax, contained in the PPACA, is “calculated as the lesser of income over the $200,000 or $250,000 thresholds or unearned income. The lower of these two figures is multiplied by 3.8%. (The definition of "unearned income" is very broad. It includes interest, dividends, capital gains, annuities, royalties and rent. Excluded is tax-exempt interest and income from retirement accounts such as IRAs.)”

The reconciliation bill, HR 4872 (page 33) contains the language for this tax. It provides for a tax on “net investment income,” which is defined as the sum of “gross income from interest, dividends, annuities, royalties, and rents,” which are not earned in the ordinary course of a trade or business and “net gain (to the extent taken into account in computing taxable income) attributable to the disposition of property.” It does not apply to property held in a trade or business.

You must look at several factors to determine whether you will owe Medicare Investment Income Tax when you sell your home, or when you have a gain on any investment. First, the tax is not applied to the total sales price, so you must calculate your net gain. Second, the tax is applied on the lesser of your income over $200,000 (or $250,000 for joint filers) or the net investment income (which includes your net gain.)

When calculating your additional tax burden under the PPACA, don’t forget to include the increase in your Medicare Part A Taxes, which rise by.9% for individuals making over $200,000 a year or joint filers earning over $250,000.

According to Mayes, a federal income tax scenario for a high-income, two children, family in New Jersey with wages of $1 million; rental income of $36,000; book royalties of $7,500; dividends and interest of $50,000; capital gains of $100,000 (perhaps from the sale of a house); and investment income of $193,500 would result in two new tax payments. The first would be a Medicare surtax of $6,750 ($750,000 multiplied by 0.9%) and a Medicare Investment Income tax of $7,353 (or $193,500 multiplied by 3.8%.)

Like any tax law, the whole thing is pretty complicated, and miscalculations can be expensive. So, whether you will be liquidating stocks to pay for college, or selling the vacation home because you’re down-sizing, be sure to talk to your accountant and to the attorneys at Shoffner & Associates first. Call us at 617-369-0111, or email Freya Shoffner at fashoffner@shoffnerassociates.com. We can help.

Charities -- What You Need To Know -- Free Webinar

2010-11-12T14:14:00.000-08:00

Next Thursday The IRS Will Hold A Free Webinar for Tax Exempt Organizations.

Starting Off Right: What 501(c)(3) Organizations Need to Know is a free webinar is a fast-paced overview by two IRS Exempt Organizations tax veterans on what tax-exempts need to do (and what they will want to avoid) to follow IRS rules and keep their tax status in good standing in years to come. This 45-minute session will be held Nov. 18 at 2 p.m. EST. If you are a newly formed 501(c)(3) organization or an organization that wants a refresher, register today and start off right.

Debt Free... Can It Be?

2010-11-02T09:35:00.000-07:00

How long will it take to eliminate your debt? Use this Debt Reduction Calculator to find out. Then get in touch with Freya Shoffner and the attorneys at Shoffner & Associates to ensure your financial success.

Now The IRS Offers A Form to Help Small Businesses Claim The New Health Care Tax Credit

2010-09-10T14:26:00.000-07:00

Let's face it. Every small business is going to be facing an ever-increasing mound of paperwork from the IRS. Right now, staying on top of all of the health care requirements is pretty tricky. One helpful item is the IRS' newly released a draft version of the form (Form 8941) that small businesses and tax-exempt organizations will use to calculate the small business health care tax credit when they file income tax returns next year. The IRS also announced how eligible tax-exempt organizations –– which do not generally file income tax returns –– will claim the credit during the 2011 filing season.

Take a look at the forms now so that you'll be ready to take the best advantage of that tax credit when the time comes. And, as always, give Shoffner & Associates a call at 617-369-0111 or drop us a line law@shoffnerassociates.com if you have any questions.

Decipher Notices From The IRS

2010-08-04T13:35:00.000-07:00

Finding a letter in your mailbox from the IRS is always scary. What's worse is trying to figure out the notice inside. Finally, the IRS has set up a page that explains how to understand their notices. Just visit the IRS online.

And, if you need help dealing with any tax issues -- or if you'd like to find out how to avoid tax issues -- just let any one of us at Shoffner & Associates know. We're here to help.

Save Your Small Non-Profit's Tax Exempt Status!

2010-07-30T13:04:00.000-07:00

One of the challenges facing over-worked small non-profit organizations is meeting the yearly tax filing burden. Let's face it -- sometimes it just doesn't happen.

If your non-profit didn't manage to file its 2007, 2008, or 2009 returns, don't despair. The IRS has established a special one-time special filing deadline of October 15, 2010. Follow this link to find out more.

http://www.irs.gov/newsroom/article/0,,id=225959,00.html

Changes In Medicare

2010-05-24T14:59:00.000-07:00

In the next few days Medicare recipients should be receiving the new brochure " Medicare and the New Health Law - What it Means for You." The brochure explains the most important parts of the Affordable Care Act" for those who are receiving Medicare as well as their families. The brochure is also available online at http://www.medicare.gov/Publications/Search/Results.asp?PubID=11467&Type=PubID

For those recipients who enter the Part D "donut hole" and who are not eligible for Medicare Extra Help, their first benefit from the new law will be a $250.00 check. And, next year Medicare beneficiaries will find that their colorectal cancer screenings and mammograms are covered by Medicare, in addition to an annual wellness visit.

Remember, that Medicare is only part of a complete longterm care strategy. Attorney Freya Shoffner and the associates at Shoffner & Associates will be happy to help you decide exactly how you'll make a strategic plan for the best future possible. Write to us -- or call us at 617-369-0111 -- anytime.

More On The Small Business Health Care Tax Credit

2010-05-21T14:19:00.000-07:00

On May 17, the IRS published new information to make it easier for small businesses to figure out if they are eligible for the new health care tax credit and to calculate how big their credit might be. The IRS also makes it clear that businesses may still qualify for the federal credit even if they are receiving state health care tax credits. The other good news is the credit also applies to add-on vision and dental coverage.

The Small Business Tax credit is in effect for this year, and it is supposed to encourage small businesses to either begin offering medical insurance for their employees or to maintain the coverage that they have in place.
According to the IRS

In general, the credit is available to small employers that pay at least half the cost of single coverage for their employees in 2010.The credit is specifically targeted to help small businesses and tax-exempt organizations that primarily employ moderate- and lower-income workers.
For tax years 2010 to 2013, the maximum credit is 35 percent of premiums paid by eligible small business employers and 25 percent of premiums paid by eligible employers that are tax-exempt organizations. The maximum credit goes to smaller employers –– those with 10 or fewer full-time equivalent (FTE) employees –– paying annual average wages of $25,000 or less. The credit is completely phased out for employers that have 25 FTEs or more or that pay average wages of $50,000 per year or more. Because the eligibility rules are based in part on the number of FTEs, not the number of employees, businesses that use part-time help may qualify even if they employ more than 25 individuals.

Eligible small businesses can claim the credit as part of the general business credit starting with the 2010 income tax return they file in 2011. For tax-exempt organizations, the IRS will provide further information on how to claim the credit. Notice 2010-44 .

Freya Shoffner and the attorneys at Shoffner & Associates has been helping small businesses negotiate the ins-and-outs of tax credits for a long time, and we'll be happy to help you too. Give us a call. 617-369-0111.

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Watch Out For These Common Tax Filing Errors!

2010-04-12T15:14:00.000-07:00

It's April 12th and many of our clients are starting to have tax-filing nightmares. To make it easier to get to sleep, keep these tips in mind:

1. Don't forget to use the peel-off label if you are mailing your return. And, don't forget to include your Social Security Number.
2. Check your figures. Then check them again. Arithmetic mistakes can lead to problems.
3. Don't forget to sign and date your return. And, don't forget to include your payment!
4. E-file or Free File. The software will help you avoid penalties.
5. Be careful if you're claiming the Homebuyer Credit or if you received an Economic Recovery Payment.

For more information, visit the IRS page on common errors and then give Shoffner & Associates a call at 617-369-0111. We'll help ease your mind.

Be careful of Medicaid Planning Trusts in Massachusetts

2010-04-09T13:00:00.000-07:00

Many people who need long term care turn to MassHealth ("Medicaid") to fund the cost of their care. However, Congress has been very specific in stating that Medicaid benefits shall only be made available “to people who do not have sufficient income or resources to provide for themselves." H.R.Rep. No. 265, 99th Cong., 1st Sess., pt. 1, at 72 (1985.) Those who apply for MassHealth assistance for long term care cannot own more than a total of $2,000 in assets. Reducing the size of one's estate to below $2,000 often involves the use of Trusts, which are known as "Medicaid Planning Trusts."

Trusts that exclude assets from a person's estate for Medicaid purposes must meet certain very strict requirements. Recently, the Massachusetts Appeals Court upheld the MassHealth determination that an irrevocable, income-only trust which expressly prohibits distributions of principal, but which contains other provisions which could conceivably permit the trustees to invade trust assets, is a countable asset for Medicaid purposes. Doherty v. Director of the Office of Medicaid (Mass. App. Ct., Essex, No. 08-P-939, June 18, 2009).

This Appeals Court decision is just one more skirmish in the battle over Medicaid benefits. And, while trusts are still an important instrument to protect assets when planning for long term care, Medicaid Planning Trusts must be very carefully drawn to assure compliance with the applicable Federal statutes and the Massachusetts regulations.

To make sure that your estate plan will meet your needs for long term care, write to Attorney Freya Shoffner or give her a call at 617-369-0111. The lawyers at Shoffner & Associates are ready to help you.

Employers -- Learn About the Tax Credit for Providing Health Insurance

2010-04-05T09:37:00.000-07:00

Now IRS.gov provides information to small employers about the new tax credit for providing health coverage.

The credit is designed to encourage small employers to offer health insurance coverage for the first time or maintain coverage they already have. In general, the credit is available to small employers that pay at least half the cost of single coverage for their employees.

“This credit provides a real boost to eligible small businesses by helping them afford health coverage for their employees,” said IRS Commissioner Doug Shulman. “We urge small businesses and tax-exempt employers to look closely at this important tax break — which is already effective — to see if they qualify.”

The maximum credit is 35 percent of premiums paid in 2010 by eligible small business employers and 25 percent of premiums paid by eligible employers that are tax-exempt organizations. In 2014, this maximum credit increases to 50 percent of premiums paid by eligible small business employers and 35 percent of premiums paid by eligible employers that are tax-exempt organizations.

The site is informative and easy to use. It includes:

• A graphic to help employers quickly determine if they qualify for the credit;
• Scenarios that explain how much certain businesses and exempt organizations would benefit from the credit; • Tax tips on taking the credit; and,
• Questions and answers.

For more information and help on making the most of employer tax credits, visit Shoffner & Associates on line, or call us to make an appointment. 617-369-0111.

Four Dangerous Estate Tax Traps!

2010-03-16T07:18:00.000-07:00

Last year, we heard all kinds of predictions that Congress -- or the President -- would not let the estate tax expire for 2010. Well it did.

This year, when a person dies, the estate is not subject to any Federal Estate Tax. That is true regardless of how large the estate happens to be. David Koch could pass away and leave all of his approximately $19 Billion fortune to his legatees and the estate would not pay a cent of Federal Estate Tax.

Of course, there are traps. Actually, there are four of them.

Trap Number 1. Tax Basis. One of the advantages of the old estate tax law was that a person who inherited property from an estate received a "step up in basis." According to the IRS, "Basis is generally the amount of your investment in a property for tax purposes." The basis is usually the amount that was paid to purchase the property. With the "step up in basis" when a person inherited property the basis was equal to the fair market value of the property on the date of death. Attorney Letha Sgritta McDowell of Oast & Hook gives this example: "If a person purchased some shares of stock for $5,000, and then later sold the same stock for $10,000, the person’s basis is $5,000, and this person would pay tax on the $5,000 of capital appreciation. If that same person died owning the stock and it was worth $10,000 on the date of the person’s death, then whoever inherits the stock would have a “stepped up” basis of $10,000. If the person who had inherited the stock sold it for $10,000, then this person would pay no tax on the sale due to the step up in basis."

Now, under federal law, if the property is worth more $1.3 million (or $3.0 million if it is going to a surviving spouse) the decedent's basis transfers to the recipient. Using Attorney McDowell's example, when the person who had inherited the stock sold it for $10,000, he or she would have to pay capital gains tax on the $5,000 of capital appreciation.

However, in 2011 the step-up basis will return. This means that those who have substantial assets must consider revising their wills to deal with this year's limited step-up basis provisions and next year's return of the step-up basis.

Trap Number 2. Gift Tax. The Federal Gift Tax Law has not been repealed. This year you may give up to $13,000 to each recipient without reporting the gift. Otherwise, the maximum amount you can give during your life without paying a Federal Gift Tax is $1 million. If you give more than that, regardless of the Estate Tax exclusion, you will be taxed at the highest individual income tax rate, which is 35% for 2009 income. Be careful about making a gift to a trust. Unless the trust is treated as wholly owned by you or your spouse, every gift to a trust in 2010 is taxable. This means that you must be very careful in designing any gifting strategy so that you can give the most and be taxed the least.

Trap Number 3. States Still Charge Estate and Inheritance Taxes. In Massachusetts the estate tax is a transfer tax on the value of the decedent's estate before distribution to any beneficiary. Any estate with a value over $1 million is subject to the Massachusetts Estate Tax. The amount of tax is equal to the amount of the maximum credit for state death taxes using the Internal Revenue Code Section 2011 in effect on December 31, 2000. For example, if a decedent were to die with a Massachusetts taxable estate of $1.5 million, the estate would have to pay Massachusetts Estate Tax of $64,400. The tax must be paid within 9 months of the date of death, so it is essential for individuals with assets in excess of $1 million to ensure that their estate contains adequate liquid assets to pay the tax on time.

Trap Number 4. The Estate Tax Is Coming Back. The way the law is written, in 2011 all estates in excess of $1 million will be subject to a Federal Estate Tax, with a highest marginal rate of 55% and a surcharge for mega-estates, unless Congress acts in the 20 weeks left of this year's session. That means, if a person dies in 2011 with a taxable estate of $1.5 million, the Federal Estate Tax Due would be $555,800! Of course, the estate would also have to pay the Massachusetts Estate Tax and be sure that the taxing authorities received the full payment within 9 months of date of death!

Call Your Lawyer. Avoid The Traps. Estate planning doesn't have to be hard, and it doesn't have to be expensive. And, a good estate plan can save you and your loved ones hundreds of thousands of dollars. The attorneys at Shoffner & Associates know what to do and how to do it right. They'll design a plan that is right for you and your budget. Call us today at 617-369-0111.

Great Strategies For Entrepreneurs

2010-02-25T09:39:00.000-08:00

It's not news that it is very hard to make a buck these days. And, small businesses need to use every resource possible to make the most of each opportunity. Zeke Camusio of The Outsourcing Company focuses on ten ways to avoid common business mistakes. Check out his blog "Let's Do It!" and then tell us what you think.

Every Tax Deduction Helps

2010-02-12T14:59:00.000-08:00

Watch Your Mileage Deductions

Taxpayers often miss important deductions, and one of them is the deduction for business mileage.

26 CFR 601.105: Rev. Proc. 2009-54 updates Rev. Proc. 2008-72, 2008-2 C.B. 1286, and provides optional standard mileage rates for taxpayers to use in computing the deductible costs of operating an automobile for business, charitable, medical, or moving expense purposes.

This revenue procedure also provides rules under which the amount of ordinary and necessary expenses of local travel or transportation away from home that are paid or incurred by an employee are deemed substantiated under § 1.274-5 of the Income Tax Regulations if a payor (an employer, its agent, or a third party) provides a mileage allowance under a reimbursement or other expense allowance arrangement. The substantiation methods described in this revenue procedure are not mandatory.

A taxpayer may use actual allowable expense amounts to substantiate expenses if the taxpayer maintains adequate records.

The attorneys at Shoffner & Associates are always available to help you make the most of your business opportunities. Write to Freya Shoffner at fashoffner@shoffnerassocates.com -- anytime.

Haiti Relief and Your Tax Return

2010-02-07T08:01:00.000-08:00

John Schacter, EA, a Boston tax accountant offers the following advice for deducting donations made to help the victims of the Haiti earthquake:

Millions of Americans have mobilized to help the people of Haiti in the aftermath of the terrible earthquake there. This month Congress passed a law that the President signed, giving taxpayers the choice of deducting donations for Haiti relief on their 2009 tax returns – even though the donation actually happened in 2010.

Here are 10 important facts the Internal Revenue Service wants you to know about this special provision.

A new law allows you to claim donations for Haitian relief on your 2009 tax return, which you will be filing this year.
The contributions must be made specifically for the relief of victims in areas affected by the Jan. 12 earthquake in Haiti.
To be eligible for a deduction on the 2009 tax return, donations must be made after Jan. 11, 2010 and before March 1, 2010.
In order to be deductible, contributions must be made to qualified charities and can not be designated for the benefit of specific individuals or families.
The new law applies only to cash contributions.
Cash contributions made by text message, check, credit card or debit card may be claimed on your federal tax return.
You must itemize your deductions in order to claim these donations on your tax return.
You have the option of deducting these contributions on either your 2009 or 2010 tax return, but not both.
Contributions made to foreign organizations generally are not deductible. You can find out more about organizations helping Haitian earthquake victims from agencies such as the U.S. Agency for International Development ( http://www.irs.gov/app/scripts/exit.jsp?dest=http%3A%2F%2Fwww.usaid.gov ).
Federal law requires that you keep a record of any deductible donations you make. For donations by text message, a telephone bill will meet the record-keeping requirement if it shows the name of the organization receiving your donation, the date of the contribution, and the amount given. For cash contributions made by other means, be sure to keep a bank record, such as a cancelled check or a receipt from the charity. Receipts should show the name of the charity, the date and amount of the contribution.
For more information go to http://www.irs.gov/pub/irs-pdf/p3833.pdf

John Schachter EA

John Schachter + Associates, Inc.

305 Newbury Street 2nd Floor

Boston, MA 02115

p 617/236-1915

f 617/236-1916

www.johnschachter.com

IRS Announces A New Virtual Workshop

2010-01-17T13:41:00.000-08:00

Knowing what your business needs to do to satisfy the IRS can seem like an impossible task. Mistakes such as late filings, insufficient payments, and improper calculations can cost a fortune, or even drive you out of business. To keep your business on the right track, spend some time with the IRS Virtual Workshop. It provides the information that you need in an easy-to-understand format so you can stay focused on what's most important for your small business - your profits.

Visit Shoffner & Associates to learn how Freya Shoffner and her associates can help your small business, or give us a call at 617-369-0111.

Estimated Taxes

2010-01-08T14:57:00.000-08:00

The IRS offers this advice about paying estimated tax.

Estimated tax is the method used to pay tax on income that is not subject to withholding. This includes income from self-employment, interest, dividends, alimony, rent, gains from the sale of assets, prizes and awards. You also may have to pay estimated tax if the amount of income tax being withheld from your salary, pension, or other income is not enough.

Estimated tax is used to pay both income tax and self-employment tax, as well as other taxes and amounts reported on your tax return. If you do not pay enough through withholding or estimated tax payments, you may be charged a penalty. If you do not pay enough by the due date of each payment period you may be charged a penalty even if you are due a refund when you file your tax return.

Who Must Pay Estimated Tax

If you had a tax liability for 2008, you may have to pay estimated tax for 2009.

General Rule
You must pay estimated tax for 2009 if both of the following apply.

You expect to owe at least $1,000 in tax for 2009 after subtracting your withholding and credits.
You expect your withholding and credits to be less than the smaller of;
- 90% of the tax to be shown on your 2009 tax return, or
- 100% of the tax shown on your 2008 tax return. Your 2008 tax return must cover all 12 months.

Sole proprietors, partners, and S corporation shareholders - You generally have to make estimated tax payments if you expect to owe tax of $1,000 or more when you file your return. Use Form 1040-ES, Estimated Tax for Individuals, to figure and pay your estimated tax. For additional information, refer to Publication 505, Tax Withholding and Estimated Tax.

Corporations - You generally have to make estimated tax payments for your corporation if you expect it to owe tax of $500 or more when you file its return. Use Form 1120-W, Estimated Tax for Corporations (PDF), to figure the estimated tax. You must deposit the payments. For additional information, refer to Publication 542, Corporations.

Who Does Not Have To Pay Estimated Tax

If you receive salaries and wages, you can avoid having to pay estimated tax by asking your employer to take more tax out of your earnings. To do this, file a new Form W-4 (PDF) with your employer. There is a special line on Form W-4 for you to enter the additional amount you want your employer to withhold.

Estimated tax not required
You do not have to pay estimated tax for 2009 if you meet all three of the following conditions.

You have no tax liability for 2008
You were a US citizen or resident for the whole year
Your 2008 tax year covered a 12 month period

You had no tax liability for 2008 if your total tax was zero or you did not have to file an income tax return. For additional information on how to figure your estimated tax, refer to Publication 505, Tax Withholding and Estimated Tax.

Estimated tax requirements are different for farmers and fishermen. Publication 505, Tax Withholding and Estimated Tax, provides more information about these special estimated tax rules.

How To Figure Estimated Tax

To figure your estimated tax, you must figure your expected adjusted gross income, taxable income, taxes, deductions, and credits for the year.

When figuring your 2009 estimated tax, it may be helpful to use your income, deductions, and credits for 2008 as a starting point. Use your 2008 federal tax return as a guide. You can use the worksheet in Form 1040-ES (PDF) to figure your estimated tax. If you estimated your earnings too high, simply complete another Form 1040-ES worksheet to refigure your estimated tax for the next quarter. If you estimated your earnings too low, again complete another Form 1040-ES worksheet to recalculate your estimated taxes for the next quarter. You want to estimate your income as close as you can to avoid penalties.

You must make adjustments both for changes in your own situation and for recent changes in the tax law.

When To Pay Estimated Taxes

For estimated tax purposes, the year is divided into four payment periods. Each period has a specific payment due date. If you do not pay enough tax by the due date of each of the payment periods, you may be charged a penalty even if you are due a refund when you file your income tax return.

Using the EFTPS system is the easiest way to pay your federal taxes for individuals as well as businesses. Make ALL of your federal tax payments including federal tax deposits (FTDs), installment agreement and estimated tax payments using Electronic Federal Tax Payment System (EFTPS). If it is easier to pay your estimated taxes weekly, bi-weekly, monthly, etc. you can, as long as you have paid enough in by the end of the quarter. Using EFTPS, you can access a history of your payments, so you know how much and when you made your estimated tax payments.

References/Related Topics

For help with your tax law question, feel free to give Freya Shoffner a call at 617-369-0111.

Succession Planning and Your Single-Member LLC

2009-12-21T14:02:00.000-08:00

Eileen Reichenberg Sherr, CPA, M. Tax., AICPA, Washington, DC, and David E. Boyle, CPA, MBA, Ernst & Young LLP, Seattle, WA published the following:

In a split 10-6 decision, the Tax Court ruled in favor of a taxpayer that the check-the-box (CTB) regulations do not apply for purposes of valuing the transfer of property held through a single-member limited liability company (LLC) for federal gift tax purposes; rather, the CTB regulations govern how the entity will be taxed for federal income tax purposes (Pierre, 133 T.C. No. 2 (2009)). Under this holding, the CTB regulations (Regs. Secs. 301.7701-1 through -3) should not be applied to disregard an LLC in determining the nature of the property that is being transferred by the donor for purposes of the federal gift tax. Instead, the transfer of an ownership interest in a single member should be recognized as a transfer of an interest in an entity separate from its owner for federal gift tax valuation purposes and not as a transfer of the underlying assets in the LLC.

Under the facts of the case, the Tax Court held that the CTB regulations did not, for federal gift tax purposes, transform donations and sales of interests in a single-member New York LLC into transfers of the underlying cash and marketable securities in that LLC. The court determined that state law--rather than federal tax law--determines the nature of a taxpayer's transferred ownership. For example, because New York state law recognizes the entity as being separate and apart from its owner, the transferred LLC ownership interests were subject to discounts for lack of control and lack of marketability, rather than being valued as direct transfers of undiscounted, proportionate shares of the LLC's assets.

The Tax Court decision did not specifically address the computation of an appropriate valuation discount. In reaching its decision, the majority noted that the CTB regulations provide that they are to apply for "federal tax purposes." The IRS argued that the regulations do not limit the application of the rules to the federal income tax. The Tax Court rejected the IRS's argument, noting that the courts have consistently held that state law creates the legal interests and rights that are to be valued for purposes of federal gift and estate tax.

Implications

In holding that a single-member LLC is not disregarded as an entity separate from its owner for federal gift tax purposes, the decision has broad-ranging implications for state transfer tax and international estate planning, in addition to gift and estate tax valuation considerations. For example, the decision supports the position that for state estate and inheritance tax purposes where property is held through a single-member LLC, the asset potentially subject to tax should be the LLC interest (intangible property) and not the property held by the LLC. With respect to international estate planning, the decision suggests that a nonresident alien could use a foreign disregarded entity to hold U.S. property and avoid U.S. gift and estate taxes on what would otherwise be taxable U.S. situs property. The decision can also be read as contrary to the lookthrough approach that the IRS applies in determining the estate and gift taxation of partnership interests held by nonresidents. Note that the decision may be appealed by the IRS (to the Second Circuit), or the IRS could choose to address the decision by amending the CTB regulations.

What does this mean for your LLC? When you are planning your estate, be sure to consult with an attorney who understands both state and federal estate and income tax implications of single-member LLC's.

And remember, the attorneys at Shoffner & Associates are always here to help.

Call us at 617-369-0111 or write to us at fashoffner@shoffnerassociates.com.

Copyright? Who Cares? You Do!

2009-12-03T14:54:00.000-08:00

Imagine that you are doing your usual internet browsing and notice an image that looks just perfect for your business’ Web site. So, you copy it and paste it onto your site, with no other thought. Then, weeks, maybe months later, you receive a demand letter, asking for thousands of dollars in damages for use of the image.

You did not intend to do anything wrong. But did you?

Most likely, yes, even if you did not intend to do anything wrong. You have committed copyright infringement, which occurs when one of a copyright owner’s exclusive rights is violated.

Because copyright infringement is a strict liability violation, it is possible to be liable even if you had no knowledge that an infringement occurred (“anyone who violates any of the exclusive rights of the copyright owner” is liable; 17 U.S.C. §501(a) (1994)). This means that, even if you thought the image was perfectly free to use, you are liable. And, liability can be expensive.

Also, even if you stop using the image after you determine that it was owned, you are still liable for the time frame where you used the image unauthorized.

The best defense to this type of situation is first to determine if the image is in fact registered with the copyright office. Statutory damages and attorney’s fees can only be awarded if the registration was filed before the infringement or within 3 months after the first publication of the work (17 U.S.C. §412). If the image is not registered, then the likelihood of damages being awarded is slim.

Of course, the best advice I can give in this situation is to avoid it all together. Prevention is the best medicine to avoid strict liability copyright infringement.

If you see an image that you wish to use, you must receive permission from the author. Check to see if the image indicates the user privileges and if you must pay to license the image.

Sometimes giving credit to the author may be all that he or she wishes, but you never know. Better to be safe than sorry when it comes to intellectual property ownership.

By Kelly L. Swan Taylor, Esquire

TRADEMARKS WISH YOU HAPPY THANKSGIVING

2009-11-25T14:39:00.000-08:00

As I rake my yard for the 8th time this autumn and search the depths of the freezer aisle for the “perfect bird” my thoughts naturally move toward this upcoming Thursday morning. I usually wake up at the crack of dawn to prepare for a day of cooking and entertaining, and therefore find much comfort in the nostalgia of the Macy’s Thanksgiving Day Parade. I love the floats, the waving flags, and who couldn’t love those Broadway show tunes?

The Macy’s parade starting in 1924, by first generation immigrants, who were employed by the corporation. The store workers created the parade themselves, to show appreciation for their new country (certainly a great sentiment to carry on during this time of year). The logo, noted above, was registered by Macy’s (Federated Department Stores), in 1998, and is used exclusively in relation to the Thanksgiving Day Parade.

Of course I did not ask Macy’s permission to mention their logo and parade. So, how is it possible for me to discuss and show the parade’s mark? The simple answer is that I am utilizing a provision in the Lanham Act, called Fair Use ( “reasonable and good faith use of a descriptive term that is another’s trademark to describe rather than to identify the user’s goods, services, or business”).

Basically, I am using this mark purely for description and identification purposes. I am not using it in a suggestive way, or with respect to sponsorship or association with the mark’s owner’s product or services. Now, if I was trying to sell you a Macy’s parade T-shirt, I might be I a bit of trouble. But, as much as I enjoy the parade, my intent is not to use the mark for any unauthorized activities.

So, as you sit down to watch the parade in a few days, you may want to give some thought to how hard Macy’s and its employees have worked to move this parade from a simple employee event, to a national icon and registered trademark.

Posted by Attorney Kelly L. Swan Taylor

In Selling Your Business, Cash Flow is Everything.

2009-11-16T11:59:00.000-08:00

People often ask me how much their business is worth. The answer is: you probably won't be able to sell your business for more than five times the true cash flow of your business.

What is Cash Flow?
Actually, there are several ways to measure the amount of money that flows in and our of your business; and each one differs in important ways from the others. Here are some typical measurement methods.

EBIT: That is: Earnings Before Interest and Taxes. EBITis calculated by subtracting the company's "operating expenses" from its "operating income." Operating expenses are your ongoing costs such as sales and administration, or research and development, as opposed to production costs. The operating expenses for a real property management venture would be:

* accounting expenses
* license fees
* maintenance and repairs, such as snow removal, trash removal, janitorial service, pest control, and lawn care
* advertising
* office expenses
* supplies
* attorney fees and legal fees
* utilities, such as telephone
* insurance
* property management, including a resident manager
* property taxes
* travel and vehicle expenses

Of course, using EBIT does not give your prospective buyer the whole picture because it excludes the businesses production costs, which might be substantial.

EBITDA: This is an acronym for "Earnings Before Interest, Taxes, Depreciation and Amortization" and, while it is frequently used as a means for valuing a business, it is not truly a measure of cash flow. It is actually a way to calculate operating profitability before non-operating expenses (such as interest) and non-cash charges (such as depreciation and amortization) are deducted. The problem is that taking out what can be really big expenses, such as interest and taxes can make even money-losing ventures look healthy on paper. Also, these figures are very easy to manipulate. Some good examples of companies that fell into this category were found in the "dotcoms" of ten years ago. They had no hope of every showing their shareholders a dividend, but they became very popular investments based on EBITDA figures.

True Cash Flow or Operating Cash Flow: This is the amount of pre-tax money that is actually distributed to the owners. It allows for the deduction of the big expenses including depreciation and amortization, as well as changes in working capital that either use or provide cash to the operations. The amount distributed includes salary, bonus, distributions, and rental payments that are in excess of the fair market rental values for the equipment and/or buildings used by the business.

You can see that each of these forms of measurement will produce a different cash flow amount, and therefore a different sale price for your business. The challenge for a business owner is to understand the true value of the business and to set a realistic asking price. By taking time to do a careful analysis of your True Cash Flow before you begin to think about your asking price, you are building the foundation for a successful, and profitable sale. Of course, to manage a truly successful sale of your business, you should rely on the advice of competent professionals including your tax accountant and your attorney. Feel free to call us (617-369-0111) or write fashoffner@shoffnerassociates.com.

2009-11-13T08:41:00.001-08:00

One of the most common questions I hear is "what do I have to keep for the IRS?" Visit http://ping.fm/arL2x to find out.

Energy Credit Advantages

2009-11-04T14:32:00.001-08:00

Here's the latest update from the IRS on homeowner energy tax credits.

Expanded Recovery Act Tax Credits Help Homeowners Winterize their Homes, Save Energy; Check Tax Credit Certification Before You Buy, IRS Advises

Home Energy Video: English | Spanish | ASL

Audio File for Podcast: English | Spanish

Video: Money in Your Pocket

IR-2009-98, Oct. 29, 2009

WASHINGTON — People can now weatherize their homes and be rewarded for their efforts. According to the Internal Revenue Service, homeowners making energy-saving improvements this fall can cut their winter heating bills and lower their 2009 tax bill as well.

The American Recovery and Reinvestment Act (Recovery Act), enacted earlier this year, expanded two home energy tax credits: the nonbusiness energy property credit and the residential energy efficient property credit.

Nonbusiness Energy Property Credit

This credit equals 30 percent of what a homeowner spends on eligible energy-saving improvements, up to a maximum tax credit of $1,500 for the combined 2009 and 2010 tax years. The cost of certain high-efficiency heating and air conditioning systems, water heaters and stoves that burn biomass all qualify, along with labor costs for installing these items. In addition, the cost of energy-efficient windows and skylights, energy-efficient doors, qualifying insulation and certain roofs also qualify for the credit, though the cost of installing these items does not count.

By spending as little as $5,000 before the end of the year on eligible energy-saving improvements, a homeowner can save as much as $1,500 on his or her 2009 federal income tax return. Due to limits based on tax liability, other credits claimed by a particular taxpayer and other factors, actual tax savings will vary. These tax savings are on top of any energy savings that may result.

Residential Energy Efficient Property Credit

Homeowners going green should also check out a second tax credit designed to spur investment in alternative energy equipment. The residential energy efficient property credit, equals 30 percent of what a homeowner spends on qualifying property such as solar electric systems, solar hot water heaters, geothermal heat pumps, wind turbines, and fuel cell property. Generally, labor costs are included when calculating this credit. Also, no cap exists on the amount of credit available except in the case of fuel cell property.

Not all energy-efficient improvements qualify for these tax credits. For that reason, homeowners should check the manufacturer’s tax credit certification statement before purchasing or installing any of these improvements. The certification statement can usually be found on the manufacturer’s website or with the product packaging. Normally, a homeowner can rely on this certification. The IRS cautions that the manufacturer’s certification is different from the Department of Energy’s Energy Star label, and not all Energy Star labeled products qualify for the tax credits.

Eligible homeowners can claim both of these credits when they file their 2009 federal income tax return. Because these are credits, not deductions, they increase a taxpayer’s refund or reduce the tax he or she owes. An eligible taxpayer can claim these credits, regardless of whether he or she itemizes deductions on Schedule A. Use Form 5695, Residential Energy Credits, to figure and claim these credits. A draft version of this form is available now on IRS.gov.

Happy Halloween From Attorney Taylor

2009-10-30T12:13:00.000-07:00

As Halloween is fast approaching, my thoughts go to countless amounts of chocolate and treats. So, in honor of this cavity-induced holiday, I thought it would be a perfect time for a tasty trademark issue, even if it is about bunnies, and not pumpkins.

The issue involves whether a chocolate bunny can in fact be trademarked.

Currently, Switzerland’s Lindt & Sprungli are battling chocolate maker Hauswirth of Austria over the gold-wrapped chocolate rabbits, with ribbons around their necks that we all know so well. In 2001, Lindt received a trademark on the three-dimensional shape of its bunny. Following its trademark ruling, Lindt went into full-scale legal attack on many companies which make similar-looking items.

Hauswirth has stayed its ground and questioned the trademark’s validity, arguing that Lindt’s trademark was granted in bad faith (“bad faith” occurs when the applicant knew that identical or similar products already existed in other parts of the European Union, or if the applicant intended to prevent other companies from selling such products).

Historically, three-dimensional trademarks have been surrounded by a slew of controversy. There have been similar problems with chocolate bars, bars of soap, and even Lego toy blocks. And while Americans and Europeans allow logos, graphics, words, and even shapes (in theory), to be trademarked, courts have been hesitant to go down the three-dimensional route. Trademark law does not allow a three-dimensional shape to be registered if the shape is functional. In support of its mark, Lindt says its bunny deserves a chance, and that it is quite complicated to manufacture, citing considerations of structural integrity and high-speed foil wrapping devices.

So, what was the ultimate decision in this delectable chocolate-covered fiasco? Well, that is still being decided by Austria’s high court, which must rule on the bad faith issue, specifically when filing the application for trademark, the relevant factors to consider are:

--the fact that the applicant knows or must know that a third party was using an identical or similar sign for an identical or similar product cable of being confused with the sign for which registration is sought;

--applicant’s intention to prevent that third party from continuing to use such a sign;

--the degree of Legal protection enjoyed by the third party’s sign and by the sign for which registration is sought.

So, before we peel off those foil and plastic wrappers from all those tiny little candies, perhaps we should give a thought to what is inside and how it got there. And perhaps maybe we will get a decision on that very thing just in time for the Easter Bunny.

Kelly L. Swan Taylor, Esq.

Help For Non-Profits From The IRS -- Really.

2009-10-19T15:07:00.000-07:00

I'm always on the lookout to see what the IRS has to say on issues that affect my clients. And, now the IRS has a video that is designed to help not-for-profit corporations understand the new Form 990 requirements. I've found that when my not-for-profit clients understand what will be required come filing-time, it is much easier for them to manage their bookkeeping functions so that they can work most effectively and efficiently with their accountants.

In addition to the video series,you can read a case study about getting started with the new 990, and there is even a five-part interactive course on how to stay exempt. Of course, the IRS' site for charities is always a great resource.

All of us at Shoffner & Associates are committed to helping each of our not-for-profit clients keep their financial and tax operations functioning smoothly and efficiently so that you can focus on what is really important -- Helping. We are always ready to answer your questions and to lend a hand. Call us. Write to us. Visit our website: shoffnerassociates.com.

Here's what the IRS published just last week:

New Video Series Helps Exempt Organizations Understand Redesigned Form 990 Requirements

IR-2009-92, Oct. 14, 2009

WASHINGTON — The Internal Revenue Service has launched a new case study and video program to help exempt organizations and their tax preparers better understand the newly revised Form 990 series which must be filed for the 2008 tax year.

The Form 990 series, redesigned for the first time in nearly 30 years, requires more disclosure and transparency by exempt organizations. With some exceptions, organizations that are exempt for federal taxation are required to file the Form 990 information return. The additional information will give the IRS and the public a better view of how the exempt organizations work, especially in terms of expenditures and executive salaries.

To help illustrate key points and answer important questions about the new Form 990, the IRS’ Exempt Organizations Division developed “The New Form 990: Getting Started,” a case study about a hypothetical organization – Exempt Organization for Disaster Relief (EODR).

The hypothetical case study includes a set of facts describing organizational and financial aspects of EODR, and a completed Form 990 based on those facts. A video series walks you through key reporting issues common to most organizations required to file Form 990.

Before starting the videos, people should read the hypothetical EODR case study and review the example Form 990. The series of videos, each between five and ten minutes long, cover a key area of the Form 990, using facts from the case study.

The videos are listed in an order based on the sequencing list found on page 5 of the Form 990 instructions. However, they can be viewed in any order. Included in the video series are:

Overview
This video is a good place to start for people who have questions about the redesigned Form 990. It looks at some of the key things to consider about the Form 990 and the various schedules that exempt organizations may need to complete, particularly Schedule R.
Revenue and Expenses
This segment covers two of the financial statement portions: Part VIII, Statement of Revenue, and Part IX, Statement of Functional Expenses. It looks at how to fill out the required columns of information for revenue and expenses.
Balance Sheet, Supplemental Financial Statements, and Schedule D
This video, reviews Part X of the Form 990, the Balance Sheet, and Part XI, which covers Financial Statements and Reporting. It explains some differences between the redesigned and previous version of Form 990. It also focuses on parts of Schedule D, Supplemental Financial Statements.
Program Services, Other IRS Filings and Tax Compliance
This video focuses on Part III, which allows an organization to “tell its story” and describe its program services, and Part V, which covers other IRS filings and areas of tax compliance. Part V will alert organizations if they have other filing obligations besides the Form 990 and will help them to determine if they engage in activities that raise tax compliance concerns.
Compensation
This segment reviews the Form 990 compensation reporting in Part VII. It explains who needs to be listed in Part VII and explains the three types of compensation to report. It also highlights Schedule J, the compensation continuation schedule.
Governance
This segment describes how to complete Part VI of the redesigned Form 990, which requests information about the organization’s governing body, management, policies and procedures and disclosure practices. It also focuses on Schedule L, which requests information on transactions with interested persons, such as directors, officers, key employees and their family members.
Summary, Schedules, Signatures
This segment covers Parts I, II and IV of the Form 990—Summary, Signature Block and Checklist of Required Schedules. It also provides an overview of several new schedules to the Form 990.

“The New Form 990: Getting Started” is only one of the online resources the IRS offers for 990 filers. There is a five-part interactive course at www.stayexempt.irs.govand a series of 990 filing tips, plus the 990 form, schedules and instructions at www.irs.gov/charities.

Small Business Retirement Plans... Simplified

2009-10-16T08:50:00.000-07:00

For most of my small business and professional clients, establishing and maintaining a company retirement plan is a major pain. To make things easier, the IRS created a tool that should help. Here's what the IRS Newsroom has to say:

New IRS Retirement Plan Navigator Aims to Help Small Businesses

IR-2009-91, Oct. 13, 2009

WASHINGTON — The Internal Revenue Service has created a new Web-based tool to help small business owners determine which tax-favored pension plan best suits their needs and how to keep their plans in compliance.

The IRS Retirement Plan Navigator is intended to provide employers with an easy-to-use guide that focuses on three areas: choosing a plan, maintaining a plan and correcting a plan.

By using the navigator, employers may find that choosing and maintaining a pension plan is not as daunting as they thought. Some plan types are less costly and easier to establish than others.

The navigator does not suggest which plan may be best for a specific employer but it does lay out the options to allow them to choose one that best fits their situations. The navigator includes a side-by-side comparison of pension plans and their requirements.

The navigator provides a checklist and suggested resources for maintaining compliance. Pension laws change frequently. Employers can minimize problems by doing a once-a-year review to ensure they maintain compliance.

The IRS also recognizes that mistakes can be made unintentionally, and many errors can be corrected without notifying the agency. The navigator offers suggested options to employers seeking to correct errors and bring their plans back into compliance.
Although the Retirement Plan Navigator is aimed at small business owners, it also can help mid-size businesses review their options as well. Individuals who want to better understand their employer’s plan may also find it of use.

The Web-based guide will be kept up to date as pension laws and regulations change.

And, as always, our attorneys are ready and able to help you make the most of every tax advantage. Call us --- anytime.

Non-Compete Agreements Clearly Not Dead In Massachusetts

2009-09-28T11:32:00.000-07:00

In the current state of the economy, receiving an employment offer may seem like the best news that could be delivered, especially once you finally receive the offer officially in writing. However, that moment could certainly be diminished by a contract provision, carefully crafted and positioned within the document that could significantly affect your future, even past this current employment. That provision is called a non-compete clause.

A Non-compete clause or covenant not to compete (CNC), is used when one party (usually an employee) agrees not to pursue a similar profession or trade in competition against another party (usually the employer), and usually requiring a reasonable geographic restriction and timeframe. Most states legally allow these contract provisions, including Massachusetts. California is one state that completely prohibits the use of them, except in limited circumstances (for instance, in the sale of the business).

Therefore, largely based upon what some call non-compete “abuse” by employers, Massachusetts’ Representative William H. Brownsberger introduced legislation (H. 1794) that called for the prohibition of non-compete agreements, except in limited circumstances (similar to the California law). Of course, this has lead to many discussions regarding the danger of these agreements and whether they diminish labor mobility or innovation within the market. This is certainly a concern for those professionals who wish to strike out on their own and form start-up companies, only to find out that they are restricted or subject to tremendous litigation fees from their efforts.

Rep. Brownsberger’s bill seemed to be generating enough momentum and support for his bill, that many thought these agreements might finally be dead in Massachusetts. However, this summer, Rep. Brownsberger seems to have backed-down a bit from his strict stance and joined with Rep. Lori Ehrlich to draft a new, compromised bill, that is not as restrictive on these agreements. Surprisingly, the bill introduces many features that some say may make these agreements even MORE prevalent, including the use of presumptive reasonableness within the endorsed parameters. Consequently, if the legislation so clearly and particularly outlines what is considered reasonable, then drafting these provisions will be essentially easy for the employers, and will further promote them (the exact opposite a result that Rep. Brownsberger intends). We will have to wait to see how the legislature ultimately votes on this issue this fall.

So, what is the ultimate lesson to be learned here? First, Non-compete agreements are not things to be ignored, when looking over your contract. You would be advised to have a reputable attorney look over your agreement, to determine if it is reasonable and suits your needs. Second, remember that non-competes are still fully alive in Massachusetts, until further notice, and could significantly affect your employment prospects in the future. And in today’s economy, no one wants to be left out in the cold when it comes to the future of his or her employment.

By Attorney Kelly L. Swan Taylor

IRS Update On Record Keeping

2009-09-22T11:07:00.000-07:00

One of the most common questions I receive from my clients is "what do I have to keep for the IRS?" And, as you know, I'm always on the lookout for information from the IRS that will help my clients. In a recent IRS update, the authors answer this perpetual question, and I thought you'd be interested.

What kind of records should I keep?

You may choose any recordkeeping system suited to your business that clearly shows your income and expenses. Except in a few cases, the law does not require any special kind of records. However, the business you are in affects the type of records you need to keep for federal tax purposes. Your recordkeeping system should also include a summary of your business transactions. This summary is ordinarily made in your business books (for example, accounting journals and ledgers). Your books must show your gross income, as well as your deductions and credits. For most small businesses, the business checkbook is the main source for entries in the business books.

Supporting Business Documents

Purchases, sales, payroll, and other transactions you have in your business will generate supporting documents such as invoices and receipts. Supporting documents include sales slips, paid bills, invoices, receipts, deposit slips, and canceled checks. These documents contain the information you need to record in your books. It is important to keep these documents because they support the entries in your books and on your tax return. You should keep them in an orderly fashion and in a safe place. For instance, organize them by year and type of income or expense. For more detailed information refer to Publication 583, Starting a Business and Keeping Records.

The following are some of the types of records you should keep:

Gross receipts are the income you receive from your business. You should keep supporting documents that show the amounts and sources of your gross receipts. Documents for gross receipts include the following:
- Cash register tapes
- Bank deposit slips
- Receipt books
- Invoices
- Credit card charge slips
- Forms 1099-MISC
Purchases are the items you buy and resell to customers. If you are a manufacturer or producer, this includes the cost of all raw materials or parts purchased for manufacture into finished products. Your supporting documents should show the amount paid and that the amount was for purchases. Documents for purchases include the following:
- Canceled checks
- Cash register tape receipts
- Credit card sales slips
- Invoices
Expenses are the costs you incur (other than purchases) to carry on your business. Your supporting documents should show the amount paid and that the amount was for a business expense. Documents for expenses include the following:
- Canceled checks
- Cash register tapes
- Account statements
- Credit card sales slips
- Invoices
- Petty cash slips for small cash payments
Travel, Transportation, Entertainment, and Gift Expenses
If you deduct travel, entertainment, gift or transportation expenses, you must be able to prove (substantiate) certain elements of expenses. For additional information on how to prove certain business expenses, refer to Publication 463, Travel, Entertainment, Gift, and Car Expenses.
Assets are the property, such as machinery and furniture, that you own and use in your business. You must keep records to verify certain information about your business assets. You need records to compute the annual depreciation and the gain or loss when you sell the assets. Documents for assets include the following:
- When and how you acquired the assets.
- Purchase price
- Cost of any improvements.
- Section 179 deduction taken.
- Deductions taken for depreciation.
- Deductions taken for casualty losses, such as losses resulting from fires or storms.
- How you used the asset.
  When and how you disposed of the asset.
- Selling price.
- Expenses of sale.
The following documents may show this information.
- Purchase and sales invoices.
- Real estate closing statements.
- Canceled checks.

Employment taxes
There are specific employment tax records you must keep. Keep all records of employment for at least four years. For additional information, refer to Recordkeeping for Employers and Publication 15, Circular E Employers Tax Guide.

References/Related Topics

Recordkeeping

Sell Your Business To An Insider – With Proper Planning You’ll Both Win.

2009-09-14T10:10:00.000-07:00

Whether your succession plan includes a sale to a third party, or to an insider, there are significant risks involved. Selling your business to someone on the inside is usually safer than selling to a stranger. And, when you and your skilled advisors execute a carefully designed and implemented sale to an insider you can reduce the risk most significantly.

Let’ look at some steps that you and your professionals can take.

Take Your Time. You and your buyer will need between 3 and 8 years to plan, implement and pay for the transfer of your company. No Kidding. If you don’t have that kind of time – or you don’t want to take that time, work with your advisors to design a different type of exit strategy.

Learn. This is no time to make things up as you go along. Choose professionals – an accountant and a lawyer among others – who know the ins and outs of company transfers. Look for networking groups and seminars that will boost your know-how. Beware of learning just enough to be dangerous. Make the commitment to become an expert.

Build Your Cash Flow. When you transfer your business to an insider, the company’s cash flow will be—at least at the beginning—the only source of the money that you will receive. Really, it is like paying a no-show employee. If you business can’t generate the cash now to pay an absent, highly compensated employee, then you have some serious work to do before you make that transfer.

Maximize Your Value Drivers. Evaluate these 8 key factors because your inside buyer can only succeed if the business’ value keeps growing:

1. Your Customer Base. What is their buying trend? How much of your customer base is junk? What is their buying trend over the last five years? How many new customers have been acquired annually over those same five years? How stable is that customer base? What vulnerabilities exist?

2. Your Recurring Revenue. Your repeating revenue is much more valuable than your one-time sales. Build those repeat sales.

3. Your Product Line. Is it varied? Is it well integrated? Are your products complimentary and competitive?

4. Your Gross Margin. That’s the most important line item on your Profit & Loss.

5. Your Intellectual Property. That includes your patents, trademarks, and copyrights but it also includes things like a unique way to generate sales leads, or an effective way to close Internet sales. What do you know that your competitors don’t? That’s Intellectual Property and it can help your inside buyer be successful.

6. Your History and Your Reputation. This is also known as “good will.” If your company has a great reputation with customers, competitors, and the community, your buyer has a better chance of success and you have a better chance of getting paid.

7. Your Sales and Marketing Effectiveness. Are you using the same old sales strategy that you put in place in 1983? That won’t help your inside buyer. Make sure that your marketing techniques are state-or-the art. Check those close ratios – is your sales force still the super team that it was five years ago? If so, make it better.

8. Your Ability To Fight The Competition. The longer your inside buyer can hold off the competition, the more likely the business is to succeed long after you’ve gone. What are your products true advantages? Do you have a big technical edge? Build your stash of secret weapons.

Make Yourself Expendable. If you’re going to sell to an insider, your buyer should be better at what you do -- than you are. Not only that, but they must be ready, able, and hungry to take on the debt necessary to own the company themselves.

Define Your Goals. Know what your really want, and what you won’t settle without. When your plan is properly designed, your goals will be met before you make the transfer. Write down what you want, and think about these:

· Financial Security

· A set “walk away date”

· Keeping the company legacy

· Rewarding your key people

· Using someone else’s money to bring the company to the next level.

Keep Taxes To A Minimum. You must structure the sale to make sure that the company’s tax in cash flow is kept to a minimum. Otherwise, your buyer is effectively taxed twice. If you do it right, you can save about 1/3 of the company’s cash flow, which increases your chances of getting paid.

Transfer Ownership One Step At A Time. Make sure that you stay in – or near—the driver’s seat until you’ve received the entire sales price. Maintain voting and operational control and shift the risk the new owners. That way, if performance falters, or the new owners decide to throw in the towel, your company will survive.

Write It Down. Once you’ve thought through your plan, you need to write it clearly and communicate it to your eventual owners. Otherwise, nobody will take it seriously. Also, and more importantly, the written plan is what you and your professional advisors will use to coordinate what you do to make your plan a reality. When you include a time line in your plan, you are even more likely to see it succeed.

Don’t Forget To Dream. Every once in a while, sit back and imagine how wonderful it will be when you successfully transferred the business that you started to the next generation. What a success!

Is It Time To Sell Your Business?

2009-09-03T08:40:00.000-07:00

Think Before Your Sell... An Insider Might Be Your Best Buyer.

So many of our business-owner clients build their exit strategy around selling their business to an independent third party. They think that they’ll obtain more cash from a third party and that the sale will be less risky.

Often, they are completely wrong.

Third Party Sales Can Be Risky.

Of course, if you can get your price from an outsider and payment in full in cash at the closing, and if you have no time to make a carefully structured sale to an insider, then the third-party sale is the less-risky choice.

Many Companies Aren’t Appropriate For All-Cash Sales.

To be a good candidate for an all-cash sale, your company must:

* have more than $1 million (or even $2 million) in EBITDA;
* be in a attractive market sector;
* have strong fundamentals; and
* enjoy a unique competitive advantage;

Otherwise, you just aren’t a likely candidate for a sale to a third party, and it won’t be reasonable to expect cash.

It Can Be Hard To Find a Third-Party Buyer.

Every sale requires a buyer. We’re in the middle of a tough time for business, so unless your company is in an attractive market sector, such as power, alternative energy, health care, medical services, or healthy-living products, prospective buyers will be in short supply. These days if your in the business of construction, retail, real estate, automotive, or consumer products you may will find it impossible to attract an outside buyer.

The Longer Your Wait, The Riskier It Gets.

What will you do if:
* A qualified buyer doesn’t show up?
* What happens if,
** your industry niche has fallen out of favor; or
** your sales drop of; or
** the economy is in decline or worse?

A Carefully Structured Insider Sale Puts You In Control.

You can:
* Choose your buyer;
* Name your price;
* Control ownership until you are paid in full; and ,
* Shift the responsibility for performance to someone else.

Do Take Time To Plan.

Selling your business to someone inside the business takes some work, some time and careful planning. Although insiders may not have the ready cash right now, you can still sell profitably when:
* your company has a good management team
* your company has good cash flow; and,
* you allow plenty of time before leaving to make your exit plan work.

Work With Experts.

The best exit strategies are implemented with the help of a knowledgeable attorney and an informed accountant. As soon as you start your business, you should be planning your successful exit. Let your advisers show you how to do it right. Call us today. 617-369-0111.

7 Hot Tips From the IRS

2009-07-22T13:49:00.000-07:00

As the economy slows, there are more and more opportunities to start a new business. However, many new businesses fail because they don't keep up with all of the IRS' regulations. Following is excerpted from the IRS' website, and it is a great guide for anyone considering starting a new business.

IRS Summertime Tax Tip 2009-02

Anyone starting a new business this summer should be aware of their federal tax responsibilities. Here are the top seven things the IRS wants you to know if you plan on opening a new business this year.

First, you must decide what type of business entity you are going to establish. The type your business takes will determine which tax form you have to file. The most common types of business are the sole proprietorship, partnership, corporation and S corporation.
The type of business you operate determines what taxes you must pay and how you pay them. The four general types of business taxes are income tax, self-employment tax, employment tax and excise tax.
An Employer Identification Number is used to identify a business entity. Generally, businesses need an EIN. Visit IRS.gov for more information about whether you will need an EIN. You can also apply for an EIN online at IRS.gov.
Good records will help you ensure successful operation of your new business. You may choose any recordkeeping system suited to your business that clearly shows your income and expenses. Except in a few cases, the law does not require any special kind of records. However, the business you are in affects the type of records you need to keep for federal tax purposes.
Every business taxpayer must figure taxable income on an annual accounting period called a tax year. The calendar year and the fiscal year are the most common tax years used.
Each taxpayer must also use a consistent accounting method, which is a set of rules for determining when to report income and expenses. The most commonly used accounting methods are the cash method and an accrual method. Under the cash method, you generally report income in the tax year you receive it and deduct expenses in the tax year you pay them. Under an accrual method, you generally report income in the tax year you earn it and deduct expenses in the tax year you incur them.

Visit the Business section of IRS.gov for resources to assist entrepreneurs with starting and operating a new business.

Uncertainty Breeds Inaction

2009-05-29T11:36:00.000-07:00

You're not the only prospect we meet who is facing uncertainty. Quite a few prospective clients meet with us. We hear their concerns, what they want created, and what they want resolved. We see the pain in their faces when they arrive and understand the challenges that they face.

If you need, or even think you need legal assistance, the worst thing you can do is hesitate. My high school basketball coach taught his team the English proverb, "He who hesitates is lost."

This is no time to hesitate. If you're seeking legal assistance with a small business, tax, or estate planning matter, call Sue and request an appointment at your earliest convenience.

Even if you decide to go with the "other guy" you'll leave our office knowing we heard you and that we'll be glad to see you next time too.

Glenn Biggs
Paralegal

DIY Divorce -- Will It Work For You?

2009-03-21T11:13:00.000-07:00

"DIY Divorce" - In the news recently on The Boston Globe's website boston.com.
Author: Meredith Goldstein
Link: http://boston.com/lifestyle/relationships/articles/2009/03/18/diy_divorce/

In the article, Attorney Steven Ballard stated, "[t]he reality is that people can represent themselves in many cases," Ballard says. "It's been my practice to tell clients . . . they can handle the divorce themselves. If there are little in the way of assets to divide, if there are no children, there's no reason people shouldn't go into court and grab the papers themselves." Ballard recommends the book "How to File for Divorce in Massachusetts" by Sharyn T. Sooho and Steven L Fuchs.

Our firm generally agrees with Attorney Ballard. Certain couples can handle their divorce on their own -- pro se. However, we've seen far more situations where couples attempt to work out their divorce on their own and end up with more problems than they knew they had to begin with. Often these couples end up spending far more than they would have if they had sought professional advice at the outset.

If you are considering donning your DIY divorce tool belt consider these factors first:

1) Are you generally able to communicate rationally with each other?

2) Do you agree on how your assets and debts will be divided?

3) Do you agree on whether one of you will need spousal support and, if so, how much?

4) Do you agree on who will be the primary caregiver for the children?

5) Do you agree on how and when each of you will spend time with the children?

6) Do you agree on how much each of you will contribute to supporting the children?

7) Do you agree on which partner will be responsible for providing health insurance for the other and for the children?

If you answered "no" to any one of these questions, then you should seek professional advice before you begin the divorce process. An experienced attorney can help you identify several solutions and obtain the most fair and equitable settlement possible.

Our attorneys and staff understand your need to conserve funds. But remember, divorce is difficult and painful. Sometimes, it's best for you to hand off the hard parts so that you remain focused on you.

If you are contemplating a divorce or separation, find out what you need to know before you begin. Simply contact us at OMG@askfreya.com

Submitted by Glenn Biggs, paralegal.

Our Paralegal Explains Honest Responsibility

2009-03-07T11:08:00.000-08:00

Honest responsibility"

I found this term in the March 6, 2009 issue of The Wall Street Journal. Peggy Noonan covers the crash of a Marine F/A 18 Hornet into a San Diego neighborhood in:

"Wall Street Could Learn From the Marines About Accepting Responsibility"

Our proud and now grief-stricken Marines take it upon themselves to get to the bottom of the crash and the civilian deaths it caused. The investigation laid bare each involved person's role, decisions, and outcome of those decisions. So thorough was the Marine investigation, a rapidly-formed group intent on obtaining an investigation disbanded nearly immediately once the investigation's results were aired with it's leader stating "I think we're out of business.

The article's link to our firm is the thoroughness Ms. Noonan calls "honest responsibility". At Shoffner & Associates, this quality is included for every client and every project.

Honest responsibility is a perfect description of what you will receive when you entrust us with your project.

Glenn Biggs, Paralegal

Attorney Taylor Weighs In On Trademarks

2009-03-05T06:55:00.000-08:00

So, exactly what is a trademark and what is the importance of registering it?

A trademark is actually the face of your organization or company. It could be a logo, drawing, or even just the name that you want associated with your business. It could be in black and white or color, with any font you wish. Most importantly, it describes your organization or business, and distinguishes it from all those in the marketplace.

But what is the big deal about registering it in the first place? It is actually so important that you cannot afford not to register it. In the age of instant access to the Internet, even owning a Web site allows more individuals to view and access your organization's information.. and steal it. And this can happen even if you have been using your mark for a long time and then finally decide to register it.

Take the recent case of one of my clients. He had been using his mark for many years and finally decided to register his mark when when he saw some similar marks on other Web sites. It looked seemingly simple. He wanted to register a mark with his own name. However, it turned out that someone else, with a completely different product, beat us to the punch. And they were not even using the name in commerce. But because of trademark law, the other mark had priority, to even use my client's NAME, because the other mark was filed first!

So, the lesson to be learned here is that a trademark filing is of the utmost importance. It can save you a lot of time and money -- and your business's reputation in the long run.

Happy filing!
Kelly L. Swan Taylor, Esq.

Small Business Profit in 2009

2009-02-15T13:55:00.000-08:00

The election has come and gone. Still, news on the economic front is grim. Big business is laying off workers by the thousands. How on earth can a small business survive?

I strongly believe that this is a great time for small businesses to lay the foundation for a profitable 2009. It isn't too late. In fact, this is just the right time.

Start by thinking a bit about the Japanese management theory of Kaizen. The key to Kaizen is to strive for continuous improvement through all the aspects of life. When applied to business, practicing Kaizen means to focus on activities that will constantly improve all of the functions of your enterprise.

Take a hard look at your business and make a list of everything that is working well. Then take a harder look and make a list of everything that needs improvement.

Now, ask yourself a question. When was the last time you and your management team wrote up a business plan? If you have a business plan, when was the last time you reviewed it and revised it?

If you haven't written a business plan, or if the last time you reviewed and revised it was more than a year ago, it's time to do it again. Here are five great reasons why you should write your new business plan now.

1) The business planning process makes you think. It is easy (although painful) to identify what doesn't work in your business. It is another thing completely to figure out how to turn those weaknesses into strengths. The structured thinking required to build a business plan may be just what you need to turn your efforts into profits this year.

2) Writing a business plan will give you a better understanding of all the details that go into running your business well. It may be that by changing just one or two of the details you can begin to build substantial profits this year.

3) Building a comprehensive business plan will make it easier for you to communicate your company's goals and procedures to your management team and to your staff. This will help to improve cooperation and performance.

4) A solid business plan increases your credibility and will help you make a more effective presentation to prospective investors and lenders.

5) Writing your business plan will allow you to remember all that you have achieved and to make a road map to your next successes.

Take this opportunity to turn off the telephone, minimize your email screen, and figure out where you are now, where you are going, and how you will get there. Those are the key elements in business planning, and writing your business plan is the first step in building a pattern of Kaizen -- continuous improvement designed to lead to continuous profit.

The New Equal Pay Bill

2009-02-07T12:55:00.000-08:00

In 2007 the United States Supreme Court ruled that a worker who is a member of a protected class must file a claim of discrimination within 180 days of a company's initial decision to pay him less than another worker doing the same job.

On January 29, 2009, President Obama signed a bill that overturns the Supreme Court ruling. The Lilly Ledbetter Act, is now federal law.

That means each paycheck is a possible instance of discrimination, which extends the limitations period on wage discrimination claims to 180 days beyond the employee's termination date.

Employers -- be sure to review your pay and compensation procedures and records very carefully to ensure that any discrepancies in pay cannot be attributed to discrimination based on age, gender, race, ethnicity, sexual orientation, religion, or disability. And, if you have any questions, don't hesitate to give me a call.

Estate Taxes -- Here To Stay

2009-02-04T10:06:00.000-08:00

President Obama and congressional Democrats want to freeze the estate tax at its current level rather than allowing it to disappear (according to the current law) in 2010. The Senate Finance Committee is expected to move within the next few weeks to reverse the current law, and Mr. Obama should present his estate-tax preservation proposal in his next month's budget.

The Democratic plan is a defeat for the small business groups and others who created and funded the effort to repeal the "Death Tax." While most estate taxes are collected from the "ultra rich", family businesses struggle with it as well and often spend precious time and energy finding ways to minimize the tax so that their businesses can be passed from generation to generation.

None of this news will be a surprise for my clients. Even when the current law was enacted, I was letting people know that the law would expire in 2011 and that, unless Congress acted, the estate tax would revert to the old threshold of $1 million and a rate of 55% (that right, 55% off the top to the federal government -- don't forget at least 3% to the state as well.)

Now that we have an idea about what the current administration expects to do to raise money from estates, it is a good time to review your assets and your estate plan and give some thought as to how you plan to protect what you have and to preserve it for the next generation.

100 Essential Tips For Starting A Successful Business

2009-02-01T16:32:00.000-08:00

Strange as it may sound, it is a good time to start a business of your own. There is plenty of office space and industrial space available at bargain prices, and vendors will be very eager for your business. Another good thing for someone starting out is that there are loads of highly-skilled, energetic, eager people looking for jobs.

So, if you have an idea, the drive, and the know-how don't delay. Start your business today.

But first -- keep these 100 very important factors in mind.

Number One: Ask For Advice. You probably know your business idea inside and out. Whether it is opening your own restaurant or launching your own e-business, you've probably imagined your picture on the cover of "Forbes" hundreds of times. However, you may not know all that you need to know about writing a business plan, or obtaining financing, or managing employees. Be smart -- find some mentors. Join your local Chamber of Commerce, or work through your college alumni network, or find a support group like Score. Score.org is an online group of volunteer business executives who can help you with a variety of start-up issues.

Number Two: Watch Your Funding. It is never easy to find funding for a new business venture, and banks today are more careful about lending money than ever before. Start by writing a strong business plan and by making a very careful assessment of the money you will need to start. Then, review the plan carefully to ensure that it is accurate and realistic. You may find that you have to begin the business on the cash that you can provide yourself -- which can be a big advantage. It will force you to be careful at the start. And, once you can show that you've achieved your initial milestones, you may find that traditional lenders will be more interested in your proposal.

Numbers Three Through One Hundred: Find a Good Lawyer. A good lawyer who has experience with start-ups is a new business' most valuable resource. You can do almost anything yourself, but it is your lawyer who will help you choose the right entity, and who will protect you from overly zealous investors (who will try to take your company away from you in exchange for a little money.) And, your attorney will help you protect your intellectual property and prevent you from running afoul of the IRS. Find an attorney who will work with you on your budget and who can structure the fees to fit your abilities. Using a good lawyer from the start can be the difference between failure and succeeding beyond all of your dreams.

Who Cares About the Uniform Probate Code?

2009-01-31T11:26:00.000-08:00

You Do. Finally, after about twenty years of thinking about it -- Massachusetts adopted the Uniform Probate Code. That means our probate laws will be more like those of other states and that the word "Probate" will be less scary than it used to be. For example:

* You will be able to appoint an estate administrator in 7 days instead of 5 months;
* There will be more protections for beneficiaries of trusts; and,
* More protections for people under guardianship.

Of course, the law isn't effective right now. Some changes will be in place by July of this year, but the entire law won't be in place until July, 2011. Nevertheless, now is a good time to make sure that your estate plan is up to date and to visit your favorite lawyer.