BizLawBuz …. The Power of Know

The relief from the minimum distribution requirements, as outlined in the article below, is welcome news to older folks who don’t need to take the minimum distribution in order to get by. This new requirement is especially timely for those participants who would like the chance to let their retirement plans recover somewhat from the recent market decline before they make further withdrawals.

LeClair L. Flaherty, Esq.
Direct Dial: (248) 893-1402
lflaherty@wrightpenning.com

The original source of this information is from http://www.omf.org/omf/us:

Pension Bill Waives 2009 IRA RMDs

On December 23, 2008, President Bush signed the Worker, Retiree and Employer Recovery Act of 2008. (H.R. 7327). This bill includes a key provision that will waive IRA, 401(k), 403(b) and some other types of required minimum distributions (RMDs) for 2009.

Under the IRS rules, individuals over age 70½ are required to take required distributions each year from their IRAs. For most IRA owners, the distributions are paid out under the following Uniform Table. Payouts equal the balance the previous December 31 multiplied by a factor based upon age. More senior persons must take a larger withdrawal.

Age IRA Approximate Payout
71 3.8%
75 4.4%
80 5.3%
85 6.8%
90 8.8%
95 11.6%

Because the value on December 31 of 2007 was used for RMDs in 2008 and the stock markets declined in late 2008, a number of IRA owners had to take larger distributions than would be expected in normal years. In order to enable individuals to rebuild their IRAs and other qualified plans, Congress has created an “RMD holiday” for 2009. During 2009, individuals may choose to not withdraw any amount even if they are over age 70½. Of course, IRA owners over age 59½ may still voluntarily withdraw without penalty and pay income tax on amounts from an IRA.

Several members of Congress also asked the IRS to make changes for year 2008. Because many individuals had already taken withdrawals in 2008, the IRS declined to make any changes for year 2008. The “RMD holiday” applies only to year 2009.

GiftLaw Weekly Editor’s Note: This provision will be helpful to many persons who are attempting to rebuild their IRA. Hopefully, the markets will also recover in 2009 and IRAs will begin to grow again. While the requirement to take a distribution in 2009 does not exist, it still will be possible for charitably-minded persons to make direct transfers from IRAs to qualified charities in 2009.

These changes, as written about below, effective January 16, 2009, should at least marginally improve the hassle for employers of compliance with the FMLA. In particular, the updated regulations clarify that the burden is on the employee, and not the employer, to give timely notice of a request for FMLA leave.

The updated rules significantly expand the leave rights for military personnel and their families. Employers dealing with currently enlisted personnel, their family members, or with family members caring for soldiers returning from duty need to pay particular attention to these updated requirements.

–Dirk A. Beamer
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From the Manufacturer & Business Association

DOL Issues Final Family, Medical Leave Changes

November 17, 2008

Society for Human Resource Management
November 2008
By Bill Leonard, Senior Writer

After more than two years of collecting data and drafting revisions, the U.S. Department of Labor (DOL) has released the long-awaited final changes to regulations governing the Family and Medical Leave Act (FMLA). The final rule revisions, which were set to appear on the Federal Register on Nov. 17, 2008, will take effect on Jan. 18, 2009, and help clarify employer and employee responsibilities under the law.

Prior to publication, the DOL placed a link to the 762-page rule revision on the department’s web site. Attorneys and business-related groups throughout the country began poring over the document to analyze the changes.

The immediate reaction was that DOL officials had made only modest changes to the proposed set of rules, which were released in February 2008.

“We are taking a close look at the final regulations and comparing them with the proposed changes,” said Lawrence Lorber, a partner in the labor and employment practice area of the Washington, D.C. office of Proskauer Rose LLP. “At first glance, it appears there aren’t any changes that are radically different from the proposed regulations.”

Officials from business-related groups such as the U.S. Chamber of Commerce and the National Association of Manufacturers stated that although the final rules don’t differ much from the DOL’s original proposal, the rule revisions still shed important light on how the FMLA is to be applied in the workplace.

“The new rule does some good things, and we welcome these changes,” said Mark Freedman, director of labor policy for the U.S. Chamber of Commerce. “We do wish that it had done more, but the DOL has taken some important steps to restore the balance of employer and employee obligations under the statute.”

Some family advocacy groups weren’t so happy with the final regulations, however.

“The new FMLA regulations for workers take us in the wrong direction, and are harmful and unnecessary,” said Debra L. Ness, president of the National Partnership for Women and Families. “They will restrict access to protections workers have relied on for 15 years, protections they need now more than ever, with the economy in deep trouble and families struggling terribly.”

DOL officials said that the department received more than 5,000 comments on the proposed changes during the public comment period, which ended April 11, 2008. It took the department nearly six months to go through all the public comments and draft appropriate responses.

The final regulations implement the expansion of the FMLA for military families, which was passed by Congress and signed into law by President Bush in January 2008. According to Lorber, the new regulations governing the FMLA leave for military families and caregivers might receive the most attention from attorneys and employers—“just because they’re new.”

Under the FMLA expansion, employers are required to offer up to 26 weeks of unpaid leave to employees who provide care to wounded U.S. military personnel. Employers must provide 12 weeks of FMLA leave to the immediate family members (spouses, children or parents) of Reservists and members of the National Guard who have “qualifying exigencies.”

The DOL’s definition of “qualifying exigencies” is included in the final regulations and will affect any employer who employs military Reservists and members of the National Guard, Lorber said.

“There is a lot of interest in the term because it definitely will have an impact on how employers must approve FMLA-mandated leave,” Lorber said.

The new rule defines “qualifying exigencies” as (1) short-notice deployment, (2) military events and related activities, (3) child care and school activities, (4) financial and legal arrangements, (5) counseling, (6) rest and recuperation, (7) post-deployment activities and (8) additional activities where the employer and employee agree to the leave.

According to a statement released by the DOL, the revised regulations include a number of changes to address the U.S. Supreme Court’s ruling decision in Ragsdale vs. Wolverine Worldwide Inc. The new rule clarifies that if an employee suffers individual harm because the employer did not follow the notification rules, the employer may be liable.

The regulation finalizes the DOL’s longstanding position that employees may settle their FMLA claims voluntarily without court or departmental approval. However, prospective waivers of FMLA rights will continue to be prohibited. While the rule retains the six individual definitions of “serious health condition,” the revisions provide guidance on some regulatory matters. First, it clarifies that if an employee is taking leave involving more than three consecutive calendar days of incapacity plus two visits to a health care provider, the two visits must occur within 30 days of the incapacity. Second, it defines “periodic visits to a health care provider” for chronic serious health conditions as at least two visits to a health care provider per year.

Phone: 814-833-3200
Toll free: 800-815-2660
Fax: 814-833-4844
Website: http://www.mbausa.org/

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If you have any questions about how your business could be affected by the Department of Labor changes made to the Family and Medical Leave Act please contact me at Wright Penning & Beamer, (248) 477-6300.

-Dirk Beamer
www.wrightpenning.com

From a December 10, 2008 Detroit Free Press article

December 10, 2008

Foreign tax policies put U.S. cars at disadvantage

BY U.S. REP. MIKE MICHAUD

In the debate about the Big Three American automakers, unfair foreign trade practices have scarcely been mentioned and the very unlevel playing field on which we force our domestic producers to compete.

Unfair foreign trade and economic practices are not “just a different way of doing business,” but are conscious policies intended to distort markets and give foreign firms a competitive advantage. Consider just one of these unfair practices: value added tax systems, which are used to discriminate against American cars, trucks and auto parts, as well as thousands of other products, by more than 150 of our trading partners.

The VAT is levied at each step of the production process — whenever value is added to a product and that product is passed up the assembly chain. The VAT is ultimately incorporated in the final price of the product and paid by the end consumer. However, if the product is exported, the producer gets a big break: The tax is rebated. In effect, the VAT functions as an export subsidy. But it is also a barrier to foreign markets for products from the United States, a non-VAT country.

If VAT countries trade with each other, it is a wash. Each country rebates the VAT for its exported products and imposes the VAT on imported products. There is rough parity. But in the United States, there is a free ride for foreign products produced under a VAT system — because we do not levy a VAT at the border that compensates for the export rebate the product received at home. American-made, domestic products sold in our market do contain the cost of our taxes, but exported VAT products don’t contain the cost of taxes at home or here.

This VAT disparity exists on cars, trucks and auto parts imported into the United States.

Compare a German and American car, each offered to the consumer in its home market for $20,000. When the German car is exported to the United States, the VAT taxes are rebated, and it costs $17,885 here — a price advantage of roughly 10% due only to the difference in tax systems, not corporate competitiveness.

The $20,000 American car exported to Germany is saddled with the VAT at the border — which is imposed not just on the base price of the car, but the shipping and insurance costs as well — and winds up costing $25,792 in Germany.

Small wonder that Detroit cannot export effectively from the United States but must set up foreign operations to counter the effects of the VAT (and currency manipulation and many other unfair foreign trade practices).

This VAT disparity is reliably estimated to place an extra $290-billion burden on American manufactured goods and $85 billion on U.S. services — or roughly half our yearly trade deficit.

In the next session, I and other members of Congress intend to introduce legislation to address this huge problem. Once we in Congress place the Big Three — and all other domestic producers — on an equal tax footing, American firms will take back lost market share here at home, expanding the domestic economic base to generate more jobs (with good benefits), profits, income — and tax revenue.

U.S. REP. MIKE MICHAUD, D-Me., represents Maine’s 2nd Congressional District and is the founding member of the House Trade Working Group, a leading voice for fair trade policies in Congress. Contact him through his Web site at www.michaud.house.gov.

Technology Solutions Explains the Importance of Taking Advantage of IRC Section 179 to Small to Mid-Sized Businesses

Many Companies Are Not Aware of the Tax Law that Can Impact Their Bottom Line

LIVONIA, MI — November 26, 2008 — Technology Solutions, LLC, an industry leader in business communications, announced today that the company is educating the region’s businesses on how to take advantage of significant tax deductions when acquiring new technology under Internal Revenue Code (IRC) Section 179. Technology Solutions, LLC is placing special emphasis on Section 179 because the deductions may change under the new administration in 2009.

“Section 179 of the Jobs and Growth Tax Relief Reconciliation Act was specifically designed to give businesses the ability to increase their spending on new equipment and generate growth in order to stimulate the economy,” said Steve Futrell, President of Technology Solutions, LLC. “Unfortunately, many companies are not aware of these substantial deductions and how it applies to their business. We believe it is our job as our customers’ strategic business partner to educate them on Section 179 and give them the information so they can determine whether to take advantage of it in 2008.”

Back on February 13th, President Bush raised the deduction limit under Internal Revenue Code (IRC) Section 179. Now, business taxpayers may generally elect to take an outright deduction of up to $250,000 of the cost of equipment placed in service during a tax year. If the aggregate cost of qualifying equipment placed in service during the tax year is greater than $800,000, then the deduction is reduced by $1 for each dollar by which the aggregate cost exceeds $800,000. For qualifying assets, the cost of which has not been deducted under Section 179, the remaining cost of the equipment is then depreciable in accordance with the ordinary tax depreciation rules.

Since February, businesses have been experiencing a tremendous push with these new changes. Those companies that are aware of the deductions are scrambling to ensure they are taking the appropriate steps, because it means hard dollars going directly to their bottom line. Surprisingly, many companies have either never heard of the law or don’t know how to take advantage of it.

“During these uncertain economic times, companies must continue to change the way they conduct business and invest in technology or they will not be around much longer,” added Mr. Futrell. “These deductions give businesses of all sizes the ability to do just that! Many organizations haven’t made a change to their voice and data technology in quite some time and the latest advancements have an amazing impact on profitability and productivity. Now, is the time for every organization to take a hard look at implementing new technology that will help them weather the ups and downs that our economy is likely to experience over the coming months.”

ABOUT TECHNOLOGY SOLUTIONS, LLC
Technology Solutions, L.L.C. is a leading provider of voice and data networking equipment and services for businesses within Michigan and across America.
Technology Solutions offers state-of-the-art technology to help its customers increase profitability, reduce communications costs, and give them a competitive advantage in their marketplace.

The company has quickly expanded to provide complete converged solutions incorporating voice systems, data systems, and structured cabling needs, saving customers significant time and cost, and enabling them to leverage their IT investment for future growth. From a consultative approach, Technology Solutions designs, implements, and monitors end-to-end solutions.

With over 70 years of experience, the professionals at Technology Solutions are committed to the philosophy of providing best in class technology, with personal and customized service and support.

For more information on Technology Solutions, call (734) 542-6929 or visit www.ts-llc.com.
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Please feel free to contact Wright Penning & Beamer with questions about your company’s technology investments at 248.477.6300

Trademark protection services for companies large and small

Services Offered: We work with clients to develop maximum protection against trademark infringement. When disputes over trademark infringement arise, we act quickly to protect your company’s interests.

Dirk Beamer’s experience in this arena can be traced back to his days handling trademark disputes as a federal court law clerk. Today, clients with national and international sales, such as Full Throttle Motorsports and Trijicon, routinely call on us to stop others from infringing on their trademarks.

Trademark/Servicemark Registration
Services Offered: Preparation of necessary documents to register trademarks and servicemarks for business entities at the local, state and federal level.

When your business operates in multiple cities, counties, states or countries, it is important to ensure that your name, logo, trademarks and servicemarks are protected against infringement. Allow Wright Penning & Beamer to assist you in obtaining that protection.

Personal Management

Protecting your wealth and property for your family’s benefit

Many people don’t realize that if you don’t make a plan for yourself, the government will step in and make a plan for you! We help our clients realize their dreams for themselves and their loved ones. We help them to save money and maintain privacy and control, and to minimize court involvement wherever possible. When court involvement is unavoidable, we help them navigate that road, too.

Probate Administration and Litigation

Services offered: We help you to navigate the maze of probate court rules and reporting requirements in conservatorships, guardianships and decedent’s estates. Should disputes arise, we protect your interests through mediation, arbitration or probate litigation.

Taking care of a loved one’s affairs when there has been a death or incapacity can be emotionally and physically exhausting. We have the experience and know-how to help make what can be a very difficult time as stress free as possible, whether we’re handling a mundane task like filing court forms or a more challenging one like uncovering wrongdoing or resolving a family dispute. As a result of her skill in this area of the law, Julie Pfitzenmaier recently spoke on probate litigation at a Michigan Trial Lawyers Association seminar.

Trust Administration

Services offered: We provide extensive advice to trustees in a wide variety of contexts, including revocable trusts, irrevocable trusts, charitable trusts, educational trusts, and others.

It can be intimidating when you’re asked to be trustee of a trust, especially if the trust is to continue for any length of time. We routinely assist clients in carrying out their duties as trustees. We can be very “hands on” if you need close support, or we can simply work in the background, ready to give direction when you call on us. We also have many years of experience in preparing federal estate tax returns in larger estates, and a proven track record in achieving quick and favorable results from the IRS upon review of those returns.

Residential Real Estate

Services offered: We represent the unique needs of both buyers and sellers, from first-time home purchasers to sale-by-owner to investors, in a timely and efficient manner.

We’ve been doing real estate transactions for many years, and it’s an area of practice that we enjoy. A real estate transaction can be a pleasure for all parties, as long as everyone is fully informed of the laws and alert to possible errors. Whether we prepare the purchase documents or review documents prepared by others, we protect our clients against mistakes that could prove costly.

Tax Planning

Services offered: We provide guidance on a broad range of tax questions because sometimes clients need to talk to someone in addition to their accountant – especially in matters of real property, estate and gift taxation.

We often work in conjunction with clients’ accountants to find favorable solutions to issues having both tax and legal consequences. When people don’t have a skilled accountant that they can turn to, our input is all the more valuable. We’ve often saved clients headaches and heartaches when they’ve come to us with an idea that they didn’t realize had hidden tax consequences, such as adding children to a deed or an account.

Estate Planning

A law office with extensive estate planning experience

Services offered: We protect you and your family and loved ones in the event of misfortune through the preparation of wills, trusts, powers of attorney and patient advocate forms.

Estate planning has been a core component of our practice since the day it opened. It’s a natural extension of the services we provide for our business-owner clients. We have extensive experience in preparing everything from the simplest of wills to the most complex of plans involving multiple trusts, disability and charitable planning.

In addition, our attorneys spend dozens of hours each year in continuing education, frequently lecturing on the subject of estate planning. Lee Flaherty has received and annually renews a Certificate of Completion in the areas of probate and estate planning issued by the Institute of Continuing Legal Education and the Probate and Estate Planning Section of the State Bar of Michigan. Dan Penning taught estate planning courses for several years at Oakland University. One of our founding partners, Bill Wright, is a regular presenter at probate and estate planning seminars sponsored by the Institute of Continuing Legal Educations.

To learn about our other asset protection services, please use the following link: Additional Asset Protection Services

Employment Law

Let our experienced lawyers guide you through your employment law dispute

Services Offered: We counsel businesses to help them understand the complexities of employment law and how to avoid problems. We negotiate effective termination and severance agreements where possible, and defend employers against frivolous claims where necessary.

Our attorneys belong to the Labor and Employment Section of the State Bar of Michigan and train annually at its Institute. Let the experienced lawyers of Wright, Penning & Beamer guide you through your employment law dispute.

Disputes & Litigation

From account collection to unfair competition, our lawyers handle it all

On television, courtroom lawyers neatly wrap up lawsuits in the span of a one-hour episode. In the real world, commercial disputes with customers, suppliers, competitors or employees rarely follow such an orderly process. At Wright Penning & Beamer, we bring a balanced combination of legal expertise and business common sense to our clients’ problems. We explore every avenue for delivering verdicts, judgments or settlements that bolster or protect the client’s bottom line.

Account Collection

Services Offered: We collect outstanding receivables for our clients through negotiation and, when necessary, litigation.

Unlike “collection firms” that act much like collection agencies, Wright Penning & Beamer assures direct attorney involvement and oversight in debt collection cases. Through long-standing relationships with major corporations like Sysco Food Services of Detroit, LLC, Wright Penning & Beamer has successfully handled thousands of collections matters.

Business Disputes and Litigation

Services Offered: We work with clients to find the most comprehensive and cost-effective solutions to business disputes. Where appropriate, we seek to negotiate and enforce win-win solutions for our clients and those they do business with. And, when necessary, we develop and implement aggressive trial strategies to protect our clients’ legal rights and business interests through the legal system.

At heart, our lawyers are business people. We analyze each dispute carefully to understand the legal options and the business ramifications. In courtrooms across the state and across the nation, Wright Penning & Beamer attorneys deliver results. When those results are challenged on appeal, we prevail nine times out of ten.

Construction

Services Offered: We represent both contractors and property owners in commercial and residential construction disputes, including proceedings under Michigan’s Construction Lien Act.

Wright Penning & Beamer enjoys relationships with several national lien firms who engage us to file and enforce construction liens in Michigan.

Contract Disputes

Services Offered: We find effective resolutions to contract disputes between our business clients and third parties. Where the other party will not entertain reasonable, joint solutions, we bring and/or defend lawsuits to enforce contract terms on a state and national level.

We work with supplier contracts, personal service contracts, verbal and written contracts, software and technology contracts, confidentiality and non-compete agreements, and everything in between.

Insurance Coverage Disputes

Services Offered: We pressure your insurance carrier to honor its obligations to you if you have been denied coverage under your policy.

We are unique in the fact that we have experience representing insured parties, insurance carriers, and insurance agents. We have served as general counsel to the National Association of Professional Allstate Agents for nearly ten years.

Landlord/Tenant Disputes

Services Offered: We act to enforce rights for payment of rent or possession of property on behalf of landlords. We act to protect the rights of commercial tenants if landlords fail to live up to their lease obligations.

We handle dozens of landlord/tenant disputes for business clients every year.

Sales Representative Contracts

Services Offered: We develop clear agreements with your sales force that minimize the chance of any dispute once you part ways, and we provide experienced representation when disputes do arise.

We have litigated millions of dollars in disputed commissions over the past ten years, covering topics ranging from auto parts to holographic images.

Unfair Competition

Services Offered: We seek quick remedies when competitors engage in business practices that cross the line – whether they involve violations of a non-compete agreement, the misappropriation of proprietary information, or tampering with customers.

Our attorneys have both initiated and defended claims of this kind in state and federal courts across the country for clients such as Toshiba Business Solutions-Michigan, Masters Green and Chemco Products. Dirk Beamer has written and published about rights and risks under the Uniform Trade Secrets Act.

Commercial Real Estate

Our proven commercial real estate attorneys give you a real advantage

Areas of Practice: Acquisitions, Sales, Leases, Financing and Eviction.
Services Offered: Drafting, reviewing, negotiating and recording the legal documents needed to create or transfer an interest in commercial-use real estate.

Many of our business clients also own the commercial real estate and building(s) in which they operate. We have negotiated many of these acquisitions, sales and leases. Interfacing with city governments, dealing with zoning variances, obtaining tax abatements – these are all examples of how we assist business owners in achieving the tax-saving benefits of owning commercial real estate.