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Legal Alerts - Legal Reliefs
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Quick Contacts
508-771-6272 [MA]
401-486-4002 [Cell]
401-453-1700 [RI]
gordon@gacarpenter.com
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Greetings!
In my business law
practice, I come upon information that business owners ought to know --
either to help their business prosper or to avoid a lurking legal
problem.
An e-mail such as this will only be sent when I encounter things important to share with business owners -- an ALERT to a potential problem or RELIEF to an issue being faced.
The first item in this issue is potential RELIEF for your business coming from the recent federal stimulus law. Scan it to see what may apply.
The second item will impact you if you have 20 or more employees. ALERT!!! Pay attention here.
The third items will likely apply. It becomes operative when 2010 rolls around BUT it will take you time to be ready. So start that process now -- it may be complex.
I urge each business owner to visit my website where you will find additional items of interest to business owners, including more Alerts and Reliefs.
Thanks for your attention.
 Gordon |
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ARRA Potpourri |
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Of course, anything coming out of Congress will be confusing and convoluted -- 1,000+ pages and $750+ BILLION dollars!!! I need say no more about the American Recovery and Reinvestment Act [ARRA].
But within ARRA there are provisions that may be of significant benefit to your current business and business planning. This Newletter cannot begin to explain the vast array in detail. So I decided to simply produce a list of some of the business goodies inbedded in this historic Act. If something catches you eye call me and I will provide more information. If it's a specific tax issue, your accountant may have his or her finger on more information tailored to you. [Of course, unless the first bullet applies to you, I recommend leaving your accountant alone until tax season has passed!]- If you are a small business [gross receipts <$15MM] who had a net operating loss in 2008, your carryback period has been increased from two to five years. This might provide refunds of taxes previously paid.
- Depreciation write-offs under Section 179, which dropped to $133,000 as of last year-end, have been restored to $250,000.
- The 50% first-year bonus depreciation has also been extended through 2009. This could be big [~$8,000] if a new car or light truck is right for your business.
- Hiring an unemployed veteran or a "disconnected youth" can get you a tax credit equal to 40% of the first $6,000 of wages paid. A "disconnected youth" is between 16 and 25 who has not been regulalrly employed or attending school in the past six months.
So there's the list to ponder. Hopefully, one or more may apply to your business which will ease the struggle of getting through the economic mess we are all experriencing. |
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COBRA Subsidy for terminated employees. |
If your business
Has 20 or more employees, and
Has terminated an employee since September 1, 2008 or
Terminates an employee before year-end 2009,
then you MUST comply with new COBRA provisions whereby the federal government will subsidize [meaning pay you back] 65% of the COBRA health plan cost.
The devil is in the details, of course, and some of the application can be complex. Essentially what's involved is the involuntary terminated worker can chose to continue his health coverage and only need to pay 35% of the cost. You [the employer] pay 100% of the cost to the health plan provider and then take the 65% federal subsidy as a credit against your quarterly payroll taxes otherwise due. Since I believe most affected employers use a payroll service, they should be providing the appropriate details to you. You might want to check with them to be sure they are up to speed because it is your responsibility!!
One tricky part is the employee who was involuntarily terminated between September 1 of last year [2008] and currently and who declined the COBRA coverage -- you've got to ask again informing him or her of the new 35% cost.
This provision of ARRA became effective upon President Obama's signing on February 17, 2009. It does not apply to employees who leave voluntarily.
The above is the new federal COBRA subsidy. Massachusetts, like many states, has a so-called mini-COBRA law which applies to employers with two to 19 employees To date, Massachusetts has not enacted a comparable subsidy provision but you should be alert to the possibility.
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Protecting Personal Information A Must!!
CAUTION
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On January 1, 2010 [recently extended from May 1, 2009] a new law will require every business which has any personal information about a Massachusetts resident to have in place severe computer and paper destruction protections and use restraints to prevent any "identity theft". This Massachusetts law is the first of its kind in the United States.
Any information includes credit card information, driver's license number and social security numbers and more.
Every business means one - with even one employee
[see Aye Aye -- I-9 article on my website].
- which has extended credit to a customer and/or captured usual
information like a credit card or driver's license number or received a personal check.
Preparing to comply likely will be time-consuming, at the least, and may be expensive. For certain, you need to be proactive. The law and regulations [available at www.mass.gov/Eoca/docs/idtheft/201CMR17amended.pdf] set a standard for compliance; the actual application of the standard will depend on the particulars of your business and how it operates. Nevertheless, it appears there can be some statements of general application -- - "Personal information" stored on computers, laptops, PDAs, flash drives OR transmitted wirelessly or on public networks [including all internet connections and landline telephones] must be encrypted, yes encrypted!!
- "Personal information" on paper must be stored under lock and key and shredded when destroyed.
- Employees should have access to personal information only on a need-to-know basis and access by others password or otherwise restricted.
- Employees with access need to be trained regarding their obligations to keep all "personal information" absolutely confidential.
I expect within the coming months there will be multiple workshop and similar opportunities for you to learn more about what's required. Yes, the busy summer season is on the horizon so that is not the time to tackle these issues. Begin NOW!!The Massachusetts Office of Consumer Affairs & Business Regulation have a variety of resources available to assist your compliance [www.mass.gov/consumer] including a guide for formulating a mandatory comprehensive written information security program. Enforcement of the law [M.G.L. c. 93H] and regulations resides with the Massachusetts Attorney General. Do not ignore this. If you are not compliant and a verdict comes against you there may be no insurance coverage to save you.
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My website has much more information about my practice and credentials. Just click on the link below and you'll be there.
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REMEMBER --
Other Legal Alerts and Legal Reliefs are available at my website.
Gordon A Carpenter, Attorney and Counselor at Law |
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