The IRS rules and regulations concerning the taxation of foreign currency transactions are very complex. However, where the taxpayer is an individual, as well as for many partnerships, corporations and limited liability companies, the basic rules are as follows:

1. As a general rule, any foreign currency gain or loss shall be computed separately and treated as ordinary income or loss.
    

2. As an exception to the general rule, a taxpayer may elect to treat any foreign currency gain or loss attributable to a forward contract, a futures contract, or option as capital gain or loss if the taxpayer makes such election and identifies such transaction before the close of the day on which such transaction is entered into. This election need only be made in the taxpayer's books and records.
    

3. As another exception to the general rule, a taxpayer may elect to treat any foreign currency gain or loss attributable to any regulated futures contract or non-equity option which would be "marked to market" under Internal Revenue Section 1256 if held on the last day of the taxable year as capital gain or loss if the taxpayer makes such election and identifies such transaction before the close of the day on which such transaction is entered into. This election must be mailed to the IRS in compliance with the IRS's detailed regulations as to the manner for making the election.

So, if the taxpayer holds the currency itself (paper money and coins), or cash equivalent such a certificates of deposit and the like, the taxpayer cannot elect out of ordinary income or loss treatment.

The election mentioned in Item 2, above, need only be entered in the taxpayer's internal books and records. But do not be fooled. In the event of an audit, the IRS usually requests corroboration of such "internal" records such as a broker's statement. Thus, it is a good idea to purchase such contracts and make such elections through a broker whose records may prove more believable than the taxpayer's records.

In contrast, the election mentioned in Item 3, above, is proscribed by regulation. This election is very detailed and must be mailed to a specific address within the IRS and contained detailed information about the transaction.

If the above elections are not properly and timely made, the IRS may re-characterize the gain or loss as ordinary gain or loss.

The right to publish anonymously is a freedom of speech generally protected by the First Amendment, although constitutional protection is not afforded to anonymous speech that is defamatory. Anonymous speech published on the Internet is afforded the same constitutional protection, but persons targeted by such speech may seek identification of the speaker from the website host or Internet service provider when the speech is allegedly defamatory. However, no national consensus has yet emerged on precisely how to balance the right of anonymous free speech with the need of a defamed person to obtain the identity of the speaker.

In Krinsky v. Doe 6, the court of appeal concluded that if a defendant has been notified that a plaintiff seeks his or her identity and the defendant seeks to quash a subpoena issued to the site host or service provider, the plaintiff must make a prima facie showing of the elements of libel in order to defeat the motion to quash. If the plaintiff succeeds in providing evidence that a libelous statement has been made, the court concluded that no further balancing of interests is necessary to overcome the defendant's constitutional right to speak anonymously (Krinsky v. Doe 6 (2008) 159 Cal. App. 4th 1154, 1172).

The court in Krinsky noted that a requirement that the plaintiff attempt to notify the defendant when his or her identity is sought would not be unduly burdensome, and also that Internet service providers and message board hosts often provide notice to parties when their identity is sought. The court did not actually impose a notice requirement, however, because in the case before it, the defendant had already been notified and thus the issue was moot. (See Krinsky v. Doe 6 (2008) 159 Cal. App. 4th 1154, 1171).

So, if you seek the identity of an anonymous internet poster who you believe has defamed you, you must sue the anonymous defendant as a "DOE" defendant, (e. g., Defamed Plaintiff vs. DOES 1-10), then serve a subpoena on the ISP (the internet service provider(s) that are hosting the offensive posting such as EarthLink or Google, etc.) requesting the identity of the anonymous internet poster. Then, pursuant to the Krinsky case, if you present a prima facie case that the speech at issue is unprotected defamatory speech, the court will order the ISP to identify the anonymous internet poster so that you can proceed with your defamation lawsuit.

One of the most important concerns for an investor is his or her personal liability for debts incurred by the business enterprise. The investor usually realizes that losses sustained by the business may wipe out the amount invested; the concern is whether creditors of the business can reach the investor's personal resources beyond the amount invested, if the business assets prove insufficient.

Sole proprietors or general partners put their entire personal wealth at risk; on the other hand, limited partners, LLC members, LLP partners or corporate shareholders generally do not. I.e., the limited partner, LLC member, LLP partner or corporate shareholder normally risks only the amount invested.

However, limited partners are supposed to be "passive" investors with no active role in management of the corporate business (otherwise, they risk personal liability for its debts.

Consequently, for investors who propose to be regularly active in the business, the corporate form (or possibly an LLC or, for certain professionals, an LLP) would be the preferred choice ... if all other factors balance out equally. But other factors are rarely equal. Moreover, as a practical matter, limited liability usually is not a crucial consideration, particularly with small closely-held corporations, for the following reasons:

a. Personal guarantees may be required: First of all, banks and others extending credit to a small corporation frequently require that the shareholders give their personal guarantees. Also, such guarantees are frequently required on leases and other long-term corporate obligations (especially on dealings with government and financial institutions).

b. Insurance may cover corporate obligations: Most businesses carry liability insurance to cover claims based on torts committed by agents or employees; and such insurance often extends to fire, theft and employee dishonesty. To the extent such insurance coverage exists, the business is protected and the owners have no risk of personal liability, whether the business is incorporated or not.

c. "Alter ego" liability: In certain cases, the corporate entity may be disregarded (the corporate veil "pierced") and the shareholders held personally liable for corporate debts because of the manner in which they have dealt with the corporation.

(1) Requirements:There are two basic requirements:

* Unity of interests: First, the shareholders sought to be held liable have treated the corporation as their "alter ego," rather than as a separate entity; and

* Resulting injustice: Second, it would "sanction a fraud or promote an injustice" to uphold the corporate entity and allow the shareholders to escape personal liability for its debts.

(2) Presumption against alter ego liability: In practice, courts regard the alter ego doctrine as a drastic remedy and disregard the corporate form only reluctantly and cautiously. This is because alter ego liability is fundamentally at odds with the general rule that a de jure corporation is a legal entity separate from its owners; and the law specifically permits owners to incorporate a business for the very purpose of shielding them from its liabilities. Accordingly, the burden of pleading and establishing alter ego liability is on the plaintiff creditor.

(3) Application: The alter ego doctrine is usually applied where there are only a few shareholders and they have not respected their corporation's separate identity; for example, where the shareholders:

* Fail to contribute capital, issue stock or otherwise complete formation of the corporation;

* Use corporate assets as their own (e.g., withdraw corporate funds for personal use without treating such withdrawals as salaries or dividends);

* Commingle corporate funds with their personal funds; or

* Fail to observe corporate formalities (e.g., fail to regularly elect directors, appoint officers, hold board meetings and keep minutes or file corporate tax returns).

Requirement that "injustice" would otherwise result:Despite evidence that shareholders disregarded the corporate entity's "separateness," alter ego liability will not be imposed unless upholding the corporate shield under the facts would result in an injustice. "The alter ego doctrine does not guard every unsatisfied creditor of a corporation but instead affords protection where some conduct amounting to bad faith makes it inequitable for the corporate owner to hide behind the corporate form." Claimants seeking to pierce the corporate veil must show the manner in which they were harmed by a shareholder's abusive conduct toward the corporation or some other "injustice" or "inequity" that would result from recognition of the corporate entity.