Law Offices of Robert J. Ross

Gender stereotyping can lead to law suits under the Family Medical Leave Act. “Caregiver Bias”

A recent federal appeals court decision required an employer to pay overtime compensation to salaried workers due to the employer’s performance-based bonus compensation plan.“Bonus Plan May Trigger Overtime”

Adventure sports and other hazardous hobbies can lead to the loss of life insurance benefits. “Life Insurance Policy Rescinded”

A substantial verdict was awarded the victim of repeated identity theft schemes for the negligence of a credit reporting agency. “$200,000 for Identity Theft Victim”

Charitable Remainder Trusts can be a useful tax-planning tool. “Charitable Remainder Trusts” 

Congress has enacted temporary changes to coverage by FDIC Insurance. “FDIC Insurance Update”

Whether it is a palatial estate where Rockefellers and Vanderbilts would feel at home or a rustic cabin in the woods complete with an outhouse, a family vacation home often carries sentimental value that doesn’t show up on financial ledgers. That is all the more reason why owners of such homes should plan for the orderly transfer of the home for future generations. With the help of some professional guidance, owners can choose from a variety of options tailored to particular situations and priorities.

• Outright sale of the property to a third party is simplest, but be prepared for substantial capital gains if the property has been in the family long enough to appreciate in value.
• A simple bequest can be used to keep the home in the family, but, by itself, it may not address issues such as use and maintenance.
• A trust, in particular a Qualified Personal Residence Trust, has some tax benefits. The grantor gifts the property but retains a right to use it for a definite term. The value of the gift is calculated as the value of the property, less the retained interest. However, if the grantor does not outlive the retained term, the property will be included in the grantor’s estate.
• A limited liability company (LLC) has the benefit of protecting assets generally. If someone is injured on the property, the owner’s liability would be confined to the ownership interest in the property.
• A partnership has the advantage of a formal structure, but each partner would have to contribute.

The issues that arise most often for second and subsequent generations concern how to allocate both the benefits and the burdens of the vacation home, that is, the use of the home and the expenses of the home, including maintenance, insurance, and taxes. The benefits and burdens can be spelled out in writing in as much detail as is desired, but it is not advisable to leave these matters to chance. There is the potential for discord and bruised feelings in even the most congenial families if for example, one sibling is left out of the prime vacation times while shouldering more than his or her share of costs for maintenance and repair. Parents might head off at least some of these issues by setting up an endowment to cover ongoing expenses for the home.

Looking a bit farther down the road, whatever legal forms are used should provide a means by which one or more of the family members can sell his or her interest in the home to the remaining family members. Considering that there may be honest disagreement as to the property’s value, it makes sense to look for consensus by using two separate appraisals, one arranged for by the selling family member and one by the remaining owner or owners.

It has become more common for employers to offer not only conventional 401 (k) retirement plans, but, since they became available in 2006, also Roth 401(k) plans.

For 2009, an employee can put away a total of up to $16,500 in a 401 (k) plan. If the employee is at least 50 years old or will be before the end  of the year, the maximum contribution rises to $22,000 because of a “catch up” contribution of up to $5,500. The total contribution may be allocated between 401(k) and Roth 401(k) accounts. In fact, the prevailing view is that it is a good idea to have some money in both types of plans because doing so will yield benefits from a diversified exposure to taxes. Read more

“E-Mails Can Modify Contracts” informs of the possible ramifications of agreements made informally via email.
“Roth 401(k)s” discusses the differences between Roth and Traditional 401(k) plans.
“New Identity Theft rules Affect Businesses” outlines new precautions financial institutions and creditors should take to prevent abuses, and potential ramifications of noncompliance.
“Religous Land-Use Lawsuits” discusses several disputes between zoning officials and religious organizations.
“Cold Feet Cost Groom $150,000” discusses damages awarded one woman a resulting from her grooms reneged marriage proposal.
“Estate Planning for Vacation Homes” offers several strategies for preventing infighting amongst heirs over vacation properties.

IMPORTANT NOTICE TO PERSONS DOMICILED IN ILLINOIS CONCERNING ILLINOIS ESTATE TAXES IMPOSED ON ESTATES OF PERSONS WHO DIE IN YEAR 2009:

Illinois is “decoupling” from the year 2009 federal estate tax exclusion amount of $3,500,000. This may result in substantial Illinois estate taxes if your estate for tax purposes exceeds $2,000,000. We suggest that you consider early in 2009, the interaction of federal and Illinois estate tax laws on your estate planning documents with us or with another lawyer of your choice who practices in the area of estate planning.

“Business Start-Up Checklist” discusses important questions would-be entrepreneurs should ask themselves prior to starting a new business (note: the idiom “carrying coals to Newcastle” means spending an inordinate amount of energy on something useless, fruitless, or redundant – Newcastle, England was a major coal exporter).
“Age Discrimination in Employment” reviews a recent decision by the Supreme Court that puts the onus on employers to prove its policies are based on reasonable factors other than age when defending age discrimination claims.
“All in the Family–Father Wins $4 Million from Daughter“concerns a recent court decision concerning a business dispute between family members.
“Generation-Skipping Trusts” reminds us that GSTs are not only for wealthy families, and discusses various advantages and disadvantages of GSTs as part of an estate plan.
“New Nonprofit Tax Forms” describes new instructions and filing requirements for Internal Revenue Service Form 990 for nonprofit organizations.
“Careful What You Click” describes potential legal hassles involved with online agreements.

“Family Responsibilities and the Workplace” discusses how employers can protect themselves from discrimination claims based on the employee’s status as a parent or caregiver.
“Small Business—Maintaining a Safe Work Place” emphasizes the importance of small business compliance with workplace safety standards.
“Misconceptions about FDIC Insurance” dispels common myths about deposit insurance if a bank fails.
“The Murky Waters of Wetland Protection“discuss developments in wetlands environmental regulation.
Other Articles :

• “LLC Owner Liable for Employment Taxes“
• “Vacation Home Tax Treament“

“Computer Fraud and Abuse Act Update” discusses how companies can protect themselves under the civil provisions of the Computer Fraud and Abuse Act.
“IRS Gets Tough on Deferred Compensation” discusses developments in IRS treatment of deferred compensation.
“Excluded Heirs May Still Inherit“emphasizes the importance of updating estate plans to ensure desired inclusion—and exclusion—of beneficiaries.
“‘Arm’ Borrowers Beware!” describes adjustable rate mortgage pitfalls.
“Can You Trademark a Flavor?“provides an analysis of intellectual property rights related to product flavoring.
“Hours of Service” Under The FMLA” discusses the interpretation of “hours of service” under the Family Medical Leave Act.