Lobb & Plewe Attorneys At Law

Corona Business Law Blog

Taxes and your disposable income

New business owners who are creating a start-up company are often overwhelmed by the number of local, state and federal tax regulations that they must follow. Experienced business owners often find that they are so accustomed to paying taxes, that they inadvertently pay more than necessary in an attempt to remain in compliance with the endless tax laws that are implemented and changed on an annual basis.

Proper tax planning can ensure that business owners can remain in compliance with all tax laws, and tax optimization can prevent business owners from paying more than they owe in taxes. There's nothing more frustrating for business owners than to look around at their office and realize that they have been taxed at least once - if not twice - on everything that they can see and touch. They paid sales taxes on the office chair they are sitting on when they purchased it, and they paid business property taxes on the computer that is front of them. Not to mention, those revenue reports generated on the computer reveal how much of the business profits have been taxed on an annual basis as well.

Rules for out-of-state LLCs doing business in California

Most individuals and organizations that operate limited liability companies, or LLCs, are only concerned about the tax laws and filing processes that are required by the state in which their LLC is registered. However, a surprising number of LLCs are required to fulfill tax filing obligations in the state of California, even if their business is not located within the boundaries of the state.

This fact confounds business owners around the country, but the fact of the matter is California has tax laws that require LLCs to file with the state if they are considered to be conducting business with businesses or residents in the state.

How SB 218 and AB 170 Could Impact Employers

As the 2019 California Legislative Session comes to a close in mid-September, employers around the state are closely monitoring two bills that may impact their employment processes. Senate Bill 218 (SB 218) and Assembly Bill 170 (AB 170) are two bills that focus on employee discrimination and how that discrimination must be handled by employers. Both bills, in their current forms, appear to prioritize the needs of the employee. However, these pieces of legislation may make it more challenging and more costly for employers to do business in the state.

Noting the complexity of the topic, both employers and employees are curious about the future of these bills. As the legislative session is set to be finished in just a few weeks, it is assumed by many that these bills will be approved and ultimately be sent to the governor to become law. The question is whether there will be significant changes made to the bills within the final weeks.

Look out business owners, here comes OSHA

Businesses have been put on notice that, once a group of 76 new inspectors are trained, OSHA plans to inspect more businesses for jobsite safety violations.

U.S. Secretary Alexander Acosta in April personally informed a House Appropriations subcommittee that OSHA inspections will become more frequent than they currently are.

Succession Planning: Structuring a Successful Plan With Tax and Non-Tax Considerations

No business should operate without a succession plan in place. The succession plan should have its imprint on the day-to-day operations of the business. Once you have a succession plan in place, the implementation of that plan will integrate itself into the fabric of decision making. Importantly as well, the timing of your succession will become real and tied to something other than a loose idea of someday transitioning out of your company.

If you work with Lobb & Plewe in putting your succession plan together, the initial step will include a detailed conversation regarding the possible avenues of succession. As an owner you may have already decided that family, a strategic buyer, a private equity firm or the employees, will end up owing the company. If preliminary determinations have not been made, all of the options will need to be reviewed. Once basic details have been discussed, L&P will start the draft of a Business Succession Plan (BSP) which is discussed in more detail below in this article.

Four tips for business owners facing potential litigation

When your business interests are threatened by the prospect of litigation, you need to know what to do in order to protect your investment. We have seen many companies who failed to realize the impact that litigation has upon a business's day-to-day operations, resulting in significant harm that is difficult to overcome.

We wanted to take a few moments to discuss some of the necessary things that you should do in the event that you or your company encounters the threat of a potential lawsuit. Taking these steps now can pay huge dividends later.

Forming and operating your business

When starting a new business, you will want to decide whether to operate your business as a sole proprietorship or as a separate person by forming an entity. In rare instances, operating as a sole proprietorship is sufficient. However, in the vast majority of instances, you will want to form an entity to operate your business because, amongst other things, operating as an entity provides you, as the owner, protection from personal liability for the entity's debts and obligations, provided you observe corporate formalities in maintaining the entity's separate legal identity. 

Trustees Responsibility when Trustee has Sole and Absolute Discretion

A trustee is bound by the terms of the trust agreement. The performance of his or her duties, including and especially making distributions to beneficiaries, must strictly comply with the trust terms. However, more and more trusts, especially those utilizing advanced estate, tax, and asset protection planning techniques, provide an independent trustee with sole and absolute discretion to make distributions of principal and/or income to the trusts beneficiaries. So how does a trustee exercise this discretion? Is the trustee free to do anything or are there restrictions?

Even when a trustee holds sole and absolute discretion over trust distributions, the trustee must still exercise that discretion in a reasonable fashion. Specifically, the Trustee must balance the competing purposes of the trust. Specifically the Trustee must weigh his or her responsibility to have assets to distribute against the beneficiaries needs and wants. Satisfying immediate and excessive wants will deplete the trust and render the beneficiary helpless in a moment of greater need. So how does a trustee draw that line?

Portman-Cardin bill includes IRA Preservation Act

Attorney Aaron Hegji of Lobb & Plewe, LLP, and a director of the Coalition For American Retirement (CFAR) is pleased to announce that legislation prepared by the CFAR is included in the Portman Cardin retirement savings bill (the Retirement Security and Savings Act) introduced by senators Rob Portman, R-Ohio, and Ben Cardin, D-Md.

The senators are known as the "gold standard" when it comes to retirement plan legislation. It is no small accomplishment and a major honor to be included in their sweeping and significant legislation.

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