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Monday
Jan292018

Su-PERFLUO-us? More Chemicals Added to Prop 65 List

Environmental Litigation AttorneyEnvironmental Litigation Defense Attorney

 

Stephen T. Holzer

818.907.3299

 

Business owners manufacturing, buying, selling, or importing products in California already know about the state’s Prop 65 law. But do they also know every single chemical or substance that is on that list?

PFAs in food containersThey couldn’t possibly unless gifted with total recall, and even then they would have to keep up with numerous revisions made by the state’s Office of Environmental Health Hazard Assessment (OEHHA). As of December, nearly 1,000 contaminants have been added over the past 30 or so years – substances that are known to the State of California “to cause cancer or reproductive toxicity.”

Some recent additions to the list are perfluorooctanoic acid (PFOA) and perfluorooctane sulfonate (PFOS), members of the perfluoroalkyl substances (PFASs) family of chemicals.

As of now, the State has not determined a Maximum Allowable Dose Level. The federal Environmental Protection Agency however, established a drinking water health advisory level at 70 parts per trillion. Nevertheless, California businesses with 10 or more employees must provide warning labels on products that contain these PFOs, and in buildings where PFOA or PFOS may exist.

The chemicals are widely used to protect products from moisture and potential stains and to reduce friction in mechanical industries. So which businesses will most likely be affected?

  • Food Manufacturers & Packagers (packaged foods with coated paper);

  • Restaurants & Other Food Vendors (seafood or fish from water contaminated by PFOS, take-out containers, pizza boxes, popcorn bags, etc.);

  • Manufacturers (cosmetics, camping equipment, water/stain resistant clothing, water/stain resistant treatment products for clothing or furniture, carpeting, etc.);

  • Commercial Building owners and managers;

  • Retailers and Distributors dealing with any of the above.

PFOsAccording to the EPA, the contaminants aren’t made in the U.S. anymore – but PFOAs and PFOSs still show up in many imported products. And they don’t biodegrade well, thus the recent concerns regarding their presence in groundwater, fish, etc.

Anyone dealing in these and other products that contain PFOAs or PFOSs in California should post a Prop 65 warning label on products that contain these contaminants, and in buildings where employees or consumers may be exposed to the chemicals. 

Stephen T. Holzer is a Business Litigation Attorney and Chair of our Environmental Practice Group. 

Disclaimer:
This Blog/Web Site is made available by the lawyer or law firm publisher for educational purposes only, to provide general information and a general understanding of the law, not to provide specific legal advice. By using this blog site you understand there is no attorney client relationship between you and the Blog/Web Site publisher. The Blog/Web Site should not be used as a substitute for obtaining legal advice from a licensed professional attorney in your state.

Wednesday
Jan172018

Employment Defense: It’s Raining Complaints 

Lawyer for EmployersEmployment Defense

 

by Tal Burnovski Yeyni

818-907-3224

 

If you missed recent news regarding the #MeToo movement – welcome back from outer space! The Me Too movement has been sweeping the U.S. and the world since October 2017, encouraging women and men to speak up about sexual harassment incidents.   

The phenomenon was not missed by California legislators, who introduced the following two new bills:  

AB 1867 would require employers with 50 or more employees to maintain records of employee complaints of sexual harassment for 10 years from the date of filing.  

AB 1870 would extend the period to file a complaint of unlawful employment practice with the Department of Fair Employment and Housing for one to three years from the date of the alleged unlawful practice.

Though too soon to tell whether these bills will find their way into California’s Government Code, they demonstrate the legislature’s intent to crack down on harassment in the workplace.

Meanwhile, be sure you have a written, compliant, anti-harassment policy as well as an open door policy in place. Procedures for reporting harassment should be outlined in an employee handbook or distributed to all employees in some written format.

Those with 50 or more employees should also provide training to supervisors regarding harassment, discrimination, and bullying prevention every two years, as mandated by state law.

Now, more than ever, eradicating harassment in the workplace should be a priority.

Tal Burnovski Yeyni is an Employment Defense Attorney.

Disclaimer:
This Blog/Web Site is made available by the lawyer or law firm publisher for educational purposes only, to provide general information and a general understanding of the law, not to provide specific legal advice. By using this blog site you understand there is no attorney client relationship between you and the Blog/Web Site publisher. The Blog/Web Site should not be used as a substitute for obtaining legal advice from a licensed professional attorney in your state.
Wednesday
Dec202017

Divorce Planning: How Tax Reform Could Affect Your Decisions

Encino Tarzana Divorce LawyerCertified Family Law Specialist

 

by Vanessa Soto Nellis

818.907.3274

  

 

 

Under the current tax law, individuals making spousal support payments may deduct the payments on their tax returns. Conversely, the individual receiving alimony must count those payments in his or her gross income.

These rules provide a financial benefit for both parties during an otherwise difficult time. Spousal support payors could agree to higher alimony payments knowing the deductions help reduce taxable income. Recipients therefore, generally receive more spousal support, and are generally taxed on the income at a lower rate.

These benefits go away as of January 1, 2019 under the latest version of H.R.1 Tax Cuts and Jobs Act (H.R.1).

So what does tax reform mean for couples who are already divorced, expect to finalize a dissolution next year, or may separate and divorce later? If the President signs the current version of H.R.1:

  1. Individuals paying spousal support pursuant to a court order executed before December 31, 2018 will continue to deduct those payments; individuals receiving spousal support will continue to count the alimony as income – so long as there are no changes.  

  2. Couples who finalize divorces or separation agreements in 2018 will follow the above-rules. 

  3. Divorced couples seeking modifications to their dissolution or separation agreements should consider doing so in 2018 if the alimony payment deduction is of importance. 

  4. Couples with a pending divorce should consider settling the alimony question in 2018 to take advantage of the deduction. 

  5. Tax reform will also impact child support, as family law courts base the amounts paid here on combined income of both parents – changes to the tax rates, and standard or itemized deductions will impact the calculations.

For more information, see Section 11051. Repeal of the Deduction for Alimony Payments.

Vanessa Soto Nellis is the Chair of our Family Law Practice Group.

 

Disclaimer:
This Blog/Web Site is made available by the lawyer or law firm publisher for educational purposes only, to provide general information and a general understanding of the law, not to provide specific legal advice. By using this blog site you understand there is no attorney client relationship between you and the Blog/Web Site publisher. The Blog/Web Site should not be used as a substitute for obtaining legal advice from a licensed professional attorney in your state.

Wednesday
Dec202017

Full Speed Ahead: SBA Directory May Hasten Franchisee Lending Process

Franchise & Distribution Practice Group Chair

 

by Barry Kurtz

818-907-3006

 

As of January 1, 2018, the U.S. Small Business Administration (SBA) will begin implementing new rules that will affect franchisors, entrepreneurs wishing to join a franchise system, and lenders or CDCs (Certified Development Companies). Lenders who want to make SBA-backed loans will be responsible for certifying that a franchisee-borrower is eligible for an SBA loan.

The new rules call for the SBA to create and maintain a directory of approved franchisors eligible for government-backed loans for their franchisees. Franchisors whose franchisees apply for the government-backed business loans– specifically 7(a) and 504 loans to open franchises – will want to ensure their franchise system is registered with the SBA.  

To obtain approval, franchisors will need to submit their Franchise Disclosure Documents, franchise agreements and other paperwork franchisors may require franchisees to sign.

Once a franchise system appears on the registry, lenders will know that franchisees of the franchisor will be eligible for SBA loans. In addition, franchisors may be eligible for automatic renewal in the directory each year, if the franchise documents have not substantially changed.).

Before January 2017, a private company called FRANdata maintained a similar registry, but the SBA banned use of that in favor of a more cumbersome process:

Franchisors had to provide blanket approvals for all franchise agreements they were going to sign with SBA funded franchisees, or negotiate and get approvals for individual franchisee agreements and use an SBA approved addendum every time an SBA borrower wanted to buy a franchise.

Those choices were either time-consuming or ill-fitting of circumstances.

SBA Approved Franchisors

The 2018 process seems to be more hybridized, incorporating the documents review system and the above-referenced SBA addendum, with a new registry system.

As mentioned, the approvals process to gain initial entry on the registry means submitting the FDD, agreements and other documentation provided to potential franchise buyers. The SBA reviews these to pre-approve for SBA financing – which doesn’t serve to endorse a system in any way, it just makes financing easier for qualified loan seekers.

The Franchise Directory will include those companies that have met all SBA criteria, some that meet the Federal Trade Commission’s definition of a franchise, and certain brands that do not meet the FTC definition but are otherwise eligible.

Franchisors that want to apply for a listing on the SBA Franchise Directory should email franchise@sba.gov.

Barry Kurtz is a State Bar of California Certified Specialist in Franchise & Distribution Law.

Disclaimer:
This Blog/Web Site is made available by the lawyer or law firm publisher for educational purposes only, to provide general information and a general understanding of the law, not to provide specific legal advice. By using this blog site you understand there is no attorney client relationship between you and the Blog/Web Site publisher. The Blog/Web Site should not be used as a substitute for obtaining legal advice from a licensed professional attorney in your state.

Thursday
Nov302017

The Tax Cuts and Jobs Act: Trust & Estate Planning Considerations

Gift Tax, Trusts & Estate Planning Attorney

 

by Kira S. Masteller
818.907.3244

 

 

This week was supposed to be the week Republicans passed a tax bill. It’s unclear what exactly will happen in the immediate future, or if we’ll have to wait for the New Year to see any type of tax reform. If or when we do get tax reform, the new law under the current Administration will be called the Tax Cuts and Jobs Act.

Income Tax Reform 2017So how will this affect estate planning?

If either the U.S. Senate or House manage to pass their respective bills (both branches of Congress will need to sign off on one, cohesive plan), we could see big changes in the future.

Here’s a look at how potential tax reforms could affect individuals and married couples under each Congressional proposal.

 

Regarding Income Taxes

 

a.) Tax Brackets

HOUSE: Raises individual tax rates, but cuts tax brackets from seven to four. The new brackets would be changed to 12, 25, 35 and 39.6 percent.

SENATE: Keeps the current seven individual tax brackets, but lowers the rates for some of these. The revised rates will be 10 (same as current), 12, 22, 24, 32, 35 (same as current) and 38.5 percent.

b.) Standard Deductions

HOUSE & SENATE: The House and the Senate envision raising the standard deduction from the current $6,350 (single)/$12,700 (married) to $12,000/$24,000. One difference between the proposals is for the Head of Household deduction, currently capped at $9,500. The House plan raises this amount to $18,300, while the Senate plan raises it to $18,000.

c.) AMT

HOUSE & SENATE: Each chamber decided to repeal the Alternative Minimum Tax, which basically ensures the wealthier filers pay a minimum amount of tax no matter how many deductions they take.

d.) SALT

HOUSE: House Representatives plan to repeal the State and Local Tax Deduction (specifically income and sales tax deductions), and sets a cap on property tax deductions at $10,000.

SENATE: The Senate’s plan aims for a full repeal of this deduction.

e.) Pass-through Income

HOUSE: Income “passing through” sole proprietorships, partnerships, S-Corporations, etc., and currently taxed at individual income tax rates, will be taxed at 9 percent on the first $75,000 earned, and capped at 25 percent maximum. The current maximum rate is 39.6 percent. Certain personal service providers (law, accounting, brokerages, performing arts, etc.) would not be eligible for the lowered rates under this plan.

SENATE: In contrast, the Senate plan offers a 17.5 percent deduction rather than a lowered tax rate.

f.) Child Tax Credit

HOUSE: The Representatives’ plan raises this credit to $1,600, plus a $300 credit for each parent and dependent who is NOT a child. The child tax credit goes away for married couples making $230,000 or more per year.

SENATE: The credits are slightly higher at $2,000, plus a $500 credit for each dependent child. It is phased out for married couples earning $500,000 or more annually.

 

Regarding Estate Tax

 

HOUSE & SENATE: Currently, there is a 40 percent tax levied on assets valued at over $5.49 million, per individual. Both the branches of Congress would double the basic exclusion. However, the House of Representatives included plans to repeal the tax after 2024, while the Senate will not repeal estate taxes.

 

Regarding Charitable Gifts Tax

 

HOUSE & SENATE: Certain tax reforms such as the significant rise in standard deductions and a possible repeal of estate taxes, could have negative consequences for nonprofits. If more taxpayers choose the standard deduction rather than itemizing their returns for example, there will be less incentive to give to charity.

 

We anticipate there will be considerable “chopping” to both proposals with a compromise that leaves us with most of the proposed items for individuals intact, but potentially revised timelines for repeal rules. Stay tuned, as we will summarize the final reform tax bill when passed.

Kira S. Masteller is a Shareholder in our Trusts & Estate Planning Practice Group. 

Disclaimer:
This Blog/Web Site is made available by the lawyer or law firm publisher for educational purposes only, to provide general information and a general understanding of the law, not to provide specific legal advice. By using this blog site you understand there is no attorney client relationship between you and the Blog/Web Site publisher. The Blog/Web Site should not be used as a substitute for obtaining legal advice from a licensed professional attorney in your state.

LEWITT HACKMAN | 16633 Ventura Boulevard, Eleventh Floor, Encino, California 91436-1865 | 818.990.2120