Nov 2023
8th Nov 2023
The Corporate Transparency Act
Why it looks like a good idea to form your LLC before January 2024! It gives you more time to comply with the Corporate Transparency Act (CTA).
The Corporate Transparency Act (CTA) most likely applies to you or someone you know. Failure to comply with this egregious and overreaching act will criminalize the failure and fine them into eventual bankruptcy. I suppose you can see McCartha Law, LLC is against this act as it applies to those of us who are small to medium businesses as it is conceivable that it could criminalize up 34 million of us in the U.S. who are otherwise law abiding citizens and for what --- not registering ourselves with the federal government so we can “show law enforcement our papers”.
Read more...
The Corporate Transparency Act (CTA) most likely applies to you or someone you know. Failure to comply with this egregious and overreaching act will criminalize the failure and fine them into eventual bankruptcy. I suppose you can see McCartha Law, LLC is against this act as it applies to those of us who are small to medium businesses as it is conceivable that it could criminalize up 34 million of us in the U.S. who are otherwise law abiding citizens and for what --- not registering ourselves with the federal government so we can “show law enforcement our papers”.
Read more...
Jul 2023
6th Jul 2023
LLC Taxed as an S-Corporation — Dividends (Capital Gains or Ordinary Income?)
Dividends can be classified as either ordinary income or capital gains, depending on the specific circumstances.
In general, dividends paid by most domestic and foreign corporations to individual investors are considered ordinary income for tax purposes. Ordinary dividends are typically subject to the ordinary income tax rates, which vary based on the individual's income level.
However, certain dividends may qualify for a lower tax rate known as the qualified dividends rate. To qualify for this lower rate, dividends must meet specific criteria, including being paid by a U.S. corporation or a qualified foreign corporation and satisfying certain holding period requirements. Qualified dividends are taxed at the same rates as long-term capital gains, which are generally lower than ordinary income tax rates.
It is important to note that payouts of S Corporations are not considered to be “dividends” rather they are “distributions”. Primarily, S Corporations are only subject to one tax (not double tax as C Corporations are) and as we discuss as part of the training for our Limited Liabilities formations, the taxability of earnings from an S Corporation (or a LLC taxed as an S Corporation) is the same regardless of whether that income is actually distributed to the owner or not… Hence the normal distributions of cash is not taxable whatsoever to the owner of an S Corporation but as in all things, there are exceptions which are outside the scope of this blog.
It's important to note that tax laws and regulations can change over time, so it's always a good idea to consult with a tax professional or refer to the most recent tax guidelines to understand the specific tax treatment of dividends in your situation.
These are the types of questions we sometimes run into when forming LLC (Limited Liability Companies) for our clients. We look forward to serving you with your LLC formation and teaching consultation.
In general, dividends paid by most domestic and foreign corporations to individual investors are considered ordinary income for tax purposes. Ordinary dividends are typically subject to the ordinary income tax rates, which vary based on the individual's income level.
However, certain dividends may qualify for a lower tax rate known as the qualified dividends rate. To qualify for this lower rate, dividends must meet specific criteria, including being paid by a U.S. corporation or a qualified foreign corporation and satisfying certain holding period requirements. Qualified dividends are taxed at the same rates as long-term capital gains, which are generally lower than ordinary income tax rates.
It is important to note that payouts of S Corporations are not considered to be “dividends” rather they are “distributions”. Primarily, S Corporations are only subject to one tax (not double tax as C Corporations are) and as we discuss as part of the training for our Limited Liabilities formations, the taxability of earnings from an S Corporation (or a LLC taxed as an S Corporation) is the same regardless of whether that income is actually distributed to the owner or not… Hence the normal distributions of cash is not taxable whatsoever to the owner of an S Corporation but as in all things, there are exceptions which are outside the scope of this blog.
It's important to note that tax laws and regulations can change over time, so it's always a good idea to consult with a tax professional or refer to the most recent tax guidelines to understand the specific tax treatment of dividends in your situation.
These are the types of questions we sometimes run into when forming LLC (Limited Liability Companies) for our clients. We look forward to serving you with your LLC formation and teaching consultation.
May 2023
22nd May 2023
Health Care Power of Attorney
More than ever you and I need a Health Care Power of Attorney.
When you create a Health Care Power of Attorney you are choosing an advocate/agent to make medical decisions for you when you can’t because of incapacity or the like. This Health Care Power of Attorney will also be your advocate if you are without the strength to advocate for yourself. For example, I had a type of flu that made it difficult for me to make my best decisions and the doctor was going to give me some medication that would shoot my blood pressure sky high without considering that I had high blood pressure, fortunately my wife advocated against that (even though I didn’t care at the moment because I just wanted to feel better) and may have very well saved my life.
A Health Care Power of Attorney is part of our Estate Planning Package for you.
When you create a Health Care Power of Attorney you are choosing an advocate/agent to make medical decisions for you when you can’t because of incapacity or the like. This Health Care Power of Attorney will also be your advocate if you are without the strength to advocate for yourself. For example, I had a type of flu that made it difficult for me to make my best decisions and the doctor was going to give me some medication that would shoot my blood pressure sky high without considering that I had high blood pressure, fortunately my wife advocated against that (even though I didn’t care at the moment because I just wanted to feel better) and may have very well saved my life.
A Health Care Power of Attorney is part of our Estate Planning Package for you.
18th May 2023
Estate Planning is For Everyone.
I recently did an Estate Plan for my college aged child and recognized how underutilized this need is attended to until it becomes a dire problem.
An Estate Plan essential answers the following key questions:
1. Who is in charge of my HealthCare when I can't be?
2. Who is in charge of my finances and possessions when I can't be?
3. To whom should I leave my money?
Reflecting back on my own time in college, I realized I needed help several times with my financial and healthcare decisions due to the fact that I was injured playing Rugby or engaging in other not so smart activities. Consequently, our firm provided such estate planning for my child and I can do the same for you and your child.
Contact me and we will help you.
An Estate Plan essential answers the following key questions:
1. Who is in charge of my HealthCare when I can't be?
2. Who is in charge of my finances and possessions when I can't be?
3. To whom should I leave my money?
Reflecting back on my own time in college, I realized I needed help several times with my financial and healthcare decisions due to the fact that I was injured playing Rugby or engaging in other not so smart activities. Consequently, our firm provided such estate planning for my child and I can do the same for you and your child.
Contact me and we will help you.
Aug 2020
10th Aug 2020
Today’s Contract Caution-Attorney’s Fees
Today’s Contract Caution: Dark Secret-Beware of who pays for Attorney’s Fees and Courts Costs in contracts.
6th Aug 2020
Today’s Contract Caution: Indemnification
Today’s Contract Caution: Indemnification - essentially means you will pay the damages and cover the costs (attorney’s fees plus) of someone else’s lawsuit.
Jun 2020
29th Jun 2020
Revocation of Will by divorce (a dry place) 1-29-20
Once upon a time, the issue came before us of a former spouse that was named as the sole beneficiary of her ex-husband’s Will and she was also named as his personal representative/executrix (the “CEO”) of his estate in his Will that he made/executed (i.e. signed and put into effect legally) prior to their divorce.
10th Jun 2020
Safe with a Trust
Safe with a Trust: A Trust is an agreement with some you "trust" (Trustee) to do what you want them to do for someone else (Beneficiary).
Apr 2020
19th Apr 2020
Signing Contracts for LLCs
How to sign a contract for a Limited Liability Company in Alabama: