Mark Anderson, Attorney at Law, PLLC

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Happy 4th of July

Posted by Mark Anderson on July 5, 2010 at 9:39 AM Comments comments (0)

IN CONGRESS, July 4, 1776.

The unanimous Declaration of the thirteen united States of America,

When in the Course of human events, it becomes necessary for one people to dissolve the political bands which have connected them with another, and to assume among the powers of the earth, the separate and equal station to which the Laws of Nature and of Nature's God entitle them, a decent respect to the opinions of mankind requires that they should declare the causes which impel them to the separation.

We hold these truths to be self-evident, that all men are created equal, that they are endowed by their Creator with certain unalienable Rights, that among these are Life, Liberty and the pursuit of Happiness.--That to secure these rights, Governments are instituted among Men, deriving their just powers from the consent of the governed, --That whenever any Form of Government becomes destructive of these ends, it is the Right of the People to alter or to abolish it, and to institute new Government, laying its foundation on such principles and organizing its powers in such form, as to them shall seem most likely to effect their Safety and Happiness. Prudence, indeed, will dictate that Governments long established should not be changed for light and transient causes; and accordingly all experience hath shewn, that mankind are more disposed to suffer, while evils are sufferable, than to right themselves by abolishing the forms to which they are accustomed. But when a long train of abuses and usurpations, pursuing invariably the same Object evinces a design to reduce them under absolute Despotism, it is their right, it is their duty, to throw off such Government, and to provide new Guards for their future security.--Such has been the patient sufferance of these Colonies; and such is now the necessity which constrains them to alter their former Systems of Government. The history of the present King of Great Britain is a history of repeated injuries and usurpations, all having in direct object the establishment of an absolute Tyranny over these States. To prove this, let Facts be submitted to a candid world.

He has refused his Assent to Laws, the most wholesome and necessary for the public good.

He has forbidden his Governors to pass Laws of immediate and pressing importance, unless suspended in their operation till his Assent should be obtained; and when so suspended, he has utterly neglected to attend to them.

He has refused to pass other Laws for the accommodation of large districts of people, unless those people would relinquish the right of Representation in the Legislature, a right inestimable to them and formidable to tyrants only.

He has called together legislative bodies at places unusual, uncomfortable, and distant from the depository of their public Records, for the sole purpose of fatiguing them into compliance with his measures.

He has dissolved Representative Houses repeatedly, for opposing with manly firmness his invasions on the rights of the people.

He has refused for a long time, after such dissolutions, to cause others to be elected; whereby the Legislative powers, incapable of Annihilation, have returned to the People at large for their exercise; the State remaining in the mean time exposed to all the dangers of invasion from without, and convulsions within.

He has endeavoured to prevent the population of these States; for that purpose obstructing the Laws for Naturalization of Foreigners; refusing to pass others to encourage their migrations hither, and raising the conditions of new Appropriations of Lands.

He has obstructed the Administration of Justice, by refusing his Assent to Laws for establishing Judiciary powers.

He has made Judges dependent on his Will alone, for the tenure of their offices, and the amount and payment of their salaries.

He has erected a multitude of New Offices, and sent hither swarms of Officers to harrass our people, and eat out their substance.

He has kept among us, in times of peace, Standing Armies without the Consent of our legislatures.

He has affected to render the Military independent of and superior to the Civil power.

He has combined with others to subject us to a jurisdiction foreign to our constitution, and unacknowledged by our laws; giving his Assent to their Acts of pretended Legislation:

For Quartering large bodies of armed troops among us:

For protecting them, by a mock Trial, from punishment for any Murders which they should commit on the Inhabitants of these States:

For cutting off our Trade with all parts of the world:

For imposing Taxes on us without our Consent:

For depriving us in many cases, of the benefits of Trial by Jury:

For transporting us beyond Seas to be tried for pretended offences

For abolishing the free System of English Laws in a neighbouring Province, establishing therein an Arbitrary government, and enlarging its Boundaries so as to render it at once an example and fit instrument for introducing the same absolute rule into these Colonies:

For taking away our Charters, abolishing our most valuable Laws, and altering fundamentally the Forms of our Governments:

For suspending our own Legislatures, and declaring themselves invested with power to legislate for us in all cases whatsoever.

He has abdicated Government here, by declaring us out of his Protection and waging War against us.

He has plundered our seas, ravaged our Coasts, burnt our towns, and destroyed the lives of our people.

He is at this time transporting large Armies of foreign Mercenaries to compleat the works of death, desolation and tyranny, already begun with circumstances of Cruelty & perfidy scarcely paralleled in the most barbarous ages, and totally unworthy the Head of a civilized nation.

He has constrained our fellow Citizens taken Captive on the high Seas to bear Arms against their Country, to become the executioners of their friends and Brethren, or to fall themselves by their Hands.

He has excited domestic insurrections amongst us, and has endeavoured to bring on the inhabitants of our frontiers, the merciless Indian Savages, whose known rule of warfare, is an undistinguished destruction of all ages, sexes and conditions.

In every stage of these Oppressions We have Petitioned for Redress in the most humble terms: Our repeated Petitions have been answered only by repeated injury. A Prince whose character is thus marked by every act which may define a Tyrant, is unfit to be the ruler of a free people.

Nor have We been wanting in attentions to our Brittish brethren. We have warned them from time to time of attempts by their legislature to extend an unwarrantable jurisdiction over us. We have reminded them of the circumstances of our emigration and settlement here. We have appealed to their native justice and magnanimity, and we have conjured them by the ties of our common kindred to disavow these usurpations, which, would inevitably interrupt our connections and correspondence. They too have been deaf to the voice of justice and of consanguinity. We must, therefore, acquiesce in the necessity, which denounces our Separation, and hold them, as we hold the rest of mankind, Enemies in War, in Peace Friends.

We, therefore, the Representatives of the united States of America, in General Congress, Assembled, appealing to the Supreme Judge of the world for the rectitude of our intentions, do, in the Name, and by Authority of the good People of these Colonies, solemnly publish and declare, That these United Colonies are, and of Right ought to be Free and Independent States; that they are Absolved from all Allegiance to the British Crown, and that all political connection between them and the State of Great Britain, is and ought to be totally dissolved; and that as Free and Independent States, they have full Power to levy War, conclude Peace, contract Alliances, establish Commerce, and to do all other Acts and Things which Independent States may of right do. And for the support of this Declaration, with a firm reliance on the protection of divine Providence, we mutually pledge to each other our Lives, our Fortunes and our sacred Honor.

Business Planning

Posted by Mark Anderson on June 11, 2010 at 11:13 AM Comments comments (0)

You want to start your own business or you have started your own business. Now what? What types of business entities are there and what is right for you.

 

There are different types of businesses. Depending you can operate your business as sole proprietorship, Limited Liability Company, corporation, or partnership. If you own your own business and have not done any business planning, then you most likely are operating a sole proprietor.

 

The sole proprietor is probably the most common type of business. The problem with a sole proprietor is that you have unlimited liability. Depending upon the state you are in you may be able to form a sole member limited liability. This would allow your have limited liability. You could also form a corporation. A corporation requires that you follow certain formalities such as having officers, a board of directors, and having annual meetings for share holders and directors to elect officers and conduct business. A Limited Liability Company does not require all the formalities which make it easier to operate. A Limited Liability Company will have members. It can be run by a manager or its members. You don’t need to have annual meeting but it is probably a good idea. If there are more to owners in the company you should talk to your CPA or accountant as you will need to file tax returns for the companies. Depending on your situation you want to make an S-Election to have pass through taxation. You could also have your LLC treated as a disregarded entity for tax purposes. This makes sense for most single member LLCs. You should discuss this with your CPA. If you form a corporation you will most likely need to obtain a tax identification and pay a salary. It is a good idea to talk to your accountant and CPA as he or she will know your situation and provide the best solution or advice to you.

 

If there are two or more people in business then you could operate as partnership, corporation or Limited Liability Company. If you do no business planning, then most likely you are operating as a partnership. This is not good because a partner has joint and several liability with the other partners. This is not so in corporation or a limited liability company. Also, you need to plan ahead to have buy out agreement or operating agreement if you should decide to break up the company. It is better idea to plan ahead and agree on these terms instead of fight over the break up in court.

 

You should probably not continue to operate as partnership due to the liability issues. Montana has limited partnership or limited liability partnership acts to allow you to convert to a limited partnership or limited liability partnership to allow for some liability protection. However, limited liability companies are becoming more popular and you may want to consider just forming an LLC. It is a good idea to have an operating agreement or partnership agreement to outline how the partnership will operate and what happen if it is dissolved.

If you are considering forming a company, then you should talk to a business attorney like me as the right type of company will depend on your situation.

Do you need a will or trust

Posted by Mark Anderson on June 10, 2010 at 11:46 AM Comments comments (0)

Do you need a will or a trust?

Almost everyone will need a will. There are some differences between a will and a trust. Whether or not you need a will or trust will depend upon your situation.

I. Do you need a Will?

A basic will provides for expenses, lists an executor or personal administrator, and provides for specific devises of real and personal property and the residuary of the probate. It will also appoint a guardian for minor children.

A will need to go through probate. A will is subject to claims of creditors and could be contested leading to additional costs. You also need to publish a notice to creditors in your local paper. This may be expensive depending upon your area. In addition, you will need to pay the personal representative and your attorney.

II. Do you need a Trust?

A trust does not need to go through probate. Probate is open record and requires notice, publication, and usually an administrator or executor, and attorney.

Some people do not want all their business made public. A trust provides for more privacy. Also, depending on your state, probate may be expensive. If probate in your state is more expensive than creating a trust, then you may wish to create a trust. However, you will need to pay an attorney to prepare a trust and transfer assets such as real estate in to the trust. You may want to contact a probate or trust attorney in your area to ask how much a trust would cost. Some lawyers will agree to a flat fee.

 

A trust is used to hold property in benefit for another individual. Say for instance you have children that are unable to handle money or a special needs child. In a trust you appoint a trustee to handle the money for this individual. There are typically conditions attached to any distribution of money.

Most people do not want their children getting a large amount of money or property when they turn 18 so they set up a distribution schedule or limit the distributions for certain items. For instance, a trust could contain provisions to only allow your children to receive 1/3 of their share of the trust property at age 18, 1/3 at age 24, and 1/3 at age 30. The trust could also contain provisions to control the distribution of money for education or medical emergencies.

III. Do you need both a Will and Trust?

Some people decide to have both a trust and a will. A person can create a revocable trust during their life time. If you own property in numerous states it is good idea to have the property owned by a revocable trust so you don’t need to open a probate in every state. This can lead to unnecessary expenses involved in opening a probate in every state.

Sometimes people forget to transfer all the property to the trust. So they create a pour over will. If something is forgotten, then the will pours over the left over items to the trust. Then, the trust would distribute the assets according to the terms of the trust. In these cases, the will has similar provisions to the trust. In addition some wills contain trusts called testamentary trust. These trusts are usually in your will and are fund upon death.

IV. If you are concerned with estate taxes you may need something besides a simple will or trust.

Estate taxes are really not a big issue for most people. In fact in 2010 there is no estate tax. If Congress does not act then the estate tax will come back in 2011. It will only apply to estates over $1.0 million. It is expected that Congress will enact a law to set the estate tax exemption at $3.5 million.

If you think this situation will apply to your estate, then there are credit shelter trusts, marital bypass trust, or QTIP trust that enables you to reduce estate taxes. Depending on your situation these trusts could be used to reduce your estate’s tax liability.

You could also create a charitable remainder trust. This type of trust allows you to retain the income during your life and upon you death, the remainder of the trust is distributed to charity.

There are also family limited partnerships (FLPs) that can be used to reduce the value of your estate by reducing the value of real estate placed in to FLPs. FLPs are usually used in a family owner ranch or farming operation where the value of the land has substantially appreciated over time. Other entities such as an LLC can also work for estate planning purposes if you operate a family business. If you are concerned about estate tax, then you should talk to an estate planning attorney.

As any estate plan depends upon your situation, it is a good idea to talk to an estate planning attorney in your state to see what will work for you.


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