Tuesday, April 26, 2011

10 Benefits From Making A Will

Perhaps you have been thinking for a while about making a will but have never quite found the time to get around to it; here are 10 Benefits that you will immediately get.

1. Children - If you die and don't nominate guardians for your children who are under the age of 18 then the local Social Services and the Courts will do it for you. If you have children from a previous relationship you can ensure that they will be financially looked after when you have gone.

2. Protect Your Spouse/Civil Partner - If you wish to ensure that your spouse receives what you actually want to leave to them and not have to rely on current government legislation you must document your wishes. The law imposes a limit on the amount of money that passes to a spouse, this could well be a lot less than you wish them to get.

3. Unmarried Couples - It doesn't matter how long you may have been living with your partner, in law nothing will automatically pass to them. Unmarried partners have no legal rights to inherit anything whatsoever.

4. Divorced? - Maybe your divorce was not bitter or acrimonious and you have still left something to your ex partner in your will. But what if they were to remarry? How would you feel if assets ended up in the hands of their new spouse?

5. Separation - For those that have separated but not yet divorced there can be a nasty sting in the tail. Until you receive your Decree Absolute, the marriage is still extant. Should you die, your spouse - even though you don't think of them as such - will be legally entitled to receive your estate, up to the spousal limit.

6. Pets - Most pet owners are very attached to their pets and want to have the peace of mind of knowing what would happen to the "family friend" after they have gone. Writing it down ensures that your wishes are known.

7. Property - The only way to ensure that the full value of your property is protected from attack by the tax authorities, levy of care home fees and creditors is to make a properly structured will. This will mean that all of the value will be left for your family.

8. Funeral Plans - A lot of people have very specific wishes about how they want their funeral to be conducted. Making detailed plans relieves your family from the responsibility of trying to guess what it is that you would have wanted.

9. Small businesses - If you are a sole director or there are only one or two of you the business can be left without a decision maker and nobody who can authorise payments - such as staff wages. You should also make plans for the sale of your share so that your family can receive the benefit of your hard work with as little interference as possible from the tax authorities. If it is your business partner that dies it will ensure that you don't have to liquidate the business to pay their beneficiaries.

10. Living Wills - If you are of unsound mind or unconscious and not able to make your wishes known to the medical profession they have no way of knowing what treatments - if any - that you may not want to receive. Making a living will removes that doubt.

Article Source: http://EzineArticles.com/5859319

Monday, April 25, 2011

Why You Need the Personal Liability That is Afforded You by Forming an LLC

There are certain liability issues that you need to concern yourself with as a business owner that are not present if you are working for someone else. Personal asset protection should be a major concern for you in case your company is ever involved in a lawsuit. Forming an LLC for your company is a great step towards providing this personal liability protection.

When you setup a limited liability company, you have to make sure that it is properly formed. In a court of law, your LLC has to stand up so that you are not facing personal liability from the operation of your business. Ensuring that your structure is setup properly is easy when you use an incorporation service to file the paperwork correctly on your behalf.

The more your company grows, the more contact it is going to have with customers or other parties. Each personal that deals with your business could possibly sue it, so you have to be protected against personal liability issues.

Unfortunately, as a business owner you can be the subject of a lawsuit at any given time. Protecting your personal assets from lawsuits is something you need to do as the possibility of being sued is a real one.

You need to have a business structure for your company to have the necessary personal liability protection, instead of operating as a sole proprietor. There is no reason to not have a limited liability company because of the inexpensive online formation services that are available, thus giving you the personal liability protection you need.

A company that is financial successful tends to be a larger target for a lawsuit than one that is not doing as well. So as your company finances improve, you are going to find that you are a larger target for those looking to sue a business.

You have to consider the fact that someone might be less inclined to sue a company with no money than they are going to sue a company that is worth something. As your company grows, you need to make sure that you are properly protected personally from any business lawsuits.

As a business owner, you need to make sure that you are personally protected from any liability arising from your business. Forming an LLC is a great first line of defense for personal liability protection. Completely separating your business and personal financial transactions, as well as having a properly setup limited liability company is a great way to limit your own personal liability exposure.

Article Source: http://EzineArticles.com/2063002

Sunday, April 24, 2011

Tax Advantages of a C Corporation

As you may know, a C-Corporation is what most people generally think of as a corporation. The owners (called shareholders) are not generally liable for the debts of the corporation. The corporation is taxed as a separate entity under the Internal Revenue Code based on specific provisions applicable to C-Corporations, including special C-Corporation graduated tax rates.

The shareholders are again taxed only if the income of the C-Corporation is distributed to them in the form of dividends. This is referred to as the "double C-Corporation tax" and is sometimes the main disadvantage of the C-Corporation as a form of business enterprise for some small businesses. In addition, a C-Corporation is liable for the accumulated earnings tax that is designed to prevent a C-Corporation from avoiding the payment of dividends to shareholders.

The Accumulated Earnings Tax is an additional business tax that is paid by corporations who choose to retain accumulated earnings rather than pay out the earnings in the form of dividends to investors. As a tax on earnings that are to be diverted into settling outstanding debt or investing in some aspect of the company operation, accumulated earnings taxes are calculated in addition to the usual corporate income taxes that I have outlined below. It is important to remember that the amount of accumulated earnings may impact the total amount of income tax due in a given quarter.

The Tax Advantages of a C-Corporation:

1. C-Corporation Graduated Tax Rates: Click on this link to see the graduated tax rates.

NOTE: For any successful business, these tax rates may be significantly lower on income up to $100,000 than the individual tax rates imposed on the shareholder of an S-Corporation or LLC.

2. Fiscal Tax Year: A C-Corporation may adopt any tax year it elects, even if this year is different from the tax year of its shareholders. This allows flexibility with the accrual of income and the payment of owner's salaries and bonuses. An S-Corporation or LLC must generally adopt a calendar tax year.

3. Employee Fringe Benefits: Shareholders of an S-Corporation or members of an LLC who own more than 2% of the corporation's stock are not allowed tax-advantaged fringe benefits available to the employees of a C-Corporation. These benefits include accident and health plans, group-term life insurance, and employer provided meals and lodging.

A Note on Double Tax on C-Corporation Liquidation: If a C-Corporation sells its assets and liquidates, there is generally a tax at both the corporate and shareholder level. When it comes time to sell the company in the future, you can discuss ways to significantly reduce this and or eliminate them completely through proper exit planning.

One way a C corporation can lessen the impact of double taxation is by paying you (the shareholders) who are employed by the firm reasonable salaries and bonuses on a tax-deductible basis. I like to review your corporate and personal tax situation annually to determine an appropriate level of compensation.

I believe that in many instances, the optimum tax and legal solution is achieved by the use of multiple legal entities. For example, combining a C-Corporation operating entity that conducts the active day-to-day business of the company with an S-Corporation (or LLC) leasing and management company to hold the land and fixed assets of the business and is responsible for overall management.

Article Source: http://EzineArticles.com/6032223

Saturday, April 23, 2011

Friday, April 22, 2011

Understanding Power-of-Attorney

A power-of-attorney (POA) is a legal document or instrument which allows one person to have the legal right to take actions and/or make decisions on another person's behalf. With a broad power-of-attorney, the recipient is able to legally do virtually anything that the issuer could have done him- or herself. As such, a POA can be a very powerful device in both daily, transactional, and probate application.

Power-of-Attorney Basics

A power-of-attorney document is issued (or "executed") by a person called the Principal. This is the person who intends to delegate certain rights and responsibilities to another person, or to have that person act on his or her behalf. The person to whom rights and responsibilities are delegated is called the Agent or Attorney-in-fact. Depending on the terms of the POA, the Agent may be given the power to:

- Manage the Principal's property (including buying and selling)

- Invest, liquidate, transfer, or otherwise manage the Principal's financial assets

- Undertake litigation or deal with legal matters on the Principal's behalf

- Take other legal, financial, or property-related actions or decisions

It is important to remember that, although a POA gives great power to an Agent, the Principal is still in control of his or her own affairs, and can make decisions regardless of whether he has issued a power-of-attorney. For example, a power-of-attorney can be revoked at any time by the Principal for any reason. Certain types of POA may also become invalidated upon the Principal's death or incapacitation (i.e., if the Principal becomes mentally incompetent to make sound decisions).

Types of Power-of-Attorney

Powers-of-attorney are generally divided into three main categories: durable, non-durable, and springing.

Non-durable powers-of-attorney are POAs which take effect immediately and will become invalid, should the Principal die or become mentally incompetent.

Durable powers-of-attorney are POAs which take effect immediately but remain valid even if the Principal becomes mentally incompetent and last until the Principal dies.

Springing powers-of-attorney are POAs which are designed to take effect upon the occurrence of a certain event, such as the principal's death.

Choosing an Agent

Choosing the right Agent is a key step in drafting a power-of-attorney. An untrustworthy agent can destroy your finances, relationships, and legal standing with the powers that you delegate to them. Furthermore, it is usually up to the Principal or people close to him/her to monitor the actions of the Agent. Keeping accurate records can help catch evidence of abuse before too much damage is done.

Article Source: http://EzineArticles.com/1227064

Thursday, April 21, 2011

Forming a California Limited Liability Company - Mistakes to Avoid

Are you an investor or entrepreneur setting up a limited liability company for a California venture? Your decision probably makes good sense. An LLC reduces your legal risks and (usually) minimizes income and payroll tax expenses. But be careful! You want to avoid three common incorporation boo-boos:

Mistake #1: Ignoring the Franchise Tax

Limited liability companies deliver big benefits in terms of minimizing legal and business risks and in terms of grinding down your business taxes.

If you own a business or investment through an LLC, for example, you're not (and other owners won't be) liable for the LLC's debts or other obligations merely because of your ownership.

Furthermore, limited liabilities companies offer huge tax accounting benefits, including the ability to elect the tax treatment you want for the LLC: sole proprietorship, partnership, c corporation, S corporation, and so on.

Unfortunately, the state of California (rather uniquely among states) reduces the attractiveness of the LLC option. The state levies an annual LLC tax on limited liability companies. At a minimum, this tax equals $800, but the hit goes up based on the business's income rises.

The LLC franchise fee is significant for many small investors and micro-businesses. Accordingly, make sure if you're thinking about forming a limited liability company that formation still makes sense once you consider the extra state taxes you pay as a result.

Many very small investments and businesses, very frankly, probably can't justify paying $1,000 or more for the benefits the LLC option delivers.

Mistake #2: Planning for Quick Setup

Another mistake related to forming an LLC in many states - including California - is this: State government offices that process LLC applications are now taking longer and longer to stamp the paperwork "approved." And that means you need to plan ahead and factor the delays into your business and investment plans.

In mid-to-late 2010, for example, the California Secretary of State says that processing the articles of organization for a limited liability company requires roughly sixty days. That's actually pretty brutal: If you want to operate your business as an LLC, you'll going to have to wait almost two months just to get the business or investment entity setup.

Mistake #3: Using a Nevada Corporation or LLC

Another blunder to avoid like the plague is incorporating in Nevada or some other "business friendly" state like Delaware.

With the massive hassle-factor of incorporating California limited liability corporation, you might wonder whether you can just go next-door to Nevada.

Another state's fees and taxes are almost always going to be lower than California's. And many states quickly process business formation documents because they realize that doing so benefits everybody.

But practically speaking, you can't simply "opt" for incorporating in another state. If you're operating your business or making an investment in California, you either need to use a California LLC or corporation... or if you've initially setup up a corporation in another state (like Nevada) you'll need to register your Nevada entity as a foreign corporation or foreign LLC operating in California.

Registering a "foreign LLC" or "foreign corporation" in California, however, puts you right back at square one: Registration of the foreign corporation takes months and triggers the annual franchise fees and taxes.

Article Source: http://EzineArticles.com/4794291

Wednesday, April 20, 2011

Probate - Understanding The Basics

Probate is a legal process that occurs after a person passes away. It involves the transfer of the assets of the deceased to the beneficiaries and creditors. If there is a will and it names an executor, the executor will be responsible for seeing that the terms are carried out throughout the probate process. The executor must identify and inventory the assets and also have them appraised. This process can take anywhere from a few months to a year. The executor may have to sell vehicles, land, securities, artwork or other property to pay any cash bequests - or pay off any debts left by the deceased. The executor could be a relative or an unrelated person. He or she could ask the lawyer who drew up the will for help with the legal necessities of probate. The cost of the lawyer will be paid directly by the estate of the deceased.

If the deceased did not leave a will, or if an executor is not named in the will, then the probate court will frequently assign the responsibility of handling the probate process to a relative; such as the spouse or child, or to the person who inherits the bulk of the assets of the deceased. This person is called the administrator. If a probate proceeding is not required, the court will not appoint an administrator. Instead, the family members and friends of the deceased will choose a person to serve as an informal administrator.

The probate process has several phases. The executor or administrator must prove the validity of the will and deliver it to the local probate court. The will can be validated with a written statement made under oath by the two witnesses to the creation of the will. The executor or administrator must also present the court with information on all of the property and debts of the deceased and the beneficiaries. Then creditors are informed of the death of the deceased. Creditors usually have six months from the notification of the probate to collect any money that is owed to them.

They must recover the money from the estate and not the heirs. The estate tries to settle these debts out of the available assets. If any assets are left, they are distributed to the beneficiaries. If all of the debts cannot be paid off, then the court decides how to use the available assets to pay off the debts. The heirs are not legally obligated to pay off any remaining debts of the estate. If the deceased did not leave a will, the state laws will decide how the available assets are distributed to relatives. The heirs and the beneficiaries are also notified about the probate proceeding. This is the time when objections to the will are usually made. The objections can be due to accusations that the will was drawn up while the deceased was mentally unstable, or that the will is a forgery.

There are situations where probate is not a necessary action. One situation is when the deceased leaves behind very few possessions which can be distributed to beneficiaries without any judiciary supervision. If there is any money account or property that is jointly owned, then the remaining co-owner will get the money account or property by default.

Article Source: http://EzineArticles.com/640732

Tuesday, April 19, 2011

California Advance Health Care Directive

The name Terri Schiavo invokes a visceral reaction for many Americans. In 1990, Terri Schiavo, then 26 years old, suffered a cardiac arrest that deprived her brain of oxygen for 5 minutes before being resuscitated. The consequential brain damage left Terri in a persistent vegetative state ("PVS"), unable to move, communicate, swallow, feed herself, make choices, think, or feel pain or emotion. She failed to regain consciousness for the rest of her life. Experimental surgery and several years of therapy produced no recovery signs.

During Schiavo's unconsciousness, her fate was the source of seemingly endless, contentious, lengthy and expensive litigation, pitting Terri' husband against Terri's family. Ultimately Terri' husband prevailed, after 7 years of litigation, and Terri's feeding tube was removed by court order for the third and final time on March 18, 2005, and she died on March 31, 2005. An autopsy revealed that no treatment could have reversed the brain damage. Goodnough, Schiavo Autopsy Says Brain, Withered, Was Untreatable, New York Times, June 15, 2005, p A1, col 1.

A California version of Terri Schiavo involved Robert Wendland. Conservatorship of Wendland (2001) 26 C4th 519. In 1993, Robert Wendland, 42 was seriously injured in an automobile accident. Emerging from a coma, paralyzed and brain-damaged, he lived on a feeding tube for 2 years before his wife of 15 years, Rose Wendland, requested permission from California courts to be named his conservator (think parent) and to remove his feeding tube. Robert's physicians indicated that he would likely never recover significantly and that he failed to interact with his environment or attempt to communicate with his family and caregivers. Rose Wendland testified that he had told her before the accident that he would never want to live in a state in which he was completely dependent on others for his care. Before involving the courts, Rose Wendland had submitted the case to the ethics committee of Lodi Memorial Hospital West. This ethics committee voted unanimously that Robert Wendland should be allowed to die.

However, Wendland's mother and sister objected to Rose Wendland's petition and argued that Wendland should be kept alive. Ultimately, the California Supreme Court ruled that the conservator, Rose, needed to show clear and convincing evidence in order to remove the feeding tube, which she could not do. Although, Robert died while the case under submission.

Finally, the most famous end-of-life United States Supreme Court case, Cruzan v Missouri Dep't of Health (1990) 497 US 261, involved a then 25 year old automobile accident victim. The resulting injury left Nancy Cruzan in a PVS as well. The accident occurred on January 11, 1983. The Supreme Court case was not decided until June 25, 1990. Later on, Cruzan's feeding tubes were removed on December 15, 1990 and died 11 days later.

These cases illustrate that end of life decision are not exclusive to the mature community and can drag on for years if not properly anticipated. In response, Californians typically draft an Advance Health Care Directive to prepare for such a situation. The document can spell out what end of life procedures the drafter wants done, (i.e. pull the plug) and can also nominate an agent to make health care decisions on the drafter's behalf should the drafter become incapacitated like Terri Schiavo or Nancy Cruzan. It is a painful but necessary decision to draft an Advance Health Care Directive (known as a living will in some jurisdictions) because the consequences of not drafting are very steep. Furthermore, it is very straight-forward to draft one. Most, if not all people, want to die with some dignity, and an Advance Health Care Directive is the optimum instrument to effectuate that sentiment.

Article Source: http://EzineArticles.com/5119814

Monday, April 18, 2011

The Different Types Of HIPAA Compliance Forms

 In order for companies to be in compliance with the Health Insurance Portability and Accountability Act, or HIPAA, they must have the proper documentation. HIPAA compliance forms are pieces of documentation that help medical facilities and other businesses comply with the provisions of HIPAA regulations. This federal law, established by Congress, helps protect patient information of those individuals receiving medical care. The Health Insurance Portability and Accountability Act is a very serious matter. If a company is not in compliance with HIPAA regulations there are severe and specific penalties. All medical environments in patient or out patient care must follow HIPAA regulations. In order to have a satisfactory policy compliance there has to be a streamlined effort from all fields and levels of medical information. Below we will discuss some important HIPAA compliance forms.

3 HIPAA Compliance Forms You Should Know About

1. A notice of privacy practices is a common privacy form that you could be familiar with. This document informs patients of the provisions of HIPAA. This document will most likely be given to you by a health care specialist. You could possibly be given this document when you visit a medical facility. The document is generally meant for patients to better understand the regulations that protect them and how they are implemented.

2. Another HIPAA document you could be familiar with is the form to release your medical information to others. This document can be signed by a patient if they wish to release their information to other individuals such as a new medical office. If you have been referred to a specialist by your family doctor you will need to sign a release form so your medical information can be sent over to the specialist.

3. Patient request forms are another type of HIPAA related medical form. This can include a Patient Health Information (PHI) form. Also included in this category could be a patients request for accounting of disclosures. This form would entail a list of any offices that have received their medical information from a certain medical office.

Among other HIPAA compliance forms, another informal document called a HIPAA checklist is also available. This document provides a checklist of all the compliance information a medical facility should be following. This document can serve as a checklist for medical managers to follow to prioritize compliance. Many medical offices create these checklists on their own, as they are not required by HIPAA. Even though they are not required they are a great way to keep your office in check.

With HIPAA you can rest assured that your medical information will be safe and secure. The Health Insurance Portability and Accountability Act has changed the way medical information is transmitted and secured. When you travel to your doctor you will be able to understand the privacy documents you could be presented and realize that are they for your safety. HIPAA has dramatically decreased the fraud associated with health care. It continues to make our health care system more efficient and secure.

Article Source: http://EzineArticles.com/5329517

Sunday, April 17, 2011

Planning to Protect Your Entire Family in Case of Medical Emergencies

Do you know who is legally authorized to make your critical health care and financial decisions if you are disabled and cannot do so? What about your loved ones? We have heard from people whose elderly parents have had strokes away from home as well as those whose children have been seriously injured while at college. In both situations, because they do not have the proper legal authorization, they were not able to speak to medical personnel on behalf of their parents and children. Without the right planning in place and readily available at all times, these already difficult situations can land you in a disastrous bureaucratic tangle when you and your loved ones can afford it least.

With important new medical privacy laws such as HIPAA (Health Insurance Portability & Accountability Act) becoming more and more strictly enforced by hospitals and medical facilities, making sure you have the proper authorization is more critical than you might think. Without the proper legal authorization your loved ones may not be able to assist you when you need it most. And if you don't have the proper written authorization to assist your loved ones, including your spouse, children, elderly parents and anyone else you may be responsible for, you may not be able to assist in their health and financial decisions when they need you.

Because of HIPAA, it is more critical than ever that you have current and effective health care proxies, HIPAA release forms and durable powers of attorney. Due to issues of law and interpretation, these critical documents should be updated on an annual basis to ensure effectiveness.

Most parents are not aware that medical professional's interpretation of HIPAA laws can prevent you from receiving information about your children's medical condition once they reach eighteen. Hospitals and Student Health Administrations at most colleges are notorious for strictly enforcing these regulations. Some hospitals have even refused to tell parents anything over the phone-including whether or not their college age child has been admitted to the hospital!

If your elderly parents are relying on you to help them make critical medical and financial decisions, make sure that you have current and correct legal authorization readily accessible or you may find yourself cut off from access when they need your help most. For that reason we help ensure our clients have 24/7 access to all of their health care documents.

Even if you have current, enforceable documents, that may not be enough. Do you know how your documents will be accessed if there is an emergency? If they are on a shelf in your home or locked in a vault at your attorney's office, they will not be there for you when you need them most. Make sure you are not shut out of important health care decisions by ensuring twenty-four hour, seven day a week access to your documents and emergency contact information as well as those of your children, parents, grandchildren and other loved ones.

Article Source: http://EzineArticles.com/1501351

Saturday, April 16, 2011

The Importance of Home Ownership Papers

As with all types of investment, the one and only thing that really matters at the end of the process is that little piece of paper. The very same is true when it comes to real estate matters and the piece of paper you want to be holding when the loan or mortgage is settled are the title or deeds. This little piece of paper basically allows you to proof that you have officially paid off all outstanding debts and that you now own the house, a document of evidence we could say.

Having the title also means that even if someone else may be on the property or land, for example, as a tenant, the owner still maintains the legal rights that come with owning a property. The title acts as documentation that is matched in the records of the local authority you reside in as well as well as in the authority property itself is located in.

Deeds are similar kinds of credentials that are used in the procedure of attaining a title. More often than not, people who invest in real estate obtain a deed as a type of transaction paper to the title. This then confirms that the person or persons acquiring the property have rights to the title in addition to the rights for the property. Typically, there are a number of legal issues and conventions that are tied to this kind of document ensuring the transaction is a fair one.

If someone is about to receive a deed or a title for a house or piece of land or property, several factors have to be considered. Firstly, proof of insurance has to be shown and you'll also need duplicates to prove that you actually bought the house. The other people who are selling you the house or land will also need to have this proof of purchase. This would include invoices, receipts and a purchase agreement from the mortgage and what is known as proof of satisfaction, basically that the person who is buying the house or land/property has been able to meet all the requirements needed for purchase of the said property.

The final step in making your home is entirely yours is to ensure you have the title or the deeds in your hand. Appreciating this procedure in obtaining a title, and verifying you enter the final closing prepared to make the exchange, you will be able to own that property you have been working to.

Article Source: http://EzineArticles.com/1130253

Thursday, April 14, 2011

The Office - I Declare Bankruptcy!

The Office - I Declare Bankruptcy! Michael Scott declares bankruptcy. If only it were that easy.

Wednesday, April 13, 2011

Pros of Filing For Bankruptcy

There are certainly a lot of negative aspects to being in this situation, but there are a lot of pros to filing for bankruptcy once you've gotten into a situation to be considering it.

Your creditors will stop calling you. Chances are that you are well aware that you owe money--but creditors are still calling you, constantly. This will stop once you file.

You can stop focusing on your past problems. You've probably been pretty focused for a while on trying to fix these problems, but you can finally let go of that move on--this will be a huge relief. There will still be much to do, don't be mistaken about that, but at least it will be moving forward instead of constantly looking back and being stuck.

Instead, you can start focusing on rebuilding your finances. This will be difficult, but at least it's in the right direction. It will take a while to build up a decent credit score and be able to make any big financial moves again, but at least you'll be moving forward. Staying stuck in the same situation, and possibly digging yourself into deeper trouble, will certainly not be moving you forward, and probably will only be delaying the inevitable and taking longer overall.

Often while we're trying to put off having to file for bankruptcy and make such a big decision, we end up getting further behind and racking up more debt. Once it's gotten to a certain point there may be no other way out. By filing for bankruptcy you can get out of the situation, start moving forward and building a new life instead of letting this drag on further.

While it is certainly a hard decision to make with many downsides, there are a lot of pros to filing for bankruptcy.

Article Source: http://EzineArticles.com/5322037

Tuesday, April 12, 2011

The Different Types of Bankruptcy Options

Bankruptcy options can be a great choice for individuals and businesses that need financial help. When you borrow money from banks it can simply wipe your slate clean and help you be eligible to start over. There are two reasons for this:

o Discharging debt so that nobody is officially liable for the repayment

o Setting up a realistic payment plan that is under the discretion and supervision of the bank

Of course, bankruptcy should always be the last choice of someone who cannot take care of their financial responsibilities. You must always consider your bankruptcy options and compare them with all of your future financing.

Most negative items will stay on your credit report for seven years, but, bankruptcy will be shown on your report for ten. This can make it a lot more difficult to borrow loans or credit in future.

If this is the only option for you, then it is best to sit down with a bankruptcy professional and go over every bankruptcy option there is for your situation. There are two main types of bankruptcy, and they are:

1. Liquidation: This results in the payer not being responsible for the repayment of the certain debt, or more properly known as discharging the debt. The property of the 'filer' is sold so that the earnings can go toward the payment of his or her unsecured debts.

2. Reorganization: This allows an individual to rid their debt by setting up a specific payment plan under a judge's supervision. Of course, this kind of payment plan is court ordered. Any debts that are left unpaid are typically discharged. For the most part, the court system will understand your financial situation and help you if they can, but do not expect your payment plan to be just what you can afford. Most of the time, you will be able to afford it, but it will just be a little more than you hoped for.

There are currently four types of bankruptcy options that revolve around the filing of the claim.

1. Chapter 7: Liquidation for businesses and individuals

2. Chapter 13: Reorganization for particular individuals

3. Chapter 11: Reorganization for businesses and individuals

4. Chapter 12: Reorganization that may be reserved for individuals that may be in the fishing or farming business

All bankruptcy options will affect you all in the same way no matter which one you choose. It is normally great for credit card debts, but some debts may be obligatory, which means that the certain debt cannot be discharged. Examples of debts that cannot be discharged are student loans, tax and federal debts, child support and spousal support.

If most of your debts seem to be the latter, then it is in your best interest to look for other choices rather than bankruptcy options. Filing bankruptcy should always be the last resort, but sometimes people are in such a financial bind that this is the only option left to choose. For instance, you can always check out debt consolidation companies and debt repair. Just remember that if bankruptcy ends up being your choice, seek professional help.

Article Source: http://EzineArticles.com/3384010

Monday, April 11, 2011

LLC Versus Corporation - Choosing the Right Option

Small businesses hoping to protect themselves and their owners regularly ask which option is better: a limited liability company or a corporation. And no wonder. You can hear knowledgeable attorneys and accountants argue passionately for either option.

Nevertheless you can often get a good answer about what makes most sense in your specific situation by looking at the best reasons to form an LLC and the best reasons for incorporating.

Reasons to Choose LLC Option

Two big reasons suggest choosing the limited liability company option. The first reason? A limited liability company requires simpler governance as well as less red tape and paperwork.

By design, LLCs are set up so people can easily govern how the LLC's owners interact with the LLC and how the LLC governs itself. This "ease" means that correctly operating an LLC (in a legal sense) is very easy. A one owner LLC (also known as a single-member LLC) can safely and legally operate using the simplest of procedures and guidelines. (In contrast, corporations typically need to schedule annual shareholder meetings and regular board of directors meetings--and then corporations also need to appoint corporate officers to run things on a day to day basis.)

The second reason one chooses an LLC concerns the tax rules for LLCs. An LLC provides a really unique tax advantage as compared to a regular corporation. A one-owner limited liability company can be "disregarded" as a separate taxpayer and then just show its income and deductions on its owner's tax return. This keeps the accounting really simple.

Note: At some future point, an LLC (including a one owner LLC) can elect to be treated as an S corporation or a C corporation. Note that multiple owner LLCs are treated by default as partnerships but that these LLCs, too, can elect to be treated as S corporations or C corporations.

Reasons to Choose Corporation Option

You can point to at least three good reasons to choose a corporation over an LLC, even if you're initially going to be a rather small-time operation.

First of all, a corporation gets some "branding" benefit just by being a a traditional "corporation." This is weird, I'll admit. But sometimes customers and vendors just plain think that a corporation is (or sounds) more credible and trustworthy. Accordingly, if for basically psychological reasons you want a corporation or you want words and acronyms like "inc," "corp," "incorporated," or "corporation" in the business name, by all means, chose a corporation. Period.

A second benefit of a traditional corporation concerns the extra governance controls required by a traditional corporation. And, in essence, this is the flip side to that coin about LLCs requiring less governance. People (like outside shareholders) may require the governance controls that a traditional corporation provides. And in this situation, one typically wants to use a traditional corporation.

A third benefit of a traditional corporation deserves mention, too. While the extra tax accounting flexibility that an LLC offers its owners sounds appealing, in some situations the entity wants to be taxed as just a regular corporation (also known as a C corporation) right from the get go. In this scenario, one obviously doesn't get any benefit from the extra "tax flexibility" of a limited liability company. Accordingly, selecting a traditional corporation right from the start makes most sense and saves you paperwork. (The traditional corporation will initially automatically be treated as a C corporation.)

Article Source: http://EzineArticles.com/4523700

Sunday, April 10, 2011

Living Trust Vs Will: An Easy-To-Read Comparison for Californians

If you're from California, you probably keep hearing about Living Trusts and you might be wondering why do I need one? Indeed, my clients often ask me, "Isn't a Will good enough?" Well, the answer to that question depends on your particular circumstances.

You see, if you don't own a home and your personal property assets total less than $100,000, a Last Will & Testament is probably the appropriate transfer planning device for you. With a Will, you can avoid having your assets arbitrarily distributed to unintended beneficiaries and you can also nominate guardians for any minor children.

But, if you own a home or have over $100,000 in personal property assets, then it's highly likely your estate will need to pass through Probate. Probate is an expensive and time-consuming court proceeding that is usually unnecessary. Some people think if they have a Will they can avoid Probate. The opposite is true though. If you own a home or have personal property assets totaling over $100,000, having only a Will virtually guarantees that your estate will need to be Probated. Conversely, if you create and fund a legally valid Living Trust there will be no need for a Probate. That's because a Trust holds your assets, similar to the way in which a corporation holds it's assets. Since the Trust holds your assets instead of you directly, there are no assets for a Probate court to transfer upon your passing. Instead, the Trust itself enables the Trustees to easily take care of this process themselves for the benefit of the Living Trust's beneficiaries.

But what is a Living Trust exactly?

Simply put, a Living Trust replaces what most people think of, when they think of a Will. In other words, a Living Trust dictates to whom and how your assets are to be distributed after you're gone. A Trust also empowers a person or persons to carry out these duties. So far, this is virtually identical to a Last Will & Testament in California.

However that is where the similarities end. Besides Probate avoidance, a competently drafted Living Trust allows for sophisticated transfer tax planning and it helps families avoid conflicts. A Trust also can protect family assets from spendthrift children and their creditors. These are just a few financial examples of the post-death concerns that Living Trusts address and resolve.

But also, if you become incapacitated during life because of mental or physical disability, a Trust enables Successor Trustees to step in and help you. This is a major difference to Wills because they only take effect after a person's death. This additional function of Trusts helps to avoid an embarrassing, time-consuming, and expensive court Conservatorship. A Conservatorship is yet another court proceeding that is needed to appoint someone to help you, if and when you can no longer take care of yourself because of physical or mental incapacity. A properly drafted and executed Revocable Living Trust helps you to avoid a Conservatorship similar to how it helps your family avoid a Probate proceeding.

Without a doubt, Living Trusts allow families to achieve all sorts of unique and important goals. That is why Trusts are highly publicized. It is also why, Californians who own a home or have personal property assets that total greater than $100,000, should seriously consider setting up a Living Trust instead of just a Will.

Article Source: http://EzineArticles.com/5695807

Saturday, April 9, 2011

Angry Woman Humming In The Divorce Court

This lady starts humming just to control her anger... and then she starts to sing! Divorce is never funny but this clip sure is!

Friday, April 8, 2011

Do You Need to Update Your Will?

You will often hear about the necessity to update your Will, but do you know precisely what change in circumstances would mean that you should have it amended? Our lives change regularly, often dramatically, yet often, changing our Will is the last thing on our minds. The list below is designed to give you some guidelines to prompt you when you need to contact your Will writer.

* Has your marital status changed? Many people now marry more than once, and later in life. If you have remarried since your previous Will, your old document won't be of any use unless you inserted an 'anticipation of marriage' clause. This would then allow the Will to stay valid. The same applies to a recent civil partnership ceremony.
* Are you separated or divorced from a partner? Do you realise that in the event of your demise in this current situation, your former partner will remain your principal beneficiary unless you update your Will?
* Have any of your children been married or have you had any new children, adopted or otherwise? Have your children had children? If any of these circumstances apply, you should update your Will if you'd like any of these new children to also benefit from your Estate.
* Has your actual Estate changed? Do you own more or less than originally stated? Have you perhaps sold anything that was included in your Will?
* Did you name any of your friends as beneficiaries? Are you still friends with them or are you no longer in contact?

Article Source: http://EzineArticles.com/5797674

Thursday, April 7, 2011

Legal Separation Vs Divorce - Understanding How to Choose

Happily ever after is not always the case when it comes to being married. Often times married couples have a hard time and need to have a break from each other for one reason or the other. It is amazing how many marriages actually end in divorce. However, before you make the decision to get a divorce it is important to know all the facts and options before making a choice. You need to look at legal separation vs divorce when choosing the right one to fit your needs. First let us look at and distinguish the differences.

Legal separation is similar to a legal divorce however there are notable differences that need to be taken into account. A legal separation does not permanently dissolve a marriage, it is something that can be temporary if so desired. There are some couples that just need time apart from one another and living separately is the answer.

A legal separation occurs when the two parties are living separately and it has been filed through the court system. Do not mistake a legal separation for a separation. A separation is not filed with the courts and does not carry the same provisions as a legal separation. Much like a divorce, a couples assets, property and child custody are addressed via a legal separation agreement which is filed with the courts. A separation does not provide provisions and is based solely on verbal agreements. Living separately is mainly used to determine if separating is really what a couple wants to do. There is not paperwork or filing with the courts in the case of a separation.

A legal separation is mainly different from a divorce in the fact that the couple is still legally married. There are benefits to living separately instead of immediately filing for a divorce. A divorce terminates the marriage and any and all joint interest the couple may share. A living separately does not terminate the interest however it does divide the interest. Another benefit of a living separately is the couple can still take advantage of the tax advantages of being married, they can also continue with joint insurance coverage.

Once legally separated can be canceled at any time and the marriage returned to its original status. If a couple automatically proceeds with a divorce when there is a chance for reconciliation, the couple would have to get re-married. If there is any possibility of a reconciliation a legal separation is the way to go. It gives you the time to decide if being separated permanently is what you really want.

The statistics show that 50% of first time marriages end in divorce, especially for individuals under the age of 40. This may not be surprising to many of you because it is a sad but true fact. It seems to be a quick fix for many troubled marriages. Maybe if more people know there were other alternatives to divorce, no so many divorces would be happening. There are times when all a troubled marriage needs is a little time and reflection for both parties to see that they truly were meant to be together.

Whether you choose to have a divorce or get legally separated, it is highly recommended that you obtain legal counsel. Both a legal separation and divorce require filings to be made in the courts. A divorce also requires a reason for the divorce whereas a legal separation does not require any reasoning. Do not take for granted the different options afforded to you, sometimes making decisions quickly and while in an irritated or frustrated state is rash. Divorce and separation are not games, they are serious matters and need to be viewed as such.

Divorce is not something anyone wants to experience but there are times when the only alternative to a bad marriage is divorce. Whether you decide to have a full blown divorce or give a legal separation a try, it is important to find out all the details and facts before making a decision. Each state and country have different rules and prerequisites that apply for both legal separations and divorce. This is one of the most important decisions you will make; therefore, make it wisely.

Article Source: http://EzineArticles.com/3598645

Wednesday, April 6, 2011

Power Of Attorney

Power of attorney in the United States is the appointment of the agent to another person is still to allow a person to make decisions for another person on their behalf. Power of attorney can only be granted when the person giving the power understands the implications of their decision and the consequences the decision can have. If the person is not considered to mentally capable, than the granting will not be considered legally valid and binding.

There are four types of power of attorney forms, these are:


A general appointment covers a very specific period of time. This type of appointment is usually used for a specific financial of legal decision that will need to be made. When a person grants power at one time and then loses their mental capacity to make decisions, the appointment is immediately void and no longer valid. The person that was the agent will no longer be allowed to make any decisions for the person that originally granted them the power.

Enduring For Financial Matters:

This type of appointment only becomes active when the person has lost capacity to make decisions themselves. Granting this type of power of attorney is to prepare for the event of losing mental capacity, so that there is someone who will become active in the event that this takes place that can make financial and legal decisions for the person. These are the only decisions that can be made with this type of granting.

Enduring For Medical Matters:

Enduring power for medical matters is similar to enduring for financial matters. This is to prepare for the future event of no longer having the mental capacity to make medical decisions for yourself. This type of power of attorney only becomes active in the event that the person loses mental capacity. The agent can only make decisions that pertain to medical decisions and has no other power over the person's life.

Enduring For Guardianship Matters:

Again, this type of appointment only becomes active when the person has lost the mental capacity to make life style decisions for themselves. The person that is granted the power will only be able to make decisions that involve where a person lives or other similar life style choices. They have no other say in any other aspect of the person's life.

With any of the types of available power of attorney decisions, a person wants to make sure that the person being appointed is trustworthy and will act in their best interest. Keep in mind too, that with a general and enduring attorney, these can be appointed and written into the document that they must agree together on any decisions that are made for the decision to be legally valid.

Article Source: http://EzineArticles.com/5967518