Attorney Peggy Miller and Shannon O’Daye volunteered at the Family and Child Care Resource of Northeast Wisconsin Kite Fest event in Green Bay.  Di Renzo & Bomier, LLC sponsored a booth at Kite Fest for children to decorate their own kitten, puppy, or bird face masks, crowns and sun glasses.  Kite Fest is an event that is a fabulous day for raising awareness and funding for healthy child development programs.

Should Social Media be Addressed in my Will?

The United States Government recommends that your estate planning documents include provisions that address your Social Media accounts.  If you have an existing estate plan, an amendment to those documents can be made to address this issue.  If you do not have an existing estate plan, this is something you should consider when preparing those documents.  Here is a link to the article:

http://blog.usa.gov/post/22261234875/social-media-will

DiRenzo & Bomier, LLC welcomes new Attorney.

DiRenzo & Bomier, LLC is pleased to announce the addition of Peggy Miller.  Peggy will be practicing primarily in the family law and guardianship practice areas.  Peggy brings 15 years of experience to our already thriving family law practice. 

Wisconsin Right to Work Legislation

I.                   Wisconsin’s Right-to-Work Law

 

            Wisconsin’s Right-to-Work Law was signed by Governor Walker on March 10, 2015. The new law prohibits a labor contract from containing provisions which require workers to join a union and pay dues as a condition of obtaining or continuing employment. Specifically, the new law prohibits private employers from negotiating union contracts that require an individual to:  (1) refrain or resign from membership or voluntary affiliation with a labor organization; (2) become or remain a member of a labor organization; (3) pay dues or other fees to a labor organization; or (4) pay any third party an amount that is in place of, equivalent to, or a portion of dues or other charges required by members of a labor organization. Anyone who violates this law is subject to criminal penalties for a Class A misdemeanor, which may constitute a fine of up to $10,000, imprisonment up to nine months, or both.

 

            It is important to note that the new law does not impede a worker’s rights under the federal National Labor Relations Act, nor does it prevent unionization of private sector workplaces. Employers cannot ban union membership, but they also cannot require it.

 

            Notably, on Tuesday, March 11, 2015, a lawsuit challenging the law was already filed in Dane County by the Wisconsin AFL-CIO and local chapters of the International Association of Machinists and United States Steelworkers Association. The complaint alleges that the law violates the state constitution because it deprives the unions of property without just compensation. Similar lawsuits have been filed in other right-to-work-states, including Indiana, but the claims have failed.

 

II.                Effective Date:  March 11, 2015

 

            The new law became effective immediately (as of March 11, 2015), but it only applies to collective bargaining agreements that are executed, renewed, modified, or extended on or after March 11, 2015. Thus, any existing, mid-term labor contracts that were signed before March 11, 2015 will remain in effect until the contract is renewed, modified, or extended. Employees under those existing contracts will still be required to pay union dues.

 

            Additionally, the institution of the new law does not mean that unionized workers can immediately withdraw union membership. Unionized workers who are currently under a contract that pre-dates the law may be required to remain a member and pay dues until the contract term has expired. Furthermore, most unions only allow members to drop during brief annual periods, and if the member does not do so, the membership automatically renews. Unions tend to make it difficult for workers to withdraw, and the text of the law does not specify how members can terminate their memberships.

 

 

 

III.             Employer Implications

 

            Due to the infancy of the law, it is hard to pinpoint the exact effects this new law will have on employers. However, Wisconsin is the 25^th state to enact a right-to-work law, and it may be helpful to examine the effects similar laws have had on employers in other right-to-work states. Many right-to-work states report that the laws give employers more freedom in hiring and more leeway with wages. On the other hand, opponents of the law contend that right-to-work laws drive down wages. Opponents are also concerned that the law causes a “free-rider” problem because even non-unionize workers who do not pay union dues are covered by many collective bargaining agreements.

           

            One of the major effects of the law may be a significant decrease in union membership. In Michigan, for example, union membership reportedly declined by 48,000 members even as the workforce grew by 44,000 people in 2014. The sharp decline in membership has resulted in decreased union revenue and support from employees, which weakens the bargaining power of the union. Therefore, employers will have more bargaining power when negotiating labor contracts. For this reason, and many others, right-to-work states become more attractive to employers, thus bringing more jobs to the state. Right-to-works laws are expected to boost the state economy consequently.

           

IV.             Conclusion

 

Essentially, employers and employees are required to abide by existing, mid-term labor contracts even if they require membership dues. Any contracts executed, renewed, modified, or extended after March 11, 2015 cannot require union membership or payment of union dues as a condition of obtaining or continuing employment. Although the particular implications on employers remain to be seen, it is important that employers are aware of this new law when negotiating new labor contracts.

Your Claim Has Been Denied, or Has It?

DiRenzo & Bomier recently settled a claim for well in excess of $100,000.  While this may not be interesting in and of itself, the story becomes more interesting when the same claim was denied by the insurance company at the claims adjuster level.  What this means is that DiRenzo & Bomier did not take no for an answer and filed a lawsuit.  Ultimately the insurance company that offered nothing to resolve the claim prior to the lawsuit, paid a sizable settlement because DiRenzo & Bomier pursued its client's legal right of recovery.

Are business gifts and awards tax deductible?

Many entrepreneurs and small businesses are not aware of the tax implications of gifts given to employees, customers and business associates or awards given to employees. There are some specific limits and rules around gifts and awards that you should understand. First, you can deduct gifts to customers, clients and business associates, but you are limited to $25 per recipient per year. That’s really a low amount. This limit was set in 1954, when gas was 25 cents a gallon, and has never changed. Try sending flowers or a fruit basket for less than $40! (It may be time for a new tax act to change this rule.)  You are allowed to deduct the cost of engraving, packaging and mailing the gift separately, provided the added cost is incidental to the gift itself. When you give a customer tickets to a football game, a concert, a play, etc., the IRS says you can treat it either as a gift or as entertainment expense, which is 50% deductible. In most cases, with the high cost of sporting and arts events, it will usually make more sense to call these expenses “entertainment” rather than gifts.

Can you combine limits?

With this low limit on business gifts, you might try to get around it by combining limits of your client, their spouse, their children, etc. However, the IRS considers married couples to have one $25 limit between the two of them. You can have a separate limit for the client’s child if you have a real business relationship just with that child. This assertion might not fly if you’re giving a small child a nice bottle of French Bordeaux. The gift must be appropriate for the recipient. The IRS does not let you combine your limit with your spouse’s limit for the same individual, even if you both have real business relationships, separate from one another, with the same person. They just don’t want you to go over that $25 limit!

Gifts to employees or co-workers

Now, let’s talk about gifts to your employees or co-workers. Low-value gifts to employees are fully deductible. What’s a low value gift exactly? This is not defined in the tax code, so it’s really up to you and your tax/legal team to decide. The most popular gift to employees is cash or gift cards. They are perfect for any occasion! But as employee gifts, cash, gift cards and other cash equivalents are considered taxable compensation to be included on the employee’s W-2. So maybe gift cards are not the perfect gift after all. Achievement awards to employees are not treated as gifts or taxable income. If the achievement award is $400 or less, is presented to employees at a “meaningful presentation”, and is not cash, gift cards, securities, or other cash equivalents, it is deductible in full and not taxable to the employee. If your business has a documented qualified employee achievement award program that does not discriminate in favor of highly compensated employees, you can give out fully deductible achievement awards of up to $1,600 per year per person,  but the gifts cannot be cash or cash equivalents.

Say no to gifts to officials

What about gifts to police officers, regulatory inspectors, and government officials? (Whoa, just typing that made me feel all queasy inside.) You need to steer clear of these types of gifts, which may be considered bribes. Obviously, bribery is illegal in the U.S., as it is in most countries around the world. However, bribes are commonly used in some places to help “grease the wheels”, to secure approvals, and to win contracts.  As a U.S. company doing business in another country, you are prohibited from bribing by the Foreign Corrupt Practices Act (FCPA), which carries stiff monetary penalties and/or jail time for those found guilty. Anything that could be construed as a bribe, including trips, accommodations, etc., as well as cash, is subject to the FCPA as circumstances dictate. So if you paid for the Defense Minister of Country X’s spouse to go to fashion week in New York City, complete with prime tickets to her favorite designers’ shows, and within a few weeks your company sold Country X’s military a large order of insect repellent, you may get a visit from the U.S. Department of Justice. Consult with an attorney if you’re still thinking about using this tactic. I’ll say it, even though it should go without saying, that bribes, and the associated fines from the U.S. government, are not deductible.
In summary, deductions for gifts to customers, clients, and business associates are limited to $25 per person per year. Gifts to employees do not have a limit but they must be “reasonable”. If cash or cash equivalents are given, they must be reported as compensation and taxed, in order to be deductible. Certain employee award programs have higher limits for gifts, but require other compliance measures. As is usually the case, documentation is your friend when it comes to deducting gift expenses.

DiRenzo & Bomier, LLC welcomes new Attorney, Mary Stahler

DiRenzo & Bomier, LLC is pleased to announce the addition of Mary Stahler.  Mary is joining the firm after recently graduating from the top of her class at Valparaiso University Law School.  Mary’s primary practice areas will include trusts, estates, real estate, and business transactions.