Transactional

By: Theodore F. Claypoole

During February 2010, the Internal Revenue Service (“IRS”) began its first Employment Tax National Research Project in 25 years. As part of the project, the IRS will randomly select a total of 6,000 taxpayers (2,000 taxpayers in 2010, 2,000 taxpayers in 2011, and 2,000 taxpayers in 2012) for comprehensive audits of those taxpayers’ compliance with employment tax law and related reporting requirements. More information about the project can be found on the IRS’ website.

For more information on the Employment Tax National Research Project or Federal income taxes, please contact Theodore F. Claypoole at 610-692-1371 or tclaypoole@utbf.com.

By: Theodore F. Claypoole

While acting in the capacity of an officer of a corporation or manager or member of a limited liability company, it is important for one to hold himself or herself out as the officer or manager or member of the corporation or limited liability company, as applicable. There have been many recent court cases involving creditors attempting to have the Court hold the officers or shareholders of a corporation personally responsible for the corporation’s debts to that creditor. In addition to attempting to pierce the corporate veil of a corporation, a creditor may argue that the officer personally contracted for the services with the creditor. Officers of a corporation and managers and members of a limited liability company may unduly subject themselves to personal liability in a contract intended to be between their corporation or limited liability company and a third party if the officer, manager, or member fails to sign the contract in his or her capacity as an officer, manager, or member of the corporation or limited liability company, as applicable.

For example, a creditor may argue that John Doe, President of ABC Corp. is personally obligated under a contract where John Doe signs the contract as simply John Doe. He should sign the contract in his capacity as an officer as follows:

ABC Corp.

By: John Doe
John Doe, President

OR

John Doe
John Doe, President of ABC Corp.

For more information on corporations or limited liability companies, please contact Theodore F. Claypoole at 610-692-1371 or tclaypoole@utbf.com.

By: Denise C. Werkley

Will you see solar panels in your neighborhood? Maybe, or maybe not depending on whether there is a homeowners association and what the restrictions for your neighborhood say – but it may not matter for long. Pennsylvania State Representative Tom Houghton has recently indicated he intends to put forth legislation which would prohibit Homeowners Associations from enforcing restrictions which impede or prohibit the use of solar panels.

Do solar panels help or hurt the aesthetics and value of a neighborhood? Will this increase green building and marketability of homes? It will be interesting to watch how this legislation unfolds. View a recent press release and Rep. Houghton’s request for co-sponsorship describing the legislation.

Contact Denise C. Werkley for more information.

By: Daniel P. Dwyer

Please read my blog to learn about the 2009 update to the Pennsylvania Mechanics Lien Law.

Contact Daniel Dwyer for more information.

By: Denise C. Werkley

Effective January 1, 2010 new HUD rules went into effect which require the settlement process for borrowers to be made more clear by the use of new forms. The Good Faith Estimate form and HUD-1 Settlement Statement required by the Real Estate Settlement Procedures Act (RESPA) has been revamped. Lenders, borrowers and title companies need to be sure they have implemented the new changes. For more information on the RESPA changes please contact Denise Werkley.

HUD’s press release on the RESPA changes can be found here.

For a sample of the new Good Faith Estimate Form, go here.

For a sample of the new HUD-1 Settlement Statement, go here.

By: John K. Fiorillo

If you are a homeowner, please read my recent blog about real estate taxes and assessments. Contact John Fiorillo for more information.

By: Nancy J. Glidden

Please see our blog on financial responsibility of the members of a closely held LLC.

Please contact Nancy Glidden for more information.

By Brian D. Boreman

Read our recently posted blog about the Fair Labor Standards Act.

By: William J. Burke

Can the creditor of one spouse reach funds in the spouses’ joint account to satisfy the debt? A Delaware County Pennsylvania judge said “yes” in a recent case, Gross v. Laver. Although property jointly held by husband and wife as entireties property, including cash in joint bank accounts, cannot usually be reached to satisfy the debts of only one spouse, the Court held that transfers of money into their bank account over a period of time were “fraudulent” under the Pennsylvania Uniform Fraudulent Transfer Act.

The husband – had his paycheck from his medical practice direct-deposited into an entireties joint bank account, from which disbursements were made for various expenses, including ordinary living expenses and mortgage payments. However, there were many disbursements for other expenses, including substantial expenses for maintaining a number of horses (about $48,000/year), gift of a car to the couple’s daughter, and other expenses associated with the continuation of an affluent lifestyle. The Court considered the amount of funds deposited into the account and what that money was used to pay for, and also considered the duties and services performed by the wife (who did not work outside the home). The Court concluded that there was no reasonably equivalent value received in exchange for the substantial transfers into the joint account, and ordered both husband and wife to pay the judgment. The case is on appeal.

For more information, please contact our office.

By: Transactional Department

Not all debts are dischargeable in bankruptcy. The key is to know which claims can be exempted from discharge and then what steps you, as a creditor, need to take to preserve your non-dischargeable claim. For a primer on the steps you should take, click here.

For more information, please contact our office.