Broward County’s New Recording Procedures

journalsBroward County, Florida, has released a recent update on their new record keeping procedures. Effective January 1, 2015, Broward County will no longer assign Book and Page numbers to the documents being recorded. The new record keeping procedures will be done through an “Instrument Number” which is how the documents will be found if searched in their database. They do make an exception for large format documents. See Broward County’s Memo for further information.

Source: RTT Instrument Number Memo

ATTENTION: NEW FLORIDA SMALL BUSINESSES- BEWARE OF SCAMS!


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A Florida company based out of Tallahassee, Florida, has been attempting to convince new business owners who have recently formed a new corporation or LLC, to send money by exaggerating to be involved in a vital step in the business formation process. This “company” has gone by other aliases such as the “Florida Center of Corporation,” and now currently operates under “United Business Services”

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In the letter it states: “You have one step left to receive your Florida Certificate of Status”, they are instructed to complete their filing by filling out a stub and to “mail back to the corporations center with your payment of $47.00 (some recent mailings have said $47.99 or a similar amount) to complete your articles of organization certificate.” We urge caution because the correspondence is made deceptively like it is coming from a government agency. And note in the image here, that in very fine print, it states that “This is not a government agency.”

 

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We classify this as an inappropriate deception of the Florida Department of State services because the only service United Business Services is providing is to obtain a Certificate of Status (or good standing) from the Secretary of State of Florida.  The state only charges either $8.75 (for an INC) or $5 (for an LLC) for this.  Furthermore, when we checked the address for the company, it came up as an empty office space which is available for rent. The company came up in no searches affiliated with that address, or any other.

 

If you have any questions as to the legitimacy of these letters, do not hesitate to contact your Florida Business Law Attorney as soon as possible.

Conduct a Year End Clean-Up for Your Business

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As the year end approaches, there are some important questions to ask yourself about your business. Where does your company currently stand financially? What do you plan to achieve in the upcoming year and next five years? In order to answer some of these important questions, the first thing to do, is conduct a year end clean-up for your business.

The first recommendation is to check all your contracts and agreements currently in place, and see if there are any amendments, updates, or law changes that need to be made in the document. If contract and/or agreements need to be updated and have not been done so already, this would be the perfect time to update them for the upcoming New Year.

Secondly, your corporate binders should be updated, as they include all the important legal documents that manage your business. The incorporation documents, the bylaws or operating agreements of your business, the policies and procedures, as well as the minutes from the meetings need to be updated on a bi-annual or annual basis to make sure they comply with the Florida Statutes and new laws in effect.

Another thing to clean up is your employee, independent contractor, and/ or vendor agreements, as they should comply with the current laws, should have a good standing effective date, and still be up to date. Many times when we are retained, we find our client’s agreements are outdated or non-compliant with Florida laws. Maintaining and updating your business paperwork can take a lot of time and effort; however it is a necessary step that needs to be done on a yearly basis, in order for you to run your business effectively and successfully!

If you have any questions about conducting a year end clean-up for your business, feel free to contact your Business Law Attorney today, we will be happy to assist you through this process!

 

The Biggest Estate Planning Mistake

The most common mistake that can be made when estate planning is the failure to keep your forms and documents up to date.  As simple as it sounds, there are countless instances where people who did not have updated beneficiary forms inevitably ran into complications later in the process.

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Without proper documentation, the money and property you saved for your loved ones may fall into the hands of ex-spouses, irresponsible or untrustworthy family members, or other unintended heirs.  Besides having control over who gets your money and how much, designating a beneficiary also avoids probate in some circumstances.  Updating your estate plan regularly, you can be certain your wishes will be carried out in your absence the way you want them to.

Here are some of the forms that you should update regularly: bank accounts beneficiary lists, retirement accounts, life insurance benefits, and so on.  If a divorce, death, or any other life or relationship change occurs that will affect how you plan your estate, it is imperative you make those document changes immediately.  Contact us today to speak with a Florida Estate Planning Attorney and ensure you are protected in all aspects of your estate planning.

Source: Estate Planning Digest 

Real Estate Investment Tips on Tax-Deferred Exchanges (1031 Exchange)

A tax-deferred exchange is a where property owner trades one or more relinquished properties for one or more replacement properties of “like-kind”. The payment of federal income taxes and some state taxes on the transaction is deferred until a later date, instead of a typical transaction where the property owner pays the taxes on any gain realized from the sale.  The exchange, however, is not tax-free.  When the replacement property is ultimately sold, the deferred gain as well as any additional gain realized is subject to tax.

Section 1031 of the Internal Revenue Code states “that no gain or loss is recognized on the exchange of property held for productive use where the property owner has reinvested the sale proceeds into another property.  For example, if vacant land is exchanged for an apartment building, the taxpayer could not be forced to pay taxes on “paper gain”.  The general guidelines to be met in order to allow the taxpayer to defer all taxable gain are that the value of, equity in, and debt on the replacement property must be equal or greater than the value of the relinquished property.  Also, all of the net proceeds from the sale of relinquished property must be used to acquire the replacement.”

The main reason to exchange property instead of selling is the ability to postpone taxes or potentially eliminate them all together.  That way you are able to use the money saved towards investing in another property, and you receive an interest free loan from the federal government in the amount you would have paid in taxes.

Before considering a tax-deferred exchange, there are a few requirements that allow for this replacement.  First, your property must qualify.  Properties that are specifically excluded are: inventories, stocks, bonds, or notes, properties held primarily for sale, interests in a partnership, certificates of trusts, and choses in action.  Also, both the relinquished and replacement property must be held for productive use in a trade or business investment.  Immediate resales or the taxpayer’s personal residence do not qualify.

Tax Deferred Exchange

For a deferred exchange, the properties must be of “like-kind”.  This means they must both be located in the U.S. and must qualify.  Personal properties must be of like-class.  It is also a basic requirement that the relinquished property must be directly exchanged for the other property and cannot be sold for cash to be used in purchasing the replacement property.

Tax-deferred exchanges can be very beneficial for the taxpayer planning to sell an investment or property.  As long as the IRS guidelines are strictly followed, this method can be used as a wise investment strategy. Avoiding losses potentially as high as 30% due to state and federal taxes means allowing the proceeds to go towards future investments or make improvements to the replacement property. If you are considering a tax-deferred exchange for your property, contact us if you are interested in this type of transaction!

For more information see: http://www.irs.gov/uac/Like-Kind-Exchanges-Under-IRC-Code-Section-1031

Changes to Florida Land Trust Law

A Land Trust is an incredibly useful document that may benefit and protect you as a property owner.  Most tax advisers and U.S. attorneys are unfamiliar with the purpose and value of a land trust, and do not know how this device works.  Through the use of a land trust, you are able to keep matters of estate private and avoid probate (proving the legitimacy of a will of course).  This means avoiding a large amount of attorney’s fees and delays in property distribution to your beneficiaries.  With the laws constantly changing and adjusting, it is important to speak with a Florida Real Estate Attorney that can help you draft these documents could potentially save your and your family from unnecessary actions later on.

New Land Trust Law

The New Law

Effective June 28, 2013, there has been significant changes in the Florida Statues regarding land trust laws. Florida Statute Section 689.071 has been amended with the passage of House Bill 229, meaning this statute no longer contains the same third party protection features, which have been moved to Section 689.073. Trustees are now able to deal with trust properties under the powers of the deed and do not need to disclose the terms of the trust. Starting immediately, deeds where the title is taken by a trustee with trust powers stated in the deed will now refer to the new laws.  These changes may affect you and could create legal implications you are not aware of.  Call Gulati Law today to find out if these new laws effect your current situation or if you are interested in drafting a land trust for your property or land.

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