by: Bradley R. Coppedge, Esq. You’ve heard it said that for many people, their house is their largest or most important investment. But for small business owners, his or her business may well take the place of the house as the most important investment. So when it comes to estate planning, what is the best course for the business owner? Gift it to children? Sell or gift it to employees? Sell it to a third party buyer? Just close up shop at death? There are 3 primary ways to transition a business as the owner considers or plans for retirement: 1) no “transition”–shut it down and liquidate assets 2) sell the business to employees or unrelated 3rd party 3) sale, gift or combination of the two to children or related parties. In considering an actual transition short of ‘shutting down the business’, four key issues need to be on the…       Read More

Compiled by: Richard Sheinis, Esq. Cyberattack Caused Olympic Opening Ceremony Disruption New York Times “The purpose of this malware is to perform destruction of the host” and “leave the computer system offline.” In an interview, Talos researchers noted that there was a nuance to the attack that they had not seen before: Even though the hackers clearly demonstrated that they had the ability to destroy … Implementing the NIST CSF for Improved Healthcare Data Security HealthITSecurity.com February 12, 2018 – Cybersecurity frameworks are often cited as key ways for organizations to improve their approach to healthcare data security, especially as more entities utilize connected devices and work toward interoperability. The National Institute of Standards and Technology (NIST) has one of … Facebook Starts Pushing its Data-Tracking Onavo VPN Within its Main Mobile App TechCrunch Onavo Protect, the VPN client from the data-security app maker acquired by Facebook back in 2013, has…       Read More

By:  John E. Parkerson, Jr., Esq. and Katja Demmel A January 24, 2018 federal court jury conviction in Madison, Wisconsin serves as a serious warning to companies about how they can be destroyed easily by the theft of intellectual property. Fortunately, federal prosecutors were successful in securing a criminal conviction – but unfortunately not before the company that was the theft victim was almost destroyed. After 11 days of trial, the jury convicted Beijing-based Sinovel Wind Group Co. Ltd. (“Sinovel”), the largest wind turbine manufacturer in China, of conspiracy to commit trade secret theft, theft of trade secrets, and wire fraud. Sentencing is set for June 4. The crimes’ victim was American Superconductor, Inc. (“AMSC”), a U.S. energy technologies company based in Massachusetts. The theft caused AMSC to lose hundreds of millions of dollars, more than $1 billion in shareholder equity, and almost 700 jobs representing over half its global workforce. With…       Read More

Compiled by: Richard Sheinis, Esq. Medical Supply Giant to Pay $3.5M in Settlement for Five Separate Data Breaches PropertyCasualty360 Cyber liability insurance market: Equal parts promise and peril. The cyber liability insurance market presents opportunities as well as potential hazards for insurers. North Korea Latest: How Kim Jong-Un Trains Elite Hackers to Target Enemies Around World Express.co.uk A 2017 report by the US Congressional Research Service predicts there may be as many as “between 3,000 and 6,000 hackers trained in cyber operations” acting on behalf of North Korea. Typically they are able to produce their own sophisticated hacking tools rather than relying on established … Hacking Threats Loom Over 2018 Olympics The Hill Cybersecurity experts believe the group is a so-called “faketivist” hacking persona associated with Fancy Bear. Meanwhile, experts at Trend Micro identified several Olympics sport organizations among the cyber group’s targets in the second half of last year, including…       Read More

Written by: Brent Allen, Esq. and Adam Prom, Esq. Florida is on the front lines of the opioid epidemic. According to the Florida Behavioral Health Association, opioid-related hospital costs amounted to $1.1 billion in 2015.1)Florida Behavioral Health Association, Florida’s Opioid Crisis (January 2017), available at http://www.fadaa.org/links/Opioid%20Media%20Kit_FINAL.pdf. This figure represents a steady increase in opioid-related hospital costs year over year, which were $460 million in 2010 and $933 million in 2014.2)Id. Moreover, according to the Florida Department of Law Enforcement Medical Examiner’s Commission there were 5,725 opioid-related deaths reported in Florida in 2016.3)Id. This represents a 35% increase in reported opioid-related deaths from the prior year. Prescription drugs, including opioids, were found to be the cause of death or present at death more often than illicit drugs, and accounted for 61% of all drug occurrences.4)Id. The State of Florida is fighting back. On May 3, 2017, Florida Governor Rick Scott issued…       Read More

Written by: Anthony E. Stewart, Esq. The Internal Revenue Service (IRS) and state tax agencies are warning employers about one of the most dangerous phishing scams in the tax community. Cybercriminals are targeting organizations nationwide and tricking payroll personnel into disclosing the sensitive personal information of an organization’s entire workforce. Last year, more than 200 employers fell victim to this Form W-2 phishing scam, which compromised the identity of hundreds of thousands of employees. The IRS has warned that organizations have lost both employees’ W-2s and thousands of dollars in fraudulent wire transfers as a result of the scam. A W-2 contains sensitive personal information, such as an employee’s name, address, social security number, income, and withholdings. If this stolen information is used to create and submit false tax returns or open lines of credit, the organization may also be liable for the resulting identity theft of its employees. Here’s…       Read More

Compiled by: Richard Sheinis, Esq. ‘Jackpotting’ Hackers Steal Over $1 Million from ATMs Across US: Secret Service Reuters A hooded man holds a laptop computer as blue screen with an exclamation mark is projected on him in this illustration picture taken on May 13, 2017. … The heists, which involve hacking ATMs to rapidly shoot out torrents of cash, have been observed across the United States spanning from the Gulf … Tech Giants Brace for Europe’s New Data Privacy Rules New York Times Amazon recently began improving the data encryption on its cloud storage service and simplified an agreement with customers over how it processes their information. And on Sunday, Facebook rolled out a new global data privacy center — a single page that allows users to organize who sees their … As Hackers Gain Strength, Israeli Cyber Firms Raise More Money Than Ever The Jerusalem Post As hackers gain strength,…       Read More

This article discusses the new deduction available to non-corporate taxpayers for “qualified business income” earned from pass-through entities, such as S corporations and limited liability companies. As a general matter, “qualified business income” is income which is earned from a domestic business, which is not investment income, and which is not compensation for services provided by the taxpayer. Moreover, unless the taxpayer’s taxable income is below a certain amount, the income generally must be earned from a business whose primary offering is something other than the provision of services in order to qualify for the deduction. Once it is determined that the income meets the definition of “qualified business income”, the taxpayer generally may, subject to several important limitations, deduct 20% of this income from his adjusted gross income in determining his tax liability.

This article discusses the basic considerations which must be addressed in forming and operating a Section 501(c)(3) organization, primarily from a federal income tax perspective. It addresses the purposes for which 501(c)(3)s may be organized and operated, commercial activities of 501(c)(3)s and the unrelated business tax, the prohibition against private inurement, and the taxation of excess benefit transactions. The article discusses limitations on lobbying activities by charitable organizations and the prohibition on political campaign activities. Finally, the article addresses special considerations which apply to certain types of non-profits, including hospitals and educational organizations.

Hall Booth Smith, P.C. congratulates Partner James W. “Jim” Standard, Jr. on completing a Master of Laws (LLM) degree in Taxation from New York University School of Law, one of the most prestigious tax law programs in the nation. Standard’s studies focused on corporate and partnership taxation, the taxation of mergers and acquisitions, international transaction taxation, executive compensation taxation and tax-exempt organizations. Standard leads HBS’s transactional and business litigation practice groups, and his taxation expertise deepens the firm’s capabilities in these high-demand matters. HBS Partner Bradley R. Coppedge in our Columbus office also holds an LLM in tax. “Tax law is complex and constantly changing, and clients can rely on us to guide them through the nuance and intricacies with complete confidence that they are getting the best counsel,” said Standard, who has been with HBS for more than a decade. “It’s gratifying to bring an additional layer of knowledge…       Read More