Florida Estate Planning Lawyer Blog

Florida LLC's are one of the best choices for a new business entity. When thinking of forming a company, may people only look for low taxes and protection from liability.

Unfortunately, many are misinformed as to the protection that a corporation can offer. While it is true that a corporation and a Limited liability company can both protect a persons personal assets from corporate liability (in most cases), only the properly created Florida LLC can protect your business assets from personal liability.

If someone sues you and wins, they can take your stock in your corporation just like they could take your stock in GM. Once they own your stock, they can sell the company, fire you, and liquidate the company. If this happened to you it could cost you your livelihood.

To protect against this many people now use limited liability companies in Florida. If the LLC is properly created you can be protect from judgments, reduce the risk of lawsuits, and still be taxed as a partnership or an S-Corp. Yes you can be a LLC but choose to be taxed as a S-Corp.

While legal Zoom will let you create a Corporation or LLC online in almost any state, they can not evaluate your personal circumstances, and make recommendations on how to set up the LLC to offer you the protections under Florida Laws. I have seen many LLC's created by Legal Zoom which failed to take advantage of these protections.

In addition, I have noticed that the people who use these services do not understand the importance of acting like a business entity. They rarely have meetings or authorize actions by the board members or officers. These actions can create prevent the business entity from protecting the owners, directors, and shareholders from personal liability.

Part of what your lawyer should do is understand your circumstances, and design an entity to protect your needs and interests. At the same time, the attorney should educate you on how to take advantage of the protections offered. just because your form an LLC or Corporation does not mean you are protected.

To discuss how to use your business entity to protect your personal assets and protect your business assets from the owners personal liability you should Contact a Florida Business and Asset Protection Lawyer

Here is a list of links that should be useful for anyone starting or running a business in Florida.

Florida state and local links

• MyFlorida.com

State Portal

• Licensing Portal

City Guides

• Jacksonville Florida City Guide
• Miami Florida City Guide
• Orlando Florida City Guide
• Panama City Florida City Guide
• Tampa Florida City Guide

Statewide Offices

• Governor


• Lt. Governor
• Attorney General


• Secretary of State
• Treasurer and Insurance Commissioner

Legislative Branch

• Florida Legislature
• Auditor General


• Office of Program Policy Analysis and Government Accountability
• Florida Monitor: Government Accountability Report

Continue reading "Florida State and Local Government links" »

I received 5 copies of the IRS guide in the mail today. If anyone would like one you can Contact me and I will be happy to send one.

You may also order the CD from the IRS by calling 800-829-3636 and asking for Publication 3208 or by searching for SBRG on the IRS.gov website

There are many times when one needs to discuss a the effects of a settlement or legal decision with a Florida Tax Attorney, CPA, or Accountant prior to signing documents.

When possible a tax adviser should be involved early on in a case to make sure that efforts are spend on a tax friendly solution. Obtaining advice to consult with your tax adviser after a successful mediation or settlement often leads to unnecessary tax expenses.

If you are in the early states of litigation, be sure and discuss potential outcomes with your tax adviser to understand the effects on your or your business.

I have written several articles on problems with using the "free legal documents" or low cost fill in the blank forms that might be available at your local Staples or office supply shop. Richard Shea of the Connecticut Estate Planning and Elder law Blog has another example of problems that can occur with these "free legal documents"
Richard says that when people use these free forms to create business entities they are not informed about local taxes and reporting requirements. One example is the "Business Entity Tax in Connecticut, The Department of Revenue Services is apparently sending out 23,000 letter to notify people of their failure to comply with the requirement.

In Florida, an online service will not inform you if you need to apply for an occupational license, nor how many your business will need for each location. Perhaps a bigger issue, is that these online services do not know you or your circumstances and cannot utilize or inform you of how to take advantage of certain options or techniques to protect you, your family, or your business partners from each others personal liability.

To discuss if you Florida Limited Liability Company or Florida Limited Liability Company was created properly and your are taking advantage of all of the protections you can, please Contact an attorney or Florida Business Formation Lawyer.

The IRS Small Business Products Catalog has 5 publications and guides that all small businesses should own. You can order up to 5 copies of each for free. They can be viewed online.

1.Tax Calendar for Small Businesses and Self-Employed - View Online
2. A Virtual Small Business Tax Workshop DVD - View Online
3. Small Business Resource Guide CD 2008 - Updates- 2007 View Online
4. Recognizing Illegal Tax Avoidance Schemes Brochure - View Online
5. Small Business Tax Responsibilities - View Online

For more information on these issues please Contact a Florida Business Lawyer or your tax adviser.

Besides using multiple entities for asset protection, two common methods include the use of UCC liens or lease backs.

UCC filing is the equivalent of equity stripping. The UCC filing is a lien on your business asset from typically from a finance company. You can form a Florida Limited Liability Company and exercise a note from the company to your other Florida Business Entity. Along with the not a properly recorded UCC security document can be filed with the State of Florida. This will encumber the assets of the entity and protect those assets from an attempt to attach them to a lien. In effect the finance company would be first in line to collect any proceeds from the sale of the assets.

Another method is to create a lease back situation where one company owns the asset and leases the asset to another company. Since the operating company does not own the asset, it is not available to satisfy the debt.

It is important to create these techniques prior to valid claims to avoid a fraudulent transfer. To learn more about these and other asset protection techniques, Contact a Florida Asset Protection Lawyer.

If you live in a Jacksonville or another city in Florida where the Chief law Enforcement Officer (CLEO) will not or easily sign a Form 4, there are several solutions.
Class 3 Weapons include suppressors, , short barrel rifles, machine guns, and other destructive devices.

The most common solution is to create a NFA revocable trust to hold title to the firearm or class 3 items.

A NFA Gun Trust, Class 3 Firearms Trust, Florida Limited Liability Company, or Florida Corporation is a legal entity established under state law. For NFA purposes many individuals prefer the a Revocable Trust over a corporation or LLC because the cost is far less on an ongoing basis. Business entities typically have state filing fees of around $150 a year. In addition there are the costs of tax preparation, compliance and filings with the IRS. In Florida and many other states Revocable Trusts like the NFA or Firearms trust do not require any disclosure or public filings. This means the ownership, control, and management is private.

Although most Florida Revocable or Living Trusts can hold firearms or other class 3 items, many are not properly setup to deal with the issues involving firearms and other items which are regulated by the National Firearms Act (NFA). If the NFA is violated, the people in possession, and who transferred the items are subject to criminal charges, substantial fines, and forfeiture of not only the class 3 items in question but all firearms in the possession or ownership. ($250,000 penalty, 10 years in prison, and forfeiture of items)

The gun or firearms trust must give the Trustee instructions and special powers so that they can legally manage for unplanned events. Weapons and other assets in a Firearms Trust can not be distributed like other assets upon the death or incapacity of the person who placed the items in the trust(The Grantor or Settlor).

There are many advantages to a firearms trust, if you own or plan to purchase a class 3 items you should contact a lawyer who is familiar with these issues and can design a trust to protect you and your family from liability. If you are in Florida you can contact me and if you are in another state I would be happy to get you in touch with a lawyer in your state who can provide information on Gun Trusts.

U.S. Citizenship and Immigration Service (USCIS) announced in the November 26, 2007, Federal Register that all employers must transition to the revised Form I-9 no later than December 26, 2007. Effective December 26, 2007, employers who fail to use the revised form will be subject to applicable penalties.

1. The revised Form I-9 will is effective December 26, 2007, for all new hires or re-verifications. The rule is not retroactive. Employers do not need to complete new forms for existing employees for whom an I-9 has been properly completed.

2. The employee is not required to provide the Social Security Number in Section 1 of Form I-9, unless the employer participates in E-Verify.

3. When re-verifying employees, employers must use the new Form I-9 along with its updated list of acceptable documents. Updating Section 3 on the old/existing Form I-9 is not an option.
All previous versions of Form I-9, in English or Spanish, are no longer valid after December 26, 2007.

4. The Form I-9 is available in English and Spanish. However, only employers in Puerto Rico may have employees complete the Spanish version for their records. Employers in the 50 states and other U.S. territories may use the Spanish version as a translation guide for Spanish-speaking employees, but must complete the English version and kept it in the employer's records. Employees may also use or ask for a translator/preparer to assist them in completing the form.

Download New I-9 Form
Download New I-9 Instructions

For more information talk with your Florida Business Lawyer.

This is the third part to a series on Protecting the Company's Privilege and the dangers of Email. Click here if you missed Part 1 and Part 2. Many Jacksonville Business Lawyers tell their clients that email can be very dangerous in the event of litigation. One should always be careful before pressing the send button.

Some of the things you should implement in regards to email are:

1) Provide training to employees teach them what the proper steps are to prevent inadvertent disclosures, spoliation, and other risks from occurring.

2) Always separate business advice from legal advise, use lead ins to make it clear that what is being provided is legal advise.

3) Indicate in the communications when the communication is for legal purposes or in anticipation of litigation.

4) Limit the distribution of any disclosure to avoid waiver of privileges.

5) Teach and train that any disclosure, even an unintended one, can be a waiver of the privilege.

6) Create, implement, and audit your firms document retention policy.

If you have question on your Document retention policy or how your firm is using email on an internal and external basis, be sure to have a Florida Business Lawyer or Attorney review and audit your procedures.

This is the second part to a series on Protecting the Company's Privilege. If you missed Part 1 it can be found here. Many Jacksonville Business Lawyers tell their clients that Blackberry devices are invitations for disaster because clients have their guard down. In the past people communicated with a short phone call, in a hallway conversation, at the water cooler. Today in house counsel and employees often communicate with text messages and emails. Often they are giving business and legal advice to employees. Sometimes both business and legal advice is given in the same conversation.

Only legal advice is privileged and the privilege can be lost if business advice is intermingled with the legal advise. This privilege only protects communications within the United States. In house counsel should be cautious when communicating with employees or offices in other countries. Some countries do not recognize a privilege for in-house counsel.

Some countries like France and Switzerland recognize no privilege at all for in-house counsel and Japan is in between France and the United States.

How can in-house counsel protect their emails?

• Be conscious of when you are giving legal and business advise. Sometimes you may want to send two emails.
• When sending out legal advie make sure its clear that it is legal advise. Start your emails with "You have asked for my legal advice on this issue". Teach your staff not to mass forward your messages, if the message is forwarded to one person to many, the privilege can be lost.
• Educate your staff that email is not destroyed by simply pressing the delete key. Blackberry devices create inadvertent documentation in situations where clients have their guard down. Don't send an email that you would not like made public.
• Selectively use Privileged & Confidential" notations on e-mail communications. This will help in the event you have to argue the meaning in front of a judge.

Continued in Part 3

So you have been sued, can you remember what you put in that email? Do they still have a copy? Did they forward it to anyone else? Email is dangerous in corporate litigation, to find out some of the risks read this and the next few articles on Protecting the Company's Privilege.

Never write if you can speak,
Never speak if you can nod,
Never nod if you can wink

- Attributed to the 19th century Boston political boss Martin Lomasney

One of the biggest risks with email is the loss of Attorney-Client Privilege. Generally this privilege protects communications that are sent between a client and an attorney from disclosure to third parties. Some jurisdictions only protect client to attorney conversations and those attorney conversations which are in response to a clients question. Therefore attorneys should structure their emails as responses to clients questions to provide the greatest chance for protection from disclosure.

Sometimes when email is from an attorney to a client and the communications in anticipation of litigation, the conversation can be protected under the work product doctrine. In order for this protection to apply the conversation must:

be between a lawyer and a client (person or entity);
be for the purpose of obtaining legal advice;
be to a lawyer acting in their capacity as a lawyer; and
be kept in confidence.

If any condition is not kept, the privilege is waived. With email, the condition of the conversation being kept in confidence is the one that is waived the most often. If an email is forwarded to an outside party, or someone who does not need to know the privilege can be waived.

Continued in Part 2

The Florida Asset Protection Blog has an interesting article on the advantages of being paid as an independent contractor over an employee when you are an unmarried debtor who does not support minor children. Generally wages are exempt form wage garnishment when the person is married or supports minor children.

This is one of the reasons why a properly structured Florida limited liability company (LLC or L.L.C.)can provide more protection than a Florida corporation. While both the Florida Limited Liability Company and the Florida Corporation can protect personal assets from liability that is created by the company, a Florida LLC can also protect the company assets from the personal liabilities of the owners or members.

Jonathan Alper goes on to state that a unmarried debtor who does not support minor children is subject to wage garnishment and garnishment of the independent contractor fees. A wage garnishment will stay in place for all future wages while a separate writs of garnishment needs to be obtained each time the employer is going to make a payment to the debtor. It is difficult for the creditor to anticipate payments to the independent contractor and to serve a writ prior to each payment.

You should speak to a Florida Business Formation Lawyer about setting up a Florida Limited Liability Company or converting your Florida Corporation to increase your asset protection.

As a Jacksonville Florida non-compete Lawyer, I often am asked about some of the provisions that are contained in a Florida employment agreement. I found an article on the Texas Non-Compete Law Blog, entitled Texas Executive Employment Agreements: Checklist for Employees and thought that the information would be relevant to my Florida Clients. I have based this information on what was contained in that article, but modified removed some information and added some that is specific to Jacksonville and throughout Florida .

1. Term of Employment. Employment agreements are either for a fixed term or at-will. An at-will employment agreement can be terminated by either party at any time for any reason. Some employment agreements that are purportedly for a fixed term (e.g., a one-year term) also contain provisions pursuant to which the employer may terminate the employee “for any reason” on shorter notice (e.g., “thirty days’ notice”)—such an agreement is in reality a 30-day employment contract.

2. Position, job duties, location. Employment agreements routinely contain provisions outlining what the employee’s title will be, what their duties will be, who the supervisor will be, and where the work will be performed.

3. Compensation. Employment agreements often reference compensation or salary and sometimes discretionary compensation (e.g. bonuses and stock options).

4. Termination for Cause. Employment agreements often provide that an employee may be terminated for “cause,” and “cause” is defined to include various acts or omissions by the employee. Some acts—like commission of a felony and embezzlement of company funds are fairly easy to understand. However, defining “cause” to include the employee’s failure to perform his/her job duties can be difficult because this can be subjective. Employees want what a clear non subjective definition of cause.

Continue reading "Florida Employment Agreements: Terms and Conditions" »

As a Jacksonville Business Lawyer, I often run up against cases which involve a Breach of a Fiduciary Duty. These disputes can be between employees and employers, companies and their suppliers, Personal representatives and beneficiaries, guardians and wards, Trustees and beneficiaries, or officers, directors, managers and the company they work for.

Definition: a fiduciary relationship is where one person places complete confidence in another in regard to a particular transaction or one's general affairs or business. The relationship is not necessarily formally or legally established as in a declaration of trust, but can be one of moral or personal responsibility, due to the superior knowledge and training of the fiduciary as compared to the one whose affairs the fiduciary is handling.

Elements Cause of Action - Florida Supreme Court
The elements of a claim for breach of fiduciary duty are: the existence of a fiduciary duty, and the breach of that duty such that it is the proximate cause of the plaintiff’s damages

If you feel that you are dealing with a breach of fiduciary duty and have suffered damages as a result, you should discuss the facts and circumstances with a Florida Business Lawyer.