One of the provisions included in the health care reform legislation enacted in 2010 will subject certain individuals to a 3.8% tax on net investment income (or "unearned income"). The new law is effective in 2013 and imposes a tax on "net investment income" when an individual taxpayer’s modified adjusted gross income exceeds $200,000 for single filers and $250,000 for joint filers. The tax is equal to 3.8% of the lesser of the taxpayer’s "net investment income" or the amount by which the taxpayer’s modified adjusted gross income exceeds the threshold (i.e. $200,000 for single filers and $250,000 for joint filers). Trusts and estates are also subject to the new tax. For trusts and estates, the tax is equal to 3.8% of the lesser of the trust’s or estate’s undistributed net investment income or the adjusted gross income in excess of the highest tax bracket on trusts and estates (i.e., approximately $12,000 for 2013).
The 2010 enactment of the Affordable Care Act (“ACA” or the “Act”) ushered in an enormous social reform effort aimed at improving the nation’s health care system through a series of mandates, premium subsidies, and taxes. Although the full impact of the Act will not be known for years to come, its intended goals were to expand health insurance coverage and to reduce costs. After much discussion and debate, as well as legal challenges all the way to the U.S. Supreme Court, implementation of the ACA is upon us. As a result, employers must comply with the Act’s myriad requirements, the most significant of which become effective on January 1, 2014. Regulatory guidance is pouring forth, and it is not too early for employers to determine how the rules of the Act apply to their businesses. In fact, employers with calendar-year plans may want to take action as soon as next month.
The North Carolina legislature is now considering proposed legislation (SB 491/HB 484) under which the siting of "Wind Energy Facilities" ("WEFs") (i.e., wind turbine farms and the supporting infrastructure) would be subject to a permit process overseen by the North Carolina Department of Natural Resources ("DENR"). In particular, the proposed permitting process would require consideration of potential impacts to the environment and to military training operations. What is the background for this requested legislation, why is it important for North Carolina and its economy, and why is DENR the logical permitting agency? Does this proposal benefit the development of alternative energy facilities in North Carolina?
The possibility of wind energy development on the Outer Continental Shelf (OCS) off North Carolina’s shores moved one step closer to fruition last week, as the Department of the Interior Bureau of Ocean Energy Management (BOEM) released its Call for Information and Notice of Intent regarding leasing and site assessments.
Over 4.5 million North Carolinians voted in the 2012 general election on Tuesday, November 6, and those voters made a number of important decisions. This article gives a brief overview of what happened with some discussion of the implications of the election results.
HIPAA has returned as a key compliance area. And some providers may be at significant risk because they never adopted HIPAA "security" policies to implement the HIPAA "security" rules.
This manuscript provides an overview of mineral rights law in the context of potential shale gas development in North Carolina. Specific topics addressed include: background on shale gas resources and development; historical development of mineral rights law; understanding mineral rights and surface rights; the statutory and regulatory framework of the Gas Act, including the provisions of the recently enacted Session Law 2012-143; lease issues and provisions; royalty rights; and additional issues.
This summer, the North Carolina General Assembly revised our state’s “forced combination” corporate income tax statutes for the third time in three years. This year’s revision, in Session Law 2012-43 (S.B. 824), requires the Department of Revenue to adopt a formal rule interpreting the substantive provisions of the new combination statute that was enacted in the 2011 legislative session. Like the changes enacted in 2010 and 2011, the new statute appears motivated by a desire to force the Department to be more transparent in its decision-making and to give taxpayers clearer and more concrete guidance on when they can expect to be compelled to report their income on a combined basis. Whether the new statute will in fact lead to greater clarity in this murky and controversial area remains uncertain. At minimum, however, the formal rulemaking procedures mandated by the new statute will give businesses affected by North Carolina’s combined reporting laws the opportunity to participate in the process of determining how and when the Department can wield its combination power.
This summer the NC General Assembly adopted, and the Governor signed into law, important new amendments to Article 9 of the Uniform Commercial Code ("UCC"), the Article governing secured transactions in personal property and fixtures. The amendments, recommended by the American Law Institute and the Uniform Law Commission, have been enacted by over half the states and are designed to go into effect simultaneously on July 1, 2013.
The North Carolina General Assembly has completed its 2012 session. Often referred to as the "short session" since its primary purpose is to adjust the second year of the biennial budget adopted in 2011, Legislators also considered a number of matters other than the budget during their seven weeks in Raleigh. This article contains some highlights from this year's session.
In the international business community, few law enforcement matters in recent years have attracted as much attention as the Foreign Corrupt Practices Act. FCPA enforcement - conducted by both the U.S. Department of Justice and the Securities and Exchange Commission - has been intense and increasing over the last decade. The total numbers of FCPA actions brought by both agencies have risen from a mere five in 2004 to between 40 and 74 in the last three years. This trend has particular relevance for Triangle companies, including pharmaceutical companies and clinical-research organizations.
The Affordable Care Act ("ACA") requires that Medicare and Medicaid "overpayments" be reported and returned by the later of (i) 60 days after the overpayment was "identified" or (ii) the date any corresponding cost report is due (if applicable.) This requirement became effective on March 23, 2010 - so, health care providers have been subject to it for nearly two years. On February 16, 2012, CMS issues a long-awaited proposed rule to implement the overpayment requirement.
The Stark physician self-referral law is a strict liability law with many detailed technical requirements. The Affordable Care Act (“ACA”) amended a key Stark exception for group practices—the in-office ancillary services exception (“IOAS”). IOAS is “key” because it allows physician-owners to refer to their group practices. The ACA added new technical requirements to the IOAS for practices that provide MRI, CT, or PET services at their practice. This advisory explores those requirements by reviewing CMS’s guidance on the ACA amendment. CMS’s guidance is important for any practice that relies on the IOAS for providing MRI, CT, or PET services.
Accused insider trader John Kinnucan will be found guilty or not guilty in the Southern District of New York — and liable or not, in the U.S. Securities and Exchange Commission’s case — but Brooks Pierce attorney David Smyth says his case likely won't provide the definition that many traders crave.
Over the past 10 years, the scope of the North Carolina Department of Revenue’s authority to force affiliated corporations to file combined returns has become one of the most controversial aspects of North Carolina’s corporate income tax laws. The statute granting this authority has been criticized in recent years for the vague standard it establishes for determining when the Department of Revenue is justified in requiring a combined return. In the 2011 legislative session, presumably in response to this criticism, the North Carolina General Assembly repealed G.S. 105-130.6, replacing it with more detailed guidelines in new G.S. 105-130.5A. As explained in this article, while this new statute creates new, taxpayer-friendly procedural limitations on the Department’s ability to compel combined reporting, the substantive guidelines of G.S. 105-130.5A provide the Department with a significant amount of discretion in determining whether to require a combined report, and it is therefore unclear whether the new statute will actually provide taxpayers with the clarity the statute’s proponents were seeking.
Many organizations across a wide range of industries use two-way radios for internal communications between and among personnel, and many of these two-way radios are licensed under Part 90 of the FCC’s rules. The FCC has imposed a January 1, 2013, deadline for certain Part 90 licensees in the Industrial/Business Pool and the Public Safety Pool to modify their operations and FCC licenses to meet certain “narrowband” (12.5 kHz or narrower) requirements in the 150-174 MHz (VHF) and 421-512 MHz (UHF) frequency bands. These narrowbanding requirements apply only to Part 90 licenses that operate in these frequency bands.
In many ways, New York Times Co. v. United States represented the apogee of the protections afforded the press by the United States Supreme Court. The Court’s decision affirmed the essential role newspapers play as a check on the power of government and rejected attempts by the government to block publication of the Pentagon Papers. Forty years later, newspapers share the stage with a host of new digital media platforms. Digital technology allows news organizations to provide accounts of greater depth, allow real-time access to official source documents, and provide links related to stories or information - all on a single digital page. Readers can comment in real time and engage in dialogue with other readers or the reporters themselves. Readers can turn into reporters by offering tips or their own material. Section 230 of the Communications Decency Act has helped spur the growth of such user-generated content on news websites. The law provides immunity to website operators for user-generated content that is “created” or “developed” by third parties over the Internet. But just like the government's efforts to block publication of the Pentagon Papers forty years ago presented a grave threat to the ability of a free press to report on issues of public importance, newspapers today seeking to make full use of digital technologies face a chilling effect from possible civil liability for all kinds of news content posted on their Internet websites.
The North Carolina General Assembly has completed its 2011 regular session. Approximately 1,600 bills were introduced during the session. Here’s a quick guide to the Legislative activities that are particularly important to the business community.
Among corporate lawyers the traditional point of view was that corporate minutes should record final board actions and otherwise say as little as possible. This was based on the theory that the less you say, the less chance you have of creating problems. That approach is changing now, prompted by the Disney litigation and also fueled by changing social expectations and increasing federal regulation of boards and governance. This article covers the corporate law of corporate minutes, the importance of recording final actions, minutes as evidence, crafting a record of a business judgment, omissions, ownership and other observations.
Since 1996, the Health Insurance Portability and Accountability Act (HIPAA) has affected nearly every aspect of health care. HIPAA imposes an array of measures aimed at keeping personal medical information private and secure. Its provisions can apply to law firms and attorneys in their everyday representation of certain clients. Because of HIPAA’s stiff penalties and other potentially embarrassing consequences, anyone working with clients in health-related fields must understand their duties under HIPAA.
As the economy recovers, will you consider expanding your company’s business? Relocate to a larger facility, or build a new facility? Expand to a neighboring property? Open a new branch?
If you consider buying or leasing real property, my advice is: Do your environmental due diligence, and do it early.
Contaminated sites are common. Chances are, if a property has been developed in the past, there is a risk of contamination, especially in downtown or industrial areas. If you determine the property may be contaminated, do not reflexively look elsewhere. While there are risks to buying contaminated property, often they can be minimized sufficiently – through tools such as escrows, indemnities, insurance, and the Brownfields Program – to justify the purchase if the property is a good business deal.
It can be important to distinguish between guarantee of collection versus guarantee of payment when the principal obligor is a debtor in bankruptcy – either under Chapter 7 or 11.1 Because, the automatic stay of § 362 prevents a creditor from seeking payment from the debtor, if a creditor is the beneficiary of a collection guarantee where the conditions precedent for collection from the debtor have not been met, absent relief from the automatic stay, the creditor may be precluded from collecting from the guarantor. Whereas under a guarantee of payment, no such impediment would exist to
prevent a creditor from proceeding against the guarantor or co-debtor, regardless of the bankruptcy of the principal obligor.
One month after federal regulatory banking authorities released their Guidance on Incentive Compensation (the “Guidance”), President Obama signed into law The Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 (the “Act”).
Included among the provisions of this massive legislation are several provisions that will impact the executive compensation and corporate governance and securities law disclosure requirements of all public companies. In addition to incorporating the Guidance, public companies have additional regulations to digest and implement.
Some of the provisions of the Act are effective immediately; others will require rulemaking by the SEC and/or federal banking regulatory authorities. Many of the new requirements will impact the 2011 annual reporting season. Summarized below are the executive compensation, corporate governance and securities disclosure provisions of the Act.
Offering employee benefits in addition to wages is one way to help attract and retain quality employees. However, providing benefits entails a host of dizzying rules with clever acronyms such as “ERISA,” “COBRA,” and “HIPAA.” The headaches multiply for small business owners, who are busy running the business and possibly lack HR departments to handle benefits. However, regardless of the difficulty, failure to administer benefits properly can result in severe fines and penalties. This article offers a brief overview of the applicable rules and describes the problems that can arise when employers do not comply with them.
The Federal Reserve System, the Office of the Comptroller of the Currency, the Office of Thrift Supervision and the Federal Deposit Insurance Corporation (the “Agencies”) recently issued its “Final Guidance on Sound Incentive Compensation Policies” (the “Guidance”). Intended to assist banking organizations in designing and implementing incentive compensation arrangements and related policies and procedures that effectively consider potential risks and risk outcomes, the Guidance will form the basis for supervisory examinations of a banking organization’s incentive compensation practices and will influence CAMELs ratings.
Earlier this year, on April 7 and 8, the Raleigh Marriott City Center and Raleigh Convention Center were hosts to the second annual Triangle Game Conference ("TGC"). The TGC is sponsored by the Triangle Game Initiative, which is a trade association for the Raleigh-Durham interactive entertainment and advanced learning industries.
Prominent scientists believe the world concentration of carbon dioxide already exceeds a "safe" level. Thus, there will likely be a need to not only reduce the pace of net emissions but also to develop technologies for effectively removing carbon from the atmosphere. One promising technology is the use of biochar to sequester carbon in soil. This article considers legal changes needed to fully accomodate credits for biochar and otherwise encourage net-negative projects.
Answers to common DJ legal questions with attorney Coe Ramsey. Topics covered include incorporating your company, building contracts that stand up in court, and essential documents for your business.
In an increasingly digital and cost-conscious business environment, many companies may desire to provide their standard terms and conditions of sale or purchase to vendors and customers electronically by posting those terms on the Internet, rather than providing a separate paper copy or printing terms and conditions on the reverse side of invoices, sales receipts, or purchase orders. This practice may also enable businesses to achieve better consistency of terms across contracts and provide their constituents with easier access to key terms. This article summarizes a growing body of case law addressing whether parties can be bound by terms that were not printed in or attached to the parties’ written agreement but simply made available via one party’s Web site.
The Supreme Court’s groundbreaking decision in Citizens United v. FEC opens the door for corporations and labor unions to make unlimited independent expenditures to advocate for the election or defeat of a federal candidate. The decision was a watershed moment in both First Amendment and campaign finance law.
To assist clients prepare their annual reports and proxy materials for the 2010 annual reporting season, we are highlighting some of the most significant developments during the last year. These development include proxy disclosure enhancements for public companies; additional requirements for TARP recipients; non-binding say-on-pay proposals; further extension of attestation report exemption for non-accelerated filers; elimination of broker discretionary voting authority; changes to NASDAQ corporate governance rules; Form 10-K considerations; and heightened regulatory oversight and enforcement.
On December 19, 2009, Congress enacted and President Obama signed into law certain extensions and changes to the COBRA subsidy, which was created earlier in February 2009 by the Stimulus Bill. The new COBRA modifications make important changes to the COBRA rules that are effective immediately.