Suttons Bay Law

The corresponding picture of my 16-year-old son, Tucker, with this blog post, was recently taken at a hockey tournament in Cleveland, Ohio. Tucker, by all accounts, is one of the best goal scorers for his team. For the first two games of the tournament, Tucker was repeatedly frustrated by missed opportunities and some remarkable goalie saves that sent him into the tournament semi-final game with no goals. The first two periods of the semi-final game were more of the same. Tucker worked and worked, but no goals. He kept focused and worked hard in the third period and then, with 30 seconds left, he seized an opportunity and scored the game-winning goal. The picture was taken right after the goal was scored. Success at last!

As I reflect on Tucker’s experience, it occurred to me that his path to success in that situation mirrors how we, as adults, should pursue success. Dr. Alan Zimmerman, in his internet newsletter “Tuesday Tip” recently commented on the various studies that have been conducted about achieving “success”. In his newsletter, Dr. Zimmerman cites four key elements of success which is first to “toil awhile” and secondly “to endure awhile”. The last two steps of success are to “believe always” and the final step being “never turn back”. Dr. Zimmerman states, “the folks who make it in this world…the folks who become truly successful…continue to toil and endure in spite of their problems, challenges, and setbacks. Successful people know that hard work does not prevent problems. It simply gets them through the problems.”

In summary, Tucker’s accomplishments have made me very proud of him as a hardworking and dedicated young man. That being said, his accomplishments also reminded me of the important lesson of what it takes to be truly “successful”. We are facing challenges in today’s world that are unprecedented. However, we still have the ability to be a success, survive the challenges, and become better people through the process.

Dan A. Penning
(a.k.a. Proud Father)

Tags: Suttons Bay Depot by Dan Penning
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Thought you might be interested in the article below:

DOL Issues COBRA Subsidy Model Notices

By Stephen Miller

(You can view the entire article here)

The American Recovery and Reinvestment Act (ARRA), signed into law in February 2009, mandates that plans notify certain current and former participants and beneficiaries about the COBRA premium reduction subsidy (see “COBRA Coverage Expansion: HR Action Steps to Take Now”).

The U.S. Department of Labor (DOL) has created model notices to help plans and individuals comply with these requirements. Each model notice is designed for a particular group of qualified beneficiaries and contains information to help satisfy ARRA’s notice provisions.

“The model notices we are releasing enable employers to quickly spell out for former employees and their families how to take advantage of COBRA coverage and the subsidy,” said Secretary of Labor Hilda L. Solis in a statement. “The ARRA provides a 65 percent tax subsidy for the cost of health benefits, making them more affordable for the unemployed and their families. Millions of individuals, including those who previously declined employer-provided coverage under COBRA, will be eligible to receive a subsidy on their premiums for up to nine months.”

General Notice (Full version). Plans subject to the federal COBRA provisions must send the General Notice to all qualified beneficiaries, not just covered employees, who experienced a qualifying event at any time from Sept. 1, 2008 through Dec. 31, 2009, regardless of the type of qualifying event. This full version includes information on the premium reduction as well as information required in a COBRA election notice.

General Notice (Abbreviated version). The abbreviated version of the General Notice includes the same information as the full version regarding the availability of the premium reduction and other rights under ARRA but does not include the COBRA coverage election information. It may be sent in lieu of the full version to individuals who experienced a qualifying event on or after Sept. 1, 2008; have already elected COBRA coverage; and still have it.

Alternative Notice. Insurance issuers that provide group health insurance coverage must send the Alternative Notice to persons who became eligible for continuation coverage under a state law. Continuation coverage requirements vary among states, and issuers should modify this model notice as necessary to conform it to the applicable state law. Issuers may also find the model Alternative Notice or the abbreviated model General Notice appropriate for use in certain situations.

Notice in Connection with Extended Election Periods. Plans subject to the federal COBRA provisions must send the Notice in Connection with Extended Election Periods to any assistance eligible individual (or any individual who would be an assistance eligible individual if a COBRA continuation election were in effect) who:

Had a qualifying event at any time from Sept. 1, 2008 through Feb. 16, 2009, and;

Did not elect COBRA continuation coverage, or elected it but subsequently discontinued COBRA.

This notice includes information on ARRA’s additional election opportunity as well as premium reduction information. This notice must be provided by April 18, 2009.

As you can see, the Department of Labor has issued model notices that relate to the 65% COBRA Subsidy provided to eligible employees as part of the federal stimulus package. These notices can be used by employers/plan administrators when communicating with eligible employees about their COBRA options.

Dirk A. Beamer

Tags: Employment Law by Dan Penning
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Without regard to whether family members are legally obligated to pay the debts of their deceased loved ones, credit card companies and debt collectors are targeting those family members to satisfy outstanding balances. Generally, unless a family member is a joint owner or guarantor of a deceased person’s debt, family members are not individually responsible for those debts. Debt collectors hope, however, that the majority of family members they contact will be ignorant about their obligations to the deceased’s creditors. In fact, a creditor’s ability to recoup funds to satisfy a deceased person’s debt is limited to those assets titled in the deceased person’s name at the time of death. If the deceased person died without assets, the debt collectors are out of luck and most likely cannot legally collect from next of kin. Family members would therefore be well-served to challenge any debt collectors looking to collect on a deceased person’s debts and demand written proof of another obligor on the account aside from the deceased. If the deceased died with assets, it is particularly advisable to consult with an attorney, preferably one well-versed in probate matters, to properly determine how a deceased’s debts should be handled.

To read more information about debt collectors targeting family member of the deceased, please visit this New York Times article: New York Times

Julie Pfitzenmaier

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Tags: Asset Protection, Estate Planning by Dan Penning
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This legislative update from the Society for Human Resource Management describes a new piece of federal legislation that was introduced yesterday. It has the potential to change dramatically the way in which unions organize and the rights employers currently maintain in requiring private elections to determine whether a workforce chooses to unionize.

Federal Legislative Action Alert!

Today, the Employee Free Choice Act was introduced in Congress! The bill was sponsored by Representative George Miller (D-CA), the House Education and Labor Committee Chair, and Senator Tom Harkin (D-MA).

The legislation would amend the National Labor Relations Act to allow unions to use the “card check” process – and bypass the secure, private election format – each time they attempt to organize workers.

Background

The National Labor Relations Act currently provides two opportunities for employees to decide whether or not to form or join a union:

1 Private ballot election - When a union receives a majority of votes through a secret ballot election administered by the National Labor Relations Board, the union is certified as the sole bargaining agent on behalf of the employees, or

2 “Card check” recognition - When a union receives at least 30 percent of signed authorization cards, the employer can request that a private ballot election be held. (When a union receives at least 50 percent of signed cards, the employer can either recognize the union immediately or request an election.)

Legislation

The EFCA would dramatically change federal labor law. The legislation would allow a union to bypass the election process after collecting authorization cards from a majority of employees. Thus, employers would lose the right to request that an election be held.

If enacted into law, EFCA would:

• Eliminate employees’ opportunity to vote in a federally-administered, private ballot election;
• Require binding arbitration within 120 days after a union is certified through a signed card collection process, if the employer and the union are unable to reach an agreement;
• Restrict an employer’s communications to employees about the workplace issues involved in the union organizing drive; and
• Create new fines against employers for an expanded list of unfair labor practices

SHRM supports the basic rights of all employees to decide freely whether or not to join a union. However, we strongly believe that a federally-supervised, private ballot election is the best way for employees to make this decision.

In addition, SHRM believes the mandatory binding arbitration called for under EFCA could impose unwanted employment conditions on both employees and employers. So in sum, employees could simultaneously lose their rights to vote on union representation and to approve workplace contracts.

Dirk A. Beamer

Tags: Employment Law by Dan Penning
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Michigan’s Unemployment Security Act was recently amended to extend unemployment benefits to certain employees who previously would not have been eligible.

Generally, individuals who leave work voluntarily are not eligible for unemployment benefits. The change to the Act creates an exception for an individual who is the spouse of a full-time member of the United States armed forces and who is forced to resign and relocate because of the military reassignment of the spouse.

Beginning after March 30, 2009, benefits paid to such individuals shall not be chargeable to the employer, but instead to the “nonchargeable benefits account” covered by the state.

Dirk A. Beamer

Tags: Employment Law by Dan Penning
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DIVORCE / SECOND MARRIAGES / FAILURE TO PLAN

LET THE DEATH WARS BEGIN!

If you have been divorced and are now remarried, you should take great caution in planning your estate and assets in the event of your disability or death. If you also have a child or children from a previous marriage or with someone you never married, these are all special situations that should be examined to avoid future problems. No estate plan is just that – no plan. These situations are ripe for conflict and lawsuits when someone plans poorly or not at all. We call these cases “death wars”. These cases literally drain tens of thousands of dollars out of an individual’s estate with respect to attorneys’ fees and court costs where, with a little expenditure of time and a fraction of the money, the whole war could have been avoided.
The best approach when getting married for a second time, or any time, is to see an attorney well in advance of the wedding date to discuss your situation. This is especially true when one or both of you have children from a previous marriage or relationship.

The following are the 10 most common causes of “death wars”:

1. Spouses lie about the value of assets or when or how the assets were acquired.

2. Spouses conceal a child from a prior relationship or marriage from their current spouse.

3. Couples fail to create pre-nuptial or post-nuptial agreements.

4. Spouses fail to change estate plans that they may have created before meeting their current spouse.

5. Spouses fail to consider that, by default, a spouse is the beneficiary of the other spouse’s qualified retirement plan such as a 401k or 403b account creating a different disposition of these assets other than as intended by the deceased spouse.

6. Failure to plan where spouses have a significant disparity in the age; and the age of one spouse is the same or close to the ages of the other spouse’s children from a previous marriage or relationship.

7. Failure to double-check beneficiary designations on life insurance policies that were in effect before meeting the individual’s current spouse.

8. Failure by spouses to review and address changes in estate plans when there has been a significant change in the health or wealth of the other spouse which may impact their ability to take care of themselves in the event of the death of the other spouse.

9. Failure to give consideration as to how real estate is titled when purchased with a second spouse.

10. Failure to clearly define the ownership and intended disposition of assets without title such as family heirlooms, jewelry, etc.

If you or anyone you know is planning on getting married for a second time or getting married with unique circumstances with respect to age, children from previous relationships or marriages, or any other unique circumstances, please feel free to refer them to us for estate planning review.

Dan A. Penning

Tags: Estate Planning, Know Your Business by Dan Penning
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According to a 2007 census bureau survey, some 6.2% of children ages 5 – 15, a total of 2.8 million children, have disabilities. Individuals with disabilities are living longer than ever. Many disabled children will outlive their parents who support them. The Wall Street Journal published an article on October 9, 2008 titled “An Estate Plan Built for Special Needs”. The piece emphasized the need to make sure that relatives’ estate plans are coordinated. The article pointed out that often times, grandparents and parents of disabled children do not coordinate their plans which can result in a disqualification of the disabled child for certain medical and other supplemental government benefits. In addition, unless a qualified trustee or guardian and conservator are appointed in a parents’ estate plan for their disabled child, assets can be squandered by unscrupulous individuals in charge of these assets. If you have or know of anyone with a special needs child, please do not hesitate to refer them to us for a consultation and review.

Dan A. Penning

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Tags: Know Your Business, Special Needs Children by Dan Penning
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As previously discussed on this blog, part of the Economic Stimulus Package passed by Congress provides for a 65% government subsidy for eligible workers toward their COBRA coverage. On February 26, 2009, the IRS released new guidelines to help employers with the task of administering these benefits. The guidelines are Form IR 2009-15. You can find it on the IRS’s website at www.irs.gov. The website also contains a frequently asked questions update on this topic, as well as a revised Form 941, which is the form employers use to claim credit for COBRA medical premiums paid on behalf of former employees. A hard copy of the form will be sent to employers by the IRS later this month.

Employers seeking credit for the cost of the subsidy must maintain various forms of supporting documentation including the following:

• Information showing receipt of the former employee’s 35% portion of the premium;

• If you have a health insurance plan from a carrier, a copy of the invoice and proof of payment of the premium to the carrier;

• If your plan is self-insured, proof of the premium amount and proof of the coverage given to the terminated employee;

• A statement confirming that the covered employees were terminated involuntarily;

• Proof that the former employee claiming a subsidy was properly eligible for COBRA between September 1, 2008 through December 31, 2009;

• A record identifying all covered employees by social security number, the amount of subsidy reimbursed to each covered employee, and whether the subsidy was for one or more family member.

Dirk A. Beamer

Know Your Business. Grow Your Business. Protect Your Business.

Tags: Employment Law by Dan Penning
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