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Based on recent surveys, some clients were looking for us to have a location in central Cincinnati. We are excited to announce the opening of a second office in the Hyde Park neighborhood: 2101 Grandin Rd Suite A, Cincinnati, OH 45208. With the opening of the Hyde Park office, CMRS aims to expand on its mission of providing first-rate legal expertise in a suburban setting. 40 Under 40 On a personal note – I was surprised and honored to be named as one of Cincinnati Business Courier’s 40 under 40 class. My peers in this group are people who are creating successful careers while giving back to the community. It is because of wonderful and supportive clients such as yourselves that I was considered for this honor. Thank you for allowing me to be a part of your lives.
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On July 1, 2018, Kentucky businesses that provide certain services will be required to collect the 6% sales and use tax from their customers for providing these services. Also, the businesses affected by this change must register for a sales and use tax account number by July 1, 2018.
While the new sales tax applies to many types of services, it is not a blanket requirement for all types of services. For example, personal care services provided by barbers and hairdressers are still not taxable services. The provisions of Kentucky’s tax reform legislation extend Kentucky’s sales and use tax to a number of services. The following is a list of services that are now taxable for sales and use tax purposes effective July 1, 2018: Extended Warranty Services The sale of extended warranty services to repair, support, or maintain tangible personal (movable) property, such as cars, or digital property, such as computers, is taxable to the purchaser on the initial sale of the extended warranty contract. This sales tax will apply to service contract agreements sold on or after July 1, 2018. The dealers should report the tax collected on the sale of extended warranties on their sales and use tax return (Form 51A102) for the tax period in which the sale occurred. The dealer may claim a resale exemption for parts purchased and installed to complete repairs under the extended warranty because sales tax applies at the time the extended warranty is sold. Facility/Event Admission Fees Effective July 1, places requiring admissions to be taxed are bowling centers, skating rinks, health spas, swimming pools, tennis courts, weight training facilities, fitness and recreational sports centers and golf courses — both public and private (including country clubs).[1] These admissions are taxable regardless of whether the fee paid is per use or in any other form, including but not limited to: an initiation fee, monthly fee, membership fee, or any combination of these. In addition, non-profit 501(c)(3) groups must collect this sales tax unless they fall into sales tax exemptions[2]. Admissions to racetracks[3], historical sites[4], and part of admissions to county fairs[5], elementary and secondary schools, and non-profit 501(c)(3) school-sponsored clubs and organizations are exempt from the sales tax. All other entities engaged in sales of admissions must begin collecting the sales and use tax. Indoor Skin Tanning Services This includes but is not limited to tanning booths or beds, as well as spray tanning services. Janitorial Services This includes but is not limited to residential and commercial cleaning and carpet services, as well as upholstery and window cleaning. Labor Charges for Installation or Repair of Tangible Personal (Movable) Property, Digital Property or Services Sold Labor is taxable if it is part of a taxable retail sale. For example, the labor bill of a mechanic to install repair parts in a car would be subject to the sales tax. However, labor associated with the repair of real property (real estate) such as HVAC units, water heaters or plumbing fixtures will not be subject to the tax. However, contractors will still pay sales and use tax on their purchase of tangible personal (movable) property (i.e. materials) to complete their construction contracts. In addition, charges for labor or services to apply, install, repair or maintain tangible personal (movable) property directly used in manufacturing or industrial processing are exempt, if the charges for labor or services were separately stated on the invoice, bill of sale, or similar document given to purchaser. Landscape Services This includes but is not limited to lawn care and maintenance, tree trimming, pruning or removal, landscape design and installation, landscape care and maintenance, and snow plowing and removal. Limousine Services The sales tax must be collected if a driver is provided. Industrial Laundry/Dry Cleaning Services This includes but is not limited to industrial uniform supply, protective apparel supply, and industrial mat and rug supply. Linen supply services This includes but is not limited to table and bed linen supply and non-industrial uniform supply services. Non-coin operated laundry and dry cleaning services/Non-medical diet and weight reducing services/Pet care services This includes but is not limited to grooming and boarding, pet sitting and obedience training. Rentals of Campsites This includes campsites, campgrounds and Recreational Vehicle (RV) parks. Rentals for a continuous period of 30 days or more to a person are excluded from sales tax. These new accommodations subject to sales tax will not be subject to the statewide or local transient room taxes. Veterinary Services The tax applies to small animals like cats and dogs. It does not apply to large animals like horses, cattle, swine, sheep, goats, llamas and alpacas, flightless birds, buffalo, and livestock. The small pet owners will pay sales tax on all charges that a veterinarian bills its customers for, including the cost of lab tests and prescription drugs. Pollution-Control Eliminates the pollution control exemption for sales and use taxes. Retailers that sell these services should charge a 6% sales tax on the full sales price charged to their customers and may claim a resale exemption on their purchase of items provided to the customer as part of the service. This resale exemption is limited to tangible (movable) personal property or digital property sold to the customers as part of the retail sale. There is no resale exemption for the resale of services.[6] In addition, Kentucky will require online or remote retailers selling tangible (movable) personal property or digital property delivered to or transferred electronically to a Kentucky purchaser to register and collect sales tax if: (1) the retailer had 200 or more transactions with Kentucky purchasers in the current or previous calendar year; or (2) the retailer had gross receipts from such transactions to a Kentucky purchaser in the current or previous calendar year that exceeds $100,000. According to the Supreme Court case of South Dakota v. Wayfair, physical presence is no longer necessary for a state to require a taxpayer to collect and remit sales and use tax for purchases made by in-state customers if the aforementioned criteria is met. This bill also enacted a 50 cents per pack cigarette tax increase ($0.60 to $1.10 per 20-count pack of cigarettes and proportionate tax rate increase for 25-count packs), as well as a cigarette inventory floor stocks tax of 50 cents. All cigarette licensees and retailers must take a physical inventory as of June 30, 2018 at 11:59 p.m. They must then file and pay the inventory floor stocks tax. Lastly, the Kentucky Department of Revenue launched a website, TaxAnswers.ky.gov, to provide additional information and resources regarding the tax reforms made during the 2018 session of the General Assembly. For more information on business law, feel free to contact attorney Elliott Stapleton in Cincinnati, Ohio.
[1] See https://taxanswers.ky.gov/Sales-and-Excise-Taxes/Pages/Facility-and-Event-Admission-Fees-FAQs.aspx for DOR guidance into specific examples of taxable and non-taxable categories of admissions. [2] See KRS Chapter 139 [3] KRS § 138.480 [4] KRS § 139.482 [5] KRS § 139.470 [6] KRS § 139.260  There is a new tax structure in effect for 2018. This change will impact almost all taxpayers. Here are five important changes which will impact individuals.
This change will impact most individuals in the State of Ohio. Many estate plans focused on estate tax avoidance created prior to 2018 will need to be updated to address potential changes based on these updates. In addition, there are implications for business owners and succession plans which likely need to be reviewed. For more information on Estate Planning, Estate Administration, Trust creation, contact Elliott Stapleton. Most organizations host or organize events for their company or with volunteers. For any organization, including for profit or non-profit, it is important to establish a process to limit liability at each event; especially events with physical activities.
One of the best practices to limit event liability is to require a signed wavier. This would need to be signed by each individual (and for minors would require a signature by a legal guardian). If the organization is going to photograph or record individuals, a waiver may also need to include a provision allowing the use of a participant's likeness in promotional material. Failure to secure a release to use a person in advertisements (including employees) could result in significant liability.  There is a new cyber threat, Smishing (SMS Phishing), which can expose you to financial risk. You may already be a victim of Smishing.
WHAT IS SMISHING: Similar to “phishing”, where an authentic looking email contains a fraudulent link, “smishing” messages are sent to you via your phone messaging service. They often prey on people’s panic and sense of urgency. As email services grow more savvy at detecting fake emails, scammers are increasingly turning to mobile devices to get to your personal information. HOW SMISHING WORKS: You receive a text message to your cell phone that appears to be an alert from your bank. It will inform you that your card has been blocked or that there has been an unauthorized charge made and will give a phone number to call to unblock your card. When you call the number, an automated representative will ask you to key in your card number, CVV (3 digit security code on the back panel of your card), and zip code. Then the automated representative will ask you if you are in possession of your card. You will say or enter a number for yes. Then, the system will advise that your card has been unblocked. Now the fraudster has your card number, CVV, and zip code, everything they need to initiate fraudulent purchases online and your card was never blocked in the first place. HOW TO PROTECT YOURSELF: If you receive any text messages like this, please ignore them. Scammers may be able to make their messages look as though they are coming from a source you trust. If you are unsure, call your bank or credit card provider directly. I ignore any call or message sent to me by a third party provider (even if they can confirm my account number over the phone). Instead, I contact the third party directly after the communication through a verified phone number on their website. Is asset protection planning necessary for small business owners?
For small business owners, it is important to limit the risk of creditor claims, avoid the loss of intellectual property rights, reduce the likelihood of disputes, and preserve more of what you earn for your family. Learn about the often overlooked, potentially hazardous legal entanglements before they overwhelm you or your business. In this 30-minute webinar, Elliott Stapleton will provide visual explanations of four asset protection methods for small business owners. This will be 30 minutes well spent – an ounce of prevention is worth a pound of cure. https://attendee.gotowebinar.com/register/824191001754893314 Join us for a webinar on November 15, 2016 at 8:00 PM EST. What happens to our family’s assets if my spouse remarries after my death? What happens to our family’s assets if my spouse goes into a nursing home after my death? In this webinar, Elliott Stapleton will discuss different options available for families who want to protect the surviving spouse from creditors and predators while also allowing flexibility with the use of assets. Who could benefit from this information?
For the majority of married couples, one spouse will survive the other. Most married couples complete their estate plan (Will or Trust) with the intent of giving full control of the family assets, after the first spouse’s death, to the surviving spouse. But what happens if the surviving spouse goes into a nursing home, is sued, or remarries? Can the surviving spouse change the Estate Plan? For couples who want a higher level of protection, beyond a Will or Joint Revocable Trust, more planning is necessary. This type of planning is important for couples who no longer have minor or college age children and are approaching retirement (or are already in retirement). After registering, you will receive a confirmation email containing information about joining the webinar. View System Requirements   Clients will frequently ask: How much can I give away before a gift tax return is necessary? For 2016 up to $14,000 per year per person. [1] Just because you don’t have to file a gift tax return, does not mean you avoid all future penalties on the gift. The following explains how your gift could create a penalty for you (or your spouse) in the future. 60 month look back period for Medicaid If you (or your spouse) to go into a long-term care facility or nursing home and apply for Medicaid, there is a penalty imposed on recent gifts. Specifically, gifts made within the last 60 months, or five years, prior to applying for Medicaid. [2] The IRS annual gift exclusion does not provide any exemption from the Medicaid look back period. If you made a gift within the prior 60 months, the result will be a penalty period from Medicaid coverage. For questions on estate planning or asset protection, feel free to contact Elliott Stapleton. Read more at on CMRS Law's website [1] Source: https://www.irs.gov/businesses/small-businesses-self-employed/whats-new-estate-and-gift-tax [2] Source: Ohio Administrative Code 5160:1-3-07.2 Medicaid: transfer of resources. http://codes.ohio.gov/oac/5160:1-3-07.2v1  How does adoption change a child’s right to inherit?
The right of an adopted child to inherit from a biological parent is severed when the final decree of adoption is issued or an interlocutory order of adoption becomes final. There is an exception to this standard. Source: Ohio Revised Code Section 3107.15(A)(1). The exception to the adoption standard applies when a parent dies and the new spouse of the living parent adopts the child. Source: Ohio Revised Code Section 3107.15(A)(1). During the administration of an estate in Ohio, it is not always easy for a Probate attorney to determine if the adoption was completed. One method of conformation is to contact the Ohio Department of Health, Office of Vital Statistics (“ODH”). This organization has adoption records for individuals born in Ohio and adopted anywhere in the US. How does your Probate Attorney determine the adoption was completed? There is a challenge with this process in the Probate administration context. Specifically, the challenge is when the only known biological parent of the children is deceased. The Ohio Department of Health, Office of Vital Statistics only makes its records available to the adopted child, the adopted parents or the child’s lineal descendants. It may be possible for biological siblings to request the name of an adopted child if that adopted child is over 18 and has already filed a name release consent with the ODH. Additionally, a biological sibling may request non-identifying information from the attorney, adoption agency, or Probate court that handled the adoption under O.R.C. 3107.66. The statute is unclear whether this would include a confirmation of an adoption decree. For confirmation in a jurisdiction such as Hamilton County, the Probate court would likely need the birth name of the child and would need permission from a magistrate before releasing even non-identifying information. For an Administrator, Executor, or Trustee, the lack of identifying information makes the administration of such an estate challenging. It is best for a fiduciary to seek counsel from an attorney familiar with the requirements in the local Probate court. Failure to properly distribute assets from the estate could result in personal liability for the fiduciary. For more information about estate planning, probate, elder law, or trust administration in Cincinnati, Ohio, visit my website. If you have questions regarding this article or any legal matter, feel free to contact Elliott Stapleton at (513) 334-0099  All Ohio Financial Powers of Attorney (FPOA) must specifically allow the attorney-in-fact to create a Qualified Income Trust (QIT), also known as a Miller Trust, in order for the principal, the person creating the FPOA, to qualify or remain eligible for Ohio’s Medicaid program.
Most FPOA’s do not include this provision because there was no previous need for it. As of July 1, 2016, anyone with a monthly income of above 300% of Supplemental Security Income (SSI), or $2,199 in 2016, will no longer qualify for Medicaid without a QIT. If the Medicaid applicant is incompetent to create their own QIT, then someone, such as the FPOA, must have the authority to create one for them. This change affects all Medicaid recipients in nursing homes, assisted living, and those receiving Home and Community Based Services (HCBS). Resource: Ohio Department of Medicaid, June 2016 For more information about estate planning, probate, elder law, or trust administration in Cincinnati, Ohio, visit my website. If you have questions regarding this article or any legal matter, feel free to contact Elliott Stapleton at (513) 334-0099 |
Elliott Stapleton Attorney with CMRS Law
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