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On December 3, 2024, a District Court in Texas placed a preliminary nationwide injunction on new Beneficial Ownership Information (BOI) reporting requirements imposed by the Corporate Transparency Act (CTA).

In Texas Top Cop Shop, Inc. v. Garland, No. 4:24-CV-478 (E.D. Texas) the judge ruled that “[a] nationwide injunction is appropriate in this case,” which means that “reporting companies need not comply with the CTA’s Jan. 1, 2025, BOI reporting deadline pending further order of the Court.”

Legal commenters have observed that the nature of the Court’s preliminary injunction could mean that the Court may later reconsider that injunction, and that the government is likely to appeal the Court’s decision. Additionally, they note that the inconsistent rulings among the District Courts may mean that the ruling in Texas Top Cop Shop, Inc. v. Garland may not be the final word on the matter. They also question whether the court has the authority to issue a nationwide injunction.

At this time, along with many of our colleagues, we are recommending that our clients be prepared to file, but not complete the filing until more information is known about the impact of this case.

There is an upcoming December 31^st deadline to file under the Corporate Transparency Act (“CTA”) that took effect on January 1, 2024. Failure to timely comply may result in significant penalties.

The CTA is a new federal law that applies to all LLC’s (single member and multi-member), Limited Partnerships, Corporations (C-Corps and S-Corps) and other entities formed by the filing of a formation document with a Secretary of State (“Covered Entities”) formed prior to, or after January 1, 2024.

All Covered Entities formed before January 1, 2024, must file an initial Beneficial Ownership Information (“BOI”) report with the Department of Treasury’s Financial Crimes Enforcement Network (“FinCen”) no later than December 31, 2024. (A separate filing deadline applies to Covered Entities formed after January 1, 2024.) Each BOI report must provide FinCen with information and documentation about the Covered Entity, as well  as its owners, directors, officers, partners, members and/or managers.  Note that Estates and Trusts may be deemed “beneficial owners” under the CTA.

There are significant penalties for failing to timely file an initial BOI report, including cash penalties of up to $10,000 and imprisonment for up to two years for willful failure to timely file.  

How to comply

If your Covered Entity has reporting responsibility under the CTA:

• You can file your initial report directly by logging on to FinCen;
• We can make arrangements for you to work with our preferred outsourced service firm and then you will deal with them directly (and without our further involvement) in connection with filing your initial BOI report; or
• You can engage a law firm (including ours) to assist you with the filing of your initial BOI report. If you would like to engage Lassar & Cowhey LLP for this purpose, please email us at [email protected] and one of our team members will provide you with a mandatory questionnaire for your use for each Covered Entity, as well as information as to the required supporting documentation that you must gather. Please note, however, that if 25% or more of your Covered Entity is owned by an Estate or Trust, the process is more complicated; if that is your situation, please instead directly contact our paralegal, Osnat Arabov for further information.

We are thrilled to announce that Lassar & Cowhey has once again been recognized for its exceptional legal talent. Two of our esteemed associates, Stephenie Yeh and Crystal Levy, have been named by Super Lawyers as New York Metro Rising Stars for 2023. Stephenie has been a Rising Star since 2018 and Crystal has been a Rising Star since 2021.

This prestigious recognition further solidifies our commitment to delivering outstanding legal services to our valued clients. We extend our heartfelt congratulations to Stephenie and Crystal for their well-deserved achievements.

Super Lawyers, a distinguished rating service operated by Thomson Reuters, selects no more than 5% percent of lawyers in each state as Super Lawyers and only 2.5% as Rising Stars. The selection process involves a comprehensive evaluation that includes peer recognition, professional achievement, and independent research.

We are immensely proud of our team’s accomplishments and the recognition they have received. We look forward to continuing to provide exceptional legal services to our clients with the dedication and expertise that have earned us this prestigious honor.

By Amie Gartenberg

Remember…

Your first time behind the wheel? Mine was memorable, but sadly for all the wrong reasons. It involved an errant fire hydrant, a twisted fender on the family station wagon, and two burly firemen who showed up at the scene of my unfortunate accident. Thankfully, there were no major injuries that day (only minor bruising to my teenage ego). My father, a young man then, was firm but loving as he took the keys away from me, insisting that I was “not ready.”

I was reminded of this episode recently when having a similar discussion with my father, now aged 75 and suffering from Parkinson’s Disease. There had been several “incidents” already, and while we were lucky on those occasions, the writing was now clearly on the wall. Though broken-hearted, we knew it was time to have “the talk” about car keys. If you have elderly parents, you may already be familiar with these difficult conversations. No doubt about it, it’s tough. But here are some things to keep in mind as you enter this new stage of life.

What I’ve learned…

• Be attentive to signs of deficits not improved over time – trust your instincts
• Ask M&D (Mom & Dad) to introduce you to their doctors – join them on an appointment
• If not already done, encourage M&D to sign legal documents (Healthcare Powers Of Attorney and HIPAA Releases) allowing you to be medically informed, and to make decisions should they be unable
• Don’t wait to start a conversation, or series of conversations that may need to evolve over time; it’s often easier before a decline accelerates
• Whatever the dangers (e.g. driving, living alone or with too many stairs, loss of memory), gather your facts – and be specific, avoid “you’re just too old to drive”
• Be curious about the mail. Act on uncharacteristic piles of unpaid bills
• Take a look in the fridge. Smell ok? Fresh food to eat? 
• Ask about “important papers”, like insurance policies and cards and car titles. Whether they have signed Powers of Attorney and Last Wills; If M&D bank online, where are their user names and passwords 
• Don’t go it alone – enlist the help of professionals
• Be patient with M&D and also with yourself – remember, this is hard 

What next

So even if your parents still coast along life’s highways at regulation speed, hard conversations may be on the horizon. If you need more specifics or resources on any of the above, or just need a sounding board, or if you have recently lost a loved one and need assistance, please do reach out – we are here to help.

Till next time, stay safe and be well,

Amie

Crystal Levy is a Senior Associate at Lassar & Cowhey LLP and a manager at Marcum LLP. She focuses on making thoughtful estate plans for modern and emerging families as well as high net worth households. Janis Cowhey is a Trusts & Estates and Tax Partner at Marcum LLP, who specializes in estate, gift and income tax planning, as well as working with same-sex couples and unmarried families. They join Stacy Francis to give insights about the required tax considerations in estate planning that the modern family needs to know about, especially if they are considering divorce. They also share how you can make sure your children and stepchildren are financially protected during and after a divorce.

Some legal considerations for getting divorced are: getting a good matrimonial, having all your documents in place, identifying legal obligations, and ensuring that your beneficiary designations are in order.

Most couples continue to file joint amended returns for quite some time until they are actually divorced.

It’s never a bad idea to update your documents before a divorce is final.

By Stephenie Yeh Chan

Recently, New York passed a budget which includes significant cuts to its Medicaid long-term care program. Beginning October 1, 2020, New York will impose a look-back period of 30 months or 2.5 years on qualifying for Community Medicaid (or home care) benefits. If a transfer is made for less than fair market value (gift) and does not qualify as an exception, it may result in a period of ineligibility. Prior to this change, New York did not impose any look-back period for these benefits, and thus, applicants were able to transfer assets or make gifts without penalization.

The new rule does not affect those who are currently receiving Medicaid benefits. It also does not affect those who wish to apply for Institutional Medicaid (or nursing home) benefits which continues to maintain a 5 year look-back period for eligibility.

We highly encourage you to contact us if you or someone you know is in need of Medicaid benefits or anticipates needing to apply for benefits in the near future. We understand that those who are disabled or elderly may not wish to have an aide in their homes at this time. However it is important to begin the process of Medicaid planning as soon as possible. Once approved, the Medicaid recipient may place a hold on services until it is safer to have home health aides.