During stressful times as going through divorce proceedings, it is common to let important issues and accounts, such as insurance coverage, fall by the wayside. However, during this time, it is extremely important to take a close look at any and all insurance policies in order to foresee whether your insurance policies may be impacted once your divorce is finalized – in order for you to strategically prepare.

Below, we discuss the two main types of insurance that are typically relevant during divorce: health and life insurance.

Health Insurance

When a couple is married, frequently, one spouse is covered in terms of their own health insurance on the other’s health plan. In order to help the spouse that does not earn an income after divorce, the purpose of the Consolidated Omnibus Budget Reconciliation Act (COBRA) is to allow them to continue the coverage under their ex’s plan for three years afterward.

However, while COBRA is convenient in terms of continuation of existing coverage, it is not necessarily the most affordable option. In addition, the time limit makes it somewhat impractical after a certain amount of time has passed.

Now that the Affordable Care Act has been passed, there may very well be cheaper health plans available for those who either don’t have their own health insurance through an employer and/or do not make enough income to purchase their own private plan. You can explore all of these options with a variety of advisers, including your divorce attorney.

Life Insurance

Life insurance is also important consideration during divorce, especially if spousal support is relevant to you. While spousal support stops when the payer passes away, typically, these payments can continue pursuant to a life insurance policy on the payer. In addition, sometimes your attorney can ensure that the life insurance policy is a required part of your divorce settlement. If this is of interest to you, you will want to make sure that you own the policy so as to retain control over that policy and ensure that changes are not made and payments regularly occur.

Life insurance needs to be arranged for before the divorce is finalized because the payer spouse ends up being uninsurable, in which case adjustments may need to be made to the divorce decree in some circumstances. In addition, existing policies may be considered a marital asset under some circumstances.

Contact Our Florida Divorce Attorneys To Find Out More

Like every other issue that you have to deal with before, during, and after divorce, figuring out how to address and deal with insurance policies may not be very straightforward. However also like everything else, you must be aware of all of the policies and details going into the divorce so that you are aware of what you might want to adjust for your divorce settlement.

If you live in Florida and have any questions about divorce, including insurance policies before and after, contact our experienced Tampa divorce attorneys at HD Law Partners today to find out how we can help.

Resource:

forbes.com/sites/catherineschnaubelt/2019/04/29/insurance-issues-to-consider-in-a-divorce/#e9dbaf0b5d1e

Posted in Divorce, Insurance Litigation | No Comments »

Seven months after Hurricane Michael hit Florida, the estimated losses from the Category 5 storm are currently over $50 billion. Property damage alone reportedly accounts for more than $5 billion, and many property owners’ claims have gone unpaid by insurance companies that are supposed to make them whole again in times like these. In addition, federal disaster relief funding has been stuck in gridlock and affected by other devastated areas, such as California and Iowa, as well as other hurricane effected neighbors of Florida.

The Significant Loss

Hurricane Michael hit Florida with significantly more force than even Hurricane Katrina hit Louisiana. The storm was especially felt in coastal cities such as Apalachicola, Panama City, and a number of others; shredding boats, businesses, and homes, and causing a number of people to go missing. People not only lost property, but a number of individuals died as well as a result of the disaster. To date, some residents are still without power. Even a number of Florida parks are still closed today. For example, the hurricane destroyed 80 to 90 percent of Florida Caverns State Park and its buildings. Thousands of trees are still uprooted throughout the state and its national forests, with agricultural and forestry losses representing more than $3 billion. There is no question that, in order to rebuild, people are going to need a lot of help.

Mexico Beach, Florida in particular has been hard-hit, with the beaches and businesses still just concrete slabs. Towns still have no banks, gas stations, or grocery stores, and very few homes are habitable. Even sewer services are still unavailable. In addition, devastating, catastrophic damage was inflicted in areas such as Bay County, where more than 45,000 buildings were damaged and destroyed, including hospitals.

Without insurance companies coming through on insurance claims, things cannot get better, and that includes the demolition of damaged buildings and the rebuilding of new ones, as well as cities. Structural damage alone done to homes has reached what some call the tipping point; translating into homelessness and unemployment.

There Is More To Be Done: Contact Our Florida Hurricane Insurance Claim Attorneys

While the Florida Legislature approved an additional $220 million in the budget—bringing the total funding to close to $2 billion—a more comprehensive federal package is still pending. In addition, while the Florida Department of Environmental Protection has been promised $4 million from the federal government, these funds will only cover debris removal.

If you have suffered from the hurricane and have concerns about your insurance claim, contact our experienced Fort Myers hurricane insurance claim denial attorneys at HD Law Partners today to find out how we can help you and your family get back on the road to recovery.

Resources:

https://wfsu.org/post/fema-reimburses-florida-hurricane-michael-debris-removal
https://cnn.com/2019/04/19/weather/hurricane-michael-upgraded-category-5/index.html
https://abc3340.com/news/nation-world/six-months-after-hurricane-michael-made-landfall-mexico-beach-waits-for-disaster-relief
https://tallahassee.com/story/news/2019/05/07/donald-trump-hurricane-michael-disaster-relief-trump-rally-panama-city-beach-puerto-rico/1130136001/
https://www.hdlawpartners.com/hurricane-michael-debris-causes-new-wildfire-devastation-to-florida-homes-properties/

Posted in Fort Myers Hurricane Insurance Attorney | No Comments »

As attorneys who regularly practice in business formation here in Florida, one recent question we have received is whether an S corporation should switch to a C corporation after the passage of the Tax Cuts and Jobs Act, and whether there is a corresponding ability for C corporations to exclude any gain from the sale of stock held for more than five years.

Below, we discuss this possibility under section 1202 and the potential to gain a huge tax break by switching to a C corporation. In a nutshell, there is some inconsistency within the statutory language which makes how you convert from an S to a C corporation very important in this process.

What Section 1202 Does & Qualified Small Business Stock

Section 1202 allows for shareholders who acquire qualified small business stock after September 2010 and hold onto it for five years to sell that stock and exclude it as declared income the greater of $10 million or 10 times the shareholder’s basis in the stock. However, there are a number of requirements that must be met in order for stock to qualify as qualified small business stock; requirements that sometimes confuse even the best tax advisers, attorneys, and shareholders alike.

In a nutshell, in order for stock to qualify as qualified small business stock it must;

• Be issued while the corporation is already a C corporation;
• Have been acquired at original issuance;
• Be linked to the corporation whose total assets are less than $50 million starting from the date of that company’s formation up to the shareholder acquiring the stock; and
• Be linked to a corporation that is not a specified service business (for example, one that is not involved in accounting, health law, consulting, financial services, engineering, or any business where the principal asset involves the skill or reputation of the owner or its employees).

You want to ensure that you meet these requirements, as–even if you convert to a C corporation– you will not be eligible if you do not. For example, if the existing outstanding stock of the company was not issued while it was a C corporation, it will never be eligible for benefits upon sale, therefore, the C corporation would have to issue new shares of stock to the shareholders–who would then have to hold that stock for five years and meet all of the other requirements–before that stock can be sold tax-free.

Other Means Of Achieving Same Benefit

Keep in mind, however, that attorneys who practice in business formation may be able to advise you on other ways to exclude post-conversion appreciation under section 1202. For example, section 1202(g) also allows for a pass-through entity to hold qualified small business stock; as long as all of the aforementioned requirements have also been met. In addition, the owners of the pass-through entity can exclude their share of that entity’s gain upon its disposition of qualified small business stock as long as two additional requirements are met:

• The owners of the entity must hold an interest in that entity as soon as it acquires that qualified small business stock through the date of disposition; and
• Each owner can only exclude the gain up to their share on the date that the entity acquired the stock.

Contact Our Florida Business Formation Attorneys to Find Out More

The lesson here is; if you’re thinking of switching to a C corporation, you want to ensure that you consult an experienced business formation attorney first in order to ensure that you do it right, as a mistake could quite literally costing millions. Contact our Tampa business and corporate attorneys at HD Law Partners today to find out more.

Resource:

forbes.com/sites/anthonynitti/2019/05/13/switching-from-s-to-c-corporation-how-you-do-it-could-save-or-cost-you-millions/#5b09abb27f74

If You Are a Business Owner or Thinking Of Forming a Business, Make Sure You Do This before Tax Season Arrives

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Proposed changes to the law in Florida could ultimately affect the ability for policyholders to hold their insurance companies accountable in terms of delaying or failing to settle claims, including those related to hurricane relief. A bill recently submitted to the legislature would make a number of changes that would cripple the ability for the consumer to go after their insurance company in the face of bad faith behavior, including taking the claim away from a jury and placing it into the hands of an administrative judge and denying the consumer the right to discovery, which would effectively leave them without any evidence, and without a case.

Current State of “Bad Faith Insurance Law” in Florida

Florida imposes what’s known as a “duty of good faith” when it comes to settling a claim with the insured or a third party, which means acting “fairly and honestly” towards its insured with regard to their interest. This means that the insurer cannot expose the insured to increased liability by failing to settle any claims against the insured, nor can they harm a third party to the insurance contract by failing to settle a claim.

An insurer also owes two major contractual duties to the insured—the duty to indemnify (payment on a valid claim)—and to defend against any third party lawsuits brought against the insured in court. In other words, the insurer owes a fiduciary duty, whereby they cannot act on the sole basis of its own interests when it comes to negotiating claims. If the insurer does not attempt to negotiate in good faith, a bad faith claim can currently be filed against them. In deciding on the claim, a court focuses on the insurer’s conduct; and while a failure to settle does not necessarily constitute “bad faith,” the insurer must initiate settlement negotiations and, if it fails to reach a settlement, it has the burden of demonstrating that it did so because there was “no realistic possibility of settlement within policy limits.” Ultimately, the court relies on the “totality of circumstances” standard and makes its determination on a case-by-case basis. The courts have established a strong precedent that determining whether or not an insurer has acted in good faith is a question for the jury, not the court.

How That Would Change

The proposed legislation would effectively undo this case law and mandate that anyone claiming a violation of an insurer’s duty of good faith would have to file an administrative complaint with the Department of Financial Services, which would first determine “the sufficiency of complaints.” If the department determines that the complaint does not meet very specific requirements, that complaint would automatically be dismissed.

Contact our Florida Insurance Claim Attorneys to Find Out More

If you have questions regarding exposure to bad faith or extra contractual liability, contact our Florida insurance attorneys at HD Law Partners today to find out more about our services.

Resources:

flsenate.gov/Session/Bill/2019/751/BillText/c1/PDF

wfla.com/8-on-your-side/investigations/change-in-insurance-law-would-take-away-consumers-day-in-court/1851917864

http://A Look at Hurricane Michael’s Damage in Florida & New Rules for Insurance Companies

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HD Law Partners is proud to support The First Tee of Tampa Bay’s inaugural event, SpringSwing, on May 23, 2019. SpringSwing is a fundraising event at TopGolf Tampa to help support the children of The First Tee of Tampa Bay. SpringSwing is a team competition, wherein your 6 players compete against others in the field. The main contest is a target point-scoring game in which experienced players and novices alike can participate, compete and win. For more information on the event and The First Tee of Tampa Bay, click the following link: https://www.golfgenius.com/pages/1759284.

The First Tee of Tampa Bay’s mission is to impact the lives of young people in the greater Tampa area by providing educational programs that build character, instill life-enhancing values and promote healthy choices through the game of golf.

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A number of older individuals who have divorced or are contemplating divorce are concerned about the impacts of divorce on their Social Security benefits. This is especially the case for older individuals, who may have, since their divorce, remarried again, and now have questions as to whether they can obtain their divorced spouse’s benefits.

Fortunately, remarriage typically does not disqualify someone from being eligible for a previous spouse’s benefits, as we discuss below.

The Rules After Divorce

If you divorced, but your marriage lasted 10 years or longer, you can receive benefits based on your ex if:

• Your benefit is less than your ex’s;
• Your ex is entitled to their disability or Social Security retirement;
• You are 62 or older; and
• You are unmarried.

However, it is also important to remember that there are some exceptions to the marriage duration requirements when it comes to widows collecting benefits. For example, if a spouse’s death was accidental, you may be able to draw reduced benefits from the deceased spouse, and then switch to receiving benefits on the first spouse’s record at a later time (provided that the first spouse provides more beneficial benefits). This is beneficial if the first spouse has a higher benefit rate than the second spouse.

If you start receiving benefits at your full retirement age, your benefit (as a divorced individual) will be one-half of your ex’s full retirement (or benefit). However, if you remarry, you cannot collect the benefits based on the former ex’s record unless that subsequent marriage ends (for example, by annulment, death, or divorce).

Where Remarriage Ends in Death or Divorce

Let’s take someone who remarries; where that remarriage ends in death or divorce: this person is still qualified to receive their divorced spouse’s benefits, even if that spouse was their first spouse (i.e. before their remarriage). In order for divorced spouses to receive spousal benefits, the high earning spouse must either be deceased, age 62, or already engaged in drawing benefits.

Still, the individual who is seeking to collect the benefits needs to wait until they are full retirement age, or else they could risk receiving a reduced benefit. Full retirement age is typically around age 66, although it depends on the year you were born. After this age, it does not make sense to wait to file for your divorce to spouses benefits.

Contact Our Florida Divorce Attorneys to Find Out More

If you live in Florida and have questions about divorce—including how to protect yourself when it comes to Social Security benefits—contact our experienced Tampa divorce attorneys at HD Law Partners today to find out how we can help. We can guide you through what is necessary to help protect you, and provide you with the very best in experienced counsel.

Resources:

pbs.org/newshour/economy/making-sense/how-to-navigate-social-securitys-benefits-after-marriage-death-and-divorce

ssa.gov/planners/retire/divspouse.html

The Most Important Mistakes to Avoid During Divorce

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A devastating fire broke out in the Florida Panhandle on March 30, and would have been reportedly easy to contain, but, instead, spread and caused a significant amount of devastation to homes and other properties due to debris that was leftover from hurricane Michael. According to the reports, the fire burned close to 700 acres just over the weekend, and forced more than 20 homeowners to evacuate; homeowners that will undoubtedly need to file insurance claims in order to try and address the devastation. It all started from a debris burn that got out of control, and as of April 1, was still not completely contained.

In fact, the effects of the Hurricane are so severe as to continue to threaten the health and safety of Florida residents that, on April 2, Gov. Ron DeSantis signed an executive order extending the state’s “State of Emergency” status for another 60 days. The counties affected by the extension include Bay, Calhoun, Franklin, Gadsden, Gulf, Holmes, Jackson, Jefferson, Leon, Liberty, Okaloosa, Walton, Washington, and Wakulla counties.

Home Damage in Florida Only Likely to Increase 

Hurricane Michael caused more than 70 million tons of trees to fall between the Georgia border and the Gulf Coast; most of which have not yet been cleared. Experts estimate that it will still take close to $40 million to remove debris and address other hazardous issues left over from hurricane Michael.

According to climatologists, this year has also been an especially dry year for the state, which only makes things worse during peak wildfire season in April and May. According to state Forest Service officials, at this point, even a normal wildfire season could catastrophic because of all the available “fuel;” with all of the trees lying on or near the ground described as “the perfect kindling.” This is likely to make life even more difficult for residents who still have not recovered from Hurricane Michael; especially those who still have not been made right via their insurance claims. Michael was the strongest hurricane to ever hit the Panhandle, and only intensified over time due to the warmer-than-average temperatures. According to estimates, hurricane industry losses just in 2018 are estimated at $11 billion, representing market wide insured loss to public and private insurers. 

If You Are Dealing with Hurricane Insurance Claims in Florida, Contact Our Experienced Attorneys

So many homes were already destroyed in Hurricane Michael, and now this latest disaster hits Floridians. If your home has suffered from Hurricane Michael, a wildfire, or any other disaster, contact our experienced Fort Myers hurricane insurance attorneys at HD Law Partners today to find out how we can help ensure that you receive the compensation you need to get back on your feet.

Resources:

artemis.bm/news/hurricane-michael-industry-loss-hits-11bn-florence-5-5bn-aon/

tampabay.com/breaking-news/hurricane-michael-debris-fuels-500-acre-wildfire-in-florida-panhandle-20190401/

newsherald.com/news/20190402/hurricane-michael-state-of-emergency-extended-for-panhandle-counties

ecowatch.com/marine-heat-waves-dolphins-2633506677.html?rebelltitem=4

As Hurricane Michael Insurance Claims Are Delayed, Floridians Could Be Made Homeless

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When it comes to transactions involving business purchases, it is crucial that the purchasing company conducts due diligence concerning the businesses’ operations and potential liabilities; especially when it comes to human resources and labor and employment law matters. Specifically, it is important to ascertain whether there are risks that could affect the value of the transaction and therefore whether the company needs to engage in activities to mitigate those risks.

While labor and employment issues have not historically presented a significant amount of risk and potential liability, this is changing, and there are now a number of emerging legal issues in this field which have the potential to affect the proposed transaction. Below, we identify some of these risks and discuss how to address them via mitigation strategies.

General Areas of Concern

There are several general areas when it comes to basic labor and employment issues; including but not limited to the following:

• Compliance with any liability regarding local, state, and federal laws, contract employment documents, and legal duties arising out of employment relationships;
• Demographics, organizational structure, and workforce operations;
• Employee benefits;
• Labor and employment costs; and
• Labor union matters.

When it comes to high-risk categories, it is crucial that you obtain assistance from qualified legal counsel and assessing the degree of risk and liability.

Sexual Harassment Claims

Sexual harassment claims are becoming an increasingly important issue when it comes to business and employee conduct. Cording to the Equal Employment Opportunity Commission (EEOC), just between 2017 and 2018, 74 percent of all charges included sexual and workplace harassment allegations. These charges not only carry significant financial risk in terms of  compensatory and punitive damages, but also exposure for the company, and tort litigation– such as assault, battery, and decimation–not only against the company, but also against directors and officers for failing to properly regulate the conduct. In addition, any evidence of cover-ups should be of concern to a company that is acquiring a business, as that can adversely impact the purchaser.

Wage and Hour Claims

Wage and hour claims are also an emerging issue that carry increasing financial impacts, as these claims can be substantial, and now average between $10 million and $50 million. These claims tend to involve the following issues:

• failure to pay minimum wage;
• failure to play pay for work;
• improper rounding;
• misclassification of employees as independent contractors;
• misclassification of employees concerning overtime;
• improper compensable time practices; and
• improper rounding.

A number of courts have held that successor companies can be held liable for previous wage and hour violations; even if they occurred before the purchaser acquired the company. There are also additional unique state law claims, for example, state laws that concern workplace safety. 

Contact Our Florida Business Attorneys to Find Out More

At HD Law Partners, our Tampa business and corporate attorneys possess the legal knowledge and experience to help address any business transaction concerns and prevent problems before they can occur. Contact us today to find out more about our services.

Resource:

law.com/texaslawyer/2019/04/08/three-emerging-labor-and-employment-risks-in-ma-transactions/

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On April 13, HD Law Partners participated in the Hillsborough County Bar Association’s 16th Annual 5k Pro Bono River Run and Judicial Pig Roast/Food Festival. Participants ran down Tampa’s River Walk, from Water Works Park to the Tampa Convention Center, then returned to Water Works Park. After the run, participants and non-participants enjoy themed tents and good food at Stetson University’s Tampa Law Center.

The funds raised by the Hillsborough County Bar Association from this event go toward providing pro bono legal services to people in need in Hillsborough County, Florida. The Hillsborough County Bar Association, through its run participants registered for the event, pledged 5,000 pro bono hours.

The firm enjoys supporting the Hillsborough County Bar Association’s goal of supporting individuals in need of legal assistance in Hillsborough County. To learn more about free and low-cost legal aid in Tampa Bay, visit the HCBA’s website for more resources. To see the complete race results, click here

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According to new research, although many parents decide to stay together and delay divorcing until their children are older because they think that is better for them, in fact, divorce is actually less harmful if it occurs earlier in childhood.

Of course, when it comes to how a family will react to divorce, experts have long held that that depends upon the family. Exactly how a child will react depends upon what is going on with the family, the child’s temperament, age, and the relationship between the parents. If there is exposure to chronic violence in the home, the consensus has been that parents should get divorced as soon as possible. The same also goes for repeated high conflict in the marriage. Still, for children who come from violent divorces, many experts will recommend that additional steps be taken, such as taking the child to therapy.

What the New Study Indicates

As the first major assessment done on the emotional impact of divorce on children, this latest study results specifically indicate that the greatest repercussions from divorce (i.e. behavioral and emotional problems in children) come in early adolescence; i.e., between the ages of seven and 14, especially in boys. Older children are not only more sensitive to relationship dynamics, but they are also more likely to be affected by other consequences of divorce, such as disruption to friendships and schooling. Conversely, for children between the ages of three and seven, the study found no differences whatsoever between children whose parents divorced and those who did not.

Interestingly, the study also showed that children from privileged backgrounds were just as likely to experience mental health problems as those who come from less advantaged backgrounds, and mothers were more likely to experience mental health issues if they separated when their children were older.

How Do I Approach My Children About The Divorce?

The experts recommend following these tips in helping you get through what can sometimes be a difficult conversation:

• Be honest, but do not provide them with the details on your split. Try to keep to how it will affect their lives—i.e. living arrangements, school, seeing the other parent, celebrations and holidays—and focus on their well-being;
• Choose your words and tone carefully, and make sure you stay on a unified message with your soon-to-be ex;
• Be open to any reaction they might have, which includes listening to their concerns and questions and answering them in a simple, calm manner; and
• Stay positive—avoid negativity.

 Contact Our Florida Divorce Attorneys to Find Out More

Getting divorced when you have children is never easy; however, if studies have shown us anything, it’s that doing so sooner rather than later is best for both you and your kids. Still, it is a subjective, personal decision. Contact our Florida divorce attorneys at HD Law Partners today to find out how we can assist you through the process.

Resource:

telegraph.co.uk/news/2019/01/17/revealed-best-age-get-divorced-protect-childrens-mental-health/

Posted in Divorce, Family Law | No Comments »