Menu

jgarretson2485

About jgarretson2485

Posts by :

Severance Packages

,

Discovering

 

 Severance Packages in Indiana: How We Can Help Employers and Employees

Severance packages are a valuable tool in the employment world, offering benefits to both employers and employees during transitions. At AAKlaw.com, we focus on drafting and negotiating severance agreements that protect our clients’ interests, whether you are an employer looking to reduce liability or an employee seeking fair compensation.

What Is a Severance Package?

Severance packages typically provide financial and other benefits to employees in exchange for agreeing to certain terms, such as releasing claims against the employer. These agreements often include:

  1. Severance Pay
    Indiana employers frequently calculate severance as 1 to 2 weeks of pay for every year of service, though amounts may vary depending on circumstances and negotiations.
  2. COBRA Coverage
    Employers may choose to include COBRA (Consolidated Omnibus Budget Reconciliation Act) benefits to extend health insurance coverage, either partially or fully paid. This can be a key element in negotiations, as continued health insurance is often vital for employees during job transitions.
  3. Release of Claims
    Severance agreements typically include a release of claims, where the employee agrees not to pursue legal action against the employer. While this release is comprehensive, certain claims—such as workers’ compensation or the right to report legal violations—cannot be waived.

How We Help Employers

For employers, severance packages are a strategic way to mitigate risk and avoid potential lawsuits, including discrimination or wrongful termination claims. We can:

  • Draft Customized Agreements: Tailored to meet your specific needs while complying with all legal requirements.
  • Negotiate Terms: Ensure agreements are fair and minimize future liabilities.
  • Include Protective Provisions: Add confidentiality, non-disparagement, or non-compete clauses where appropriate to safeguard your business.

Employers benefit from having experienced attorneys draft and review severance agreements to ensure clarity, enforceability, and legal compliance.

How We Help Employees

For employees, a severance package provides financial support during the critical period of searching for new employment. However, these agreements often contain provisions that can have long-term implications. We can:

  • Review Severance Agreements: Identify terms that may be overly restrictive or unfair, such as new non-compete clauses that limit future opportunities.
  • Negotiate Better Terms: Advocate for increased severance pay, extended COBRA coverage, or the removal of harmful provisions.
  • Protect Your Rights: Ensure you do not unknowingly waive claims you are entitled to retain or agree to terms that could harm your career.

Common Pitfalls in Severance Agreements

Both employers and employees should be aware of potential issues in severance agreements:

  • Non-Compete Clauses: Employers sometimes use severance agreements to impose new restrictions that didn’t exist in the original employment terms. These clauses can significantly impact employees’ ability to find new work.
  • Tax Implications: Severance pay is taxable, and large payouts could have unexpected tax consequences for employees.
  • Vague Language: Poorly drafted agreements can lead to disputes over enforceability or interpretation.

Why Work With AAKlaw.com?

Severance agreements require careful attention to detail to ensure they are legally sound and meet the needs of all parties. Whether you’re an employer protecting your business or an employee protecting your rights, we can help you:

  • Understand your legal obligations and rights.
  • Draft clear, enforceable agreements.
  • Negotiate favorable terms.

At AAKlaw.com, we bring experience, strategy, and insight to the table to achieve the best possible outcomes for our clients. Contact us today to learn how we can help with your severance package.

 

Forming a 501(c)(3): Purpose, Benefits, and How AAK Law Can Help Copy

,

Discovering

 

Nonprofit organizations play a vital role in serving communities and advancing charitable, educational, and other public-benefit goals. Achieving 501(c)(3) status under the Internal Revenue Code allows your organization to operate as a tax-exempt nonprofit, providing financial and operational advantages while helping you fulfill your mission. At AAK Law, we guide organizations through the complex process of forming a 501(c)(3), ensuring compliance with all legal requirements and setting your nonprofit up for success.

What Is a

501(c)(3)

What Is a 501(c)(3)?

A 501(c)(3) organization is a nonprofit entity recognized by the IRS as tax-exempt. These organizations exist for purposes such as:

  • Charitable activities
  • Religious or spiritual missions
  • Educational programs
  • Scientific research
  • Literary or artistic endeavors
  • Public safety testing
  • Promoting amateur sports or preventing cruelty to animals or children

To qualify for 501(c)(3) status, your organization must meet specific legal and operational requirements, including restrictions on political and legislative activities and the exclusive use of assets for tax-exempt purposes.

Benefits of 

Forming a

501(c)(3)

Forming a 501(c)(3) provides significant advantages for your organization, including:

  1. Tax-Exempt Status
    • Your organization is exempt from federal income tax and may qualify for state tax exemptions as well.
    • Donations made to your organization are tax-deductible for donors, making it easier to attract funding.
  2. Grant Eligibility
    • Many private foundations and government entities require 501(c)(3) status to qualify for grants.
  3. Credibility
    • Operating as a recognized 501(c)(3) enhances your organization’s credibility with donors, volunteers, and the public.
  4. Limited Liability Protection
    • Forming a 501(c)(3) as a corporation provides limited liability protection for board members and staff.
  5. Discounted Rates
    • Nonprofits often qualify for discounts on services, supplies, and even advertising from companies and vendors.

The Formation

Process

Forming a 501(c)(3) involves several steps, and compliance is critical to avoid delays or denials. The process typically includes:

  1. Defining Your Mission
    • Establishing a clear and qualifying charitable purpose is essential.
  2. Incorporating the Organization
    • Filing Articles of Incorporation with the state and including necessary legal language for 501(c)(3) eligibility.
  3. Drafting Bylaws
    • Creating bylaws that govern your organization’s operations and comply with IRS standards.
  4. Applying for Tax-Exempt Status
    • Filing Form 1023 or Form 1023-EZ with the IRS, along with supporting documentation.
  5. Ongoing Compliance
    • Maintaining records, filing annual reports, and ensuring compliance with both state and federal laws.

How AAK Law Can Help

Navigating the 501(c)(3) formation process can be complex and time-consuming, but our experienced attorneys at AAK Law are here to help. We provide:

  1. Comprehensive Legal Guidance
    • We ensure your organization meets all legal requirements, from incorporation to IRS application and beyond.
  2. Tailored Documentation
    • We draft custom Articles of Incorporation, bylaws, and policies to suit your organization’s unique needs while meeting IRS and state requirements.
  3. IRS Application Assistance
    • We prepare and file your 501(c)(3) application, addressing complex questions to improve the likelihood of IRS approval.
  4. Compliance Support
    • We help your organization establish policies and procedures to maintain tax-exempt status, including reporting requirements and recordkeeping.
  5. Strategic Planning
    • We advise on board structure, governance, and operational strategies to position your nonprofit for long-term success.

Why Choose AAK Law?

At AAK Law, we are passionate about helping nonprofit organizations thrive. Whether you’re just starting out or restructuring an existing organization, our attorneys bring the legal expertise and strategic insight needed to achieve your goals.

Let us help you focus on your mission while we handle the legal complexities. Contact us today to learn more about forming a 501(c)(3) and how we can support your nonprofit’s success.

The Tax Benefits of Donating to a 501(c)(3) Organization

Donating to a 501(c)(3) nonprofit organization doesn’t just support important causes—it can also provide significant tax advantages for donors. Understanding these benefits can help you maximize the impact of your contributions while potentially reducing your tax liability. However, it’s important to note that tax laws are complex and subject to change, so you should always consult a tax professional for advice tailored to your specific situation.

Key Benefits of

Donation to a

501(c)(3)

  1. Tax Deductibility
    • Donations to qualifying 501(c)(3) organizations are generally tax-deductible, meaning you can subtract the amount of your contribution from your taxable income if you itemize deductions.
    • This can lower your overall tax burden while allowing you to support causes that matter to you.
  2. Eligibility for Full Value Deductions
    • For cash donations, you may be eligible to deduct up to 60% of your adjusted gross income (AGI).
    • Non-cash contributions, such as property or stocks, may also be deductible, often at fair market value, though limitations and rules may apply.
  3. Avoiding Capital Gains Taxes
    • Donating appreciated assets, such as stocks or real estate, to a 501(c)(3) can allow you to avoid paying capital gains taxes on the appreciation while still receiving a deduction for the asset’s fair market value.
  4. Estate Tax Benefits
    • Donations made as part of an estate plan can reduce the value of your taxable estate, potentially lowering estate taxes owed.
  5. Corporate Donations
    • Businesses can also benefit from donating to 501(c)(3) organizations, often deducting contributions as a business expense.

Requirements for Tax-Deductible Donations

To qualify for these tax benefits, your donation must meet certain criteria:

  • Qualified Organization: Ensure the organization is recognized by the IRS as a 501(c)(3). Most nonprofits will provide confirmation of their status or a receipt for your donation.
  • Proper Documentation: Keep detailed records of your contributions, including receipts, acknowledgment letters, and appraisals for non-cash donations exceeding $5,000.
  • Itemized Deductions: Tax benefits from charitable contributions can only be claimed if you itemize deductions on your federal income tax return.

How AAK Law Can Help

At AAK Law, we understand the importance of supporting charitable causes and ensuring donors maximize their tax benefits. While we do not provide tax preparation services, we can:

  • Advise Nonprofits: Ensure your organization’s 501(c)(3) status remains in good standing so donors can confidently claim tax deductions.
  • Assist Donors: Help individuals and businesses understand the legal requirements for charitable giving and compliance with donation-related rules.
  • Guide Estate Planning: Incorporate charitable giving into estate plans to achieve both philanthropic and tax-saving goals.

Consult Your Tax Professional

While donating to a 501(c)(3) can provide substantial tax benefits, individual circumstances vary. Tax laws are complex and frequently change, so it’s crucial to consult with a qualified tax professional or accountant to understand how these rules apply to your situation.

At AAK Law, we’re here to help you navigate the legal aspects of charitable giving. Whether you’re a donor, a business, or a nonprofit organization, contact us today to learn how we can support your goals.

Changes to Michigan Earned Sick Time Act (ESTA)

,

Discovering

 

The Michigan Earned Sick Time Act (ESTA) is set to take effect on February 21, 2025, introducing expanded paid sick leave requirements for employees in Michigan.

Who Is Affected:

  • Employers: All Michigan employers with one or more employees, excluding the U.S. government, are subject to ESTA.

Michigan.gov

  • Employees: The Act covers all employees, including full-time, part-time, salaried (both exempt and non-exempt), and hourly workers.

Michigan.gov

Accrual and Usage of Sick Time:

  • Accrual Rate: Employees accrue one hour of sick time for every 30 hours worked.

Michigan.gov

  • Annual Usage Limits:
    • Employers with 10 or more employees must allow up to 72 hours of paid sick time per year, subject to accrual.
    • Employers with fewer than 10 employees must provide at least 40 hours of paid sick time and an additional 32 hours of unpaid sick time annually, subject to accrual.

Michigan.gov

  • Carryover: Unused sick time can be carried over to the next year; however, employers may limit annual usage to 72 hours.

Michigan.gov

Permissible Uses of Sick Time:

Employees may use accrued sick time for:

  • Their own or a family member’s mental or physical illness, injury, or health condition.
  • Medical diagnosis, care, or treatment.
  • Preventive medical care.
  • Circumstances related to domestic violence or sexual assault, including medical attention, victim services, counseling, relocation, or legal proceedings.

Michigan.gov

Employer Compliance Requirements:

  • Notification: Employers must inform employees about their rights under ESTA, including the amount of sick time, terms of use, and protection against retaliation.

Michigan.gov

  • Recordkeeping: Employers are required to maintain records of hours worked and sick time taken by employees.

Michigan.gov

For detailed information and updates, employers and employees should consult the Michigan Department of Labor and Economic Opportunity’s resources.