Charging orders: What are they and whose is better

At a recent lunch, a colleague posed the question, “Which state do you think has the better charging order?” That posed an interesting question that takes more time than gobbling down a crab cake sandwich allows.

So I started researching the experts. And they were all over the map.

Three lawyers writing for the American Bar Association’s Business Law Today, gave an excellent description of sorting out the issues here.

With apologies to authors Jay D. Adkisson, Carter G. Bishop and Thomas E. Rutledge, they described a charging order as a remedy provided to a judgment-creditor of an LLC member where that creditor may legally attach distributions to that member, thereby diverting that income stream to satisfy the judgment. They went on to say that under most state formulas, the charging order is subject to redemption, and a lien on the LLC interest created by the charging order is subject to foreclosure.

In simpler English, the objective then is to get the judgment-creditor paid while precluding that judgment-creditor from interfering with the business.

(Okay, now does that have you lost? Think about me trying to think about this while eating the crab cake.)

So my colleague, who hadn’t seen the description “under most state formulas”, knew that some were different than others so that meant that some were better than others. So then, whose is best? So I started trying to find an expert to tell me that. What I often found was the typical “my state’s better than yours.”

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Spooked about politics? How worried should you be?

I had the opportunity recently to hear Dr. JoAnne Feeney, Portfolio Manager of Adviors Capital Management, speak about the state of the economy.

She started with a discussion of spending patterns that her firm was seeing in the immediate future. She worked the discussion through the different economic outlooks of Millenials, Gen-Xers, middle agers and old people. (Unfortunately, I knew where I fell in the grouping. There was no volunteering for another category.) The true positive from the talk was a discussion of the signs that money was moving.

She then took her thoughts on the state of investments in automobiles, computers, new homes and furniture. What made the discussion fascinating were the keys that the advisors like her consider when analyzing companies for potential investments.

Then, without really tipping her hand as to personal preferences, she walked through the impact of either political party winning the upcoming November election and the likelihood of the impact on the economy.

She published similar thoughts from her talk this morning and I pass them along through the link here for your benefit.

http://www.advisorscenter.com/pages/commentariesDetails.php?Spooked-About-Politics-How-Worried-Should-You-Be-297

Let me know if you think she is right.

Until then, good luck and good hunting.

Randy

__________________________________________

Related articles

The Fisher Law Office is known for its experience in asset protection, business counselling and development, business succession planning, estate planning and probate administration. Annapolis attorney Randall D. Fisher has practiced for over 20 years, is licensed in Maryland, Texas, Wyoming and the District of Columbia, and has clients all over the country. He maintains the highest peer review rating for ethics (AV Preeminent) by Martindale-Hubbell, and is a sucker for long walks on the fairways.

If you need legal help, or just want to find out how he is doing at eliminate his slice, find out how to reach Randy via TheFisherLawOffice.com or find him at Facebook.com/FisherLawOffice, on Twitter @thefisherlawoffice, or at LinkedIn.com/in/FisherLawOffice.

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We are moving ………..

Just a quick note–

To let you know we are moving.

We needed a little more room, so at the end of this week, we are moving to a larger office nearby, on Bestgate Road, on the other side of the Annapolis Mall from our Jennifer Road location.

Same easy access from all points: Rt. 50 and I-97.

And, plenty of parking.

Our phone number and email will not change.

We are still adding some finishing touches to our new space, but we are open for business and ready to help you!

Best Regards,

Randy Fisher
Fisher Law Office

Move Date: February 1, 2015
New Address:
888 Bestgate Road, Suite 420
Annapolis, MD 21401
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West County Chamber: Working for You

I have made no secret that I am a member of the West Anne Arundel County Chamber of Commerce. If you look on Facebook, you’ll see me photo-bombing good friends Lisa Ennis and Dave Wheeler at our recent new member expo. With regard to the Chamber, on recent Fridays, I have been reporting on all things Chamber. I am real pleased to report that my good friend and fearless leader Chamber CEO Claire Louder was appointed by County Executive-elect Steve Schuh to chair the transition committee for workforce development. The citizen committee is charged with making recommendations on how we can reform County government to better serve the public, and will submit its report no later than January 31st, 2014. Claire will also be serving as a member of the Military Affairs Subcommittee of the Economic Development Committee.

Why it matters: Workforce development issues – finding, hiring, training, and keeping good employees – are among the most frequently heard frustrations from our members. Ensuring that our county Workforce Development Corporation is doing everything it should to address these needs, and that our business community knows what resources are available to them, can help address these issues.

Recognizing and building on the economic role of Fort Meade in our community is critical to the success of every business in the Chamber’s area, whether or not you do business with Fort Meade directly. The new homes, increased employment on post, and burgeoning number of contractors in the area, not to mention millions of dollars of construction occurring on and off post as a result of Fort Meade’s growth, help drive business for everyone from the smallest service provider to the largest developer.

Next
We’ll wade back into some advanced estate planning in this space next week. Clients come and go in that area and it’s time to talk about what all the documents are about. In the meantime, the holidays are coming. Shop Small Business on Saturday, November 29 (thank you American Express). Most importantly, stay warm!

Until then, good luck and good hunting.

Randy

__________________________________________

Related articles

The Fisher Law Office is known for its experience in estate planning, probate administration, asset protection, and business development. Annapolis attorney Randall D. Fisher has practiced for over 20 years, maintains the highest peer review rating for ethics (AV Preeminent) by Martindale-Hubbell, and is a sucker for long walks on the fairways.

Find out how to reach Randy via TheFisherLawOffice.com or find him at Facebook.com/FisherLawOffice, on Twitter @thefisherlawoffice, or at LinkedIn.com/in/FisherLawOffice.

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Building a Business on the Alphabet Soup of Estate Planning

We have been celebrating our 10th year in business and been walking through a series of discussions about all things Fisher Law Office. Part of what we need to discuss is what we do and how we go about it. More accurately, what kind of widgets we make and why we make them.

Our business focuses on wealth planning, business planning and asset protection. We do so through offering a variety of business and estate planning services. The tools of the trade, a series of legal documents, are a veritable alphabet soup of widgets.

Estate planning comes in two parts — basic and advanced. Business planning has its multiple parts and often involves speaking to someone about the life, which ultimately becomes their estate. There seemed to be a natural blend.

So I can show you how I built my business plan, lets start with a talk about an estate plan in its elemental forms. A basic estate plan benefits both you and your loved ones in the event of your incapacity and upon your death. People plan when they are healthy to choose appropriate fiduciaries to handle their affairs. Without such a plan in place, the court will appoint a conservator if you are incapacitated and will appoint an administrator upon your death. The court will also appoint guaradians for your minor children.

By taking the time to plan now, you make these decisions yourself instead of leaving it up to the court. Moreover, you choose your beneficiaries instead of having the state determine them for you; you are able to plan the manner and timing of distributions to those beneficiaries; and you can avoid probate and minimize taxes.

So people who come to see me to discuss estate planning are discussing business issues at the same time. Thus estate planning has benefits  to business and benefits to business will have benefits to the estate. But what are the documents most commonly used in basic estate planning?

The ABCs of Basic Estate Planning
Generally, the documents comprising a basic estate plan are a revocable living trust, a pour over will, an advance health care directive or health care power of attorney and living will, a durable power of attorney for financial matters, and a Health Insurance Portability and Accountability Act Authorization.

Revocable Living Trust
People often use a revocable living trust to avoid probate, for tax planning and to control the manner and timing of distribution to beneficiaries. Unlike a will, which is a public document filed with the court, the trust is private. Property held in the name of the trust is not subject to probate proceedings.

You need to transfer your assets (e.g. real estate) into the trust, generally with the assistance of an attorney. You continue to control and manage the assets as you do now, but upon your incapacity, your named successor trustee manages the trust assets on your behalf without a court having to appoint a conservator. Upon your death, your successor trustee distributes the assets to your beneficiaries according to the terms of the trust.

Will
A “pour-over” will is typically used in conjunction with a living trust, to catch any assets that may not have been transferred to the trust, so they can be distributed according to the trust’s terms. You also nominate guardians for your minor children in the will.

Durable Power of Attorney
A Durable Power of Attorney for property management enables a designated individual to handle your non-trust assets (e.g. pay your bills from a non-trust checking account, transfer assets to your trust) in the even you are incapable.

Advanced Health Care Directive and Living Will
An Advance Health Care Directive or Power of Attorney for Health Care allows you to designate an agent to make health care decisions for you in the event you are incapacitated. In addition to the release and execution of health care records and forms and consent to surgery and the like, it can be used to express your preferences regarding life sustaining care. In some states, you express your directives to medical providers and medical institutions in a living will.

Health Insurance Portability and Accountability Act Authorization
A Health Insurance Portability and Accountability Act (“HIPAA”) authorization permits your designated agent to obtain protected medical information about you in order to handle your medical affairs.

These wrap through a basic estate plan and are the building blocks of advanced plans, which are used to transfer assets to the next generation. We’ll talk about advanced estate planning in this space at a later time. We’ll also talk about some common client comments about estate planning in this space, as well.

If you haven’t taken care of your own estate planning, there are a lot of great lawyers that can help you with these decisions. If you live near us, give us a call. We would love a chance to work with you. If you don’t live near us, give us a call anyway and we will route you to some very good people.

Until then, good luck and good hunting.

Randy

__________________________________________

Related articles

The Fisher Law Office is known for its experience in estate planning, probate administration, asset protection, and business development. Annapolis attorney Randall D. Fisher has practiced for over 20 years, maintains the highest peer review rating for ethics (AV Preeminent) by Martindale-Hubbell, and is a sucker for long walks on the fairways.

Find out how to reach Randy via TheFisherLawOffice.com or find him at Facebook.com/FisherLawOffice, on Twitter @thefisherlawoffice, or at LinkedIn.com/in/FisherLawOffice.

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