An injury is something that someone never wants to suffer. Unfortunately, personal injury is a reality that thousands of Americans face every day. Whether it be slipping or falling at work, getting injured on the job, or a car accident, danger is everywhere and it’s not always your fault when you get hurt. These kinds of debilitating injuries can begin to get expensive as well. Paying for lawyers, seeing specialists, and being out of work are just a few things that can take a financial toll. That being said, we decided to team with some local financial advisors to learn about their advice on how to plan financially for a personal injury. Here’s what they had to say.

Gold Medal Waters

You did not plan to be injured so you probably don’t have a recovery plan. Your finances took a hit along with your body. Whether you managed your finances closely in the past, now is a good time to do so since tracking your expenses is one of the best ways to manage them. Assess your short and long term needs for necessary expenses first so that you can evaluate your current financial condition. Before you count on monetary compensation, see how long you can manage without it. At Gold Medal Waters, we recommend that clients retain enough cash to cover the gap before Short or Long-Term Disability Insurance income kicks in.

If you have a HELOC Home Equity Line of Credit), that can be a resource to bridge expenses if your savings are not covering necessary expenses or you don’t have any Disability Insurance. You may need or determine that a different housing situation is necessary. Sometimes a mortgage lender or landlord will work with you once they know the situation but don’t skip payments without communicating with them. Similarly, many utility companies offer extended payment plans. Family or close friend loans may be an option for some but it’s important to have clearly defined terms in writing to protect all concerned and avoid misunderstandings. Your personal injury attorney should be able to help you draft the loan document, that could include repayment upon settlement agreements for all willing to extend your loans. Once you understand where you are, you can engage the services of a fee-only financial planner who can look at your situation, and create short and long-term financial scenarios for you.

Linda Leitz

Being injured can keep you out of work for a while or even cause you to lose your job. You might have unexpected expenses – medical deductibles, changes to your home to help you get around or rest comfortably, paying a caregiver. The best time to plan for a negative event like an injury is before it happens. If you have savings that are worth three to six months of your basic living expenses, that can help you survive the financial fallout from a major injury. Sometimes life gets in the way of building up your savings enough to cover an emergency.

There are still ways to stretch your dollars while you’re recuperating and waiting for insurance and other reimbursements.

• Cut down on discretionary spending. This can include eating at home more, instead of eating out. Use up the canned and other non-perishable food you have accumulated.
• Cut back on entertainment packages with your cable or satellite service.
• If you have student loans, contact your loan servicing company to see about getting a six-month payment deferral.
• It’s important to keep your home and car payments current so that you don’t get evicted or lose your vehicle.

If you’re having trouble with those payments, call the lenders – don’t wait for them to call you. As a last resort, you can put some of your basic expenses on credit cards and pay only the minimum payments for a while. But this really is a worst case scenario. If you’re working with attorneys to get payment because of your injuries, make sure you touch base with your attorneys every week or so to see if they need information from you, and always respond to them quickly if they contact you. Be realistic about what your case might pay you. And if you do receive payment, be aware that those funds are for medical bills and keeping your lifestyle at the level you had before your injury, not increasing what you spend. Entirely too many people are worse off financially after getting a lump sum payment than before receiving it because they don’t manage it wisely. It’s up to you to see that doesn’t happen to you.

Contact a Castle Rock Personal Injury Attorney

We want to give special thanks to Matthew Kelley at Gold Medal Waters and Linda Leitz at It’s Not Just Money for their contributions to this blog post. If you need help with your financial plan, we strongly recommend giving one of them a call. If you’ve already been injured and need representation from an experienced Castle Rock personal injury lawyer, give us a call today!

For landlords, it has become all too common for tenants to skirt paying pet rent or overcome provisions against having pets by furnishing service animal certificates. With these certifications becoming more prevalent due to easy online applications, a landlord must equip themselves with basic knowledge of rules and regulations to better decipher phonies. Below is some basic information to safeguard against fraudulent service animal claims:

Emotional Support Animal vs Service Animal

According to the Americans with Disabilities Act, a service animal is trained to perform tasks directly related to a person’s disability. Unlike physical disabilities, psychological disabilities and the purpose of an emotional support animal, are not always as obvious. Instead of performing tasks, an emotional support animal provides companionship for those who suffer from anxiety and depression. Unlike restrictions to service animal breeds (dogs and miniature horses), emotional support animals can range from dogs and cats to rabbits and birds. Additionally, the lack of accreditation requirements by the ADA for service and therapy dogs has arguably led to service animal fraud, which is on the rise in Colorado. Despite these differences, both types of animals are protected under Federal Housing Authority (FHA) statute and are not considered to be pets or subject to pet fees. So how can you tell if it’s a fake? Read on!

Landlords Can Ask for Evidence to Support a Claim of Disability
To obtain a service animal, a person will usually have to get a recommendation from their medical professional. To rule out a fake, a landlord can ask the tenant to show supporting documentation of their need for a service animal. A letter from a healthcare provider, such as a doctor, or a mental health specialist will suffice. A landlord cannot ask any details concerning the person’s disability but they can ask a health professional if a disability is present, and if a service animal is needed. Note of caution: beware of service animal certificates, like those issued by National Service Animal Registry, as these are easily procurable by anyone on the internet, and should not be considered sufficient evidence.

Comply with reasonable accommodation rules

The FHA offers protection for those with disabilities by prohibiting a landlord to refuse “reasonable accommodation” – so that disabled persons have equal opportunity to use and enjoy a dwelling. A landlord should be weary of discriminating against those with service/therapy animals as they are protected under this ruling. However, the ruling also states that the request cannot put an excessive financial or administrative burden on the landlord, nor can it fundamentally alter the nature of the housing. Allowing the animal itself is not considered to be an undue burden, nevertheless, if the landlord can prove that the animal is particularly disruptive or a threat to the other tenants, then the landlord may be justified in refusing accommodation or pursuing an eviction.

While Colorado is attempting to combat service animal fraud by making it illegal to impersonate a disabled person, it can still be difficult for landlords to tell the difference. This problem, coupled with FHA protections for disabled persons may intimidate some landlords into just accepting the animal for fear of reprisal.

If you suspect fraud, it is highly recommended to seek legal advice before refusing accommodation. A lawyer can make sure a substantial case exists and act as a safeguard against legal ramifications if a court found the landlord to be violating FHA regulations.

Commission Rule E-47

January 30, 2017, marks the start of the new rule E-47, which requires a realtor to decline providing brokerage services should they lack the necessary experience. The new rule is a result of the Commissioners clarifying expectations on competency in regards to how Colorado real estate brokers conduct business. For a broker to stay compliant with this new rule, they must demonstrate familiarity with various requirements regarding real property sale and leasing, as well as geographical knowledge of the area. Should the broker decide to change markets by switching from residential to commercial properties, or conduct business in a new location, then the Commission expects the broker to obtain the knowledge needed through training and/or mentorship. Should the broker be unable or unwilling to do so, then it is expected that they decline the work. The ruling also includes that every broker stay current on new regulations within his or her market niche.

Denver LGBT couple wins housing discrimination lawsuit

On April 5, 2017, federal judge Raymond Moore found a landlord to be in violation of federal housing law by refusing to rent a townhome to a LGBT couple. The same-sex couple were hoping to secure housing in northwest Denver for themselves and their children. After meeting with the landlord, whom later wrote back to the couple citing noise concerns from the children as the reason for not renting to the family. Later in court, the landlord testified that the LGBT couple’s “unique” relationship would attract unwanted attention as the reason for the refusal. The judge found the landlord guilty of discrimination and extended protections to LGBT couples under the federal Fair Housing Act. This new case law sets a precedence for LGBT rights in Colorado and will have a resounding impact on the real estate community.

CAM Audits

Colorado Division of Real Estate has announced that it has begun to audit CAM entities. These audits will focus on various insurance requirements for C.R.S., Errors and Omissions (E&O), and Crime fidelity, as outlined in rules 12-16-1004, D-9 and D-10, respectively. Audits will also focus on rule F-6 which stipulates that contracts, agreements, authorization and disclosures must be in writing.

To date, the CAM audits have found a few reoccurring issues. Make sure you don’t succumb to these common pitfalls by being aware of statute requirements. Three of the most common problems are:

• 99% of management agreements were missing required items as defined by rule F-6.
• 20% of crime fidelity insurance deductibles were not in compliance with rule D-10, by having a deductible greater than the maximum 1% of policy amount.
• 10% of crime fidelity insurance policies were not in compliance with rule D-10, by not adhering to the 2-month minimum assessment + reserves time period.

Colorado short-term rentals (STR) is a booming industry, reportedly earning $32 million in revenue this year. In terms of regulations, Colorado is still finding its feet – recently passing a number of regulations on homeowners and landlords that utilize short-term rental platforms like Airbnb, VBRO and Homeaway. For those who currently rent out their property, or are considering on jumping on the STR-bandwagon, here are some thing you’ll need to know.

Who is eligible?

• Must be a legal U.S. resident.
• The property must be your primary residence (2nd/vacation homes are not eligible in Colorado).
• If renting, you must obtain written approval from the owner of the property.
• If your property is a condominium, must abide by HOA for rules regarding STRs.

For those who are eligible, the state of Colorado now requires short-term renters to apply for a business license, which costs $25 per year. Additionally, renters will also need to apply for a lodger’s tax ID and have the proper rental insurance. Once everything is acquired, to stay compliant the renter will need to follow the below requirements in Colorado:

• Must post business license number on all ads, including Airbnb and VRBO listings.
• Guests must be provided with rental packet that notifies guests of city rules and restrictions and pertinent rental safety information.
• General liability insurance must be maintained in case of property damage.
• Rental property must have smoke and carbon monoxide detectors, as well as a fire extinguisher.

Renters who do not follow state rules risk receiving a $999 fine per incident and/or being reported to Excise and License Investigators. It’s important to stay knowledgeable and be in compliance with state rules on STRs. For further information consult your real estate attorney.

For a contractor unaware, a mechanics’ lien is a useful legal tool for both securing and collecting on unpaid debt for services and/or materials that you have provided for a project. A lien is made against the property that the construction work took place on and doesn’t allow the owner to sell or refinance the property until the debt is paid. While being a relatively successful tool, contractors must follow state guidelines to have a lien secured. Often, many contractors succumb to various pitfalls because they are either unaware or ill-prepared when filing a mechanics lien. Don’t be a cautionary tale. If you are thinking about filing, then avoid these common mistakes.

1. File on time. For contractors that only provided labor, the deadline to file is 2 months after the last day of labor was performed. For contractors that also provided materials, they have 4 months after the last day the materials or labor was provided.
2. Must contact property owner before filing. Colorado requires that a contractor notify the property owner of the Intent to Lien 10 full days prior to filing. This can be accomplished by sending the Notice of Intent to Lien, along with a copy of the Statement of Lien that is to be filed.
3. Don’t overstate what your owed. If the lien amount is overstated or found to be inaccurate then not only is it rendered invalid, but the contractor can be forced to pay the opposing party’s legal fees.
4. Avoid Technical mistakes. Even the smallest mistakes can result in a lien being denied. Errors such as an inadequate property description or signing blunders can result in the lien being invalidated.
5. Abide by the foreclosure deadline. After a lien is awarded, it is valid for only 6 months. A contractor must file for the lien’s foreclosure/enforcement within that time frame, or risk forfeiting their lien rights.

There are limitations to a mechanics lien, such as it does not apply to public projects, and contractors can run into problems if the Notice of Intent is not properly served. If a contractor is unable to follow legal procedure when filing a mechanic’s lien, not only can the request be denied, the contractor can be ordered to pay for the property owner’s legal fees. Increase your likelihood of success and come to Robinson & Henry’s contractor event in June 2017 for further information.

Filing for federal income taxes becomes quite the process, especially for those who forget to make their quarterly payments or set aside money for Uncle Sam, such as contractors or small business owners. Unfortunately, there is unwelcome news for those who owe unpaid taxes. The FAST (Fixing America’s Surface Transportation) Act now allows the IRS to use private debt collectors to collect on unpaid taxes.

In some instances, the IRS is even required to use private debt collectors due to lack of resources or the inability to locate the individual. Here some things to know:

• The FAST Act also allows the IRS to revoke your passport for accounts that are delinquent.
• If a taxpayer cannot pay immediately, then the collector can offer an installment deal, so long as it doesn’t exceed 5 years.
• There are some instances where a private collector cannot collect on an account, such as if the account is under audit, the taxpayer is deceased or under litigation, criminal investigation or is in a designated combat zone.
• Private debt collectors cannot accept payments, they only set-up payments for the IRS. If someone is calling and demanding payment now, especially made out to anyone other than the IRS, then you know you’re dealing with a fake. Never pay directly.
• The IRS will notify a taxpayer that they are sending their account to a private collection agency. The agency will then send a second letter, confirming the transfer and outlining how the taxpayer can pay their debt. If you get a call before receiving any official letters from the IRS, then be weary.

Information for Colorado Taxpayers

Beginning this year, in March of 2017, the IRS will begin punishing delinquent taxpayers by revoking and withholding their passports. Not only will this impact the ability to travel but since a passport also serves as proof of citizenship, without it can make things like getting a job much harder. This article serves to educate those who owe a substantial debt to Uncle Sam on the specifics of the new rule, and some available options.

In 2011, a report conducted by the Government Accountability Office explored how the IRS could increase its collection of unpaid taxes. The report showed that of those who currently owed the government, 224,000 had passports. Together, these passport holders owed the government 5.8 billion dollars. From that report, the FAST Act was passed in 2015.

The FAST Act allows the IRS to hire private debt collectors, as well as revoke passports from delinquent payers. While passports usually fall under the authority of the State Department, the FAST Act allows the IRS to contact the Department and notify them of seriously delinquent accounts (accounts in excess of $50,000). The Department can then refuse to issue or renew a passport, apply travel restrictions, or even revoke a current passport.

Who will be affected?

Passport revocation will affect taxpayers who owe $50,000 (including interest and penalties) or more and travel abroad for pleasure, work or are American expats living abroad. However, the IRS will not go after seriously delinquent accounts should they already be:

• In an installment agreement
• Filed for an Offer In Compromise
• Appealing an IRS levy or lien
• Requesting for Innocent Spouse Relief

How will I know my passport is in trouble?

Before sending an account to the State Department, the IRS is required to notify the taxpayer. Those being notified will receive Notice CP 508C by mail to the taxpayer’s last known address.

Before denying a passport application, the State Department will hold the application for 90 days, giving the taxpayer time to either pay the debt in full or enter into an alternative payment plan with the IRS. If a taxpayer already holds a valid passport, before revoking it the State Department may limit travel on the passport, so the taxpayer can only travel back to the U.S.

Once the tax debt issue is resolved, the IRS will reverse its position within 30 days and notify the State Department.

When can I get my passport reinstated?

It’s not as easy as getting your balance under the $50,000 threshold. The IRS will only lift the revocation once the taxpayer is in good standing. This means that they have either paid the debt in full or have applied for other financial remedies. Available options are:

Offer in Compromise

For those unable to pay, or payment of tax debt that results in financial hardship, these persons may want to consider this option. It is a settlement with the IRS on paying less than the total amount owed. The IRS will consent if it believes it is the greatest amount it can get in a reasonable period of time. When considering these applications, the IRS will look at a persons’ ability to pay, income, expenses, and assets. This option is not available to those in the middle of bankruptcy proceedings. To be considered, Form 433- A (for individuals) or 433-b (for businesses), along with a $186 application fee and an initial payment will need to be submitted. However, in 2015, out of 67,000 applications the IRS only accepted 27,000 – thus it is highly recommended to employ the help of a tax attorney, as they can ensure a solid application is submitted.

Innocent Spouse Relief

For those who owe taxes due to actions of their current or former spouse (like reporting the incorrect income), or taxes which have arisen from a divorce, separation or annulment, may be eligible to apply for Innocent Spouse Relief. Must submit IRS form 8857 within 2 years of being contacted by the IRS, notifying you of any unpaid taxes. Widowers are also eligible for this relief.

Installment plans

While the IRS would rather a taxpayer pay a fine in full, for those facing large sums, or are unable to fully pay at once, can ask for an installment plan. This results in paying off tax debt in monthly installments, not to exceed 3 years. Beware, this option will cause you to pay more than the initial amount due to the application of interest on the debt owed.

What if I think I’ve received Notice 508C in error?

If you have received notice of delinquency and believe you do not owe taxes or believe you owe less than the stated amount, under section 7345(e) a taxpayer may appeal their status in U.S. tax court.

Why a tax attorney?

It’s common for taxpayers to feel as if they are drowning in IRS paperwork and phone calls. However, the pros of seeking legal help are that you no longer have to deal directly with the IRS – your attorney will redirect all calls and paperwork to themselves.

“But I can’t afford an attorney!” you say! Take a breath and do your research. Statistics overwhelmingly show that attorneys can actually save you money. With strong negotiation skills, insider knowledge and connections with IRS agents, most often than not, an attorney can substantially argue your debt down. Additionally, most attorneys offer a range of payment options to fit your budget – from flat fees and hourly billing, to partial representation, in which you pay for only advice or if you need help handling paperwork.

Professional ethical standards require that an attorney work in the best interest of a client – that means never taking financial advantage by offering services you don’t need. Call now to schedule your free initial consultation, where one of our tax attorneys will review your case and offer advice on how best to proceed.

Be in the know. Here are some new pieces of legislation that may have an effect on your contracting business and possible business opportunities in the state of Colorado.

HB 1297

Condominium construction has stalled in Denver. Homeownership Opportunity Alliance (HOA) cites rising developer insurance costs due to an increase in construction defect lawsuits in Colorado. Currently, state law makes it relatively easy for a homeowner’s association board to take a builder to court over construction deficiencies. The current bill, HB 1297, would require the condo homeowner’s board to first meet with the builder to voice building concerns and see if a remedy can be struck. If both parties cannot find a solution, then the homeowner’s board has 90 days to vote on whether to pursue a lawsuit against the builder. A bipartisan effort, the bill’s supporters say it’s an attempt to strike a compromise between protecting homeowners from shoddy craftsmanship and contractors from a climate of elevated litigation risk. The bill was passed by the Colorado House of Representatives on April 24, 2017 and now moves to the Senate floor.

SB 211

A bipartisan effort, Bill 211 was passed April 13, 2017. Its goal is to increase competition for state road contracts, effectively allowing smaller contractor companies into the bidding process. Current rules state that contractors must be pre-qualified before seeking state contracts with agencies such as CDOT. The current qualification procedure requires a contractor to obtain a security bond(s) that amounts to the 5% of the overall contract price. This meant that smaller companies had to either take out multiple bonds or were unable to secure the amount needed to bid. The bill will now forbid the agency from eliminating a contractor based on their financial statement, which is submitted for pre-qualification purposes.

If You’re Not Driving

If you are a passenger in a car and your friend or spouse gets pulled over, you are not required to hand over any identification if you are not driving the car. An officer may inquire about your identification but they cannot order you unless they have reasonable suspicion that you have been involved in an illegal activity.

Immigration Status

During a traffic stop, a Colorado police officer cannot ask you about your immigration status. However, an immigration officer can inquire about your immigration status, but you do have the right to remain silent by invoking the 5th amendment and consulting an attorney.

DUI Stop

You can refuse to participate in a roadside sobriety test, especially since these types of tests are easy to fail, even for sober drivers. However, while you do have the right to refuse a breath, blood or urine test, refusal will result in automatic license suspension for one year. Therefore, it is commonly recommended that you do comply with a chemical test unless you are placed in a coercive, interrogative, and dangerous situation. Attorneys usually recommend taking the blood test, as they can be retested (unlike breath tests) which gives an attorney more room to contest the original findings and get a better outcome.

What can you do?

To determine if an officer has probable cause, you may ask, “Excuse me officer, am I being detained or am I free to go?”. If they do not have cause, then you do have the right to leave.

A police officer can:

• Ask you for your driver’s license, registration, and proof of insurance.
• Ask you to step out of the car.

A police officer cannot:

• Search your car without a warrant, reasonable suspicion, or your permission
• Coerce you into answering any questions.
• Force you to take any chemical or roadside sobriety tests.
• Inquire about your immigration status.

Remember!

Always be polite and courteous with the officer – being rude or uncompliant with reasonable requests will only make the situation worse. Refrain from chatting or relinquishing any further information, as this later may be used to incriminate you. In the event you are served with a notice of revocation following being charged with Driving Under The Influence, you only have seven days to request a hearing with the Department of Motor Vehicles (DMV). For more information or to get a free consultation, call our criminal defense and representation attorneys at R&H.

Hiring an attorney can seem like an intimidating process. Prospective clients may feel agape, crushed under the impending tide of questions, like – how much money can I afford to pay; what kind of personality do I want in my lawyer; what experience and educational background is needed for my case? While it is natural to be overwhelmed by the task at hand, the lasting benefits far outweigh the temporary feelings of heartburn currently being experienced.

A lawyer is your biggest advocate, who should be working in your best interest. This means that they exemplify ethical behavior, have sound judgment, and offer cost-efficient services. When beginning your search for a lawyer, it is relatively easy to start from the comfort of your own home. There you can vet potential attorneys, see if they are properly licensed, or if any disciplinary records are present.

Once you’ve found a few potential lawyers book a few consults. Think of your first meeting as an interview, remember, you’re hiring them. Here are some important things to look for during the initial meeting:

Compatibility

It’s important to be able to feel comfortable with your attorney. Having a good rapport allows for open and honest communication, which is of paramount importance. Especially when it comes to money and taxes, everyone has skeletons in their closet, and an attorney cannot effectively do their job if they do not know all the information.

Transparent payment structure

An attorney that is transparent and candid about their fees, should confirm that they have your best interest at heart. There are many fee options from flat fees, to hourly and even unbundled services (limited representation). Be wary of any hidden fees, or of an attorney that doesn’t offer a payment plan that works with your budget or is relevant to your case.

Good people skills

A tax attorney will probably be interacting with the IRS on your behalf. A good lawyer will need to be personable and be able to effectively cultivate working relationships with various IRS personnel, even difficult IRS employees. An attorney that burns bridges and doesn’t communicate effectively can have a severely negative impact on your case.

Relevant experience

Tax law is constantly changing due to new case laws reinterpreting legal statutes. Therefore, it is extremely important for a lawyer to stay relevant so they can provide sound advice and provide innovative legal strategy. An attorney who publishes pertinent articles attends workshops and contributes to speaking events is evidence of thought leadership within their field.

For a contractor unaware, a mechanics lien is a useful legal tool for both securing and collecting on unpaid debt for services and/or materials that you have provided for a project. A lien is made against the property that the construction work took place on and doesn’t allow the owner to sell or refinance the property until the debt is paid. While being a relatively successful tool, contractors must follow state guidelines to have a lien secured. Often, many contractors succumb to various pitfalls because they are either unaware or ill-prepared when filing a mechanics lien. Don’t be a cautionary tale. If you are thinking about filing, then avoid these common mistakes.

1. File on time

For contractors that only provided labor, the deadline to file is 2 months after the last day of labor was performed. For contractors that also provided materials, they have 4 months after the last day the materials or labor was provided.

2. Must contact property owner before filing

Colorado requires that a contractor notify the property owner of the Intent to Lien 10 full days prior to filing. This can be accomplished by sending the Notice of Intent to Lien, along with a copy of the Statement of Lien that is to be filed.

3. Don’t overstate what you’re owed

If the lien amount is overstated or found to be inaccurate then not only is it rendered invalid, but the contractor can be forced to pay the opposing party’s legal fees.

4. Avoid Technical mistakes

Even the smallest mistakes can result in a lien being denied. Errors such as an inadequate property description or signing blunders can result in the lien being invalidated.

5. Abide by the foreclosure deadline

After a lien is awarded, it is valid for only 6 months. A contractor must file for the lien’s foreclosure/enforcement within that time frame, or risk forfeiting their lien rights.

There are limitations to a mechanics lien, such as, it does not apply to public projects and contractors can run into problems if the Notice of Intent is not properly served. If a contractor is unable to follow legal procedure when filing a mechanic’s lien, not only can the request be denied, the contractor can be ordered to pay for the property owner’s legal fees.

A Guide to Navigating Recent Changes to the Division of Military Pensions in Divorce Proceedings

New legislation, Supreme Court decisions and the military’s move toward a blended retirement system in lieu of the old “20 years or nothing” pension has brought significant changes to military retirement, particularly when it comes to the division of military pensions in divorce. Here’s your guide to navigating these changes.

National Defense Authorization Act (NDAA) of 2017

Military members, military administrative personnel, spouses and attorneys alike are finding themselves in a state of confusion as letters from the Defense Finance and Accounting Service (DFAS) are showing up on their doorsteps and rejecting applications for retirement division. The letters demand additional information from military members and require revisions to previously entered court orders concerning the dissolution of marriage.

This is the result of the slow-spreading news: the National Defense Authorization Act (NDAA) of 2017 amended the Uniformed Services Former Spouses’ Protection Act (USFSPA), 10 USC §1408, in a big way.

Historically, Colorado has divided military pensions using the Time Rule Formula, which has been controversial because, under this rule, the ex-spouse continued to benefit from the rank and time-in-service pay increases of the military member long after the couple divorced.

Here’s an example: a couple divorces while the military member spouse is a Captain in the Army with four years of service. All four years were while the couple were married. At that time, the member’s annual basic pay was $64,778. The same military member rises to the rank of Colonel and retires at 20 years of service with a basic pay of $120,654. The Colonel will receive 50 percent of his average base pay per month or a disposable retired pay of $5,027.25. Under the Time Rule Formula, the spousal benefit would be $502.72 per month.

However, under the NDAA amendment, spouses are no longer allowed to benefit from the rank and time-in-service pay increases that occur after a couple gets divorced. The amendment, in essence, freezes the military member’s base pay at the time of divorce and uses it to calculate the spouse’s benefit, rather than calculating an entitlement based strictly upon retired pay.

So, using the same example scenario, but this time applying what is being called the Freeze Time Formula, the monthly spousal benefit would only be $271.47, which is a $231.25 reduction in the monthly spousal benefit. Spouses do, however continue to benefit from cost-of-living adjustments between the date of the divorce decree and the date of retirement.

What it all means: Military personnel no longer need to worry about an ex-spouse benefiting from career advancements that happen long after a divorce. On the other hand, non-military spouses will no longer be able to rely on a military pension as a tool for equitable division of property.

Supreme Court Decision in Howell v. Howell

On May 15, 2017, the Supreme Court ruled unanimously in Howell v. Howell that a state court cannot offset the loss of a divorced spouse’s portion of a veteran’s retirement benefits when that veteran waives retirement pay in favor of disability pay.

A veteran who qualifies for a disability rating may elect to waive a portion of his or her retirement in order to collect nontaxable disability payments instead. This waiver results in a reduction of the retirement check and can reduce a spousal benefit stemming from a separation agreement.

For example, husband is receiving 50 percent of veteran wife’s pension check of $1,000 per month, or $500. Wife applies for disability and qualifies for a 60 percent disability rating. Wife elects to waive a portion of her retirement benefit to receive a non-taxable disability payment equivalent to 60 percent of her monthly pension check ($600), leaving only $400 of retirement pay. Husband’s spousal benefit is now reduced to $200 per month.

In Howell, the Supreme Court held that state courts cannot subsequently increase the amount that a divorced spouse – the husband in the scenario above – receives from military retirement pay in order to compensate him for a loss caused by the veteran spouse’s – the wife in the scenario above – waiver of a share of retirement pay to receive nontaxable disability benefits instead.

What it all means: Veterans can now elect to collect nontaxable disability without fear of being forced to find an additional source of money with which to compensate an ex-spouse.

U.S. Armed Forces Blended Retirement System

The NDAA transformed the military’s traditional “20 years of service or nothing” pension into a new blended retirement system. Anyone who enters the military as of Jan. 1, 2018, will be automatically enrolled in the new retirement. Military members with less than 12 years of service as of Dec. 31, 2017, will have the option to opt in to the new U.S. Armed Forces Blended Retirement system, or remain under the legacy pension.

The military’s legacy 20-year pension is a defined benefit plan where retirement pay is computed by multiplying 2.5 percent times years of service times retired base pay. Members who do not complete 20 years of service do not receive a pension. Only 19 percent of military members qualify for this retirement benefit.

Under the new blended retirement system, retirement pay would be calculated at 2 percent times the number of years of service times retired base pay, but also includes automatic matching contributions to a military member’s Thrift Savings Plan (TSP).

The TSP operates very much like an employer 401(k) plan. Even if a military member opts not to contribute money to his or her own TSP, the Department of Defense contributes an automatic 1 percent of the member’s basic pay, and will match any member’s additional contributions up to 4 percent. After two complete years of service, the TSP becomes fully vested. Members who leave after two years but before 20 years still receive some sort of retirement benefit for their service.

What it all means: When selecting a family law attorney to handle a divorce where one spouse is a member of the military, make sure he/she understands the difference between the two retirement systems; this will be critical when it comes to properly calculating the value of the military pension and any spousal benefit.

If you have questions about the information in this article, the family law attorneys at Robinson & Henry, P.C. can help answer them. Call today to schedule a consultation.

Hope for Colorado Marijuana Businesses

With banks wary of dabbling in an industry that is still at odds with federal law, and with looming threats of IRS audits, Colorado Marijuana companies are forced to reconcile tax best-practices in a cash-dominant industry.

Since becoming legal in Colorado, recreational marijuana businesses are facing increasingly common, yet “random” IRS audits. The instigator of IRS audits is tax-law culprit 280E, which prohibits businesses from claiming normal operating expenses on their tax returns. Because businesses cannot claim these expenses, they end up paying ludicrous tax amounts – so much so, the volume of incoming cash has prompted the IRS to augment its cash counting capacities in both its Denver and Seattle offices (locations where recreational marijuana is legal). Due to seemingly punitive federal tactics against legal state practices, more and more businesses are fighting 280E by taking the IRS to court. With each new cannabis litigation case, federal law seems to constantly shift– causing cannabis business’ wondering how best to stay compliant, while also trying to save money.

To cure those tax-season headaches, Colorado cannabis businesses need to educate themselves on the evolution of 280E. This article highlights some important case laws that may have a direct impact on your business, which might save you money come tax season and offer reassurance of compliance should you be audited.

History of 280E

The 1981 Edmondson tax court case was the catalyst to the IRS adding 280E to its tax code. In the Edmundson v. Comm’r, T.C. Memo 1981-623 an illegal drug trafficker was permitted tax deductions for telephone, auto and rental expenses incurred by an illegal drug business. Prompting public policy outcry, the IRS swiftly reacted creating 280E – a tax law which disallows “drug dealers the benefit of business expenditure deductions”. As such, traditional deductions like rent, employee salaries, utilities, traveling and rental expenses are not allowed. Going even further, 280E discourages marijuana companies from marketing their products by making advertising expenses nondeductible. Because Colorado marijuana businesses cannot claim the same hefty expenses that other businesses can, the IRS is collecting vast sums of money. One company reported owing $275,000 for one year of taxes.

Case Law Impacts

However, there is hope for the marijuana industry in Colorado as the state has excluded 280E in calculating state income tax, somewhat lessening the tax burden that businesses face. Additionally, in 2007 the CHAMP (Californians helping to elevate medical problems) case won the ability to deduct some of its expenses from its tax liabilities. As a nonprofit entity, the CHAMP organization offers medical services for those suffering from long-term diseases, including medical marijuana. This case sets a precedent for Colorado companies who can show that if they are involved in additional legal business dealings, that those dealings can be tax deductible. However, companies still dealing in cash may face continued problems with validating these business costs without a proper paper trail.

How You Can Save Money

In 2015, the IRS issued Chief Council Advice (CCA) 201504011 to clarify issues surrounding trafficking costs vs. production costs in 280E. The memo stated that 280E only specifically dealt with business expenses related to trafficking and not production. Hence, all production related expenses which are associated with the cost of goods sold can be deducted. For marijuana businesses who maintain grow houses, below are items that may deducted when filing annual tax returns:

• Raw materials such as seeds, soil and fertilizer
• Utilities related to production, such as water and electricity
• Maintenance costs associated with production and storage
• Rent of grow houses
• Materials and supplies related to grow and packaging activities
• Wages paid for indirect (supervisors) and direct labor (trimmers and packers)
• Quality control costs

Additionally, if a business can provide supplementary services unrelated to marijuana, then they can also claim the business expenses related to that activity. Remember to keep accurate and separate records of these additional services as proof for your tax return and in the event of an audit.

As the industry continues to evolve and new case laws influence legal precedence, businesses will continue to face uncertainty in determining costs of goods sold and the confusion surrounding tax returns. To avoid these risks amidst IRS audits and potentially save money, cannabis businesses would be smart to consult with a tax attorney. Please click here to schedule your free consultation with one of our attorneys.

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A Quick Guide To Disability Rights in Colorado

When someone is, or becomes, disabled, they are afforded certain protections under the law. To benefit from these protections, one must first understand what is considered a disability, if it is covered and what rights that person has.

The Colorado Department of Health Care Policy and Financing defines a disability as, “an impairment, mental or physical in nature that substantially limits one or more major life activities. Major life activities include caring for one’s self, walking, seeing, hearing, speaking, breathing, working and learning.” Disability and its effect on major life activities can manifest in two ways: physical or mental impairments.

Physical – a physical impairment may be present at birth, or may arise later in life due to injury or disease. Impairments can include malfunctions of the immune system, digestive system, neurological system, respiratory, circulatory, endocrine and reproductive functions. Examples of such impairments include (but not limited to) deafness, blindness, cancer, heart disease, diabetes, HIV, cerebral palsy, epilepsy and muscular dystrophy.

Mental – a mental impairment is any mental or psychological disorder that impacts a person’s ability to function normally. This can include learning disabilities, mental retardation, and emotional or mental illness. Examples include (but are not limited to) ADHD, depression, bipolar disorder, Asperger’s Syndrome, Post Traumatic Stress Disorder, anxiety and eating disorders, memory loss, mood disorders, drug addiction, Obsessive Compulsive Disorder, Postpartum Depression, Schizoaffective Disorder and chronic insomnia.

If you have a disability, it’s important to know what your rights are. Various local and federal laws are in place to protect people with disabilities within various sectors of their lives, from health and housing to employment and finances.

• Employment

The Colorado Anti-Discrimination Act (ADA) prohibits an employer from discriminating against or harassing you based on your disability. However, this act doesn’t consider it discriminatory if the employer cannot reasonably accommodate the individual’s disability, like if the disability disqualifies the person from the job, or if it would cause a significant impact on the job.

Housing

The Federal Housing Act (FHA) prohibits landlords from discriminating against disabled persons, whether in public or private housing. In addition to forbidding a landlord from refusing to rent to someone with a disability, it also requires the landlord to accept reasonable accommodation requests to make the house more accessible.

Service Animals

Under the FHA, a landlord must make reasonable accommodations for a disabled person. One such accommodation is a service animal. A service animal can be a trained dog who performs certain tasks or it can also be an emotional support animal. If a tenant provides the landlord with proof, then the landlord is required to allow these animals, regardless of their policies and are not allowed to charge pet rent or deposits from the person with the disability. Read more here.

Workers’ Compensation

In Colorado, workers who are temporarily or permanently unable to earn a wage due to injury or illness that was sustained on the job, are entitled a form of wage replacement. Colorado breaks down workers’ compensation into four categories: temporary partial, temporary total, permanent partial and permanent total disability. Read more and find applications at the Colorado Department of Labor and Employment website (www.colorado.gov/pacific/cdle/disability-and-benefits).

Accessibility

There are many local and federal laws that protect against exclusion, segregation, and unequal treatment of persons with disabilities. These laws protect a person’s ability to freely move and access different resources by requiring them to make certain accommodations. Some of these accommodations include the ability to physically access things like voting facilities, buildings, public schools, air carriers, telecommunications, public transportation and public accommodations to various businesses and nonprofits.

Other Monetary Assistance

Some individuals may be eligible for other forms of monetary help, such as disability insurance or Social Security Disability.

If you think your rights have been violated, you can file an official complaint within 60 days of the incident. Fill out the and submit the discrimination complaint form, or if you are unable to do so, then contact an ADA/504 Coordinator for assistance. For those who have filed and received an unsatisfactory outcome, an appeal can be made 15 days after the decision. Please contact our disability attorney at Robinson & Henry for more information.

You do not deserve to be treated differently or miss out on life’s opportunities because of your disability. If you think your rights have been violated and would like more information on available solutions for your specific case, please contact our office for a free consultation with our disability attorney.

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We wanted to share a client success story that happened this month. Like our other attorneys, our Real Estate team takes client consults, listening to their legal problems and offering pertinent legal advice. In this specific consult, a couple phoned us asking for advice on the sale of their home.

This particular couple had lived in their current home for 30+ years and were looking to downsize. Already they had an offer on the house and sent us the purchase offer to review. A primary concern was the $200,000 broker commission which would reduce the clients’ profit on the sale of their home. Feeling stuck between wanting to sell the house, but not wanting to pay such a high fee, they asked us what their options were.

Our lead real estate attorney, Don Eby offered an idea – the couple should respond to the purchase offer with a counteroffer. The counteroffer would make the contract contingent upon the seller’s successful renegotiation of the broker’s fee, from $200,000 to $50,000.

The Counteroffer was accepted as a contingent contract thus pressuring the broker to accept a commission of $50,000. Sometimes its only takes one good idea or a short phone call to save $150,000. We think this client found significant value in the experience and legal advice provided by our attorney.

June 29th, 2017 Robinson & Henry, P.C. opened a new Colorado Springs office at 1975 Research Parkway Suite 100 Colorado Springs, CO 80920.  The Colorado Springs Chamber of Commerce came to celebrate with a ribbon cutting ceremony.  Managing partners Bill Henry and Don Eby hosted a welcoming event, and look forward to helping the members of the Colorado Springs community.

James Townsend, lead family law attorney at Robinson & Henry’s Castle Rock office, has received AIOFLA’S auspicious “10 Best in Colorado For Client Satisfaction” award. AIOFLA (American Institute of Family Law Attorneys) is a third-party rating organization who creates annual rating lists as a resource for clients looking for the best local attorneys.

Attorneys undergo a rigorous selection process, which is based on nominations by clients and peers, as well as AIOFLA’s own independent research and evaluation. Selection criteria focuses on an attorney’s ability to succeed in their field of law without compromising client service and support.

Please join us in congratulating James on this achievement.

Earlier this year the Social Security Administration (SSA) published new rules in the Federal Register (82 FR 5844) regarding the evaluation of medical evidence in disability claims. All Social Security disability claims, including Social Security Disability Insurance (SSDI) and Supplemental Security Income (SSI) claims, filed on or after March 27, 2017, will be assessed according to these new rules.

The following rules have been revised:

• Rules about acceptable medical sources;
• How the SSA considers and articulates their consideration of medical opinions and prior administrative medical findings;
• The SSA’s articulation requirements for other kinds of evidence;
• The rules about medical and psychological consultants; and
• The rules about treating sources.

The new rules were instituted in an effort by the SSA to fight fraud and streamline the application process, but for many individuals these new rules have created a fog of uncertainty about moving through a lengthy process that, even before the new rules, seemed complicated and difficult. In fact, according to the National Organization of Claimants’ Representatives, less than half of all people who apply for disability benefits in the United States are actually accepted into the benefits program.

As such, an understanding of and compliance with the rules is more critical than ever when submitting a disability claim.

Here’s a guide to help you navigate the changes.

Opinion of Treating Physician no Longer Given Extra Weight

Previously, when you filed a Social Security disability claim, the Administrative Law Judges and claim reviewers evaluating the medical evidence in your claim could give more weight to the opinions of your treating physician. A treating physician or treating source is the medical doctor, osteopath or Ph.D.-level psychologist with whom you have an ongoing relationship, who sees and treats you on a regular basis.

In the new rules, the SSA removed the term “treating source” from the regulations entirely and replaced it with “your medical source.” Now, while your treating physician’s opinion can still be included as evidence in your claim, it can no longer be given any special weight during the review.

The rules do allow for an individual’s own medical source’s opinion to be considered the most persuasive if the opinion is consistent with other evidence and supported by that of relevant objective medical evidence.

What it all means: In short, under the new SSA rules, evidence from your treating physician, with whom you likely have an ongoing relationship and who likely has the most in-depth information about your condition, will be given the same weight as evidence from a medical consultant hired to conduct a one-time evaluation or to simply review your paperwork. This may make it more difficult to get a claim approved, especially for those suffering from conditions like lupus where symptoms aren’t always obvious.

No Special Weight Given to Decisions by Other Governmental Agencies

In addition to no longer giving extra weight to the opinion of the treating source, the SSA will no longer give any special weight to decisions made regarding disability by other governmental and nongovernmental agencies. The SSA states that those decisions “are inherently neither valuable nor persuasive to us.”

This rule includes decisions about disability ratings by the Department of Veterans Affairs (VA). This means, for example, that disability ratings given by the VA will no longer be given weight in SSDI or SSI case evaluations. The medical evidence submitted in a VA claim, however, will continue to be viewed and evaluated.

What it all means: Previously, a disability rating from another governmental agency like the VA was given extra weight by those reviewing SSDI and SSI claims. These ratings will now no longer be considered, which could also make it more difficult to get a claim approved. The good news is that claim reviewers can still consider the medical information that led to the previous disability rating when reviewing a SSDI or SSI claim.

Expanded List of Acceptable Medical Sources

With the new rules, the SSA has expanded the list of Acceptable Medical Sources (AMS) whose opinion may be included as medical evidence in your claim. AMSs are doctors and other health care professionals who have evaluated you and treated you for your condition.

Previously that list included:

• Licensed physicians,
• Licensed or certified psychologists,
• Licensed optometrists,
• Licensed podiatrists and
• Qualified speech-language pathologists.

The SSA has expanded that list to now also include:

• Physician Assistants,
• Advance Practice Registered Nurses and
• Licensed audiologists.

The following categories of health care professionals are not on the list of AMSs:

• Registered Nurses,
• Chiropractors and
• Licensed Clinical Social Workers.

Don’t Go it Alone

If you have questions about the new SSA rules, call our office; the attorneys in Robinson & Henry’s disability practice can answer them and others you may have about your SSDI or SSI claim.

This spring, the IRS started to use the services of private debt collectors to obtain unpaid tax debts from U.S. citizens. Unfortunately for taxpayers, previous worries of fraudsters impersonating real IRS debt collectors have now been overshadowed by questionable conduct on behalf of the private debt collectors themselves.

Issues arose after the New York Times revealed the call scripts that these debt collection agencies are currently using. The scripts, which are used as talking points, have collectors suggesting potentially irresponsible financial decisions, such as telling taxpayers to take out money against their homes, raid their 401Ks, borrow money from family or friends and increase their credit card debt just to pay off their taxes.

These practices would seem to violate current IRS policy that dictates when a collection agent cannot collect payment. The IRS manual, I.R.M. 5.16.1.2 states that an account becomes noncollectable in the event that payment would “create a hardship for taxpayers by leaving them unable to meet necessary living expenses” (code 24-32).

Since low-income earners comprise a majority of the cases handled by these agencies, consumer advocates are worried that these aggressive collection tactics may push blue-collar workers to the financial brink. And despite IRS policy, these debt collectors are given monetary incentives in the form of a 25 percent commission to pressure taxpayers into making bad financial decisions.

The controversy doesn’t end there. One of the four collection agencies doesn’t have the best history of ethical collection practices. Pioneer, one of the private debt collection agencies authorized by the IRS, has a record of abusive practices that previously got them in trouble. As a subsidiary of Navient, Pioneer was sued by the Consumer Financial Protection Bureau and also fired by the Department of Education after it was found to be systematically misleading borrowers by giving inaccurate loan information. Despite this history, they are currently working on the IRS’ behalf.

While the IRS and other government officials are eager to reduce the $138 billion deficit from unpaid taxes, advising taxpayers to take out more debt to pay their IRS bills may be counterproductive when these workers are later forced to lean on government programs for help.

In reaction to this news, four Democratic senators, including Sen. Elizabeth Warren, sent a concerned letter that these practices violate congressional provisions that ensured taxpayers would not be put at risk by these agencies. Steven Mnuchin, United States Secretary of the Treasury responded that he was still “supportive” of the private agencies and hoped a balance could be struck between collecting efficiently without “jeopardizing taxpayers”.

If you are worried about your tax debt or have been contacted by a private collection agent, you may wish to consult a tax expert. The tax attorneys at Robinson & Henry can:

• Audit the collector’s ethical practices and even sue the agency if they are found to be violating the Fair Debt Collection Practices Act.
• Act on your behalf, so you don’t have to talk directly with the IRS.
• Negotiate your debt down through an Offer In Compromise or arguing a case of hardship.

Please contact us now for a free initial consultation.

Join Robinson and Henry P.C. For A Networking & Tax Conference!

Agenda:

• • • • • 11:30 – 12:00 Networking & Lunch
        • 12:00 – 12:30 Taxes under Trump Presentation
        • 12:30 – 01:00 Q&A

Event Highlights:

• • • • • Catered Lunch
        • Network with over 50 local businesses
        • Tax Speech
        • Q&A with tax attorneys

       Our Attorneys will cover the following topics:

• • • • How Trump’s plan would put more money in your pocket and give small businesses the same benefits as big corporations. Even better, we’ll teach you a simple way to save thousands more on self-employment tax.
      • Why Trump’s team plans to “make more money” by hiring the more IRS agents and what that means to you.
      • Learn from our conversations with the Colorado Department of Labor and Employment and how they would like independent contractors to be a thing of the past in Colorado.
      • How you can position your business like Trump to use the Bankruptcy Code if the economy crashes.

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