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Real or Personal Property

It is important to understand the difference between real and personal property because a misunderstanding could have significant legal consequences. Real property generally refers to land and everything that is attached to it. Personal property generally refers to the stuff that you own that is not real property. Trailer homes are generally considered personal property in the State of Minnesota. Therefore, you cannot attach a mechanic’s lien to a trailer home. In addition, a mobile or manufactured home must be licensed as a motor vehicle in the State of Minnesota in lieu of paying a property tax. Real property cannot be conveyed...

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Year-End Review

Legal knowledge provides protection for your business AND your family. As professionals, we work hard every day to ensure the success of our businesses. Unfortunately, if we are not well prepared and protected, our business, our reputation and even our personal assets can all be lost, due to a single mistake or oversight. Working with a trusted business law attorney, accountant, business banker, financial planner and commercial insurance agent is essential to maintain the success of your business. If you answer “false/no” to any of the following statements, your business has exposure. Is your business properly incorporated? If your...

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Medical Assistance and Your Homestead

For many people, their homestead is their most valuable asset. However, many people do not realize the impact of medical assistance on their homestead. This article will provide a general overview through hypotheticals. Hypothetical: Mary is 75 years of age and she lives alone in her homestead. She does not have long term care insurance. She decides that she wants to move to assisted living for the community aspect of assisted living. So, she moves out of her home and moves into assisted living. She then sells her home. Analysis: Mary’s home was an exempt asset for medical assistance purposes until she...

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The Mistake of a Business Owner Regarding a Purchase Agreement

If you are going to purchase a business or sell your business there are several factors that a business owner will want to take into consideration. Business owners often make a mistake when they erroneously believe that a “simple” purchase agreement is sufficient. Consider the following hypotheticals: Hypothetical #1: Susie’s Little Educators, Inc. is owned by Susan Queen. The business is licensed by the State of Minnesota. One of Susan’s key employee’s wants to purchase the business. They find a purchase agreement on the internet and use it. The agreement includes that the key employee will purchase the business under a...

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The Sale of a Business and Real Estate

It is not uncommon for a business owner to sell, at the same time to the same buyer, a business and the real estate in which the business is based. In other words, the business owner owns the business and the real estate in which the business is based. Often, to save legal fees, a business owner will want to have one purchase agreement that includes both the sale of the business and also the real estate in which the business is based. This is rarely advised. Generally, in this type of situation, you will want to have one purchase agreement...

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A Step Up In Basis

It is common in estate planning and business succession planning – amongst other areas – to hear the phrase “a step up in basis.” A step up in basis means that the basis (i.e., the value) of the asset is stepped up to the value of the asset as of the date of death. Therefore, the tax is based on the fair market value as of the date of death rather than at the date of purchase. This article will provide a general overview through hypotheticals. The information provided is not tax advice. Please consult with your tax advisor for...

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Real Estate Taxes

Not paying your real estate taxes in Minnesota can result in your property being foreclosed upon by the government. If a foreclosure occurs under these circumstances, in Minnesota, under current law, you are not entitled to the surplus from the sale of the home. Hypothetical: Mary owns her home. She moves into assisted living. Due to the cost of assisted living Mary can no longer afford to pay her real estate taxes. So, she stops paying them. The county forecloses on her home. The home is worth $200,000. The property taxes, with interest, are $25,000. In this hypothetical, if Mary does not...

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Your Minnesota LLC is Governed Under the New LLC Act

If your LLC was formed under the old LLC Act (322B), as of January 1, 2018, your LLC is now under the new LLC Act (322C). The transfer under the new LLC Act, as of January 1, 2018, happened automatically under law on January 1, 2018. There are numerous changes under the new law. It is prudent to retain counsel to revise your operating agreement and counsel your LLC given the significant changes in the LLC law. Spangler and de Stefano, PLLP assists clients with LLCs and legal entity issues. The material contained herein is for informational purposes only, and is not intended...

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An Employer’s Obligation to Provide Written Notice About Wages, Etc.

Minnesota law requires that all employers must provide each employee with a written notice at the start of their employment and keep a signed copy of the notice on file. In addition, the employer has to provide notice to the employee before any changes regarding, amongst other things, the employee’s employment status, whether the employee is exempt and on what basis, the number of days in the employee’s pay period and the regularly scheduled pay date, the date the employee will first receive payment of wages earned, the employee’s rate(s) of pay and the basis thereof, including how the employee...

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The Mistake of a Business Owner Regarding Shareholder Agreements

Shareholder agreements often evolve over time. That is often due to, amongst other factors, the increased sophistication of the company and the fact that shareholders leave and others join. It is important to review your shareholder agreement and make certain that it is accurate and not in need of changes. The best time to review your shareholder agreement is now, when all of the shareholders are getting along. If you wait until there is a problem, then it becomes difficult, if not impossible, to amend it. The following steps are recommended: Make certain that all shareholders have signed the most...

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