A North Carolina State Bar Certified Freelance Paralegal, Rachel Royal is the founder of Royal Touch Legal & Business Solutions. As a freelance paralegal, Rachel provides virtual paralegal services to personal injury, family law, and real estate firms while also serving as a Project Coordinator for the North Carolina Pro Bono Resource Center’s Driver’s License Restoration and Housing Stability Projects.
Despite her busy workload, Rachel is a leader in the North Carolina Bar Association, serving as the Secretary and Pro Bono Co-Chair for the Paralegal Division, the Co-Chair of the Survey Committee, and a member of the Awards Subcommittee of the Pro Bono Committee.
The Corporate Transparency Act of 2019 (“CTA”)[2] was enacted January 1, 2021, as part of the Anti-Money Laundering Act of 2020 (“AMLA”), which is part of the National Defense Authorization Act for Fiscal Year 2021 (“NDAA”).[3] This article contains highlights[4] of the CTA, an outlook of regulations to come, and an alert to North Carolina attorneys of the potential impact with respect to a commercial real estate practice.
A. Purpose.
The purpose of the CTA is to “(A) set a clear, Federal standard for incorporation practices; (B) protect vital United States national security interests; (C) protect interstate and foreign commerce; (D) better enable critical national security, intelligence, and law enforcement efforts to counter money laundering, the financing of terrorism, and other illicit activity; and (E) bring the United States into compliance with international anti-money laundering and countering the financing of terrorism standards.”[5]
https://ncbarblogprod.wpengine.com/wp-content/uploads/2018/06/Blog-Header-1-1030x530.png00RealPropertyhttps://ncbarblogprod.wpengine.com/wp-content/uploads/2018/06/Blog-Header-1-1030x530.pngRealProperty2022-01-13 15:23:172022-02-08 09:53:07The New Corporate Transparency Act and Its Potential Impact on North Carolina Commercial Real Estate Attorneys
We’re all busy all the time. Some of you have dreams of being special. Some of you have dreams of being a specialist. The hurdle to that dream is the nightmare of the specialist exam.
We are here to help you add bunny ears and fuzzy slippers to that nightmare so you can accomplish your specialist dreams! Also: If you don’t care about becoming a specialist, our hope is to raise our collective abilities as family lawyers with this ongoing series.
Happy New Year from the NCBA Paralegal Division’s Utilization Committee!
One mission of the Utilization Committee is to keep the Paralegal Division informed concerning potential regulatory reform in North Carolina and other jurisdictions that might impact the paralegal profession.
As you may be aware, the North Carolina State Bar Subcommittee Studying Regulatory Change has been exploring various types of regulatory reform that might positively impact access to justice in North Carolina.
The Subcommittee has completed its work, and Mark Henriques, the Subcommittee Chair, has completed a report, Issues Subcommittee on Regulatory Change: Report and Recommendations (January 2022). The report includes recommendations to the Issues Committee and the State Bar Council concerning regulatory reform (e.g., limited licensing, regulatory sandbox, and more).
Mark Henriques will present the report to the Issues Committee at its meeting on January 19, 2022, from 2:30 p.m. to 3:30 p.m., and to the State Bar Council at its meeting on January 21, 2022, from 8:30 a.m. to 11:30 a.m.. While the Issues Committee and Council will likely be discussing many topics during their meetings, you are welcome to watch the meetings by visiting the North Carolina State Bar YouTube Channel and subscribing to receive a reminder.
After these meetings, we hope to understand better how the State Bar Council will manage the Subcommittee’s recommendations.
In the interim, click here to read the full report by viewing the 1/7/2022 update entry on the North Carolina Justice for All Project website.
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The Paralegal Division Blog is managed by the Division’s Communications Committee. Via the blog, the Communications Committee provides information written by attorneys, paralegals, and other experts designed specifically for paralegals in the areas of substantive law, ethics, technology, paralegal practice advice, and more. If you are interested in signing up to submit a blog post on a future date, you can do so here. When you are ready to submit a blog post, you can do so by using this form.
Lawyers, veterans, public sector employers and HR departments all should be aware of an upcoming Supreme Court case that involves a challenge to a state’s sovereign immunity under the federal Uniformed Services Employment and Reemployment Rights Act of 1994 (“USERRA”). If sovereign immunity is upheld as a basis to deflect private enforcement actions against public entity employers, veterans’ rights groups argue that a substantial blow will be struck to veterans in contravention of both USERRA and Congress’ intent in enacting that law. Whatever the outcome, with the U.S. involved in several overseas conflicts and a projected increase in the Department of Labor’s (“DOL”) enforcement budget, enforcement actions and private claims under USERRA are likely to remain consistent for the foreseeable future; as such, this case will be one to watch.
Section 731(c) generally treats marketable securities as money in determining gain or loss on a distribution to a partner. Section 731(a)(1) provides no gain is recognized on a distribution to a partner except to the extent any money distributed exceeds the adjusted basis of the partner in the partnership interest.
The term “marketable security” means financial instruments and foreign currencies that are, as of the date of the distribution, actively traded within the meaning of Section 1092(d)(1). For example, if a partnership distributes publicly traded stock with a value of $100 to a partner with an adjusted basis in her partnership interest of $50, the partner generally recognizes a gain of $50. However, there are a number of exceptions.
The first exception, in Section 731(c)(3)(A)(i), provides a marketable security is not treated as money if the partner receiving the security contributed the security to the partnership.
The second exception, in Section 731(c)(3)(A)(ii), provides a marketable security is not treated as money to the extent provided in regulations if the property was not a marketable security when acquired by the partnership. Reg. § 1.731-2(d)(iii) clarifies that is satisfied if (a) the entity that issued the security had no outstanding marketable securities when the security was acquired by the partnership; (b) the security was held by the partnership for at least six months before the security became marketable; and (c) the partnership distributed the security within five years of the security becoming marketable.
The third exception, in Section 731(c)(3)(A)(iii), provides a marketable security is not treated as money if the partnership is an investment partnership, and the partner is an eligible partner. A future blog post will describe what qualifies as an investment partnership and an eligible partner.
Finally, Section 731(c)(3)(B) provides for a reduction in the amount treated as money on a distribution of marketable securities equal to the difference between the partner’s distributive share of partnership net gain before the distribution and the partner’s distributive share of partnership net gain after the distribution. That is best demonstrated by Example 2 in Reg. § 1.731-2(j).
When gain is recognized as a result of Section 731(c), the basis of the marketable securities to which gain is recognized equals their basis as determined under Section 732 increased by the amount of such gain. IRC § 731(c)(4)(A).
John G. Hodnette, JD, LLM is an attorney with Culp, Elliott, & Carpenter in Charlotte.
https://ncbarblogprod.wpengine.com/wp-content/uploads/2018/06/Blog-Header-1-1030x530.png00TAXhttps://ncbarblogprod.wpengine.com/wp-content/uploads/2018/06/Blog-Header-1-1030x530.pngTAX2022-01-12 16:25:192022-01-12 16:25:19Marketable Securities as Money Under Partnership Tax Rules
Another year of unprecedented times has caused the council to experience some transitions in its members whose terms have not yet expired. I am pleased to announce that Yazmeen Gadalla will serve as Interim Treasurer and Kimberly Johnson will serve as an Interim Council Member for the remainder of the year. Jennifer Gaff has been nominated by our Nominations Committee to fill Yazmeen’s Council Member Seat, which is set to be officiated during our next council meeting.
With those announcements, we will have three council member vacancies in 2022. Nominations to fill the vacancies of the unexpired terms will be held at our annual meeting. Members interested in joining the council may submit their nominations to [email protected].
It is hard to believe I am already halfway through my tenure as the Paralegal Division Chair. When the year began, I announced that my overall goals for the council and division were inclusivity, transparency, and the implementation of activities to continue to advance the excellence of the Paralegal Division. Many thanks to the Executive Council and Council Members for helping to accomplish those goals.
Mendez v. Mendez, Court of Appeals of North Carolina, December 21, 2021
Defendant sought a modification of child support, citing the changing needs of the children based on their involvement in new activities, including music lessons, fencing, and acting classes. Defendant also requested an award of attorney’s fees in the amount of $7,300.00. The trial court order a reduction of child support, affirmed the trial courts ruling on extraordinary expenses and did not award defendant attorney fees.
Of course, defendant appealed and the court wrestled with the issues of potential errors of a) not imputing income to plaintiff, b) whether the children’s activities qualified as “extraordinary expenses” c) the lack of attorney’s fees to defendant.
The North Wind and the Sun got into a dispute about which one was stronger. To put the issue to a test, they decided that whoever sooner made a traveler take off his cloak would be the more powerful and win the argument.
The Wind blew with all its might, but the stronger he blew, the closer the traveler wrapped the cloak around him. Then, the Sun came out and, as it gently shone brighter and brighter, the traveler sat down and, overcome with heat, cast his cloak to the ground.
So goes one of Aesop’s fables, and the lesson taught some thousands of years ago is that persuasion is better than force, and that to be effective in winning an argument, one must consider how to argue, rather than to just rely on blunt force.
In 2021, LexisNexis cast a new Fellowship project from its African Ancestry Network and LexisNexis Rule of Law Foundation focused on solutions to eliminate systemic racism in legal systems. To be considered for this privilege, each law school student was given the opportunity to create a project that could provide solutions to eliminate systemic racism in the legal system while advancing the rule of law. I was fortunate to be one of the twelve Fellows chosen from the six HBCU law schools.
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