BUS640 WK1 RPLY

Week 1 DQ 1

Hosea Rodgers III 

5/14/2015 3:31:48 PM

The fourth amendment of the United States Constitution states, “The right of the people to be secure in their persons, houses, papers, and effects, against unreasonable searches and seizures, shall not be violated, and no Warrants shall issue, but upon probable cause, supported by Oath or affirmation, and particularly describing the place to be searched, and the persons or things to be seized" (Seaquist, 2012, Appendix A).   Basically for a business this means there has to be a valid or reasonable reason to look at an employee’s computer, or a company’s documents, or other things associated with that business. Basically the fourth Amendment protects a person/company’s privacy. This amendment protects the company because it can only be searched if there is reasonable cause to do so.            Being a school teacher, I have seen issues with this amendment. There was a case in Missouri in 1989. A school district adopted a policy authorizing random drug testing of student athletes.  There was a known drug problem in the school district.  Student athletes were among the drug users and dealers.  Along with the drug problem came serious student behavior issues.  By 1989, disciplinary actions had reached ‘epic proportions,’ motivating the district to introduce the Student Athlete Drug Policy.  James Acton, a 7th grader, refused the testing, and his parents refused to consent to the testing.  Because of this, he was not allowed to participate in football.  He sued the school district for violating his rights. The drug testing policy is reasonable and does not violate the 4th Amendment rights of the students.  Students do have rights at school, but those rights must be balanced with the school’s responsibility to provide a safe environment.  ("Your 4th Amendment Rights", 2012). 

References

Your 4th Amendment Rights. (2012). Retrieved from http://judiciallearningcenter.org/your-4th-amendment-rights/

 Seaquist, G. (2012).  Business law for managers.  San Diego, CA: Bridgepoint Education, Inc.

Alicia Bearden: 1st Amendment

Alicia Bearden 

5/14/2015 12:50:56 PM

“The Congress shall have Power To lay and collect Taxes, Duties, Imposts and Excises, to pay the Debts and provide for the common Defence and general Welfare of the United States; but all Duties, Imposts and Excises shall be uniform throughout the United States”, is the first clause of Article , Section 8 of the Constitution of the United States of America. This section is the enumerated powers of the federal government delegated to Congress. It states that the government has the power to tax and to spend the tax money to provide the nation with defense and general welfare. Which the defense is the military service (Seaquist, 2012). As we all know, money is power, and the money is given to Congress. Not only does congress tax our money but they also have the power to tax on imported goods. But the rule is, each state will be taxed equally on imported goods.

In my opinion, the clause limits and protects businesses. It limits them as in paying taxes is a requirement and that is money they could be investing into the business, but instead it is put into protecting their business so that they ultimately can have a business. So, it both limits and protects. Seaquist (2012) states that, “a successful economy depends on thriving businesses.” The company that I work has to follow the laws of the United States. They are responsible for paying taxes and they are a German country so they are also responsible for paying imported taxes on goods. Although my company pays their taxes I am also required to pay taxes on the money that I earn from the business I work for. When a business becomes corporate the disadvantage is the double taxation to which corporate is subject too. Although this is a disadvantage, there are tax exemptions to business when the business meets certain criteria. Also, when a business has a partnership there is a disadvantage that the partnership are taxed as personal income on each partner’s individual income(Seaquist, 2012). I believe that the tax protects the business. These taxes are implemented by the federal government that actively regulates businesses. They do this through antitrust laws, securities laws, and regulations. Also, through labor laws, tax incentives, and consumer protection (Seaquist, 2012). Once the taxes are paid, Congress can pay those that protect the company and allow it to actually do business. Having the ability to pay the military for their services make it more desirable for people to enter the military on their own account and helps prevent people to be required to enter the military. 

Seaquist, Gwen. (2012). Business Law for Managers. Bridgepoint Education, Inc. 

Eugene's Capital Gains

Eugene Cushman 

5/14/2015 9:33:52 PM

"Zero To 60: What Business Owners Need To Know About Capital Gains,” describes useful ideas that will help you learn more about capital gains and how this tax regime can impact business decisions. After reading this article, determine which of the planning opportunities could be beneficial in a corporate and independent business setting. In detail, convey why or why not? Using the text for this class, describe the pros and cons in business law regarding capital gains. Respond to at least two of your classmates’ posts.

The very first part about learning more about capital gains would be the close study of everything that can be considered a long-term capital gain versus what is considered a short-term capital gain.  This would help me learn more about capital gains.  For a corporate setting, the planning for stock options and stock grants would be a number one element that an investor will be looking at.  If you set these stocks one way, the executive may find it not in their favor and make the stock options look less that what the corporation is actually paying out.  Is it really $500,000 dollars in stock if you only get $270,000 after taxes, no it is not $500,000. 

This also lets the ones making the shot know that if they want that executive to receive that high amount, than the amount needs to be larger than what is said or clearly state what it will be after taxes.  The other one would be selling your business for its assets.  As it states in our article “A seller is usually entitled to pay taxes at the lower capital gains rate with a stock sale.  If an asset sale involves a corporation, the, the seller may incur double taxation because the corporation will pay tax on the gain from the sale of the asset and then pay tax when the proceeds are distributed to the selling owner.  Keep in mind that corporations don’t have a long-term capital gain tax rate” (Parrish, 2014).

For an independent setting, selling your partnership interest would be what comes to mind.  As noted in our text that a capital contribution which is “The initial amount of money each partner contributes to begin the business; “seed money”” (Seaquist, 2012).  This is something that should be taken into account when one owner leaves, the seed money will need to be retuned and depending on the situation, that may take a part of the accounts receivable to make up the difference.  These three planning process directly affect the business and corporation.  The business owner’s personal tax and owner’s estate plan are not so much planning opportunities that would be beneficial to the corporation and for the record, the Business owner’s estate plan is unconstitutional considering that no matter what kind of income, they are to be able to take their tax moneys and so less business owners pay these taxes as they focus on peoples income taxes, I am just saying…

The pros are easy, you pay taxes on these capital gains and you stay out of trouble with the government.  The cons are that you are having your profits taken from your hard work.

References

Parrish, S. (2014, March 24). Zero to 60: What business owners need to know about capital gains? Forbes. Retrieved fromhttp://www.forbes.com/sites/steveparrish/2014/03/24/zero-to-60-what-business-owners-need-to-know-about-capital-gains/

Seaquist, G. (2012). Business law for managers.  San Diego, CA: Bridgepoint Education, Inc.

Scott Belfuri Disc 2 - Capital Gain

Scott Belfuri 

5/14/2015 11:41:09 PM

The IRS website was more straigtforward and helpful for me to understand capital gains ( http://www.irs.gov/taxtopics/tc409.html ).  If the owner holds on to the asset for more than one  year, it is a long term capital gain (hopefully not a long term capital loss), and the tax rate is reduced significantly.  The Zero to 60 Article was a helpful warning, because the IRS website was a bit deceiving.  The IRS page linked above states that the maximum tax rate on a long term capital gain is usually 15%, and a maximum of 28% in certain circumstances.  It is understandable how it is advantageous to encourage long term investments in businesses, I can see why there is an incentive to having a lower tax rate on long term gains versus short term.  A ‘con’ though is the double or triple taxation: Seaquist (section 30.1, 2012) also explains that some folks feel this is over taxation:

“...profits of the corporation are subject to double taxation: The corporation pays income taxes on corporate profits, and then the shareholders pay personal income taxes on corporate profits distributed to them as dividends. Some maintain that the taxation is in fact "triple" because shareholders also pay taxes on capital gains realized from the sale of their stock.”

For a personal business, it might be beneficial to decide nice an early if it is going to be a family business, so that one could gift the business to a family member; it wouldn’t accrue a capital gains tax for a value up to $10,680,000.  

Parrish’s article (2014) had several other good tips for large businesses, it seems it would behoove some research into developing stock plans that qualify for long term capital gains, but don’t incur an alternative minimum tax (if possible) when looking to offer stock incentives.  Then, if selling the business, timing of the sale matters, before reaching $250,000 AGI to avoid another 3.8% tax (Medicare Surtax); and avoid selling it for assets as the tax rate could end up much higher for the seller.

Parrish, S. (2014). Zero to 60: What business owners need to know about capital gains. Forbes. Retrieved from http://www.forbes.com/sites/steveparrish/2014/03/24/zero-to-60-what-business-owners-need-to-know-about-capital-gains/

Seaquist, G.(2012). Business law for managers. Bridgepoint Education, Inc. Retrieved from http://content.ashford.edu/books/AUBUS670.12.2/sections/appa