| Tips & Traps
Tip: Apostille
No, it's not a French religious follower. An "apostille" is a certificate
signed by the Secretary of State of a state verifying the official nature
of a document so that it can be accepted at face value by officials
of another country. (In my case one was needed to enable a foreign student
returning home to transfer his school credits and continue his education.)
It is usually necessary for any document (birth certificate, police
record, corporate good standing, etc.) that is to be submitted to a
foreign country to be so certified. Countries that have signed the 1961
Hague Convention treaty have agreed to accept the certifying signature
of the Secretary of State of each state without verification. The Secretary
of State simply has to attach an apostille to the original, notarized
or otherwise verified document, and the signing country will accept
it as is. For countries not signatory to the Hague Convention, a "Certificate
of Office" is necessary. If the country in question has not signed the
Hague Convention, the first thing to do is contact their embassy or
consulate to determine what procedures are required to verify the authenticity
of what is being sent.
Russ Jensen
Russell J. Jensen PA
St. Paul
76330.2257@compuserv.com
Trap: Minnesota Use Tax
The purchase of goods via the Internet (particularly, the purchase
of computer equipment) became popular in part because a purchaser believed
it could avoid Minnesota sales tax. Recently, audits by the Department
of Revenue have uncovered this practice and several law firms have been
assessed for unpaid use tax. Minnesota firms owe use tax for purchases
of goods from out-of-state vendors or via the Internet. When a business
purchases property or taxable services for use, storage, distribution,
or consumption in Minnesota, that business is liable for use tax on
that usage Ñ unless sales tax was collected at the point of sale.
Minn. Stat. ¤297A.63, Subd. 1. A firm that purchases goods from out
of state in an effort to avoid paying sales and use tax risks exposure
to significant criminal and civil liability. Minn. Stat. ¤¤289A.60,
Subds. 5-6; 289A.63, Subd. 1(b). Civil penalties of up to 15 percent
for failure to pay the use taxes plus additional penalties may apply
if the firm substantially underreported its tax liability.
J. Patrick Plunkett
Moore, Costello & Hart, PLLP
St. Paul
jpp@mch-pllp.com
Trap: Charitable Donations
Heartfelt appeals to help somebody during a medical crisis or
help a grieving family are familiar to us all. Whether in the form of
a jar at the check-out or a direct request for donations, these appeals
sometimes prompt clients to ask if a donation to the cause is tax-deductible.
Often, the answer is no.
Taxpayers can deduct contributions only if they make them to qualified
organizations, which, apart from churches and governments, are organizations
granted nonprofit status by the IRS. Contributions made to specific
individuals, political organizations and candidates are not deductible.
You may not deduct the value of your time or services, nor generally
can you deduct the cost of raffle tickets, bingo cards or other games
of chance. A good quick reference guide is IRS Publication 526, Charitable
Contributions, which is available free at irs.gov or by calling 1-800-829-3676.
The best advice for clients in these matters is to have them find out
if there is a qualified charitable organization sponsoring the fundraiser
and if so, to get a donation receipt. If not, the donation is a gift
of the heart, but not the IRS.
James Garlough
The Garlough Law Firm, PLLC
Apple Valley
garloughlaw@aol.com
Tip: Private AG Fees
Claimants who prevail in consumer litigation under various statutes
may be entitled to a fee award as "private attorneys general." Under
Minn. Stat. ¤8.31, plaintiffs who succeed in actions under certain enumerated
statutes are entitled to an award of reasonable attorneys fees. In order
for plaintiff to be eligible for a fee-shifting award, the outcome of
the lawsuit must benefit the "general public." Whether a fee award is
granted depends upon the breadth of impact of the outcome, which usually
must affect many people or the public interest, rather than the particular
plaintiff alone. See LY v. Nystrom, 615 N.W.2d 302 (Minn. 2000). To
qualify for a fee award, the claimant must establish the significance
of the result to the general public. A defendant may try to fend-off
a fee award by showing that the result, even though successful to the
prevailing party, has limited impact upon the general public or does
not fall within the enumerated statutes.
Marshall H. Tanick
Mansfield Tanick & Cohen, PA
Minneapolis
mtanick@mansfieldtanick.com |
