LLC Owner Disclosure in Condos - Avoid the Bad Advice

News media is reporting that "Condo Buyers Can Keep Purchases Secret, N.Y. Tax Officials Say in Reversal," but is that true?

For reference, see Law Alert: LLC Owners ID Must be Disclosed in Real Estate Deals where we discuss S1730 requiring disclosure of the beneficial ownership of a one-to four-family dwelling unit owned by a LLC on real estate transfer tax forms.

It is noted that the guidance referred to by the Journal cannot be located besides through the use of deduction from a careful reading of the Department of Taxation and Finance website where the term condominium was removed from its "Important Notice regarding conveyances to or from a limited liability company." That being said, real estate professionals are reminded that S1730 wasn't the only law concerning disclosure of owners of LLCs.

Instead, FinCEN had previously issued Real Estate Geographic Targeting Orders that requried such disclosure.

As a result, regardless if the Journal is correct, which remains questionable because it involves an interpretation of S1730, which is the perview of the judiciary, not the executive branch, disclosure remains required for purchases of $300,000 or more in Brooklyn, Queens, Bronx, Staten Island, or Manhattan in New York City, New York.

 

Legal Updates: Employers Are Required To Provide New Employees With Sexual Harassment Prevention Training on or before First Day of Work

New York State recently amended its antidiscrimination laws and clarified when new employees must be provided the Sexual Harassment Prevention Notice. The State’s updated guidance recommends that at the time of hiring (or at the beginning of their first day of work) employees must be provided the employer's sexual harassment prevention policy and the information presented at the employers sexual harassment prevention training program (in English and in the primary language of the employee).

Notice must be delivered in writing (in print or email). The notice must link to or include the policy and links to training materials. 

Under existing New York State law, employers must provide sexual harassment training and policies on an annual basis to all employees.

Read the full FAQ from NY.GOV here. 

Lieb Compliance is HR's one-stop sexual harassment solution in full compliance with NYS Labor Law §201-g and NYC Local Law 96. Offering web-based, on-demand, full-video trainings, company branded complaint forms and sexual harassment policies with digital receipts to defend prospective litigation and address Department of Labor audits. Beyond this product's simplicity in satisfying an otherwise onerous requirement, the training is electric by offering real-life case studies and practical advice delivered through the eyes of a litigator. Simply, this is the choice vendor if you want both compliance and to increase employee morale. Make training fun again. For more information visit discriminationpreventiontraining.com 

Lieb at Law is Hiring An Associate Attorney

Lieb at Law, P.C., is seeking an associate attorney to support the firms widely expanding litigation and transaction practice. This role will work across the firms practice areas. Newly admitted attorneys looking for experience in multiple fields of law are welcomed. You will be trained. Competence trumps experience and career growth is limited only by your own ability, ambition and desire to learn and evolve. We are looking for a potential star that is intellectually driven, who does not cut corners, has a fresh approach, thinks outside-the-box and can provide tangible fact-driven support.

Desired qualifications:

• Must love technology and use it always, must be comfortable in a paperless office with cloud based systems;
• Demonstrated proficiency in legal writing and oral advocacy;
• Dedicated, organized and detail-oriented;
• Ability to leverage substance rather than emotion

The firm’s practice areas include:

• Litigation: Commercial Litigation, Real Estate Litigation, Real Estate Brokerage Litigation, Title Litigation, Plaintiff Personal Injury, Landlord/Tenant, Estate Litigation and more.
• Employment Litigation, Compliance and Trainings: Discrimination, Harassment, Retaliation, Wage and Hour, Restrictive Covenants, Family Medical Leave Act, Alternative Dispute Resolution, Appeals; Employee Handbooks and Policies, Sexual Harassment and Discrimination Training, Wage and Hour Audits & more.
• Legal Compliance for Regulated Industries: Outside Compliance Counsel for regulated professions, Policy Drafting, Policy Implementation, Auditing, Corporate Compliance Trainings.
• Estate Planning and Probate: Last Wills, Advance Directives, Trusts, and Probate Administration.
• Transactions: Commercial and Residential Real Estate Purchase and Lease Transactions, Business Transactions and Negotiations.

Qualifications:

Candidate must have 1 year of experience at a law firm. Excellent critical thinking, writing, organization and research (Westlaw) skills. Must be technologically savvy and detail oriented.

Lieb at Law is different:

The law firm is a part-owner of a New York State Licensed Real Estate School, Lieb School, which offers in-class and digital courses throughout New York State and Connecticut. Lieb at Law, P.C. attorneys draft curriculum and teach at the school where they have the opportunity to establish themselves as topical experts and drive the future of the real estate brokerage industry. The law firm's sister firm, a Compliance Company, Lieb Compliance, leverages legal change to enhance business services. Lieb Compliance offers sexual harassment trainings and employment law support services.

About the firm:

The firm was founded in 1977. In 2009, Andrew Lieb acquired control of the firm and transformed its legal services from a general practice to a commercial litigation boutique focusing on real estate and legal compliance for regulated industries.

The firm’s litigation practice is driven by leveraging informational imbalances to win cases. This is a substance first law firm where data drives decision making and strategy.

To achieve the firm’s information focused litigation culture, staff have access to cloud-based legal research platform so the latest cases are available to our legal team everywhere, including within the courtroom. Next, a secure, cloud-based case management system catalogs every thought and action on each client’s matter. As a result, case facts are readily accessible through the stroke of a computer key, instead of being locked away in one attorney’s memory or private paper notes in some desk draw.

Finally, enterprise file sharing, storage and collaboration software is utilized to enable the efficient collaboration between attorneys where case strategy and document preparation benefits from fresh and innovative group think.

Lieb at Law’s latest research and collaboration tools extend to the firm’s transactional team, which ensures that contractual language is driven by our real life experiential learning from our contractual litigating practice.

Lastly, we publish and teach the law that we practice in order to always stay on the cutting edge. Lieb at Law’s work product is a derivative of embracing education and technology to provide a modern law firm that is at the vanguard of representation.

To apply email cover letter and resume to careers@liebatlaw.com 

Real Tips HR: Can Employers Fire an Employee Accused of Sexual Harassment?

In this #metoo movement, employers must know how to react when an employee gets accused of sexual harassment. Can employers just fire someone on the spot? Andrew Lieb and Mordy Yankovich explain the answer in this short clip.

Attention RE Brokers - No More CE Grandfathering + New Required Courses in CE

On 10/23/19, continuing education requirements for NYS real estate brokers, associate real estate brokers and real estate salespersons were changed by A6082. These changes are effective 7/1/21.

Lieb School has got you covered for your continuing education needs. Because our school's courses are written & taught by Andrew M. Lieb, Esq. we have been teaching the required courses this entire time! We know what topics you need to avoid getting sued while making money.

The new law creates 2 new categories of continuing education: "ethical business practices" & "recent legal matters" plus it eliminates grandfathering for brokers who were licensed 7/1/08.

NOW, all licensees must receive 22.5 hours of continuing education every 2 years to stay licensed. The 22.5 hours must include:

• 3 hours on fair housing &/or discrimination
• 2.5 hours on ethical business practices
• 1 hour on recent legal matters governing the practice of real estate brokers and salespersons in New York, which may include statutes, laws, regulations, rules, codes, Department of State Opinions and Decisions, and Court Decisions 
• 1 hour on the law of agency (2 hours in the initial 2-year cycle)

Amended RPL §441(3)(a) now states (capital is newly added & [] are deleted):

No renewal license shall be issued any licensee under this article for any license period commencing November first, nineteen hundred ninety five unless such licensee shall have within the two year period immediately preceding such renewal attended at least twenty-two and one-half hours which shall include at least three hours of instruction pertaining to fair housing and/or discrimination in the  sale or rental of real property or an interest in real property, AT LEAST TWO AND ONE-HALF HOURS OF INSTRUCTION PERTAINING TO ETHICAL BUSINESS PRACTICES, AT LEAST ONE HOUR OF INSTRUCTION PERTAINING TO RECENT LEGAL MATTERS GOVERNING THE PRACTICE OF REAL ESTATE BROKERS AND SALESPERSONS IN NEW YORK WHICH MAY INCLUDE STATUTES, LAWS, REGULATIONS, RULES, CODES, DEPARTMENT OF STATE OPINIONS AND DECISIONS, AND COURT DECISIONS AND at least one hour of instruction pertaining to the law of agency except in the case of the initial two-year licensing term for real estate salespersons, two hours of agency related instruction must be completed, and successfully completed a continuing education real estate course or courses approved by the secretary of state as to method, content and  supervision, which approval may be withdrawn if in the opinion of the secretary of state such course or courses are not being conducted properly as to method, content and  supervision. For those individuals licensed pursuant to subdivision six of section four hundred forty-two-g of this article, in the individual's initial license term, at least eleven hours of the required twenty-two and one-half hours of continuing education shall be completed during the first year of the term. Of those eleven hours, three hours shall pertain to applicable New York state statutes and regulations governing the practice of real estate brokers and salespersons. To establish compliance with the continuing education requirements imposed by this section, licensees shall provide an affidavit, in a form acceptable to the department of state, establishing the nature of the continuing  education acquired and shall provide such further proof as required by the department of state. [The provisions of this paragraph shall not apply to any licensed real estate broker who is engaged full time in the real estate business and who has been licensed under this article prior to July first, two thousand eight for at least fifteen consecutive years immediately preceding such renewal.]

LLC Anonymity in Real Estate Transactions Is No More

LLCs still offer many advantages in real estate ownership, but anonymity isn't one of them.

Andrew Lieb, Esq. shares the latest updates with the law here. 

Your Guide to Buying a Flip at the Right Time

Did you know that if a buyer’s contract of sale is dated within 90 days of the seller’s deed, the buyer may not be able to get a mortgage commitment? Underwriters at mortgage lenders have policies against issuing loans when the dates between the prior deed and the current contract of sale are too close in time.

Read the full article by Andrew Lieb, Esq. published in Dan's Papers here. 

Summary of the Tenant Protection Act of 2019 for General Landlord/Tenant Practice

The Housing Stability and Tenant Protection Act of 2019 is a 74 page Act. Andrew Lieb, Esq. summarizes the list of major changes applicable to general landlord/tenant practitioners.

Read the full article in the Suffolk Lawyer Law Journal here.

New York State Overhauls Discrimination/Harassment Laws Opening the Floodgates to Future Claims

On August 12. 2019, Governor Andrew Cuomo signed legislation implementing extensive reforms to the New York State Human Rights Law, which dramatically increases protections for victims of discrimination and harassment in the workplace and makes it exceedingly more difficult for employers to defend against such claims.

Mordy Yankovich, Esq. shares an analysis of the major changes to the NYSHRL in The Suffolk Lawyer Law Journal here.

Protections for Victims of Harassment are Effective Today.

The following provisions of the recently passed New York State law which provide additional protections for victims of harassment/discrimination based on any protected class (sex, race, religion, etc.) go into effect today: 

1)  As of today, the high "severe and pervasive" standard for establishing claims of harassment no longer applies. Rather, any conduct, including isolated incidents, that merely rises above "petty slights" or "trivial inconveniences" may be considered harassment.

2) Whether or not an employee filed an internal complaint prior to filing a lawsuit is no longer determinative of an employer's liability.

3) Non-employees (contractors, vendors, etc.) can now bring claims of harassment against companies based on any protected class.

4) Non-disclosure provisions in agreements settling harassment claims are prohibited unless it is the employee's preference.

5) Mandatory arbitration of harassment claims based on any protected class is now prohibited.

Employers should ensure that these new provisions are included in their annual harassment prevention training.

Can Employers Discriminate Against Employees Based on Their Sexual Orientation or Status as Transgender? The Supreme Court to Weigh-In.

The Supreme Court of the United States is hearing oral arguments on three high profile cases today which will have a significant impact on LGBTQ rights in the workplace.

In the first two cases, Bostock v. Clayton County, Georgia and Altitude Express, Inc.v. Zarda, the justices will determine whether Federal law prohibits employment discrimination based on sexual orientation. (Federal law generally prohibits discrimination based on "sex"). In the third case, R.G. & G.R. Harris Funeral Homes, Inc. v. Equal Employment Opportunity Commission, the justices will determine whether employment discrimination against transgender people violates Federal law.

The decisions on both of these issues - which will likely be released in early 2020 - will be of great interest to both employers and employees.

Time's Up For NY Companies - October 9th is the Deadline for Employers to Comply with Sexual Harassment Prevention Requirements

October 9th, 2019 is the deadline for Employers to issue updated Sexual Harassment Prevention Policies & annual trainings to all employees. Our company Lieb Compliance solves this burden with our on-demand solution.

Rental Real Estate Enterprise Tax Deduction - Final Rule Published

New rules for a 20% tax deduction on rental properties published by IRS as 199A Safe Harbor.

What you need to know: 
The Safe Harbor applies to taxpayers who have "an interest in real property held for the production of rents and may consist of an interest in a single property or interests in multiple properties."

KEY - Safe Harbor allows rental real estate enterprises to receive a 20% qualified business income deduction for tax purposes.

If an interest fails to satisfy the requirements of the Safe Harbor, it's still possible to qualify for the 199A deduction by otherwise meeting the definition of a trade or business as set forth in 199A.


Some Notes:

• Multiple Properties - If a taxpayer has an interest in multiple properties, commercial & residential properties can't be combined for the deduction.
• "Mixed Buildings" - In a single building with both residential & commercial purposes (e.g., a storefront with apartments above), property owners have 2 options; 1) treat the property as a single rental real estate enterprise; or 2) separate the interest into both residential & commercial interests. 
• Less Flexibility - Taxpayers also can't change the forms of their interests from year-to-year (i.e., filing multiple properties as a single interest one year, and then filing them as separate interests the next).

Safe Harbor Requirements:

1. Separate books & records are maintained to reflect income for expenses for each rental real estate enterprise;
2. Records should reflect 250+ hours of rental services for each year;
3. Records should also reflect time logs (or similar documents) that show: (i) the amount of hours for all services performed; (ii) descriptions of all services performed; (iii) dates when the services were performed; & (iv) names of persons/companies performing the services; and 
4. A statement attached to a filed original return that outlines the information about the real estate enterprise(s) & why the deduction is being sought by the taxpayer. 

**IMPORTANT**: The record requirement will not apply to taxable years beginning before 1/1/2020. 

"Rental Services"

Rental Services can be performed by property owners, or by their employees, agents, and/or independent contractors. 

LANDLORDS: Keep logs of rental services and receipts to see if you qualify for the Safe Harbor deduction.

New Law Allows Disabled Tenants to Terminate Lease in Face of Worsening Medical Conditions

ATTENTION RESIDENTIAL LANDLORDS

On October 3, 2019 Governor Cuomo signed bill A2118 into law, mandating that for all leases moving forward, landlords must accept lease termination notices for tenants living with a "disability" as defined by law, or for the spouse or dependent of a tenant with a disability, should the tenant need to relocate to one of the following:

• An adult care facility;
• A residential health care facility;
• Subsidized low income housing; or 
• A residence of a family member.

The Tenant Must Give Proper Notice

In order to give proper notice, the tenant needs to attach a physician's certification that the tenant needs to relocate and cannot live independently for medical reasons, as well as a document showing admission or pending admission to an adult care or residential health care facility. 

Tenants must also submit the termination notice with 30 days notice. If the notice is mailed, the notice is considered "received" after 5 days.

Example:

Tenant mailed notice:           May 5th

Notice "received":                May 10th

Next rental payment:            June 1st

Termination effective:          July 1st

Landlords Could Face Fines or Imprisonment for Failing to Accept the Notice

Landlords who refuse the termination notice accompanied by the proper documents could be charged with a misdemeanor, facing either a year in prison, a $1,000 fine, or both. 

RESIDENTIAL LANDLORDS: Make sure that you and your teams are trained in discrimination prevention to avoid fines and jail time. 

NYC: Using the Word "Alien" Could Result In $250,000 Fine

More discrimination lawsuits are on the horizon in NYC based upon the City's Commission of Human Rights new enforcement guidelines concerning immigration status and national origin.

Landlords, merchants, and employers now face up to $250,000 in fines for using terms and phrases like "illegal alien", "alien", and "speak english" when used in the context meant to demean, humiliate, or offend.

In their press release, the NYC Commission of Human Rights provided hypothetical examples of discriminatory behavior, including:

• Harassing a restaurant patron because of their accent;
• Refusing repairs on a unit occupied by an immigrant family and threatening to call ICE if they complain;
• Paying a lower wage or withholding wages to workers because of their immigration status; and
• Harassing a store customer by telling them to stop speaking their language and demanding they speak English.

*ATTENTION LANDLORDS AND EMPLOYERS* - your teams must be trained in the different forms of discrimination and harassment to avoid fines, lawsuits, and bad publicity.

Law Alert - NYC Passes Commercial Landlord Discrimination Law with HUGE Fines

NYC COMMERCIAL LANDLORDS BEWARE! 

Discrimination lawsuits are coming if your teams are not trained to comply with the new NYC commercial tenant harassment laws. 

On 9/25/19, the New York City Council increased commercial tenant harassment fines to a minimum of $10,000 a maximum of $50,000—a ten fold increase from the previous fines that ranged from $1,000 to $10,000. 

The bill passed by the Council also expands on the definition of "tenant harassment" to include: 

• Requesting identifying documents that would disclose the citizen status of a tenant;
• Threatening a tenant based on factors including age, race, gender, disability status, or sexual orientation; and 
• Unreasonably refusing to cooperate with a tenant's permitted repairs or construction activities. 

This expands on the prior prohibitions of denying utility services, removing tenant property, limiting a tenant's access to space, or repeatedly engaging in frivolous lawsuits against tenants. 

Landlords, before taking action in tenant disputes, you should have your teams trained on the different forms of discrimination and harassment to avoid hefty fines.

Law Alert: LLC Owners ID Must be Disclosed in Real Estate Deals

ATTENTION LLC Owners

LLC sellers & buyers of residential property (1-4 family houses) will no longer be able to hide their identities.

Transfer tax returns submitted by LLCs, as required when transferring real estate, will no longer be accepted by the clerk's office unless submitted with the names and addresses of all members, managers, shareholders, directors, officers, partners, and other authorized agents.

Check out the full bill here and understand that you can no longer hide your identity in a residential real estate deal in the State of New York.