SFLG - MHBM February 5, 2018

AN INDEPENDENT SUPPLEMENT BY SANES MEDIA INC. FOR THE MIAMI HERALD

MONDAY, FEBRUARY 5, 2018

YOUR GUIDE T O L AW, A CCOUN T ING & F IN A N CE

Zumpano Patricios & Winker, P.A.: War on Terror Moves into the Courtroom

Also: • Florida’s Cannabis Law: Sessions Memorandum May Have Chilling Effect on Financial Institutions • Cyber Attacks: Time to Address the Business and Legal Risks • Forensic Accounting and Fraud Check Ups • How Can I Evict a Tenant From My Apartment Building?’

• To SBA or Not to SBA? • Assessing the Impact of the Tax Cuts and Jobs Act www.sflegalguide.com

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There is Nothing More “Permanent” Than a “Temporary” Solution When confronted with difficult situations, many times our political leaders put solutions in place without first taking a step back and pragmatically looking into the implications of their actions. The reasons could be because of lack of knowledge, political expediency or just plain laziness.

Several current situations come to mind.

The first is DACA (Deferred Action for Childhood Arrivals). What exactly did the administration think of the implication of “deferring” action? Kick the can down the road? Why not have just a simple “Action for Childhood Arrivals.” Having opted to add “Deferred,” it was foreseeable that the day would come when action had to be taken on the deferral, after years of seeing these children grow up, adapt to this country and feel every bit American.

The second is TPS (Temporary Protected Status). Again, what did the administration think of the implication of

“temporary”? How do you move or stay in a country for several years and build a “temporary” life? Did no one ever see that these “protected” individuals would one day have children? That these children would be American citizens? That they would become ingrained into the fabric of this great country?

The process of kicking the can down the road may be politically expedient in the short run. But this leads to the initial situation becoming more complex. It also politicizes the topic as “who is the party who can best serve the affected individuals?”

This is a tragic way of playing with people’s lives. Politicians stand beside crying children seeming to show compassion for their plight, while conveniently forgetting that it was their own inactions that put these children in this situation in the first place.

Politicians know that there is more drama

in these types of scenes and they are more interested in the rewards (votes) that in those affected.

Maybe we should put a “temporary” or “deferred” hold on political contributions until politicians change. I don’t know the answer, maybe I am just a “Dreamer.”

By the way, the third item on my list is no term limits for Senate and Congress. If anything, this speaks for itself.

JACOB SAFDEYE

Jacob Safdeye Publisher

Politicians stand beside crying children seeming to show compassion for their plight, while conveniently forgetting that it was their own inactions that put these children in this situation in the first place.

PUBLISHER JACOB SAFDEYE jacob@sflegalguide.com EDITOR IN CHIEF RICHARD WESTLUND editor@sflegalguide.com GUEST CONTRIBUTORS RON S. BILU STANLEY I. FOODMAN ANDREW C. HALL CAROLINA MENENDEZ COLIN ROOPNARINE PHILIP J. SHECHTER SOUTH FLORIDA LEGAL GUIDE - BM Volume 2, Number 2, 2018 This is an independent supplement by South Florida Legal Guide Mailing address P.O. Box 630428, Miami, FL 33163. All rights reserved. All titles registered and may not be used without permission. Reproduction in whole or in part of any text, photograph or illustration without written permission of the publisher is strictly prohibited. The South Florida Legal Guide makes no guarantee regarding the accuracy of information presented, results reported, or safety of products or activities described herein. The publisher notifies readers that the hiring of a professional is an important decision that should not be based solely on advertisements. Before you decide, ask the professional to send you free written information about qualifications and experience.

Contact: info@sflegalguide.com or call: (786) 879-7638 • www.sflegalguide.com

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To SBA or Not to SBA?

BY CAROLINA B. MENENDEZ

With so many options available for individuals and companies to borrow money, it’s often difficult to navigate through all the choices. The SBA (Small Business Administration) is a U.S. government agency that provides support to entrepreneurs and small businesses. SBA loans are offered by traditional banks and lenders but are partially guaranteed by the SBA. Why would a company consider this for its lending needs?

1. Longer available terms, up to 25 years for real estate and 10 years on any other business asset: With longer amortizations come lower payments, which translates to improved cash flow for one’s business.

2. Lower equity requirements: One of the advantages of borrowing through the SBA is that one can borrow up to 90 percent of the value of the collateral in some cases. Traditional lending often requires a much larger cash outlay at

the onset.

3. The “Small” in SBA is sometimes a misnomer. At first glance, one may think that because a company or firm earns healthy revenues every year, it may be too large to qualify for SBA assistance. The truth is, the SBA has different size requirements depending on the borrower’s industry and lending need, so it’s always a good idea to check with a banker to confirm eligibility. The maximum dollar amount available through

a single SBA loan can be up to $5.5 million, and in the case with 504 loans (described below), one may be able to borrow a larger amount in conjunction with a traditional bank loan.

What types of loans does the SBA offer?

• Loans to purchase another business • Loans to buy out a partner • Loans to term out evergreen line balances or to consolidate multiple credit facilities

• Loans to finance leasehold improvements • Loans to purchase equipment • Loans to purchase owner occupied real estate There are several products available depending on the borrower’s individual needs.

Below are two examples of SBA loans offered by IBERIABANK. What is the 7(a) Loan program?

As of 1996, all 7(a) loans are provided by banks and approved lenders who

CAROLINA B. MENENDEZ participate in the 7(a) Loan Guaranty Program. These loans are not offered by the SBA directly, but are guaranteed by the SBA, thus reducing the lender’s risk. If the borrower defaults, the lender can look to the SBA

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Forensic Accounting and Fraud Check-Ups

BY STANLEY I. FOODMAN

Forensic accounting has been described as an “art and science” that investigates people and money.

Forensic accountants are known for tracing funds (following the money), uncovering hidden assets and educating involved parties as to potential damages.

In simple words, a forensic accountant will hunt until the money is found, make sure that money is applied to the right place, discover if money and/or assets have been hidden, or if funds or assets have landed in the lap of unintended recipients.

This is why, (according to the Association of Certified Fraud Examiners - ACFE), forensic accountants are invaluable resources in the

discovery and the resolution of the most common type of fraud – asset misappropriation. The ACFE also believes that close to 7 percent of an organization’s revenues can be lost to asset misappropriation. It has become a serious problem and a no-win situation for all involved.

In an asset misappropriation, the perpetrator steals or misuses an organization’s belongings and resources, usually without force, through trickery and deceit.

Some examples are: stealing physical cash, performing fraudulent disbursements, inventory theft and misusage of assets (employees using company assets for their personal use).

The three circumstances in which most asset misap-

propriation occurs are: • Before the assets are recorded in the books/records of an entity (skimming).

• While the assets are held in the entity (larceny).

• During the process of purchasing goods and services (billing process, expense reimbursement and payroll frauds).

Asset misappropriation is usually detected through tips or complaints, internal controls, the perpetrator turning himself/herself in, or assessment of “red flags.”

Typically asset misappropriation will produce certain detectable symptoms. Inconsistencies and deviations in accounting, internal controls operations and behavior will produce “red flags”. Some examples are:

STANLEY I. FOODMAN • Missing, altered, or photocopied documents • Stale items on bank reconciliations • Increased or excessive past due accounts • Unexplained or confusing journal entries • Inaccuracies in the ledger accounts • Unexplained changes in financial statements • Internal control weaknesses • Lack of proper autho-

rization on documents and records • Overrides of existing internal controls • Inadequate accounting system • Excessive number of checking accounts • Frequent change of bank accounts • Unexpected overdrafts or declines in cash balance • Frequent changes in legal counsel • Frequent changes in executive management and directors • High employee turnover in areas vulnerable to fraud • Continuous rollover of loans • A compensation program that is out of proportion to profits • Problems with government regulators

An entity confronting asset misappropriation should re-evaluate its internal controls. A qualified forensic accountant can recommend internal control systems that will help deter and prevent fraud schemes, and assist with establishing control environments, accounting systems, control activities, and monitoring.

Don’t be a victim of your own making. Forensic accountants are specialists in demand due to their experience in investigation, detection, and quantification of losses. Consult now.

Foodman CPAs and Advisors, 1201 Brickell Avenue, Suite 610, Miami, FL 33131, (305) 365-1111, www.foodmanpa.com, info@ foodmanpa.com.

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ZUMPANO PATRICIOS & WINKER, P.A.: War on Terror Moves into the Courtroom Today, the war on terrorism is being fought in the courtroom, as well as on the battlefield, says Joe Zumpano, Founder and Managing Shareholder of Zumpano Patricios & Winker. As one of the early lawyers in this area, Zumpano’s list of notable cases has helped shape aspects of this nascent field.

“It’s important to remember the courage of victims of terrorism that choose to fight their battles in the courtroom,” he said. “Their path to redress for their losses is often hard fought in our courts.” South Florida Legal Guide interviewed Zumpano recently about his latest victory in a career of anti-terrorism cases. Here is a summary of that conversation.

Tell us about your recent case?

It dates back to 1999 in Colombia. Three narco-terrorism organizations – Revolutionary Armed Forces of Colombia (FARC), National Liberation Army (ELN), and North Valley Cartel (NDVC) – were seeking to establish a direct route to move cocaine from the Magdalena River Valley to South Florida. A key property at the crossroads of that route belonged to Carlos Caballero Cormane, a former United Nations Ambassador and a staunch opponent of Colombia’s drug trafficking.

On February 13, 1999, a car carrying the Ambassador was seized by ELN

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guerillas. Guerilla forces held Ambassador Caballero captive for 184 days. After they received a large ransom payment, they killed him and forced his son Antonio Caballero to flee to the U.S. Fifteen years later, I tried Caballero v. FARC, et. al, on behalf of Antonio Caballero. My law partners Leon Patricios and Bryan Cleveland assisted with the trial. We established that the high-profile assassination of Ambassador Caballero would not have been carried out by any one of the co-conspirators without the knowledge of, consultations with, and the approval and acquiescence of each of the other co-conspirators. We established that the defendants were working together as a Colombian Narco-Terrorist Association (CNTA) with ties to Mexico’s drug cartels.

Based on the activities of the defendants, the complaint concluded that the defendants’ “pattern of racketeering activity amounts to continued criminal activity in Florida, Colombia and the United States.”

We received a final judgment of $191,433,485.56 against the conspirators and two years later, after an appeal, were able to recover nearly $1 million in frozen assets for our client. To date, this is the only known case to recover

assets held by a “straw man” designated under the Foreign Narcotics Kingpin Designation Act. What were conditions like in Colombia at the time?

In Colombia, the Marxist rebel forces (FARC and ELN) were working together with right-wing paramilitary forces (AUC) to support the flow of drugs from their country to Mexico to the United States. While these rightwing and left-wing groups would kill each other on the battlefield by day, they frequently moved drugs for the Norte del Valle Cartel along established routes often by night.

For more than a decade, the Colombian drug lords would engage the FARC and ELN for armored caravan transportation of the drugs in Colombia. They would also use the AUC to move narcotics. The FARC and AUC would transport the drugs to Mexico along a Pacific coast route. The cocaine transported to Mexico was then distributed to various Mexican cartels. The CNTA was pursuing a more direct northern route to move drugs into the United States through South Florida. The Ambassador’s property sat within the crossroads of the various caminos reales that would be used by the guerillas to transport the narcotics

FROM LEFT: LEON PATRICIOS, JOE ZUMPANO AND BRYAN CLEVELAND along the northern route.

How did you “connect the dots” between the three countries?

We established that the Mexican cartels were operating as “agents and instrumentalities” of the Colombian narco-terrorist organizations in this case.

We also found that the Mexican cartels would often place their drug-related assets in the name of “straw men” that would then attempt to launder their money in the United States.

Even though some of the funds were taken across the border to Texas, some of the laundered money ended up in Florida banks.

What did the trial court determine?

On October 30 and 31, 2014, Circuit Court Judge Lisa S. Walsh held the trial on the case. The final judgment addressed many issues of legal interest. It also cited

to guidance from the Office of Foreign Asset Control that “blocked” property under the Terrorism Risk Insurance Act included property in which a blocked person or entity has a 50% of greater interest (even if the property is in the name of a “straw man”).

This particular aspect of the final judgment would prove crucial to recovery in the case. We were able to establish that the Mexican cartel agent and instrumentality of the defendants was the actual owner of the account despite their use of a “straw man” name over the account.

What about the flow of funds in the case?

On March 5, 2012, U.S. Immigration and Customs Enforcement (ICE) seized an armored car in Pharr, Texas. They uncovered $2 million separated into seven sealed bags. Shortly afterwards, a trained

canine from the Pharr Police Department alerted officers that the currency had recently been in close or actual proximity to a significant amount of a controlled substance.

Federal authorities determined that the $2 million came from Prodira Casa de Cambio S.A. de C.V., which had a U.S. address in Pharr, and was in fact a money laundering operation for a Mexican drug cartel. The U.S. government then went to court in a seizure and forfeiture action (United States of America vs. $2,000,000.00 in Currency). Because Prodira was a “straw man” for a Mexican cartel with longstanding ties to the Colombian conspirators, we established that the assets were owned by a terrorist party designated under the International Emergency Economic Powers Act.

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FLORIDA’S CANNABIS LAW – Sessions Memorandum May Have Chilling Effect on Financial Institutions

BY COLIN M. ROOPNARINE

Financial Institutions who have dipped into the burgeoning $7 billion marijuana market face greater uncertainty in light of U.S. Attorney General Jeff Sessions’ January 4, 2018, Memorandum.

Under the prior administration, Deputy Attorney General James Cole issued “Cole Memorandum #3” (February 14, 2014), which outlined suggestions for financial institutions that operated in the marijuana forum. It focused on guiding the Department of Justice’s (DOJ) enforcement of financial crimes statutes – money laundering, unlicensed money remitter and the Bank Secrecy Act (BSA) – against persons or organizations that provide financial services to marijuana businesses in states that have legalized some form of marijuana use.

A prior Cole memorandum outlined eight enforcement priorities for the DOJ and Cole Memorandum #3 restated the expectation for effective state regulatory and enforcement

• CONTINUED FROM PAGE 4 How did you track down the funds?

We decided to use our intuition and take a shot in the dark. I issued subpoenas to the largest banks in Florida. We felt that if drugs were being moved to South Florida, the money trail would be nearby.

On February 9, 2015, one of the subpoenas hit its mark. Regions Bank responded to the subpoena by identifying a “blocked account” in the name of “Pro-

systems, and included disclaimers that compliance with state law or the guidance memoranda are not a defense for violating federal law, including the Controlled Substances Act, money laundering, unlicensed money transmitter statutes, or the BSA. Part of the problem with this was that banking regulators in states like Florida did not enact any regulatory or enforcement systems dealing specifically with marijuana and how they may relate with financial institutions.

On February 14, 2014, the Financial Crimes Enforcement Network (FinCEN) also issued its own guidance, “to clarify customer due diligence expectations and BSA reporting requirements for financial institutions providing services to marijuana businesses in light of state laws legalizing certain marijuana-related activity and DOJ marijuana-related enforcement priorities.”

This, along with the enhanced customer due diligence, resulted in banks creating ever more robust BSA compliance procedures.

dira Casa SA DE CV.” Since the trial court in Caballero had found that Prodira Casa de Cambio S.A. de C.V., was in fact an agent and instrumentality of the FARC, we launched a garnishment action against the funds held

by Regions Bank.

While the garnishment was fiercely litigated, Circuit Court Judge Monica Gordo issued a final turnover judgment ordering money in the account be turned over to Caballero. That ruling was appealed, and on December

With the issuance of the Sessions Memorandum on January 4, it was apparent that FinCEN was not forewarned of the memorandum. In response to the Sessions memorandum, FinCEN issued a statement though, that its former marijuana-related guidance memorandum remained in effect.

That may not be reassuring because “guidance memorandum” do not have the force and effect of law and are subject to change without notice.

Sessions’ memorandum creates the possibility of a chilling effect on financial institutions transacting with marijuana-related business. At its extreme, financial institutions may be choose to opt out of the marijuana-related business industry altogether. The result would be a high-dollar industry that becomes almost entirely unbanked, which in turn creates additional problems of transportation of cash, payment of bills and taxes, credit, and the list goes on and on.

In addition, could we see more rigorous examinations of finan-

21, 2016, the Third District Court of Appeal affirmed the trial court’s decision.

Since then Regions Bank has turned over the funds in the blocked account.

What are the implications of this case?

It’s the first case we know of where assets were recovered from a Mexican cartel for a victim of terrorism. The case is also the first case that we know of where the assets in the name of a “straw man” specially designated narcot-

cial institutions by state banking regulators and the FDIC? And what of existing accounts? The temptation would be to simply un-bank these lucrative businesses and force them into a cash-only scenario that would cause the industry to move into the shadows, without any government oversight or regulation.

It is doubtful that was the intent, but with the prospect of the industry growing and becoming more lucrative, businesses will continue to grow and new actors will enter the market. So the question begs… “Do we truly want this industry’s finances to operate in the shadows, and free of government and regulatory oversight?” The fears addressed in the FinCEN guidance memorandum of money laundering, criminal targeting, in addition to those banks address every day in their compliance departments with Know Your Customer and BSA compliance requirements, could slowly become realized.

On January 16, 19 state attorneys general sent a letter to

ics kingpin were actually recovered because they truly belonged to a “blocked” entity under the International Emergency Economic Powers Act. The case also demonstrates the personal courage of a victim of these criminal organizations, and his attorneys, to stand up for their rights in court.

Our history is replete with those not born here who gave their lives so that we may build a nation. In this case, a man died for stand-

COLIN ROOPNARINE House and Senate leaders urging Congress to structure a legal safe harbor for financial institutions.

In addition, two bills, one in the House and one in the Senate, would provide some protection to financial institutions in states that have laws and regulations that ensure accountability in the industry. Again, the State of Florida is not among such states.

Colin M. Roopnarine is a partner on Berger Singerman’s Government and Regulatory Team who focuses his practice on administrative law.

Roopnarine can be reached at croopnarine@bergersingerman.com, www.bergersingerman.com

ing up against those who would tear it down.

What other anti-terrorist matters have you handled?

In addition to the Caballero case, I had had the honor of leading a number of international litigation efforts. In the historic case of Weininger v. Castro, we collected almost $24 million in a lawsuit against Fidel Castro, Raul Castro, and the Army of Cuba.

In another case against Cuba, we represented a for-

mer Cuban political prisoner who was purposefully infected with the hepatitis C virus – and argued that the viral replication process constituted a biological terror attack within the United States.

One of my most hard fought cases took over 10 years. It resulted in the piercing of a Bahamian trust, and in the turnover of approximately $4 million in assets. That case sent a strong message against those seeking to hide away assets in that country.

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Cyber Attacks: Time to Address the Business and Legal Risks

BY ANDREW C. HALL

Data breaches, ransomware and cyber theft should be top-of-mind concerns today for any business. The loss of confidential data can carry a heavy cost, including immediate financial losses, damage to the company’s reputation, and exposure to potentially expensive civil litigation.

In the past year, Equifax, Intercontinental Hotels Group, Saks Fifth Avenue, Chipotle, Verizon, Yahoo, Uber and dozens of other high-profile companies were victimized by cyber attacks.

Today, almost any company or professional firm can be victimized by online criminals looking for easy money. In fact, law and accounting firms are attractive targets because they are involved with escrow accounts, financial settlements and highly confidential matters.

Last year, we were able to prevent a cyber theft involving a wire transfer.After settling a case on behalf of our client, we were expecting to see a large sum deposited in our trust account. When the money didn’t arrive, we realized that something was wrong. A hacker had penetrated the sender’s network and obtained a copy of the letter notifying our firm about when the funds would be transmitted.The thieves had opened a fraudulent bank account using a similar name, instructed the sender to redirect the money to them and the money was

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wired to this fraudulent account.Because we insisted on speaking directly with the sender before and after the funds were wired, we were able to successfully intercept the theft and avoid any loss.

In this process we confirmed that because fax messages are analog, not digital, they can actually be more secure than emails or texts.

Sometimes a common-sense approach is crucial to foiling the attempted cyber fraud.

TAKE A TEAM APPROACH South Florida businesses and professional firms should make cybersecurity a top priority in their risk management programs.

Failure to do so will expose the business to the costs of a data breach, ransomware attack or diverted funds and can go far beyond the immediate losses.A successful cyber attack can disrupt the business, damage customer confidence and lead to expensive litigation, regulatory fines and penalties.

Ideally, cyber security requires a team approach.

An information technology (IT) professional should advise on the steps you may need to take to protect your network and digital, mobile and social communication channels. An operational executive can balance those security measures with the need to keep the business operating smoothly and efficiently. A human resources professional can educate

and inform employees about safety practices and the changing nature of cyber threats. Most importantly your attorney should also be part of your team to advise on the legal and regulatory aspects of cyber security and data privacy actions.

For instance, data breaches of personal information must be reported.Sensitive or secured information, including theft of trade secrets must be reported to regulatory agencies and to shareholders.

Multinationals doing business in other countries may face additional reporting requirements, such as the European Union’s new General Data Protection Regulation (GDPR). After May 25, when GDPR enforcement begins, violations can lead to fines of up to 20 million euros or 4 percent of the company’s total worldwide annual turnover in the preceding financial year.

In the U.S., healthcare organizations, banks, credit card companies and other financial service providers may also be subject to legal consequences if personal data on patients, customers or members is compromised.

Law firms also have a duty to report cyber attacks to The Florida Bar, in keeping with the goal of protecting clients’ financial and personal information against hackers. However, some firms have invested more in cyber security measures than others, and clients

should discuss this issue with their attorneys.After all, no one wants to see the confidential details of a case or settlement on a public website.

USE BEST PRACTICES Here are some other best practices, based on our firm’s knowledge and experience that can to help reduce your cybersecurity risks.

• Conduct a cybersecurity assessment or a formal audit at least once a year. As the old saying goes, “Expect the best, but plan for the worst.”

• Focus your security resources on the high-risk areas for your organization, which could range from network configuration to employee training.

• Keep investing in inhouse security measures, including firewalls, intrusion detection applications and real-time monitoring.

• Keep patching and updating your operating systems, since outdated software is a favorite avenue for a cyber attack.

• Protect connected sensors, devices or equipment – the Internet of things (IoT) – from hackers.

• Keep secure backups regularly as a safeguard against a ransomware attack. If someone locks down your system, you can rebuild your network without paying criminals in another country.

• Document your security actions every step of the way. This is vital if you find

ANDREW C. HALL yourself facing a lawsuit or a regulatory action after a cyber attack.

• Evaluate your need for cyber insurance. Weigh the cost of coverage versus your potential exposure, and be sure to read the fine print to see what the insurer covers and what might be excluded.

• Consider using an IT services provider to manage your network and data.

Outsourcing your security can be a cost-effective strategy for mitigating risk, but ask to see its security policies and practices, and review these documents with your attorney.

Finally, have an attorney

review the “fine print” on IT contracts, so you understand who is responsible for data security, and what actions both parties need to take in the event of a data breach or theft.Be prepared for a crisis, and hope those plans never need to be put into action.

T

Andrew C. Hall is the founder and managing partner of Hall, Lamb, Hall w & Leto, P.A., a Miami-based law firm specializing in complex corporate, business, and securities litigation. The firm can be contacted at 2665 S. Bayshore Dr., PH 1 Miami, FL 33133 (305) 374-5030 www.hlhlawfirm.com

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How can I evict a tenant from my apartment building?

BY RON S. BILU

If you rent a space to another person in Florida, you enter into a lease, which need not be in writing unless you wish to provide for a term of one year or more.

As a landlord, it is your duty to respect the tenant’s right of possession and use of your property free from interference. You may not enter the home frequently, at odd hours or without notice. You have a right to inspection, but only after a reasonable notice of at least 12 hours. You cannot show the property to possible buyers without notice to, and agreement of the tenant(s).

It is unlawful to increase a tenant’s rent or decrease services to a tenant in a discriminatory manner, or threaten to bring an action for possession or other civil action primarily in retaliation against the tenant. Retaliation may be presumed if it occurs after a tenant has complained about

housing conditions.

It is also unlawful to lock the tenant out, intercept or shut off utilities, water or electric services to the tenant, or remove doors, appliances or the tenant’s property from the home. If so, you can be ordered to pay a tenant damages in the amount of three months’ rent, or actual damages, whichever is greater.

So, how do I terminate the tenancy and evict?

If there is no written rental agreement or if the lease does not state otherwise and the unit is rented on a month-tomonth basis, you must give at least 15 days’ notice in writing before the end of any monthly period. A week-to-week rental period requires seven days’ notice before the end of any weekly period. The notice must be in writing and should be delivered personally to the tenant, but it may be posted

at the door if the tenant is absent from the premises.

If the tenant permanently moves out before the end of the rental term and leaves the property vacant, the law presumes abandonment if the tenant is absent for at least 15 days without previously notifying the landlord of an intent to be absent.

After abandonment, you may re-enter the dwelling unit, and you should consider legal advice or assistance.

It’s more complicated if the tenant seems to have vacated, but has left personal property on the premises, or if there is a considerable amount of unpaid rent. In such a case, you should consult an attorney before trying to dispose of the tenant’s possessions or re-renting the property.

Another complication occurs when a tenant fails to pay the rent or refuses to move out at the end of the rental

term. Here, you may evict the tenant, but only after you have taken the proper legal steps to commence an action for possession according to a very specific timetable.

How do I file an eviction in court?

You must serve a proper 3-Day notice for non-payment of rent or a 7-Day notice for ejection of the tenant to terminate the rental agreement. If the tenant ignores these notices, you are next required to file a complaint in court and have the tenant properly served with a summons and complaint.

Five days after the complaint is served, you may request the court to set a date for a hearing on a motion for default judgment for possession of the property.

However, if the tenant fails to answer the complaint within the five business days

or fails to pay the rent that is due, then you can proceed to eviction without having a hearing first, though you must obtain a court order and a writ of possession before evicting the tenant.

If the tenant disputes the amount of rent that is due, the undisputed amount of rent will likely have to be deposited with the court by the tenant and a hearing must be held. If you wish to collect money damages from the tenant, you must wait 20 days to set a hearing on damages.

If the judge agrees at the hearing that the tenant has violated the terms of the agreement, a court order will be issued for judgment and you will file a motion for writ of possession with the court.

Once granted, the sheriff will serve a writ of possession notice on the tenant, who then has 24 hours to vacate your property, or the sheriff

RON S. BILU can remove the tenant and his property.

At the end of the rental term, the property must be returned to you with no damage beyond ordinary wear and tear. The landlord has to account for or refund tenant security deposits upon termination of the tenancy.

Ron Bilu is the managing partner at the Law Offices of Bilu & Bilu in Pompano Beach. He focuses his practice on real estate.

To SBA or Not to SBA? • CONTINUED FROM PAGE 3 for repayment for the portion that they guarantee. To qualify for a 7(a) loan, the company’s tangible net worth must not exceed $15 million and the average net income after Federal income taxes (excluding any carry-over losses) for the two full fiscal years before the application date may not exceed $5 million.

The business must be an operating business, for profit entity without religious affiliation. This type of

loan is best suited for companies looking to borrow funds with a lower down payment than might be available through traditional bank loans.

What is the SBA 504 program?

An SBA 504 loan is another vehicle that many businesses use to finance expansion and growth, mainly as it relates to purchasing owner occupied real estate, doing construction and/or renovation, or purchasing fixed assets . While 7(a) loans are financed exclusively

through banks in coordination with an SBA guarantee, a 504 loan is similar but involves a CDC (Certified Development Company), a nonprofit corporation that promotes economic growth and development in its communities through 504 loans. The division of costs with 504 loans is usually comprised of 40 percent from the SBA, 50 percent from a traditional lender/bank, and 10 percent from the borrower. The benefits of 10 percent down, longer amortizations, and fixed interest

rates make this product very attractive to many borrowers. With this structure, the borrower will have two separate loans.

As with many governmentbacked programs, there are many nuances to these products and deciding which one is right for you can create challenges. At IBERIABANK’s Private Client Division, we take a consultative approach with our clients, learning as much as we can about their business and needs in order to provide sound advice on

which route to take. If you are considering purchasing real estate, renovating, or otherwise expanding your business, it is of the utmost importance to find a banking partner that takes the time to understand your business and guide you through the myriad options available.

Carolina B. Menendez is senior vice president, Private Banking at IBERIABANK. She can be reached at 305-376-2427 or by email at carolina.menendez@iberiabank.com

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MONDAY, FEBRUARY 5, 2018

AN INDEPENDENT SUPPLEMENT BY SANES MEDIA INC. FOR THE MIAMI HERALD

Assessing the Impact of the Tax Cuts and Jobs Act Editor’s note: South Florida Legal Guide asked Philip J. Shechter, CPA., partner at Cherry Bekaert, to discuss the impact of the 2017 Tax Cuts and Jobs Act on individual and business taxpayers. Here are his comments.

INDIVIDUAL TAXPAYERS Q. Who should pay the most attention to the changes?

A. While the new tax code affects everyone filing a 2018 federal income tax return, if you are used to itemizing your deductions, paying or receiving alimony or deducting unreimbursed employee business expenses, then you need to take a look at the new rules very closely.

Q. Is there an overall theme for the changes?

A. Yes. The act, in general, makes it more difficult to itemize your deductions, and encourages more taxpayers to take the standard deduction, which was increased to $12,000 (single) and $24,000 (married filing jointly). That benefit was counterbalanced, in part, by the elimination of the personal exemption of $4,150 per person.

Q. What about individual tax rates?

A. Most individuals will see a 2 to 3 percent reduction in their tax rates.

However, the income brackets have changed

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and so have the limits on itemized deductions and personal exemptions, so you may not know how large a benefit you are getting until you prepare your 2018 tax return.

Q. Will the changes affect mortgage interest deductions?

A. Yes. The mortgage interest deduction has been capped on loans made after December 16, 2017. You can only deduct interest on loans up to $750,000, so if you have a larger mortgage you lose a prior benefit.

The act also eliminated the deduction on both existing and new home equity lines of credit (HELOC). So, you may want to refinance an existing HELOC into a permanent home mortgage to benefit from the interest deduction.

as well as the corresponding inclusion in gross income for recipients. The government expects to generate billions of dollars in tax savings from this provision over the next six years. So, if you are involved in a divorce where the tax benefits of alimony payments are significant, you should try to obtain a final judgment before the end of 2018.

Q. Any other significant provisions for individuals?

A. The act raised the child care credit from $1,000 to $2,000 for taxpayers who fall within qualifying incomes. It also allows individuals saving for a child’s education to use their Section 529 plan for private schools as well as colleges and universities.

Q. What about state and local taxes?

A. The new act limits the total deduction for state and local income, real estate and sales taxes at $10,000 per year.

While Florida has no state income tax, this will be a concern for “snowbirds” who have jobs or properties in the Northeast and other states with relatively high state and local taxes.

BUSINESS TAXPAYERS

Q. How will alimony payments be affected?

A. The act repeals the alimony tax deduction effective January 1, 2019,

Q. Will there be any relief for smaller businesses?

A. Yes. If you own a business structured as a

Q. What types of businesses will benefit from the new tax code?

A. The act lowered tax rates for regular “C” corporations from 35 to 21 percent starting in 2018.

That can be a huge savings for major companies like Apple, which plans to reinvest its tax savings in its operations.

pass-through entity, such as an “S” corporation, partnership and limited liability corporation (LLC) or are a sole proprietor, you may be able to exclude 20 percent of that income on your 2018 personal tax return.

Q. Do all pass-through entities benefit?

A. No. There are income limits on the 20 percent deduction and limitations for owners of businesses that provide personal services, such as doctors, lawyers, accountants, web designers and writers. If your income is more than $157,500 on an individual return and $315,000 on a joint return, you may not qualify. Talk with your accountant early in the year because the changes to the taxation of pass-through income are some of the most complex provisions in the new law.

Q. Is there a benefit to converting from a “S” to a “C” corporation this year to take advantage of the new code?

A. In most cases, the answer will be no. A “C” corporation still pays federal income taxes and state corporate taxes, and shareholders still pay taxes on the dividends they receive from the business.

Q. What about deductions for employees?

A. Until now, employees have been able

PHILIP J. SHECHTER to deduct unreimbursed business expenses on their individual returns. But that deduction was eliminated by the new act. So, companies and employees may need to renegotiate their reimbursement policies and practices. In some cases, employees may wish to consider the possibility of becoming an independent contractor, receiving income on a 1099 form rather than as wages, because they could then deduct their business-related expenses.

Q. Are there other major impacts on businesses?

A. Yes. The act eliminates the prior 50 percent deduction for business-related expenses related to

entertainment expenses.

That could have a negative effect on the “skybox market,” as companies may be less inclined to host expensive receptions, parties and other events for their customers and employees.

However, 50 percent of food and beverage expenses can still generally be deducted through 2025 Q. Any other thoughts?

A. The new tax code is more than 1,000 pages long, and these are only some of the highlights.

You should talk with a tax professional and discuss how these changes will affect your 2018 personal, family and business returns.