“Taxes: Of life’s two certainties, the only one for which you can get an automatic extension.” – Author Unknown.
Texas businesses were granted a reprieve from confusion. Comptroller Susan Combs extended the deadline for Texas businesses to file franchise taxes from May 15th to June 16th. Ms. Combs cited overwhelming tax payer confusion over the new franchise tax laws as her reason for the 30 day extension. “We want to make sure businesses and tax practitioners have adequate time to make sure they’re complying with the revised franchise tax,” Ms. Combs explained. “Because they’re dealing with new calculations and enhanced technology for filing reports, the one month penalty waiver will help taxpayers accurately complete their returns…”
The Dallas Morning News reported that an estimated 900,000 businesses are subject to the state tax, but that only 300,000 are actually expected to pay due to an exemption for businesses with less than $300,000 in annual gross revenue or total tax liability of less than $1,000. The new franchise tax is expected to generate $6 billion a year for Texas coffers.
How does the new franchise tax affect your business?
Adam W. Vanek
(214) 890-0991
avanek@tiptonjoneslaw.com
Monday, May 5, 2008
Tuesday, April 29, 2008
Legal Gaming is Coming to Texas: Part II
“We know we’re losing that business every August by the lines of cars heading to Texas. We’re losing that tax revenue and watching Oklahoma businesses suffer at the same time. It makes more sense to keep those dollars here in our own state. It’s going to help our citizens, our businesses, and eventually help those businesses grow.” – Oklahoma State Senator Johnnie Crutchfield speaking about the Texas Sales Tax Holiday.
This blog is not a social commentary regarding the morality of legal gambling, but rather its inevitability.
As I noted last week, in 2009 the Texas Legislature will reconvene. High on the Capitol’s priority list is whether or not to legalize gaming. Last week I discussed the natural progression of how states legislate legal gaming: pari-mutuel betting such as dog tracks and horse tracks, state or multi-state lottery, video slot and bingo machines, and finally table games. This week, I want to give you a 2009 preview of the 3 most common arguments in favor of legalizing gaming in Texas: taxes, jobs and economic necessity for horse and dog track industry.
Tax Revenue: As Senator Crutchfield talks about the “line of cars heading to Texas” during the once a year Texas Sales Tax Holiday, some Texas representatives are crying foul as the lines of chartered buses migrate each day from Texas to Oklahoma casinos. Former gubernatorial candidate and famed plain talker, Kinky Friedman, commented on the intense competition between Oklahoma and Louisiana, "It's crazy to have Louisiana gamblers mad at Oklahoma for taking away their Texans." Some of the more realistic figures estimate that Texas will realize nearly $6 billion in direct gaming tax revenue annually. The proponents of legal gambling will argue that this new found money will fund Texas education, health care for children and maybe even put an end to new toll roads, as a lagniappe. But tax revenue is not the only reason, the Legislature will legalize gambling.
Job Creation: The second argument gambling proponents will make is that of job creation. It is true that legal gambling will create jobs, a lot of jobs. First, construction jobs and second, the jobs directly related to the gaming itself. And then there are those jobs that benefit from legal gambling indirectly, such as the hospitality industry, hotels, restaurants and travel. Metropolitan convention and tourism bureaus all across Texas are especially interested in legalizing gambling as a competitive advantage against competing cities such as Chicago, Atlanta and Orlando. If you then include the tax revenue generated from hotel room taxes or rental car taxes, the trickle down economics is compounded.
Economic Necessity: The third argument gaming proponents will cite is the need for legal gaming to save the Texas horse track industry. Despite hosting the Breeder’s Cup in 2004, the operator of Lone Star Park at Grand Prairie is now in dire financial straits. 2008 saw the smallest opening day attendance since the Lone Star Park was first opened in 1997. Magna Entertainment Corp., the operator of Lone Star Park announced that it is considering liquidating it’s assets to fend off creditors. While Magna does not own Lone Star Park, the City of Grand Prairie actually owns the track and leases it back to Magna, it does own significant acreage surrounding the horse track. According to the Dallas Business Journal, Magna Entertainment reported a $113.8 million net loss in 2007, bringing its total debt to $510 million. However, Magna has made it clear that it is hoping that Texas will legalize video slot machines and soon. As reported in the Austin American-Statesman, Reggie Bashur, spokesperson for the horse track industry, describes the need for legal gaming as a necessity for horse racing’s economic viability. "It's not gaming for the sake of gaming. It's gaming for the survival of the horse community as well as the track industry." The horse track industry has captured the attention of the Texas Legislature. In 2007, State Representative Jose Menendez, (D) San Antonio, filed a bill that would allow poker tables at specifically racetracks.
Eventually, the Texas Legislature will declare it is time for Texas to get off the bench and get into the game. And of course, the House will want its cut.
Adam W. Vanek
(214) 890-0991
avanek@tiptonjoneslaw.com
This blog is not a social commentary regarding the morality of legal gambling, but rather its inevitability.
As I noted last week, in 2009 the Texas Legislature will reconvene. High on the Capitol’s priority list is whether or not to legalize gaming. Last week I discussed the natural progression of how states legislate legal gaming: pari-mutuel betting such as dog tracks and horse tracks, state or multi-state lottery, video slot and bingo machines, and finally table games. This week, I want to give you a 2009 preview of the 3 most common arguments in favor of legalizing gaming in Texas: taxes, jobs and economic necessity for horse and dog track industry.
Tax Revenue: As Senator Crutchfield talks about the “line of cars heading to Texas” during the once a year Texas Sales Tax Holiday, some Texas representatives are crying foul as the lines of chartered buses migrate each day from Texas to Oklahoma casinos. Former gubernatorial candidate and famed plain talker, Kinky Friedman, commented on the intense competition between Oklahoma and Louisiana, "It's crazy to have Louisiana gamblers mad at Oklahoma for taking away their Texans." Some of the more realistic figures estimate that Texas will realize nearly $6 billion in direct gaming tax revenue annually. The proponents of legal gambling will argue that this new found money will fund Texas education, health care for children and maybe even put an end to new toll roads, as a lagniappe. But tax revenue is not the only reason, the Legislature will legalize gambling.
Job Creation: The second argument gambling proponents will make is that of job creation. It is true that legal gambling will create jobs, a lot of jobs. First, construction jobs and second, the jobs directly related to the gaming itself. And then there are those jobs that benefit from legal gambling indirectly, such as the hospitality industry, hotels, restaurants and travel. Metropolitan convention and tourism bureaus all across Texas are especially interested in legalizing gambling as a competitive advantage against competing cities such as Chicago, Atlanta and Orlando. If you then include the tax revenue generated from hotel room taxes or rental car taxes, the trickle down economics is compounded.
Economic Necessity: The third argument gaming proponents will cite is the need for legal gaming to save the Texas horse track industry. Despite hosting the Breeder’s Cup in 2004, the operator of Lone Star Park at Grand Prairie is now in dire financial straits. 2008 saw the smallest opening day attendance since the Lone Star Park was first opened in 1997. Magna Entertainment Corp., the operator of Lone Star Park announced that it is considering liquidating it’s assets to fend off creditors. While Magna does not own Lone Star Park, the City of Grand Prairie actually owns the track and leases it back to Magna, it does own significant acreage surrounding the horse track. According to the Dallas Business Journal, Magna Entertainment reported a $113.8 million net loss in 2007, bringing its total debt to $510 million. However, Magna has made it clear that it is hoping that Texas will legalize video slot machines and soon. As reported in the Austin American-Statesman, Reggie Bashur, spokesperson for the horse track industry, describes the need for legal gaming as a necessity for horse racing’s economic viability. "It's not gaming for the sake of gaming. It's gaming for the survival of the horse community as well as the track industry." The horse track industry has captured the attention of the Texas Legislature. In 2007, State Representative Jose Menendez, (D) San Antonio, filed a bill that would allow poker tables at specifically racetracks.
Eventually, the Texas Legislature will declare it is time for Texas to get off the bench and get into the game. And of course, the House will want its cut.
Adam W. Vanek
(214) 890-0991
avanek@tiptonjoneslaw.com
Friday, April 25, 2008
OF SUGAR CANE AND QUEENS: Sovereignty in the Sandwich Islands: Part Two
I’ve heard from several folks in response to my last entry wanting to know just what in the heck that Hawaiian sovereignty stuff is all about, and what on earth would make President Clinton sign something called The Apology Bill. Well, to paraphrase Keanu Reeves in Bill and Ted’s Excellent Adventure, “Something is afoot in the Sandwich Islands.” (The movie line is actually “Something is afoot at the Circle K.”) You only have to read cases like Office of Hawaiian Affairs v. Housing and Community Development Corporation of Hawaii, 177 P.3rd 884 (HI 2008) and Rice v. Cayetano, 528 U.S. 495 (2000), and study the history and debate over “The Native Hawaiian Government Reorganization Act of 2007,” also known as the Akaka Bill (after its sponsor, Hawaii Senator Daniel Akaka) currently pending in the United States Congress, to know that.
And not only is something afoot today, it has its origins in history. So some with me now as we step into Mr. Peabody’s Wayback Machine and set it for Hawaii. (Is the reference to the world famous Sherman and Mr. Peabody from The Rocky and Bullwinkle Show too obscure? Or am I just showing my age?)
Believe it or not, Hawaii was once a royal kingdom, governed by a monarchy. The islands were divided into separate kingdoms, and the notion of private land ownership was an alien concept. Instead of “owning” the land, the people were essentially trustees of the land, administering it on behalf of the gods. It really wasn’t until the advent of the haoles, the white interlopers I mentioned before, that land ownership crept into the culture.
As an aside, haole comes from the Hawaiian words ha, which means breath, and ‘ole, which means without, so the literal translation is “without breath” or “breathless.” One etymologist says it’s a reference to the fact that when the white people in Hawaii said their prayers, they didn’t breathe three times as the ancient Hawaiians customarily did. Another story, though, says that the Hawaiians found it hard to believe that people could be that pale and actually be alive, or draw breath. Whatever its origin, though, it’s rarely used fondly. According to Wikipedia (so take it for what it’s worth), a tradition began in Hawaii’s public schools in 1950s of calling the last day of school before the summer break “Kill Haole Day,” when native Hawaiian children would harass and sometimes assault white children. An article in the Honolulu Star Bulletin published on March 24, 1999, bore this headline: “’Kill Haole Day’ linked to hate-crime bill.”
Nope, rarely used fondly.
Now where were we? Oh, yeah, no private ownership of land. At last not officially, but the haoles were already gobbling up real estate wherever and however they could. In 1839, King Kamehameha III issued a Declaration of Rights that said that property couldn’t be taken “except by express provision of law.” Sounds good, as far as it goes. But hard on the heels of that, the King also granted the first constitution to Hawaii, which changed the nation’s absolute monarchy to a constitutional monarchy. The constitution set up a bicameral legislature and a supreme court.
It also did something that was the first real crack in the dam: it declared that, even though all land belonged to the King, it was not the King’s private property. Instead, the common people also had some claim to ownership, even though they still couldn’t acquire absolute ownership. In 1845, a Land Commission was established to investigate claims to private ownership of land that were being made by some folks, particularly haoles. The Land Commission recommended to King Kamehameha III a system of land distribution, under which the King would retain his private lands, but the remaining land would be divided equally into thirds among the Hawaiian government, the chiefs (the ali’i) and the tenants or common people.
Three years later, after much debate over this recommendation, came what’s known as The Great Mahele, or the Great Division. It began in January of 1848, but it wasn’t the equitable 1/3-1/3-1/3 originally recommended. Instead, the King ended up holding almost 2.5 million acres (roughly 60%) (it’s good to be king) and the chiefs got about 1.5 million acres. The King then divided his share into two parts, setting aside 1.5 million acres as government lands and keeping 1 million acres as “crown lands.” So the ultimate result was 1.5 million to the chiefs, 1.5 million to the government, 1 million for the king and, -- you do the math -- the good old common folks got screwed, ending up with about 28,600 acres.
And here’s where it gets interesting: an 1846 law had authorized the sale of government lands, and a second law in 1850 authorized any resident of Hawaii to own and convey land, citizen or not. By 1864, Westerners had bought over 320,000 acres of government lands. According to the Native Hawaiian Handbook (University of Hawaii Press 1991), edited by Melody Kapilialoha MacKenzie, by 1890, “Of a total population near 90,000, fewer than 5,000 actually owned land. Hawaiians, if they had any lands, owned small acreages. Consequently, for every four acres belonging to private owners, three were held by Westerners. The relatively small number of Westerners owned over a million acres.”
And something was afoot at the Circle K. Stay tuned for part three.
Mike Farris
(214) 979-0100
mfarris@tiptonjoneslaw.com
And not only is something afoot today, it has its origins in history. So some with me now as we step into Mr. Peabody’s Wayback Machine and set it for Hawaii. (Is the reference to the world famous Sherman and Mr. Peabody from The Rocky and Bullwinkle Show too obscure? Or am I just showing my age?)
Believe it or not, Hawaii was once a royal kingdom, governed by a monarchy. The islands were divided into separate kingdoms, and the notion of private land ownership was an alien concept. Instead of “owning” the land, the people were essentially trustees of the land, administering it on behalf of the gods. It really wasn’t until the advent of the haoles, the white interlopers I mentioned before, that land ownership crept into the culture.
As an aside, haole comes from the Hawaiian words ha, which means breath, and ‘ole, which means without, so the literal translation is “without breath” or “breathless.” One etymologist says it’s a reference to the fact that when the white people in Hawaii said their prayers, they didn’t breathe three times as the ancient Hawaiians customarily did. Another story, though, says that the Hawaiians found it hard to believe that people could be that pale and actually be alive, or draw breath. Whatever its origin, though, it’s rarely used fondly. According to Wikipedia (so take it for what it’s worth), a tradition began in Hawaii’s public schools in 1950s of calling the last day of school before the summer break “Kill Haole Day,” when native Hawaiian children would harass and sometimes assault white children. An article in the Honolulu Star Bulletin published on March 24, 1999, bore this headline: “’Kill Haole Day’ linked to hate-crime bill.”
Nope, rarely used fondly.
Now where were we? Oh, yeah, no private ownership of land. At last not officially, but the haoles were already gobbling up real estate wherever and however they could. In 1839, King Kamehameha III issued a Declaration of Rights that said that property couldn’t be taken “except by express provision of law.” Sounds good, as far as it goes. But hard on the heels of that, the King also granted the first constitution to Hawaii, which changed the nation’s absolute monarchy to a constitutional monarchy. The constitution set up a bicameral legislature and a supreme court.
It also did something that was the first real crack in the dam: it declared that, even though all land belonged to the King, it was not the King’s private property. Instead, the common people also had some claim to ownership, even though they still couldn’t acquire absolute ownership. In 1845, a Land Commission was established to investigate claims to private ownership of land that were being made by some folks, particularly haoles. The Land Commission recommended to King Kamehameha III a system of land distribution, under which the King would retain his private lands, but the remaining land would be divided equally into thirds among the Hawaiian government, the chiefs (the ali’i) and the tenants or common people.
Three years later, after much debate over this recommendation, came what’s known as The Great Mahele, or the Great Division. It began in January of 1848, but it wasn’t the equitable 1/3-1/3-1/3 originally recommended. Instead, the King ended up holding almost 2.5 million acres (roughly 60%) (it’s good to be king) and the chiefs got about 1.5 million acres. The King then divided his share into two parts, setting aside 1.5 million acres as government lands and keeping 1 million acres as “crown lands.” So the ultimate result was 1.5 million to the chiefs, 1.5 million to the government, 1 million for the king and, -- you do the math -- the good old common folks got screwed, ending up with about 28,600 acres.
And here’s where it gets interesting: an 1846 law had authorized the sale of government lands, and a second law in 1850 authorized any resident of Hawaii to own and convey land, citizen or not. By 1864, Westerners had bought over 320,000 acres of government lands. According to the Native Hawaiian Handbook (University of Hawaii Press 1991), edited by Melody Kapilialoha MacKenzie, by 1890, “Of a total population near 90,000, fewer than 5,000 actually owned land. Hawaiians, if they had any lands, owned small acreages. Consequently, for every four acres belonging to private owners, three were held by Westerners. The relatively small number of Westerners owned over a million acres.”
And something was afoot at the Circle K. Stay tuned for part three.
Mike Farris
(214) 979-0100
mfarris@tiptonjoneslaw.com
Wednesday, April 23, 2008
Get Ready… Legal Gaming is Coming to Texas
“Anytime you open the door to any form of legal gambling, entrepreneurs are going to ram it open and run through.” - Nelson Rose, Law Professor, Whittier Law School.
Legal gaming is coming to Texas. The question in everyone’s mind is when? In 2009, the Texas Legislature reconvenes and will have several video gaming bills waiting for them in committee. Each bill will have its own version of how and where to legalize gaming. First, the Texas Legislature will authorize video gaming machines: video 8-Liners or slot machines, video poker, and video bingo. The proposed legislative bills will restrict these gaming machines to horse tracks and dog tracks, “off-shore casinos”, such as riverboats, and Native American reservations primarily located in West Texas. Eventually table games will be allowed and maybe even full-fledged casinos, but that won’t be for some time.
The best way to predict the future legislative course of legal gaming in Texas is to look at what is going on in other states. For example, in 2007, the Indiana legislature authorized legal gaming at horse tracks. Indiana has only 2 horse tracks, Hoosier Park approximately 40 miles north of Indianapolis and Indianapolis Downs Park approximately 30 miles southeast of Indianapolis. Each track must pay an initial license fee of $250 million, provide $100 million or more in additional construction or capital improvements, and the new slot machine facilities must connect to the racetrack facilities. Indiana is expected to generate close to $500 million in annual revenue within the first 5 years, exclusive of the licensing fee. Indiana will also require an annual $100 license fee for each video gaming machine in use. In a cash strapped state, such as Texas, the Legislature cannot afford to ignore those numbers.
Akin to the 1991 campaign establishing the Texas Lottery, gaming proponents will declare that the tax revenue generated from legal gaming will fund public education. And, just like the Texas Lottery, the proceeds will actually be deferred to the State’s general fund. It will be up to the Texas Legislature to actually determine how much is allotted to education. By 2006, the State of Texas received more than $3.7 billion in lottery ticket sales and only allocated $1 billion to public education.
Opponents to legal gaming will declare the need to protect the moral fabric of Texans. However, a closer examination of such opponents will reveal that casinos located in neighboring states, such as the Oklahoma Chickasaw Nation, are some of the largest campaign contributors to Texas politicians. Oklahoma and Louisiana casinos have good cause to play a major role in Texas politics. Texans make up approximately 80% of Choctaw Casino’s revenue. Similarly, shortly after Texas legalized pari-mutuel betting at horse tracks in 1987, Louisiana Downs, located in the border city of Shreveport, declared bankruptcy. Once gaming is made legal in Texas, there will be no need for Dallasites to drive 100 miles to visit the $60 million plus Winstar Casino in Durant, Oklahoma when they can visit Texas Lone Star Park in neighboring Grand Prairie. And that’s the idea.
One thing is for certain, legal gaming is coming to Texas and soon. Whether a new gambling law will pass in 2009 or 2011 is up for grabs. What is not in dispute is that Texans bet millions of dollars annually in Oklahoma, Louisiana and New Mexico. The Texas Legislature will eventually stop this mass exodus of untapped tax revenue in the name of education, our children and all that is good. For those who have doubts, just follow the money.
Adam W. Vanek
(214) 890-0991
avanek@tiptonjoneslaw.com
Legal gaming is coming to Texas. The question in everyone’s mind is when? In 2009, the Texas Legislature reconvenes and will have several video gaming bills waiting for them in committee. Each bill will have its own version of how and where to legalize gaming. First, the Texas Legislature will authorize video gaming machines: video 8-Liners or slot machines, video poker, and video bingo. The proposed legislative bills will restrict these gaming machines to horse tracks and dog tracks, “off-shore casinos”, such as riverboats, and Native American reservations primarily located in West Texas. Eventually table games will be allowed and maybe even full-fledged casinos, but that won’t be for some time.
The best way to predict the future legislative course of legal gaming in Texas is to look at what is going on in other states. For example, in 2007, the Indiana legislature authorized legal gaming at horse tracks. Indiana has only 2 horse tracks, Hoosier Park approximately 40 miles north of Indianapolis and Indianapolis Downs Park approximately 30 miles southeast of Indianapolis. Each track must pay an initial license fee of $250 million, provide $100 million or more in additional construction or capital improvements, and the new slot machine facilities must connect to the racetrack facilities. Indiana is expected to generate close to $500 million in annual revenue within the first 5 years, exclusive of the licensing fee. Indiana will also require an annual $100 license fee for each video gaming machine in use. In a cash strapped state, such as Texas, the Legislature cannot afford to ignore those numbers.
Akin to the 1991 campaign establishing the Texas Lottery, gaming proponents will declare that the tax revenue generated from legal gaming will fund public education. And, just like the Texas Lottery, the proceeds will actually be deferred to the State’s general fund. It will be up to the Texas Legislature to actually determine how much is allotted to education. By 2006, the State of Texas received more than $3.7 billion in lottery ticket sales and only allocated $1 billion to public education.
Opponents to legal gaming will declare the need to protect the moral fabric of Texans. However, a closer examination of such opponents will reveal that casinos located in neighboring states, such as the Oklahoma Chickasaw Nation, are some of the largest campaign contributors to Texas politicians. Oklahoma and Louisiana casinos have good cause to play a major role in Texas politics. Texans make up approximately 80% of Choctaw Casino’s revenue. Similarly, shortly after Texas legalized pari-mutuel betting at horse tracks in 1987, Louisiana Downs, located in the border city of Shreveport, declared bankruptcy. Once gaming is made legal in Texas, there will be no need for Dallasites to drive 100 miles to visit the $60 million plus Winstar Casino in Durant, Oklahoma when they can visit Texas Lone Star Park in neighboring Grand Prairie. And that’s the idea.
One thing is for certain, legal gaming is coming to Texas and soon. Whether a new gambling law will pass in 2009 or 2011 is up for grabs. What is not in dispute is that Texans bet millions of dollars annually in Oklahoma, Louisiana and New Mexico. The Texas Legislature will eventually stop this mass exodus of untapped tax revenue in the name of education, our children and all that is good. For those who have doubts, just follow the money.
Adam W. Vanek
(214) 890-0991
avanek@tiptonjoneslaw.com
Tuesday, April 22, 2008
BEYOND BRIEFS: Part Two
In my last entry on this topic, I raised the question of why you, as a lawyer, want to write. Assuming you’ve done the necessary soul-searching and you still want to, let me know alert you to some of the dangers you face. Dangers, I might add, that can be somewhat specific to lawyers.
Too wordy—Believe it or not, being a lawyer poses some disadvantages for you as you turn to other forms of writing fiction. Unfortunately, you’ve probably learned some habits in law school and in practice that you’ll have to overcome as you turn to the written word for the masses. After all, that’s who will be reading what you write, not other lawyers and judges. Fact is, most lawyers are not good writers.
I know what you’re thinking: “Moi, not a good writer? Surely you jest.”
Okay, let’s just see. In Texas, we have what’s known as a General Denial, which lawyers assert in defensive pleadings. The typical lawyer files a General Denial that reads like this: “Defendant generally denies each and every, all and singular, the material allegations in Plaintiff’s Original Petition and demands strict proof thereof.”
Sounds good, doesn’t it? Very lawyerly. Did you know that this would have worked just as well: “Defendant generally denies the allegations in Plaintiff’s Original Petition.” Nine words accomplished the same thing that twenty-one words accomplished in the preceding paragraph.
Let me run another one by you. You’re filing a pleading in a lawsuit and need to attach a document to the pleading as an exhibit. Most lawyers refer to the document, then write this: “A true and correct copy of the aforementioned document is attached hereto as Exhibit A and is incorporated herein by reference for all purposes the same as if fully set forth herein.”
Compare that to this: “A copy is attached as Exhibit A.” Seven words versus thirty-two—and you accomplished the same thing.
You’ve probably heard the expression “less is more;” well, it’s true. Unfortunately most lawyers write as if they’re being paid by the word instead of by the hour. The problem with that is that the meaning of what you’re saying can get lost in the avalanche of words, or the emotional impact can be diluted. Better to use fewer, but more direct and powerful, words. Where most lawyers tend to use three where one will suffice, as writers of fiction you need to get into the habit of doing just the opposite. Did you know that “null” means “void,” and “void” means “null”? You don’t have to say “null and void,” and you really don’t have to say “null and void, and without effect.”
Too technical—While we’re on the subject, let’s talk about another of my pet peeves with “lawyerly” writing and that’s the use of jargon where plain English not only will suffice but also will far surpass jargon. Jargon is okay, to a point. In writing fiction, you’ll want to sprinkle your dialogue and exposition with enough jargon to create an aura of authenticity around the world you have created on paper, but not so much that the reader either loses track of what you’re saying or becomes distracted. We all know that lawyers say things like “jurisdictional limits of the court,” and “limine” and “directed verdict,” but if your reader doesn’t understand what these mean, important plot points can get lost.
For an example of how this can work well, study the movie Body Heat. When you were in law school taking Property Law, did it ever occur to you that the Rule Against Perpetuities could ever form the key plot point in a major motion picture? But that’s exactly what screenwriter Lawrence Kasden did—and did it masterfully. The audience may not have known all the finer points of the Rule as articulated in the movie, but they understood generally that because of that rule, the will William Hurt drew up for Kathleen Turner's Husband was invalid and, as a result, she stood to inherit all of her husband’s wealth rather than share it with her niece. Result? Motive for murder.
Too autobiographical—Another problem is one shared by most new writers, not just lawyers: The story is too autobiographical. Yes, you are admonished to write what you know, and you certainly know your own life and your own cases. And, yes, your life is surely fascinating to you and your family, but that doesn’t mean your life and your cases are of any real interest to the rest of the world. That doesn’t mean that parts of your life can’t inspire or inform your stories, but you’ve got to view this as an outsider looking in would. Use events and people in your life to inspire your creative thinking, then put them in a world you know intimately—the world of law—but write fiction! Ultimately your creativity will likely be far more interesting to readers than your real life, hard as that may be to believe.
Too bombastic—Now, I’m treading lightly here because I know a lot of lawyers who think their writing is just brilliant because it sounds so…intelligent? You know, two-dollar, multi-syllable, “educated” words. After all, who isn’t more impressed with a letter that begins with “The Undersigned,” instead of “I”? I hate to be the bearer of bad news to you, but just as it’s better to use one word when you might otherwise want to use three, it’s better to use a two-cent word when you might want to use a two-dollar word. Why? It’s clearer and more to the point. And it just sounds better.
Oh, really? All right, let’s compare (with apologies to police officers everywhere). Which is better? I saw the car driving down the street; or I observed the vehicle proceeding down the boulevard.
I rest my case.
But there is an exception to this general rule against being less bombastic, and it applies to dialogue. Dialogue reveals character—so a snooty, pseudo-intellectual character’s dialogue may well be peppered with bombastic speech. Or a highly educated scientist who has very little social interaction may speak in almost undecipherable scientific language even when thrust out of his laboratory. I’m sure you can think of other examples yourself, but the point is that bombastic language has its uses.
Further on the subject the writer sayeth naught.
Mike Farris
(214) 979-0100
mfarris@tiptonjoneslaw.com
Too wordy—Believe it or not, being a lawyer poses some disadvantages for you as you turn to other forms of writing fiction. Unfortunately, you’ve probably learned some habits in law school and in practice that you’ll have to overcome as you turn to the written word for the masses. After all, that’s who will be reading what you write, not other lawyers and judges. Fact is, most lawyers are not good writers.
I know what you’re thinking: “Moi, not a good writer? Surely you jest.”
Okay, let’s just see. In Texas, we have what’s known as a General Denial, which lawyers assert in defensive pleadings. The typical lawyer files a General Denial that reads like this: “Defendant generally denies each and every, all and singular, the material allegations in Plaintiff’s Original Petition and demands strict proof thereof.”
Sounds good, doesn’t it? Very lawyerly. Did you know that this would have worked just as well: “Defendant generally denies the allegations in Plaintiff’s Original Petition.” Nine words accomplished the same thing that twenty-one words accomplished in the preceding paragraph.
Let me run another one by you. You’re filing a pleading in a lawsuit and need to attach a document to the pleading as an exhibit. Most lawyers refer to the document, then write this: “A true and correct copy of the aforementioned document is attached hereto as Exhibit A and is incorporated herein by reference for all purposes the same as if fully set forth herein.”
Compare that to this: “A copy is attached as Exhibit A.” Seven words versus thirty-two—and you accomplished the same thing.
You’ve probably heard the expression “less is more;” well, it’s true. Unfortunately most lawyers write as if they’re being paid by the word instead of by the hour. The problem with that is that the meaning of what you’re saying can get lost in the avalanche of words, or the emotional impact can be diluted. Better to use fewer, but more direct and powerful, words. Where most lawyers tend to use three where one will suffice, as writers of fiction you need to get into the habit of doing just the opposite. Did you know that “null” means “void,” and “void” means “null”? You don’t have to say “null and void,” and you really don’t have to say “null and void, and without effect.”
Too technical—While we’re on the subject, let’s talk about another of my pet peeves with “lawyerly” writing and that’s the use of jargon where plain English not only will suffice but also will far surpass jargon. Jargon is okay, to a point. In writing fiction, you’ll want to sprinkle your dialogue and exposition with enough jargon to create an aura of authenticity around the world you have created on paper, but not so much that the reader either loses track of what you’re saying or becomes distracted. We all know that lawyers say things like “jurisdictional limits of the court,” and “limine” and “directed verdict,” but if your reader doesn’t understand what these mean, important plot points can get lost.
For an example of how this can work well, study the movie Body Heat. When you were in law school taking Property Law, did it ever occur to you that the Rule Against Perpetuities could ever form the key plot point in a major motion picture? But that’s exactly what screenwriter Lawrence Kasden did—and did it masterfully. The audience may not have known all the finer points of the Rule as articulated in the movie, but they understood generally that because of that rule, the will William Hurt drew up for Kathleen Turner's Husband was invalid and, as a result, she stood to inherit all of her husband’s wealth rather than share it with her niece. Result? Motive for murder.
Too autobiographical—Another problem is one shared by most new writers, not just lawyers: The story is too autobiographical. Yes, you are admonished to write what you know, and you certainly know your own life and your own cases. And, yes, your life is surely fascinating to you and your family, but that doesn’t mean your life and your cases are of any real interest to the rest of the world. That doesn’t mean that parts of your life can’t inspire or inform your stories, but you’ve got to view this as an outsider looking in would. Use events and people in your life to inspire your creative thinking, then put them in a world you know intimately—the world of law—but write fiction! Ultimately your creativity will likely be far more interesting to readers than your real life, hard as that may be to believe.
Too bombastic—Now, I’m treading lightly here because I know a lot of lawyers who think their writing is just brilliant because it sounds so…intelligent? You know, two-dollar, multi-syllable, “educated” words. After all, who isn’t more impressed with a letter that begins with “The Undersigned,” instead of “I”? I hate to be the bearer of bad news to you, but just as it’s better to use one word when you might otherwise want to use three, it’s better to use a two-cent word when you might want to use a two-dollar word. Why? It’s clearer and more to the point. And it just sounds better.
Oh, really? All right, let’s compare (with apologies to police officers everywhere). Which is better? I saw the car driving down the street; or I observed the vehicle proceeding down the boulevard.
I rest my case.
But there is an exception to this general rule against being less bombastic, and it applies to dialogue. Dialogue reveals character—so a snooty, pseudo-intellectual character’s dialogue may well be peppered with bombastic speech. Or a highly educated scientist who has very little social interaction may speak in almost undecipherable scientific language even when thrust out of his laboratory. I’m sure you can think of other examples yourself, but the point is that bombastic language has its uses.
Further on the subject the writer sayeth naught.
Mike Farris
(214) 979-0100
mfarris@tiptonjoneslaw.com
Friday, April 18, 2008
Lawyers do well; lawyers do good
As a fourth generation Texas trial lawyer, the hackles on the back of my neck always stand up when someone I meet at a cocktail party decides it’s a good idea to share his or her repertoire of lawyer jokes with me. Lawyers occupy a unique position in our system of law and government, and can affect positive changes more so than almost any other profession. My immediate retort is usually along the lines of - “so what do you do for a living that is so damn beneficial for the human race?” (hoping that the offender is a bond trader and not a teacher or social services worker) or “lawyers are like proctologists – everyone hates them until they really need one!”
I now have a better retort. More than 400 Texas lawyers, from all over the state and from diverse areas of specialization, have volunteered to serve as ad litems for the 416 children who were recently removed from the polygamist ranch in Eldorado, Texas. They are traveling to San Angelo at their own expense to carry out a much needed task that will benefit hundreds of children. They will not get a dime for their services. In fact, there are more volunteers than needed. Lawyers are paid well for their services, generally. I think that on the whole, they give back to society in an amount commensurate with the privilege of being licensed to practice law.
Now, where are those cocktail franks I saw being passed around?
Murray Camp
(214) 979-0100
mcamp@tiptonjoneslaw.com
I now have a better retort. More than 400 Texas lawyers, from all over the state and from diverse areas of specialization, have volunteered to serve as ad litems for the 416 children who were recently removed from the polygamist ranch in Eldorado, Texas. They are traveling to San Angelo at their own expense to carry out a much needed task that will benefit hundreds of children. They will not get a dime for their services. In fact, there are more volunteers than needed. Lawyers are paid well for their services, generally. I think that on the whole, they give back to society in an amount commensurate with the privilege of being licensed to practice law.
Now, where are those cocktail franks I saw being passed around?
Murray Camp
(214) 979-0100
mcamp@tiptonjoneslaw.com
Wednesday, April 16, 2008
Taxation of Limited Liability Companies
Doing business as a Limited Liability Company is popular because, similar to a corporation, owners (members) have limited personal liability for the debts and actions of the LLC. At the same time there is great management flexibility, and LLCs enjoy the benefit of pass-through taxation. Members may be individuals, corporations, other LLCs and foreign entities. There can be only one member of an LLC (in most states), or there can be an unlimited number of members. We are frequently asked how LLCs are taxed.
If an LLC has only one member (a single member LLC), the default taxation is that the member files as if the LLC does not exist. So if the single member is an individual, LLC income and expenses are reported on schedule C, E or F of the member’s 1040 return. If the single member is a corporation, the LLC income and expenses are reported on the corporation’s return (usually Form 1120 or 1120S). If an individual LLC single member prefers the LLC to be taxed as a corporation, the LLC must submit IRS Form 8832 to change the default and select the corporate form of taxation.
If an LLC has multiple members, the default is for the LLC to be taxed as a partnership (Form 1065). If the LLC prefers to be taxed as a corporation, the LLC must submit IRS Form 8832 to change the default and select the corporate form of taxation.
Remember that LLCs are subject to withholding of employment tax. Members of single member LLCs are subject to self-employment taxes on earnings. Also, members of multiple member LLCs pay self-employment taxes on their share of partnership earnings.
We would be happy to be of assistance in solidly planning and properly setting up a business entity for your venture.
Paul Tipton
(214) 890-0991
ptipton@tiptonjoneslaw.com
If an LLC has only one member (a single member LLC), the default taxation is that the member files as if the LLC does not exist. So if the single member is an individual, LLC income and expenses are reported on schedule C, E or F of the member’s 1040 return. If the single member is a corporation, the LLC income and expenses are reported on the corporation’s return (usually Form 1120 or 1120S). If an individual LLC single member prefers the LLC to be taxed as a corporation, the LLC must submit IRS Form 8832 to change the default and select the corporate form of taxation.
If an LLC has multiple members, the default is for the LLC to be taxed as a partnership (Form 1065). If the LLC prefers to be taxed as a corporation, the LLC must submit IRS Form 8832 to change the default and select the corporate form of taxation.
Remember that LLCs are subject to withholding of employment tax. Members of single member LLCs are subject to self-employment taxes on earnings. Also, members of multiple member LLCs pay self-employment taxes on their share of partnership earnings.
We would be happy to be of assistance in solidly planning and properly setting up a business entity for your venture.
Paul Tipton
(214) 890-0991
ptipton@tiptonjoneslaw.com
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