Thursday, February 16, 2017
What is an EIN?
Federal Employer Identification Number (EIN or FEIN) is a unique nine-digit federal tax identification number assigned by the Internal Revenue Service (IRS) to business entities in the United States. The name EIN is somewhat misleading; EIN's are not just for employers. EIN's do not expire. When it comes to EIN's, foreign-owned US business entities are subject to the same rules that apply to US-based owners.
Who Needs an EIN?
Generally speaking, only certain sole proprietors and single-member LLC's do not need to get an EIN. They can use Social Security Numbers instead of EIN's. However, even though EIN is not required for federal tax purposes, it may still be needed for banking purposes.
So, who needs an EIN? The IRS says that you need one if you answer YES to any of the following questions:
Do you have employees?
Do you operate your business as a corporation or a partnership?
Do you file any of these tax returns:
Tuesday, February 14, 2017
While American Valentine's Day spending is expected to drop by 7% this year, the holiday has been banned altogether in parts of Asia.
Valentine's Day celebrations were banned in parts of Indonesia and Pakistan. That's because Muslim populations there claim the holiday encourages promiscuity and is unIslamic. Police in some Indonesian cities seized condoms in shops. The holiday is outlawed in Saudi Arabia where religious police prohibits the sales of Valentine’s Day merchandise, which led to the creation of a black market for roses and other festive items.
Sunday, February 12, 2017
The Irish High Court in Dublin is hearing a case about US privacy protections and surveillance policies. The case is a part of the saga in European courts over whether Europeans’ personal information is adequately protected when moved to the US by companies like Facebook and Google.
Here is how it all began. In 2015, EU's highest court, the Court of Justice of the European Union (CJEU) invalidated a EU-US pact ("Safe Harbor")that allowed for easy data transfers from the EU into the US. That's because EU law requires that companies exporting European citizens' personal data can only do that to countries providing a similar level of legal protection for that data. CJEU has ruled that US data protection procedures were on lower lever, particularly when it became known that Facebook was compelled to turn over large amounts of personal data under the NSA's mass surveillance program, PRISM. That mass surveillance program operated under Section 702 of Foreign Intelligence Surveillance Act, which the government uses to put foreigners under surveillance. Tech giants like FB have made contributions to dozens of Congressmen who support revival of mass surveillance programs, restrictions on privacy, backdoors in encrypted programs.
Saturday, February 11, 2017
On Feb 6, the US House of Representatives unanimously passed the Email Privacy Act. The Act was then read twice in the Senate and referred to the Committee on the Judiciary. If enacted, the Act would update the Electronic Communications Privacy Act of 1986 (ECPA) to require the government to get a probable cause criminal warrant to access emails, social media accounts and similar online content stored in the cloud for more than 180 days. In other words, if the gov't wanted to access suspect's email, it would have to go through the same procedure that is currently required for paper communications or phone calls.
Currently, paper files and electronic data that is less than 180 days old may only be searched with a warrant. Beyond 180 days, according to the ECPA, law enforcement agencies can search cloud data with mere subpoenas which are easier to obtain than a judge-issued warrant.
But, even though the Email Privacy Act is popular at the House (109 co-sponsors), it may have difficulty passing the Senate where a similar billed, also passed unanimously by the House in April 2016, failed to get through due to Republicans blocking it. Critics of the bill point out that it will make it more difficult for the gov't to investigate crimes and terrorism.
Wednesday, February 8, 2017
Image courtesy NBC. Fair use for non-commercial educational purposes and news reporting.
President Donald Trump on Wednesday lashed out at Nordstrom for dropping the clothing line of his daughter Ivanka Trump. He tweeted, “My daughter Ivanka has been treated so unfairly by @Nordstrom. She is a great person -- always pushing me to do the right thing! Terrible!” He then retweeted that on the official account of the President of the United States. Both accounts jointly reach approximately 39 million followers.
So, is it legal for the U.S. President to lash out at a private company for hurting his family's business, to use public office for private gains? Apparently, yes, but I have a feeling that he might eventually be checked on that just like he recently got checked with his broad immigration ban.
Many people feel it's "unfair" for the President to use his power for family business. However, the unfair competition laws only cover competing businesses and consumers. Furthermore, plaintiff would have to prove that it was damages by the "unfair" act. Nordstrom appears to not have been immediately damaged; its stock continued to climb after the tweet.
Many critics also feel that Trump's tweet could have breached ethics rules. Previous presidents have generally avoided mentioning the names of the companies even in the cases where the administration was directly affected (e.g., the banking crisis). But, apparently, Trump has not breached any ethics rules with that tweet because ethics rules currently in effect do not apply to the president. Executive branch employees are forbidden from using their positions to promote any private business corporation, whereas the president is technically exempt. Seems like there is (yet) no rule against the the president disparaging a company.
But even though there are currently no laws or ethics rules that would preclude POTUS from attacking the company for hurting family's business, Trump might just make such rules created. That's because his actions are so grand that they often test the limits of what's legal or not for POTUS to do. We've witnessed tat a few days ago with Trump's immigration ban. Prior to the ban, there was almost no case law that would limit the president's power to ban immigrants. But Trump's ban was so broad, that a federal judge blocked it. I believe something similar will eventually happen with Trump using public office for family business purposes.
Equity crowdfunding (aka crowdinvesting, investment crowdfunding, or crowd equity) is the mechanism that allows large groups of people (the “crowds”) to invest in a company that is not listed on a stock market (unlisted company) in exchange for shares (equity) in that company.
It is a new mechanism. Prior to 2015, only accredited investors (persons with high income or net worth) were allowed to invest.
Now, an “issuer” (startup) may sell up to $1,000,000 of its securities per 12 months even to unaccredited investors.
If either your annual income or your net worth is less than $100,000, then during any 12-month period, you can invest up to the greater of either $2,000 or 5% of the lesser of your annual income or net worth.
Wednesday, February 1, 2017
В Конгрессе США рассмотрят законопроект о значительных ограничениях на выдачу визы H-1B. Администрация президента подготовила проект аналогичного указа. Политики обоих основных партий высказываются в поддержку изменения системы распределения виз H-1B таким образом, чтобы эти визы получали только самые лучшие, самые высококвалифицированные, самые высокооплачиваемые кандидаты, и только при отсутствии соответствующих американских работников.
Визой H-1B пользуются, в основном, такие ИТ-гиганты как Facebook, Microsoft, Google и др. По закону, виза H-1B должна предоставляться иностранцам, наиболее квалифицированным в науке, технике и других специализированных областях. Виза H-1B должна выделяться только в случаях нехватки американцев на соответствующие высококвалифицированные должности.
Trump administration has drafted an executive order to overhaul the H-1B work-visa programs used by technology companies like Microsoft, Amazon & Apple to hire tens of thousands of overseas workers each year. The order, if signed, would require employers to give priority to the most highly paid H-1B workers. U.S. Rep. Zoe Lofgren (D-Calif.) has introduced a similar bill to give preference to companies that can pay the highest salaries. If implemented, the order and the bill can force tech giants to give more priority to American workers, while reserving H-1B for the most qualified, highest paid foreign specialists.
The H-1B visas let US companies bring in immigrants with "highly specialized knowledge" in specialty occupations including computer programmers, scientists, engineers. Even fashion models can be eligible for an H-1B visa; First Lady Melania Trump held it.
Proponents of the visa program claim that it helps US companies stay competitive on the global market by filling in job openings for which there aren't enough highly-skilled Americans available. Opponents say there are more highly skilled Americans than the tech companies claim and the companies abuse the program in order to save money by going for cheaper foreign labor instead of well-qualified American workers.
Tuesday, January 31, 2017
Summary of the Order
On January 27, 2017, President Trump has issued the Executive Order: Protecting the Nation from Foreign Terrorist Entry into the United States. The Order:
- bans, for 90 days, all immigrants (except green card holders) from seven majority-Muslim countries: Iran, Iraq, Syria, Libya, Sudan, Somalia and Yemen.
- instructs his administration to develop "extreme vetting" measures for immigrants from those seven countries to keep "radical Islamic terrorists" out of the United States.
- suspends the U.S. refugee program for 120 days.
- bars all Syrian refugees from entering the U.S. indefinitely.
- gives preference in admission to Christians, as the persecuted in majority-Muslim countries.
Why Were Those Seven Countries Singled Out?
Syria, Iran and Sudan are on the State Department’s list of state sponsors of terrorism since 1979, '84 & '93 respectively. Iraq, Libya, Somalia and are designated “terrorist safe havens” by the State Department.
Are Terrorists from Those Countries Dangerous?
Not really. They have injured a few people and were implicated in some terrorist plots. However, nationals of the seven countries have killed zero people in terrorist attacks on U.S. soil between 1975 and 2015. During that period, top terrorist killers were from Saudi Arabia - 2,369 murders, UAE - 314, Egypt - 162.
Sunday, January 29, 2017
Letter of Intent and Memorandum of Understanding are two different titles for the same type of document. Therefore, I will use the two terms (LOI & MOU) interchangeably in this article.
What Is an LOU/MOU?
MOUs indicate an intended common line of action. It is a more formal alternative to a handshake, a gentlemen's agreement. MOU is appropriate in cases when parties either do not imply a legal commitment or in situations where the parties cannot create a legally enforceable agreement. An MOU can also help to make the arrangement clearer to the parties so as to speed up the process of negotiation in relation to the agreement.
LOUs look like contracts but the major difference is that the former are usually not binding, although they can contain some binding provisions (e.g., confidentiality).