Changes to Automobile Insurance Coverage as of November 1, 2011

By Neil L. Wojtal

In April, 2011 changes were passed by the Wisconsin State Legislature which returned the limits on coverage and the types of coverage to pre-2009 levels.  Here are the changes that will go into effect on November 1, 2011:

1.      Policies issued before November 1, 2011 are required to cover $50,000 per injured person, $100,000 per accident and $15,000 for property damage. As of November 1, the minimum amount of coverage required will be $25,000 per injured person, $50,000 per accident and $10,000 for property damage.

2.      Minimum protection for uninsured motorists (UM) will change from $100,000 per person and $300,000 per accident to $25,000 per person and $50,000 per accident.

3.      Underinsured Motorist (UIM) protection will no longer be mandatory under the new law. If you elect to carry this coverage, the minimum amount of coverage has been reduced from $100,000 per person and $300,000 per accident to $50,000 per person and $100,000 per accident.

4.      Note that policyholders will no longer be guaranteed the option of “stacking” coverage. Stacking allows a policyholder to stack coverage if they insure multiple vehicles. For example, if three vehicles are covered under the same policy and each has $100,000 in UM protection, each vehicle would have access to $300,000 worth of UM coverage through stacking. Stacking only applies to UM, UIM and medical payment coverage. Insurers may still permit stacking after November 1; however, they are not required to permit it.

5.      Medical payments insurance will remain optional under the new law; however, the minimum amount of protection will decrease from $10,000 to $1,000.

6.      Automobile insurance coverage will remain mandatory. All drivers in Wisconsin will be required to maintain a policy in order to drive legally.

7.      Another change allows insurers to place previously uninsured or new drivers in a high-risk category. Typically, the high-risk category requires higher premium payments.

If you have automobile coverage, especially coverage for UM, UIM and medical payments, you may want to review your coverage with your insurance agent at this time to see how the changes in the Wisconsin state laws will affect you.

ALERT: No Match Letters from SSA

By: Neil L. Wojtal

In 2007 the Social Security Administration (SSA) stopped sending no-match letters to employers. The letters had been sent out when an employee’s name or social security number (SSN) did not match the SSA’s records. As of April, 2011, SSA has started mailing the letters again.

What should an employer do if they receive a no-match letter from the SSA?

1.       Do not immediately terminate the employee. There could be a number of reasons for a no-match that have nothing to do with the validity of the SSN. These include: an input error at SSA, a reporting error by the employer or employee, hyphenated or multiple last names or an unreported name change. Termination may open an employer to discrimination claims for national origin and citizenship status by the U. S. Department of Justice Office of Special Counsel for Immigration Related Unfair Employment Practices.

2.       Give the employee written notice of the no match.

3.       Review the employee’s W-4 and I-9 with the employee. Check the SSA number verification system to make sure the information entered into the system is correct. You can access the system by going to the following SSA site:

http://www.ssa.gov/employer/ssnv.htm

4.       If you find an error, report the error to the SSA using Form W-2c.

5.       If no error is found, the employee must follow up with the SSA and the employer should follow up with the employee to see if the employee has done so.

6.       In the event the employee does not follow up and does not provide the employer with documentation or a credible explanation of good faith efforts to correct the problem, the employer could terminate the employee. Note that the employer must give the employee a reasonable amount of time to correct the problem. No guidelines are provided by the SSA, however, 120 days appears to be an acceptable period of time.

7.       In the event the employee produces a new SSN, an employer can ask the employee to fill out a new I-9 form if the employee had used their SSN as a list C document. The new I-9 form should be attached to the original I-9 form with a written explanation. This will help if the employer is audited by Immigration and Customs Enforcement (ICE).

It is important to remember that a SSN does establish a person’s authorization to work in the U. S. However, use of the no match letter to terminate employment immediately can open an employer to discrimination claims since there are mistakes in the system as stated in No. 1 above. The best way to avoid no match letters is to use the Social Security Number Verification System to verify SSNs after you hire an employee. Note that the system cannot be used to exclude an employee from employment given the inaccuracies in the system as stated in No. 1 above.

An employer can also use the E-Verify System to verify that an employee is authorized to work in the U. S. Note that E-Verify cannot be used to screen potential employees. It can only be used for current employees. The E-Verify System can be found at: http://www.uscis.gov/portal/site/uscis/menuitem.eb1d4c2a3e5b9ac89243c6a7543f6d1a/?vgnextoid=e94888e60a405110VgnVCM1000004718190aRCRD&vgnextchannel=e94888e60a405110VgnVCM1000004718190aRCRD

By using the systems available, and by taking the precautions stated above, an employer can reduce or avoid receiving a no match letter from the SSA and, if one is received, reduce exposure to discrimination claims by taking appropriate action.

New Visa Scam

August 18, 2011

To: All Business Associates and Friends

From: Neil L. Wojtal

RE: Visa / MasterCard FRAUD

I received this information from a business associate today. I am passing it along to alert you to this potentially costly scam.

“This is a heads up for everyone regarding the latest in Visa fraud.

Royal Bank received this communication about the newest scam.

This is happening in the Midwest right now and moving throughout the U. S. 

This one is pretty slick since they provide YOU with all the information, except the one piece they want. 

Note, the callers do not ask for your card number; they already have it. 

This information is worth reading. By understanding how the VISA & MasterCard telephone Credit Card Scam works, you'll be better prepared to protect yourself. One of our employees was called on Wednesday from 'VISA', and I was called on Thursday from 'MasterCard'. 

The scam works like this: 

Person calling says - 'This is (name), and I'm calling from the Security and Fraud Department at VISA. My Badge number is 12460, your card has been flagged for an unusual purchase pattern, and I'm calling to verify. This would be on your VISA card which was issued by (name of bank). Did you purchase an Anti-Telemarketing Device for $497.99 from a marketing company based in Arizona?' When you say 'No', the caller continues with, 'Then we will be issuing a credit to your account. This is a company we have been watching and the charges range from $297 to $497, just under

the $500 purchase pattern that flags most cards. Before your next statement, the credit will be sent to (gives you your address), is that correct?' You say 'yes'. 

The caller continues - 'I will be starting a Fraud Investigation. If you have any questions, you should call the 1- 800 number listed on the back of your card (1-800-VISA) and ask for Security. You will need to refer to this Control Number. The caller then gives you a 6 digit number. 'Do you need me to read it again?' 

Here's the IMPORTANT part on how the scam works - The caller then says, 'I need to verify you are in possession of your card'. He'll ask you to 'turn your card over and look for some numbers'. There are 7 numbers; the first 4 are part of your card number, the last 3 are the Security Numbers that verify you are the possessor of the card. These are the numbers you sometimes use to make Internet purchases to prove you have the card. The caller will ask you to read the last 3 numbers to him. After you tell the caller the 3 numbers, he'll say, 'That is correct, I just needed to verify that the card has not been lost or stolen, and that you still have your card Do you have any other questions?' 

After you say no, the caller then thanks you and states, 'Don't hesitate to call back if

you do', and hangs up. You actually say very little, and they never ask for or tell you the card number. But after we were called on Wednesday, we called back. Within 20 minutes to ask a question. Are we were glad we did! The REAL VISA Security Department told us it was a scam and in the last 15 minutes a new purchase of $497.99 was charged to our card. We made a real fraud report and closed the VISA account. VISA is reissuing us a new number. What the scammers want is the 3-digit PIN number on the back of the card. Don't give it to them. Instead, tell them you'll call

VISA or Master Card directly for verification of their conversation. 

The real VISA told us that they will never ask for anything on the card as they already know the information since they issued the card! If you give the scammers your 3 Digit PIN Number, you think you're receiving a credit; however, by the time you get your statement you'll see charges for purchases you didn't make, and by then it's almost too late and/or more difficult to actually file a fraud report. 

What makes this more remarkable is that on Thursday, I got a call from a 'Jason Richardson of MasterCard' with a word-for-word repeat of the VISA Scam. This time I didn't let him finish. I hung up! We filed a police report, as instructed by VISA. The police said they are taking several of these reports daily! They also urged us to tell everybody we know that this scam is happening. I dealt with a similar situation this morning, with the caller telling me that $3,097 had been charged to my account for

plane tickets to Spain, and so on through the above routine. 

It appears that this is a very active scam, and evidently quite successful.” 

Pass this on to all your family, friends and business associates. We must help to protect each other against these thieves.

Wisconsin Estate Planning Tips Part 3

WILLS
by Neil L. Wojtal

 A Will is a written document that sets forth your wishes concerning the distribution of your estate, who will raise your children, whether your beneficiaries will receive your assets outright or through a trust and who will serve as your personal representative to see that your wishes are carried out. Anyone who owns assets and certainly anyone with minor children should have a Will. Without one, a guardian will be appointed for your minor children and a judge will decide who will have custody of your children. If one parent survives the other this may not be an issue, however, if both parents die at the same time, this process can be time consuming, expensive and create a lot of tension in a family. For instance if both sets of grandparents are living, there could be a dispute as to who should raise the children. You and your spouse may have a brother or sister who you would prefer to raise your children. If those wishes are not set forth in a written will they will not be followed by a judge.

Further complications arise if the deceased person has children as a result of different marriages. If you want your children from a previous marriage to receive part of your estate, you would need to cover that bequest in your will. In addition, if you desire to gift certain property such as your grandmother’s wedding ring for example, that specific gift could be covered in your will. You can also make it clear in your will that certain assets are to be distributed to a favorite charity or relative. All of your specific wishes can be addressed in your will so that there is no confusion as to your wishes and you will then have appointed a personal representative selected by you to see that your wishes are carried out.

There are simple wills that are legally valid contained in the Wisconsin State Statutes in Sections 853.55 and 853.56. In fact, Chapter 853 contains a lot of information that would enable a person to create their own legally valid will. However, as with the Powers of Attorney referenced above, these wills are very simple and may not fit your individual circumstances. If that is the case, you should have a will and powers of attorney for both health care and finance and property drafted by the Zimmerman & Steber Legal Group or another qualified attorney who will customize your will and powers of attorney to meet your specific situation and address your desires.

I hope that you will seriously consider putting these important documents in place to make your wishes known to your loved ones when you are unable to speak for yourself.

 When creating a will, the following tax consequences need to be considered. Consultation with a tax expert is advised before creation of a will to get the most favorable tax treatment for your assets and heirs.

Federal –

1. Estate tax imposed on estates of $5 MIL or more ($10 MIL for a couple) in 2011 and 2012. The amount will change to $1 Million or more in 2013 unless Congress acts.

2. Inheritance tax if amount inherited is over $3.5 Million.

3. Gift Tax – 2010 and 2011 exclusion is $13,000 annually per person. You can give away $5 Million in your lifetime without having to pay a gift tax.

 State of WI –

1. Estate Tax – none in 2011 or 2012 unless the legislature acts.

2. Inheritance Tax – None if person died after 1/1/1992.

3. Gift Tax – None after 1991.

Next Posting, Trusts Part 4

Wisconsin Estate Planning Tips Part 2

Durable Power of Attorney for Finances and Property
by: Neil L. Wojtal

A Durable Power of Attorney for Finances and Property allows you to appoint an agent who will make financial decisions for you in the event you become incapacitated. If you do not have a Durable Power of Attorney for Finances and Property in place and you become incapacitated, your family may have to ask a court to appoint a guardian for you. This can be a time consuming and expensive process. Your family must hire an attorney who will arrange for a court hearing and a doctor would have to provide evidence that you are incapacitated.

Some people believe that they do not need a Durable Power of Attorney for Finances and Property if they do not own a large amount of assets. However, without one there are specific legal actions that cannot be accomplished without specific legal authority such as applying for work related disability or income continuation benefits such as Social Security; accessing or changing retirement plans; filing insurance claims or appealing denials; signing tax forms; selling a house or contracting for health care services.

This Power of Attorney can be effective immediately upon signing or it can be a “springing power”, i. e. effective only after a doctor declares you incapacitated. Even if you elect to have the Power of Attorney effective immediately, as long as you are competent, you will be able to handle your own affairs. Your agent will only be able to act if you are not able to do so. Once the Power of Attorney is activated, the agent’s authority does not end until you die. At that point, your Will takes effect and the personal representative named in your Will has the authority to act on your behalf to wrap up your affairs and distribute your assets pursuant to your wishes. Note that the agent under the Power of Attorney and the personal representative under your Will can be the same person. The statutory form for a Power of Attorney for Finances and Property is located in the Wisconsin State Statutes, Section 244.61. Note that an appendix must be attached to the POA which lists the definitions of the various powers as contained in Sections 244.44 through 244.56.

(Next posting  Part 3 -Wills)

WISCONSIN ESTATE PLANNING TIPS PART 1

ESTATE PLANNING

Part One – Durable Power of Attorney for Health Care

BY: Neil L. Wojtal

While you are living and healthy, you value being able to make your own decisions about your finances, property, health care, and raising your children. Should you die or become incapacitated, you hope others will handle these matters for you according to your wishes.

The only way to assure that will happen is through estate planning. There are three primary Estate Plan Documents that everyone should have in place.  The three primary Estate Plan Documents are: 1) a Durable Power of Attorney for Health Care - so someone can make health care decisions for you if you are not capable of doing so; 2) a Durable Power of Attorney for Finances and Property - so someone can make financial decisions for you if you are not capable of doing so; and 3) a Will directing the distribution of your Assets consistent with your desires and Estate Plan.

DURABLE POWER OF ATTORNEY FOR HEALTH CARE

A Durable Power of Attorney for Health Care (Durable POA for Health Care) authorizes another person to make health care decisions for you when you are unable to make such decisions for yourself. There is a state form contained in the Wisconsin State Statutes (Section 155.30) that you can use or you can have the power of attorney created for you by an attorney. Note that while the state form is legally acceptable it is a “one size fits all” form. It does not address any specific wishes you may have concerning your treatment in the event you are unable to communicate with your doctors. A Durable POA for Health Care can be effective immediately upon signing or it can become effective only after two physicians state in writing that you are incapable of making your own decisions. If you do not have a Durable POA for Health Care in place when you become incapacitated, no one will have the authority to speak for you concerning any decision regarding your continuing care. No one will be able to decide if extraordinary measures should be taken by your doctors to prolong your life if, for example, you are considered brain dead. Any such decision will then have to be made by a court after hearing testimony from your doctors. This is a time consuming and expensive process that will create stress for your loved ones since they are helpless to proceed without legal action since your specific wishes are not contained in a written document.

You only have to look at the Terri Schiavo case to see an example of a legal battle that lasted 7 years at great cost and family stress by all the involved parties. Ms. Schiavo was declared brain dead by her doctors and her husband, as her legal guardian, asked that her feeding tubes be disconnected allowing her to die. Ms. Schiavo’s parents insisted that she be kept alive in the hopes that she would someday recover some use of her brain and based upon her religious beliefs. The battle between her husband and her parents resulted in 14 appeals, and numerous motions, petitions and hearings in the Florida courts; five suits filed in federal district court; Florida legislation struck down by the Florida Supreme Court; a subpoena by a congressional committee to qualify Schiavo for witness protection; federal legislation and four denials of certiorari from the U. S. Supreme Court. While this case is an extreme example, all of this litigation could have been avoided had Ms. Schiavo completed a Durable POA for Health Care with specific instructions as to the use of extraordinary life saving efforts such as feeding tubes in the event her doctors declared her brain dead. A detailed Durable POA for Health Care will contain these instructions and appoint a person who has the power to carry out your wishes.

Note that a Durable POA for Health Care is not the same as a Living Will. A Living Will is a separate document, not a part of your Will. A Durable Power of Attorney for Health Care allows your agent to make health care decisions for you. A Living Will allows you to state in writing your preferences about life prolonging medical treatment. A Living Will only takes effect when you become incapacitated, cannot speak for yourself and there is no hope for recovery. A Durable POA for Health Care will cover the same scenarios as a Living Will but, if you elect to have it effective immediately upon signing, it will also cover any instances where you may be temporarily incapacitated such as a medically induced coma for instance. The standard form for the Living Will is located in the Wisconsin State Statutes in Section 154.03. Again, while this form is legally adequate, it does not provide your detailed instructions for various scenarios. A Durable POA for Health Care drafted by an experienced attorney will detail your wishes regarding several scenarios and give specific instructions as to what extraordinary measures you want to be taken by your doctors to prolong your life in the event of a life ending scenario or a temporary condition where you are unable to speak for yourself.

To Be Continued - Durable Power of Attorney for Finances and Property

Employment Law Tips Part 5

                    Zimmerman & Steber Legal Group, S. C.
                    By: Neil L. Wojtal

                    V.   OTHER ISSUES

A.  Classification of Employees as Independent Contractors: the Wisconsin Statutes, Sec. 102.07(8), requires an employer to meet all nine tests listed in the statute before the employer can classify an employee as an independent contractor. The tests are:

1. Maintain a separate business

2. Obtain a Federal Employer Identification number from the Federal Internal Revenue Service (IRS) or have filed business or self-employment income tax returns with the IRS based on work or service in the previous year.

3. Operate under specific contracts

4. Be responsible for operating expenses under the contracts

5. Be responsible for satisfactory performance of the work under the contracts

6. Be paid per contract, per job, by commission or by competitive bid

7. Be subject to profit or loss in performing the work under the contracts

8. Have recurring business liabilities and obligations

9. Be in a position to exceed or fail if business expenses exceed income

In the event an employer misclassifies an employee as an independent contractor, the employer can be subject to several issues such as tax liability, unemployment compensation issues and workers’ compensation issues to name a few.

Information on this issue can be found on the DWD website at:

http://dwd.wisconsin.gov/wc/employers/independent_contractors.htm

B.  Termination of Employment: Every employer should review their termination process, not only for compliance with federal and state laws such as discrimination, but also to prevent lawsuits arising out of the process. Foe example, no employee issue should be discussed publicly with an employee. Any employee who is subject to disciplinary action should be taken to a private room for the discussion. Any termination should be squarely based upon rule violations or business considerations. If an employer has a written disciplinary procedure, it must be followed uniformly for each employee. In addition, any disciplinary action taken by the employer must be documented in the employee’s personnel file. If an employee wishes to comment on the action, those comments should be kept in the employee’s personnel file as well. Any decision to terminate should have documentation in the employee’s personnel file that supports the business reasons for the termination. If an employer is unsure that the business reasons justify a termination, the employer should consult with an attorney prior to terminating the employee.

I hope that the information provided will be of help to all employers seeking to improve their employment processes.

The information contained in this document is intended for the sole purpose of providing general legal information and is not intended as legal advice of any kind.

This information may not apply to your specific issue, therefore, do not act upon this information without consulting Zimmerman & Steber Legal Group, SC or another qualified attorney.