FAQs

There are many types of information that, if compromised, have differing notification requirements.

A prominent example protected health information (PHI). Some unauthorized uses and disclosures of PHI might be considered a breach. Should your business have a breach of PHI, you will likely have to notify victims and the United States Department of Health and Human Services within 60 days of learning about the breach, and if more than 500 individuals in Maryland are affected, notify the media of the breach.

If your business suffers a breach of other forms of personal information, you will likely have to notify the Attorney General of Maryland, and if after an investigation you determine that the breach created the likelihood that personal information might be misused, you will likely have to notify all persons involved within 45 days after discovering the breach. If over 1000 people are affected by the breach, you will likely have to notify consumer reporting agencies.

Breach notification laws in Maryland can be complicated. If you have questions about your business’s obligations to notify customers in Maryland about a potential data breach, please contact Saltzman Law.

Under the Gramm-Leach-Bliley Act (GLBA), any business significantly engaged in offering financial services must abide by the “Privacy Rule” and the “Safeguards Rule.” If your business regularly offers a financing option to your clients, notwithstanding your business’s industry, you will probably have to abide by these rules. Under the Privacy Rule, you must provide privacy notices to customers when they begin a business relationship with you. You must also provide updated privacy notices every year thereafter.

The Safeguards Rule requires these same businesses to implement information security programs in order to safeguard customer information. As security threats become more sophisticated, these plans will need to be regularly updated.

Many business owners have questions about whether they are subject to the GLBA. If you need help understanding whether your Maryland business is subject to the GLBA, or would like us to ensure your compliance with the GLBA, contact Saltzman Law.

There are countless ways that your project could go wrong, and there are a few ways that you might be able to get out of your AIA contract. First, see what options you have in the terms of the contract. Although AIA contracts are standardized, you can always negotiate them prior to execution. If you are not getting paid monthly or by milestones, there are some situations where you can simply stop working, but it is usually better to finish the required work and file an action for unpaid balances.

We can help comb through your contract and determine the best options based on your specific circumstances.

Subchapter 5 of Chapter 11 of the U.S. Bankruptcy Code is known as the Small Business Reorganization Act of 2019 (“SBRA”). Subchapter 5 bankruptcies have many benefits over Chapter 11 and Chapter 7 bankruptcies for small businesses.

In order to file a Subchapter 5 petition, the debtor must have less than $7.5 million in debt. The debtor may remain a “debtor in possession,” retaining authority to operate the business while a trustee performs administration of payments under a Bankruptcy Plan.

In contrast to a Chapter 11 bankruptcy, Subchapter 5 bankruptcies do not require a creditors committee or disclosure statements. Moreover, owners may retain equity even if not all creditors are paid in full. Importantly, Subchapter 5 bankruptcies authorize a small business debtor to modify a residential real estate mortgage to the extent that the proceeds from the loan were used in the business.

If you are considering declaring your business in bankruptcy, contact us so that we can discuss your options and whether a Subchapter 5 bankruptcy would suit your business.

If you are looking to establish domicile in Florida from Maryland, here are some tips:

• Sign a lease for as long a term as possible, or purchase a home or an apartment in Florida, and spend more time there than in Maryland (i.e. at least six months per year)
• Register to vote in Florida, and inform the State of Maryland of your relinquishment of the right to vote in Maryland
• Obtain a Florida driver’s license and relinquish your Maryland license
• Register your car in Florida and relinquish your Maryland registration
• Transfer major bank accounts to banks in Florida and close your Maryland accounts
• Open a safe deposit box and transfer all items in your Maryland safe deposit box, which should then be relinquished
• Execute a new will, not a codicil, reciting Florida as your new domicile
• If your estate plan includes charitable bequests, include a charitable organization based in Florida
• Send letters of resignation to all Maryland clubs to which you belong
• Do not renew any Maryland entertainment subscriptions
• Join Florida-based organizations and entertainment subscriptions
• Establish relationships with, and visit, medical providers in Florida
• Establish a relationship with stock and/or insurance brokers in Florida
• Notify all businesses and government agencies with which you have a relationship, including the Social Security Administration, of your new address
• Apply for a new passport using your Florida address
• Buy a cemetery plot in Florida and relinquish your Maryland cemetery plot
• File a Declaration of Domicile in Florida and claim your new home as a “homestead” under Florida law

When you start a business without preparing any specific documents, you start either as a sole proprietorship or a partnership, based on how many people own the interests in the business. You might have a partnership agreement, but if you don’t, a statutory partnership agreement will govern your business. In any of these cases, you will be personally liable in lawsuits.

You have several options when determining what form of business you start in Maryland. If you start a corporation, limited liability company, or limited liability partnership, your individual liability will be protected. However, each one of these forms of businesses has varying pros and cons.

The tax designation of an S corp requires the designation of officers and president, and unless you are designated as a Maryland close corporation, a board of directors. S corps must be elected by filing a Form 2553 with the IRS. They are essentially double taxed as a pass through entity, but have specific requirements. For example, all stockholders must be individuals or a qualified trust. An S corp might be best for a small business with high levels of revenue.

A limited liability company (LLC) does not require designation of officers or directors. LLCs are pass through entities that do not require payment of corporate taxes. Sole-member LLCs can treat the LLC’s income as the sole proprietorship filed on the Schedule C of an individual return. If there is more than one member, a partnership return must be filed for the LLC.

Every business is different. At Saltzman Law, we can discuss your specific situation to determine the best form of business for you to create.

If you think the assessment on your commercial property is incorrect, you can appeal to the Supervisor of Assessments, then to the Property Tax Assessment Appeals Board (PTAAB). A decision by the PTAAB can be appealed to Maryland Tax Court, and finally to the Circuit Court. You will need to provide evidence of what you believe to be the fair market value of the property and that the assessment made by the assessment office was incorrect assessment. Our experience in tax law and real estate law helps us to focus on appealing your commercial real estate taxes.

There are several types of trusts you can create in Maryland, including inter vivos trusts such as revocable and irrevocable trusts, each of which can have specific goals like special needs for disabled beneficiaries, generation skipping trusts, marital trusts, or qualified terminable interest property trust (QTIP trusts). Trusts in Maryland are governed by the Maryland Trust Act which is codified in the Estates and Trusts Article of the Maryland Annotated Code. Trusts can also be created in a will as well, in which case they are called testamentary trusts. Different types of trusts have different tax obligations. Reach out to Saltzman Law if you have questions about what type of trust might be best for you.

There are numerous Federal and State laws and regulations that obligate you to take certain steps to protect your clients’ information. Federal statutes to consider include the Family Educational Rights and Privacy Act (FERPA), Health Insurance Portability and Accountability Act (HIPAA), the CAN-SPAM Act, and many more. The Maryland General Assembly recently passed the (Maryland Online Data Privacy Act of 2024 (“MODPA”)), which will significantly increase many businesses’ obligations to protect their clients’ sensitive information. Saltzman Law can advise you on how to limit your legal exposure to privacy-based litigation.

Purchases can range from the purchase of the assets of a business to the purchase of stock or membership interests. If you have identified a business you would like to purchase, make sure to conduct your due diligence and obtain a fair valuation of the business. If you will need financing, it is a good idea to have a loan set up prior to moving forward. You will then need to agree to the material terms of the sale prior to executed a Purchase Agreement. It is crucial to hold all necessary permits and licenses, which might involve purchasing these from the prior owner. If you are purchasing membership interests in an LLC, you will likely need to update the LLC’s Operating Agreement. Purchasing a business can be complicated and case dependent, so it is important to have an attorney assist you during the process.

A shareholder agreement should detail the rights of the shareholders of a corporation, including the value and structure of votes, the processes for sales, appointments, and other decisions, as well as any other provision you think will be necessary for your business. Maryland largely allows companies to make their own rules, although there are some statutory limitations and requirements. If you need guidance, Saltzman Law can help ensure your shareholder agreement includes all aspects necessary for your business.

If you are looking to sell your business, you will need a Purchase Agreement that outlines the terms of your sale. Depending on the type of entity you are selling, you may want to sell the assets of the company, the stock of the company or the membership interests of the company. If you are selling a corporation, you will need an agreement of the of all of the stockholders. If you are selling your membership interest in an LLC, you will need written approval of all of the members of the LLC.

Our firm can help to determine the type of sale that would best suit your business and help to negotiate the best sales price for you.

When you start your own business you want to protect your personal assets from creditors of the business. One of the first steps in forming your own business is to create a limited liability entity in order to limit your personal liability. In deciding what type of company or corporation is best for your business is one of the first thing you most think about. Often the answer to this question involves how you want your business to be taxed. You might want to start a limited liability company (LLC), which for tax purposes in treated like a partnership if you have a partner or a disregarded entity if you wan to create a one person LLC. To create an LLC, in Maryland, you are required to file Articles of Organization with the Maryland State Department of Assessments and Taxation (SDAT), obtain an Employer Identification Number (EIN) from the Internal Revenue Service (IRS), and create an Operating Agreement. Many people don’t create an Operating Agreement when they establish an LLC. It is like having a car with keys but not starting the car. The Operating Agreement provide the parameters of how the LLC will be governed.

To form a corporation in Maryland, you will need to file Articles of Incorporation with SDAT, create By-Laws and an organizational action naming directors and officers (depending on the type of corporation i.e. a Maryland close corporation may elect to avoid having a board of directors), and obtain an EIN from the IRS.

No matter what type of business you are forming, you will need to file an annual report with SDAT by April 15th of each year and comply with tax requirements depending on whether you are taxed as a C Corp, a S Corp or a partnership. You also might need to file (Beneficial Ownership Information (“BOI”)) with the U.S. Department of Treasury.

At Saltzman Law, we can help you decide what type of business is right for you and help you through the steps of forming that business.