inflation

What US Cities Will Be Most Impacted by The Recession?

What US Cities Will Be Most Impacted by The Recession?

“Increasing interest rates and high inflation have the US economy facing a potential recession in 2023. More and more businesses are choosing to decrease their employment rates, inventories, and construction projects to prepare for the worst.”

How Large Affluent Companies Avoid Bankruptcy

Many of the top companies in the world are backed by teams of experienced lawyers tasked with the job of finding clever ways of circumventing the law to allow these billion-dollar corporations to avoid lawsuits.

Decreasing taxes, sidestepping finance laws, and avoiding lawsuits from customers are a few examples of situations where large corporations utilize legal loopholes in order to remain successful.

Let’s discuss five legal loopholes large corporations use to avoid lawsuits:

1.    Tax Havens and Transfer Pricing

2.    Punitive Damages Deduction

3.    Carried Interest

4.    Patent Injunctions

5.    Bankruptcy

Tax Havens and Transfer Pricing

International corporations are not required to pay taxes on any profits incurred overseas unless they transfer the profits to a US bank. Transfer pricing is a practice adopted by international corporations that allow companies to transfer international profits to offshore banks so that they’re considered overseas earnings. The profits are kept in an offshore account where taxes are indefinitely deferred.

Punitive Damages Deduction

When large corporations are found to be criminally liable for an offense and are charged with punitive damages, according to the law, these expenses are considered normal business expenses. Companies are therefore able to claim the cost of this lawsuit as a business expense and significantly reduce the cost to the company.

Carried Interest

The managers and CEOs of the world’s leading companies are able to pay significantly lower taxes on their income than the average person. The profits earned from investing in a company are known as carried interest and are taxed at the capital gains rate which is a much lower rate than income. Instead of claiming to receive a salary for working at a company, CEOs and managers refer to their earnings as carried interest in order to avoid paying higher taxes.

Patent Injunctions

Patent injunctions are used when a company believes that another organization’s product is infringing on its copyrights. If a judge grants the injunction, the opposing company is prevented from selling the infringing product. Corporations have used this threat as a scare tactic to influence small companies to discontinue selling their product or pay them an exorbitant fee. This method has ensured that larger corporations have been able to dominate their industry by monopolizing sales of particular products.

Bankruptcy

Large corporations sometimes use bankruptcy to avoid lawsuits. This is a controversial legal strategy that is still used today. Large corporations establish shell companies that take on legal liability while keeping their valuable business assets separate from this new company. The shell company then files for bankruptcy which in turn freezes any lawsuits associated with the company. The goal of this tactic is to permanently block or delay any lawsuits against the parent company.

Final Thoughts

Several different clever legal strategies have been utilized by companies throughout the years to avoid any legal ramifications for their actions. Bankruptcy, tax havens and transfer pricing, patent injunctions, carried interest, and punitive damages deductions are a few of the legal loopholes utilized by multinational corporations.

If you are already filling the pinch of the recession and you need to file bankruptcy please schedule an appointment with us here at Hishaw Law LLC. We are experienced in handling Chapter 7 and Chapter 13 matters. Please complete the online bankruptcy form. To schedule a consultation with Hishaw Law LLC please contact us at 1.307.228.0407

Why is There an Increase in Families' Cars Being Repossessed?

Why is There an Increase in Families' Cars Being Repossessed?

The rate of car repossessions in the United States is on the rise and is expected to continue to do so in the coming years. In 2020, repossession rates were at the lowest they had been for six years before the pandemic. However, in 2022, repossession rates reached nearly pre-pandemic levels and in the case of low-income families, had exceeded their 2019 rates.

Why Chapter 13 Bankruptcy Filings Increased Last Year?

Why Chapter 13 Bankruptcy Filings Increased Last Year?

In 2022, Chapter 13 bankruptcy filings increased by 26.6% while business and other personal bankruptcy filings fell by 11.7%. Chapter 13 bankruptcy was established to provide debt relief to individuals who are struggling financially by giving them the grace to pay off their debts without the worry of losing their assets to creditors. In this article, we will discuss what is Chapter 13 bankruptcy and how it works as well as why there was an increase in Chapter 13 bankruptcy filings in 2022.