Daniel Ruttenberg, JD, CPA, LLM - there are as nearly many letters after his name as there are in it. While the list of credentials is impressive, what is most important to this partner at SmolenPlevy is what he learned achieving them. He learned to analyze and address his clients' legal needs from multiple perspectives. "Most people who refer clients to me think of me as a high level tax attorney", explains Ruttenberg, whose practice areas include tax planning for business, general corporate law, estate planning and estate administration. "Taxes often drive the planning I do with clients, but by no means are they the only factor to consider. There's family and business politics, cash flow needs, risk tolerance, creditor protection issues and incapacity concerns. The list goes on and on. It's my job to craft solutions which resolve those many issues."

Ruttenberg's extensive education and experience give him the background to develop effective and complex multipronged approaches to legal issues. He received his Bachelors of Science with a double major in accounting and finance from the University of Maryland. He then earned his Juris Doctor with Honors from George Mason University School of Law and his Master of Laws (LLM) in Taxation with distinction from Georgetown University Law Center. Ruttenberg is especially proud of his license as a Certified Public Accountant, putting him into an elite group of lawyers with LLMs and CPAs.

While his education and experience give him the ability to tackle some of the most complex and intricate legal issues, Ruttenberg says one of his top priorities is to keep matters understandable for clients. For instance, when starting the process of establishing an estate plan, there are no one-size-fits all questionnaires to fill out or meetings with a paralegal. Instead, Ruttenberg sits down and speaks with clients one-on-one. Getting to know his clients personally is one of the favorite and most important aspects of his law practice. "A lot of information comes out during a conversation that would not appear on paper. I end up getting a much better sense of who they are and what is important to them."

The trust that develops is vital because solutions often require Ruttenberg to go beyond what clients think they need. No matter how complex someone's business or personal situation, or how high their net worth, most people consider their situations to be very simple. "With regard to estate planning, for example, most people have not considered issues such as estate tax planning, whether an inheritance should be held in trust for children, whether they will be avoiding probate, or whether someone they trust will be able to access their assets if they become incapacitated." None of these issues can be properly dealt with through a simple will.

Most decisions, whether they address personal or corporate matters, require a broad review of the repercussions, tax or otherwise, and potentially may require a preemptive remedy to deal with foreseeable complications. Ruttenberg is able to explain these complex concepts in a straightforward manner, leaving his clients confident in their decisions. "I like to guide them to the solution instead of just telling them what they need. I want my clients to understand what I am recommending and why."

Too often, Ruttenberg has seen what happens when these issues are not addressed properly or timely. Some common examples include when a business owner dies without a succession plan in place; when a business deal is entered into on a handshake; and when a person fails to update his or her estate plan after remarriage, thereby leaving assets to a former spouse. "In many cases I'm able to help," says Ruttenberg. "But it's imperative to properly plan and keep your plans up to date with the changes in your life."

Despite his busy practice, Ruttenberg is actively involved in his community. For the past six years he has served as Vice-President of the charity, Devotion To Children, which provides access to high-quality educational and childcare programs for children from low-income families, aged six and under. Ruttenberg also recently finished seven years of service as a Director of the Fairfax Bar Association (FBA), a group consisting of over 2,000 attorneys. During this period, he was also served as President. Ruttenberg also served as a member of the Board of Directors for the Fairfax Law Foundation.

Ruttenberg is a member of the Bars in Virginia, Maryland, and the District of Columbia. He can be reached at (703) 790-1900 and dhruttenberg@smolenplevy.com.

For over 30 years, the federal government has been using tax incentives to help preserve historic buildings. Originally, federal law allowed accelerated depreciation on rehabilitated buildings, but subsequent changes have made preservation and revitalization efforts even more attractive to taxpayers.

Today, there is a general business credit equal to 20% of qualified rehabilitation expenses for a certified historic structure, or a 10% tax credit for the qualified rehabilitation of nonhistoric, nonresidential buildings first placed into service before 1936. Eligibility for the tax incentives is determined by the National Park Service.

Tax credits are often more beneficial to taxpayers than deductions are, since every dollar of a tax credit reduces the amount of income tax owed by one dollar.

The 20% credit for the rehabilitation of a certified historic structure applies to commercial, industrial, agricultural, rental, or residential properties, but not to properties used exclusively as the owner's private residence. A certified historic structure must be a building as opposed to another type of structure. To have the required historic status, the building must be either listed individually in the National Register of Historic Places or located in a registered historic district and certified as being of historic significance to the district.

Eligibility for the 20% credit also depends on meeting some additional requirements. For example, the building must be depreciable, that is, used in a trade or business or held to produce income. The rehabilitation must be substantial, generally defined as entailing expenditures exceeding the adjusted basis of the building and its structural components. Generally, this requirement must be met within two years or within five years for a project completed in multiple phases.

Qualified rehabilitation expenses include such items as architectural and engineering fees, site survey and development fees, legal expenses, and other construction-related costs, so long as they are added to the basis of the property, are reasonable, and are related to services performed.

The owner of the rehabilitated building must hold it for five years after completion of the rehabilitation or else pay back all or part of the 20% credit. A sale in the first year means that the entire credit is recaptured. The recapture amount is reduced by 20% per year for properties held between one and five years.

The 10% credit for nonhistoric buildings constructed before 1936 shares some of the requirements for the 20% credit, such as that the rehabilitation be substantial and the property be depreciable. However, only buildings rehabilitated for nonresidential uses qualify for the 10% credit. In addition, so that the identity of the original building is not lost in the process, projects undertaken for the 10% credit must meet specific tests based on retention of minimum percentages of the building's walls and internal structural framework.

An S corporation is a form of business classified for federal income tax purposes as a corporation that has elected to be taxed as a pass-through entity, in a manner similar to a partnership or sole proprietor. Unlike a regular corporation, or C corporation, an S corporation (both names derive from sections of the Internal Revenue Code) generally is not subject to federal income tax. Instead, its income is reported on the tax returns of its shareholders, and they have the responsibility for paying the tax. If there are losses suffered by the corporation, they also pass through and are reported on the shareholders' income tax returns.

Because only the shareholders, and not the corporation, are taxed, S corporations avoid the problem of double taxation associated with C corporations. This is the biggest draw for creating an S corporation, particularly for closely held corporations.

Shareholders in an S corporation, like shareholders in a C corporation, generally have limited liability arising from corporate matters, even though they pay taxes as if they were partners or sole proprietors. In addition, when the corporation eventually is sold, there can be reduced taxable gains, as compared with the sale of a business operating as a C corporation.

On the downside, the limitation on classes of stock in an S corporation provides less control over the company and the value of its stock. Potential outside investors likely will not be attracted by the pass-through tax characteristics of an S corporation, nor by the limit on the number of shareholders. Although corporate taxes are avoided, there is still a requirement for filing an informational tax return every year for a corporation with more than one owner. Finally, if avoiding formalities is an important consideration, it should be noted that, like any other corporation, an S corporation must follow the requirements for having regular meetings and keeping company minutes.

The balancing of the advantages and drawbacks of S corporation status in any given case is sufficiently complex that it is advisable to seek professional advice before making this important choice.

When it comes to divorce, Facebook isn't a friend. Family law attorneys Alan Plevy and Kyung (Kathryn) Dickerson of SmolenPlevy are urging clients to use extreme caution when using Facebook, Twitter and other social media sites. "If you're facing a divorce, it's wise to break up with Facebook too," cautions Plevy.

"Sometimes catching a cheating spouse is as simple as checking their status updates and photo albums on Facebook," says Dickerson, who, along with Plevy, make it a point to mine Social Media sites for information in divorce cases. "Many an ex has updated or Tweeted about their new boyfriend or girlfriend, the jewelry they've bought, the parties they've attended and the romantic weekends they've shared. That's potent material when the same ex is in court claiming poverty to avoid alimony or additional child support." The SmolenPlevy attorneys warn that the damage can just as easily be caused by others, including a new romantic interest who likes to share too much personal information online or who likes to post pictures on a photo-sharing site. In many cases, that information is repeated by "Friends" and Re-Tweeted by followers, leaving a long trail of copies of information that a party in litigation would prefer not to have available to their ex. Why do people feel the need to reveal their liaisons? "Often when you're running around, you're not thinking anyway," Plevy says.

The attorneys say social media sites have come into play in unique ways in their cases, including:

• A still-married man who listed his Facebook status as single, and then Friended his soon-to-be ex wife. He then posted hateful comments about his spouse and children, comments about the marriage and their respective contributions to the marriage and his intentions with regard to the litigation. These postings were the opposite of what he testified to and how he wanted to portray himself in court.
• Suffering from post-partum depression, a woman blogged that she didn't want her child and wished the child was never born. While she could explain her comments in light of her psychological condition, the comments were used to argue that she should not have primary custody of the infant.
• A trail of tell-tale texts were used to argue infidelity. Dickerson notes that depending upon the model of phone just because people hit 'Delete' doesn't mean the messages disappear from the phone's internal hard drive or that they cannot be accessed by forensic professionals with the right equipment.

There are questions about whether Social Media postings are admissible as evidence in court. Dickerson says this Facebook phenomenon is being considered by judges on a case to case basis. But between boastful updates, revealing pictures, salacious texts, too-sweet Tweets and other material, Dickerson says there's often enough to affect important, and often costly decisions.

Under the federal Fair Labor Standards Act (FLSA), employers must pay an employee an overtime rate of at least one and one-half times the regular pay rate for any hours in excess of 40 hours a week. There are exemptions from this requirement for several types of employees, including employees in executive, administrative, or professional capacities.

Two recent decisions by federal appellate courts illustrate the fine distinctions that are sometimes made between employees who are deemed entitled to overtime and those who are not because they are employed in an "administrative" capacity.

Under the FLSA and its regulations, an employee earning at least a threshold amount per week is an administrative employee if his or her primary duties consist of the performance of office or nonmanual work directly related to the management policies or general business operations of the employer or the employer's customers and if the work requires the exercise of discretion and independent judgment.

Insurance Adjusters Exempt

In the first case, the primary duty of an insurance company's automobile damage adjusters consisted of the assessment, negotiation, and settlement of automobile damage claims, making the adjusters exempt from the FLSA overtime pay provision. The fact that the adjusters engaged in total-loss negotiations 20 times per year demonstrated that their duty included the exercise of discretion and independent judgment.

The adjusters also worked in the absence of immediate supervision the majority of the time and made decisions that were reviewed only after the estimate had been written and the claim had been paid. They had full authority to settle claims within their limits of $10,000 or $15,000, as long as they could justify their decision on the facts of each claim, thereby binding their employer financially.

Saleswoman Entitled to OT

By contrast, in the second case, an advertising saleswoman for a magazine publisher, who was also compensated weekly above the threshold amount, was not an "administrative employee" for the purposes of the FLSA, and thus was entitled to overtime pay.

The employer pointed out that the employee's responsibilities included developing new clients, with the goal of increasing sales generally, and that this task concerned general management and business operations. That was true as far as it went, but the fact remained that the employee's primary duty, meaning the duty that consumed a major part, or over 50%, of her time, was simply to sell specific advertising space to clients. Since, in the court's view, the employee was "plainly a salesperson", she had to receive overtime pay whenever it was earned.