As 2020 is coming to a rapid close and business losses are looming, noncorporate taxpayers should consider whether their businesses will generate net operating losses (NOLs), and whether any loss limitation rules will prevent them from utilizing these losses on their individual returns. Several months ago, we alerted clients to the recent change in NOL rules. Under the CARES Act, NOLs generated in tax years beginning after December 31, 2017 and before January 1, 2021 (i.e., 2018, 2019 and 2020 for calendar year taxpayers), can be carried back five years, and carried forward indefinitely with no limitation. For noncorporate…

The COVID-19 pandemic has caused significant challenges to M&A transactions. Negotiations have crumbled, closings have been delayed and overall M&A activity has declined. While uncertainty remains about when M&A activity will return to normal, it appears that M&A litigation will increase in the coming months. Cases are being filed across the country as buyers and sellers who entered into M&A deals prior to—or in the early stages of—the pandemic seek legal relief to enforce or excuse obligations under their respective agreements. One of the more talked about disputes involves Victoria’s Secret owner, L Brands, who sued Sycamore Partners after Sycamore…

RETIREMENT PLAN DEVELOPMENTS IRS and DOL Release Guidance Addressing Changes Under the SECURE Act IRS Publishes Notice 2020-68 Addressing the Bipartisan American Miners Act and SECURE Act The Internal Revenue Service (IRS) released Notice 2020‑68 addressing a variety of provisions in the Bipartisan American Miners Act and the Setting Every Community Up for Retirement Effectiveness Act (the SECURE Act). Offering a Cash or Deferred Arrangement to All Long‑Term, Part‑Time Employees. The SECURE Act requires all sponsors of defined contribution plans offering a cash or deferred arrangement to permit long‑term, part‑time employees to begin participating in the plan solely for the purpose of…

On September 8, 2020, the U.S. District Court for the Southern District of New York issued an order that effectively halts the enforcement of the U.S. Department of Labor’s (DOL) recently promulgated rule regarding joint employment under the Fair Labor Standards Act (FLSA). This ruling impacts staffing agencies, subcontractors and entities whose employees perform work for the benefit of another entity. The Court Strikes Down the DOL’s Test In March 2020, the DOL clarified and limited the circumstances under which employers could be held liable for minimum wage and overtime violations under the joint employer rule. It adopted a four-factor…

On September 16, 2020, the U.S. Department of Labor (DOL) Wage and Hour Division published revisions and clarifications to the April 1, 2020, temporary rule regarding public health emergency leave under the Family and Medical Leave Act (FMLA) that has assisted families in dealing with medical emergencies arising out of the COVID-19 pandemic. Part of this emergency medical leave was created by the March 2020 Families First Coronavirus Response Act (FFCRA) and is set to expire on December 31, 2020. An August 3, 2020 Southern District Court of New York decision found certain provisions of the temporary rule under FFCRA invalid. Most…

On September 8, 2020, the U.S. Equal Employment Opportunity Commission (EEOC) once again updated its pandemic guidelines, this time to include additional information on COVID-19 screening and testing in the workplace, confidentiality, accommodations for teleworking employees and discrimination. Employers should be aware of the following updates: COVID-19 Testing and Screening in the Workplace An employer may ask all employees physically entering its workplace if they have COVID-19 or symptoms associated with COVID-19 and if they have been tested for COVID-19. However, an employer is generally not permitted to ask these questions to teleworking employees because they do not pose a…

On September 11, 2020, the U.S. Department of Labor (DOL) issued revised Families First Coronavirus Response Act (FFCRA) regulations in response to Judge J. Paul Oetken’s decision on August 3, 2020, in State of New York v. United States Department of Labor. As described in more detail below, employers should take immediate note of two key changes that the DOL has made to its rules for enforcing the FFCRA. First, the DOL has tightened the definition of “health care provider” under the FFCRA. As a result, far more employees have the right to take leave and may not be exempted…

The Main Street Lending Program (Program) is intended to facilitate lending to small and mid-sized businesses and nonprofit organizations that were in sound financial condition prior to the onset of the COVID‐19 pandemic. The aspects of the Program for nonprofit organizations became fully operational on September 4, 2020. The portion of the Program for for-profit businesses has been open since July. Under the Program, eligible lenders will originate new term loans (or expand the size of an existing credit facility) to eligible borrowers. A special purpose vehicle (SPV) funded by the Federal Reserve Bank of Boston will then purchase…

A new portion of the Main Street Lending Program (Program) is intended to facilitate lending to nonprofit organizations that were in sound financial condition prior to the onset of the COVID‐19 pandemic. The aspects of the Program for nonprofit organizations became fully operational on September 4, 2020. The two facilities for nonprofit organizations under the Program are the Nonprofit Organization New Loan Facility (New Loan Facility) and the Nonprofit Organization Expanded Loan Facility (Expanded Loan Facility). This alert summarizes and compares these two facilities and reflects guidance through the most recent frequently asked questions (FAQ) of September 4, 2020. The…

The Main Street Lending Program (Program) is intended to facilitate lending to small and mid-sized businesses that were in sound financial condition prior to the onset of the COVID-19 pandemic. The Program as to for-profit businesses became fully operational on July 6, 2020, nearly three months after the first proposals were released by the Federal Reserve. Under the Program, eligible lenders will originate new term loans (or expand the size of an existing credit facility) to eligible borrowers. A special purpose vehicle (SPV) funded by the Federal Reserve Bank of Boston (Reserve Bank) will then purchase a 95 percent participation…

On August 17, 2020, the Wisconsin Department of Natural Resources (DNR) sent 3,038 letters to Responsible Parties (RPs) involved in cleanup at remediation sites across Wisconsin.[1] The letter explains DNR’s interpretation of statutes and rules related to remediation sites, and insists that RPs assess for emerging contaminants such as PFAS. PFAS is a broad class of more than 4,000 compounds so ubiquitous they are found in the blood of many adults in the United States. Use of the compounds began in the 1940s. The compounds can be found in many household items and are used for a number of…

On August 26, 2020, the U.S. Securities and Exchange Commission (SEC) adopted amendments to expand the “accredited investor” definition in Rule 501 of Regulation D under the Securities Act of 1933. Rule 506 of Regulation D is the key federal exemption for private placements, and nearly all offerings under Rule 506 are limited to accredited investors. Key new categories include natural persons with certain professional credentials, knowledgeable employees of private funds, and family offices and other entities with investments in excess of $5 million. There are two alternatives under Rule 506. Rule 506(b) permits sales to an unlimited number of…