Articles Posted in Outlook and Trends

14 July 2025
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One Big Beautiful Bill Act – Key Tax Provisions

by JMBM’s Taxation and Trusts & Estates Department

The One Big Beautiful Bill Act (“OBBB”) was signed into law on July 4th, 2025, ushering in sweeping changes to the U.S. federal tax landscape. The OBBB permanently extends and expands many provisions of the Tax Cuts and Jobs Act (“TCJA”), and introduces significant updates that will impact both individuals and businesses. The following are among the more notable provisions in the OBBB.

Income Tax Rates

The OBBB permanently extends the reduced individual income tax rates and brackets originally enacted by the 2017 TCJA, which were previously set to expire after 2025.
Taxpayers will continue to benefit from the lower income tax rates: 10%, 12%, 22%, 24%, 32%, 35%, and 37%.

Estate, Gift, and Generation-Skipping Transfer Tax Exemption

The OBBB permanently raises the federal estate, gift and generation-skipping transfer tax exemption to $15 million per individual (or $30 million for married couples), effective for estates of individuals and gifts made after Dec. 31, 2025. This exemption amount will continue to be indexed for inflation in future years.

SALT Deduction and Passthrough Entity Tax

The OBBB temporarily raises the cap on the state and local tax (“SALT”) deduction from $10,000 to $40,000 for 2025, with the cap increasing by 1% annually through 2029. Starting in 2030, the cap reverts to $10,000. However, for taxpayers with modified adjusted gross income over $500,000, the available SALT deduction phases down by 30% of the excess income, but never below $10,000 (with the threshold amount also increasing by 1% annually through 2029). CONTINUE READING →

9 December 2024

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As previously outlined in our November blog post, the Corporate Transparency Act (CTA) was poised to impose significant federal reporting obligations on U.S. business entities starting January 1, 2025. However, a recent Federal District Court ruling has altered the compliance landscape dramatically.

On December 3, 2024, the court issued a nationwide preliminary injunction in Texas Top Cop Shop, Inc., et al. v. Merrick Garland, declaring the CTA likely unconstitutional. The injunction prohibits the Treasury Department from enforcing the Act while the case is under review. On December 5, the Treasury Department appealed the decision to the 5th U.S. Circuit Court of Appeals, but no guidance has been issued yet on the impact of the injunction.

What Does This Mean for Businesses?

This ruling effectively halts the January 1, 2025, CTA filing requirement for now. While businesses that were preparing to comply may be relieved, it is important to stay alert as the situation evolves. Here’s what you need to know:

1. No Immediate Filing Obligation
   The injunction pauses the enforcement of CTA requirements, including the submission of Beneficial Ownership Information (BOI) reports to FinCEN.
2. Uncertainty Surrounding Compliance Deadlines
   If the injunction is lifted, compliance efforts may need to resume quickly. We expect reasonable notice for any reinstated deadlines, but businesses should be prepared to act promptly.
3. Legislative or Regulatory Action Possible
   It remains unclear if legislative changes or additional Treasury Department guidance will emerge to address the court’s ruling or adjust the CTA framework.

CONTINUE READING →

08 November 2024

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JMBM’s Real Estate Practice Receives National Tier 1 Ranking in 2025 Edition of “Best Law Firms”

Jeffer Mangels Butler & Mitchell LLP (JMBM) is pleased to announce that its Real Estate (including its Hospitality Transactions) practice has received the highest possible designation of National Tier 1 in the 2025 edition of U.S. News and World Report – Best Lawyers® “Best Law Firms.”

The report recognizes the top law firms in the country for professional excellence based on peer review. JMBM’s Trusts & Estates and Land Use & Zoning practices also received a National Tier 1 designation.

In addition, the Firm received Metropolitan Tier 1 rankings in the following areas:

Los Angeles

• Closely Held Companies and Family Businesses Law
• Land Use & Zoning Law
• Litigation – Trusts & Estates
• Real Estate Law
• Tax Law
• Trademark Law
• Trusts & Estates Law

CONTINUE READING →

08 November 2024

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As the January 1, 2025, filing deadline for the Corporate Transparency Act (CTA) approaches, hotel owners, developers, and investors should be prepared to meet the new federal requirements for business transparency. Effective January 1, 2024, the CTA requires most U.S. business entities to submit detailed ownership information to FinCEN or face penalties up to $10,000. The article below by JMBM’s Taxation, Trusts & Estates Department outlines key CTA requirements, filing deadlines, and essential steps for compliance.

Corporate Transparency Act:
Upcoming January 1, 2025 Filing Deadline

by

JMBM’s Taxation, Trusts & Estates Department

Overview of the CTA Requirements and Compliance Obligations

The CTA, which became effective January 1, 2024, introduces extensive federal disclosure obligations for all businesses that do not qualify for an exemption, regardless of when formed. These new reporting requirements are stringent and can trigger multiple filings in a single calendar year exposing noncomplying individuals and entities to both civil and criminal penalties. Pursuant to the CTA, the Financial Crimes Enforcement Network (“FinCEN”) is authorized to collect beneficial ownership information (“BOI”) with respect to business entities (referred to as “Reporting Companies”) formed or registered to do business in the U.S. and disclose such BOI to various federal and state agencies (including the IRS).

In this regard, any Reporting Company that does not qualify for an exemption from reporting must comply with these reporting obligations irrespective of whether it existed before or after January 1, 2024. Penalties for noncompliance include fines of up to $10,000 – making early compliance essential for avoiding these penalties. CONTINUE READING →

13 May 2024

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In the article below, Partner Michael H. Strub, Jr., analyzes the complexities surrounding non-compete agreements and the FTC’s recent decision to ban them. With the enforceability of the FTC’s rule facing legal scrutiny, he discusses the likelihood of a cohesive federal approach and its implications for employers nationwide.

Navigating Non-Competes

by

Michael H. Strub, Jr., JMBM’s Litigation Group

The Federal Trade Commission’s rule that would ban non-competition faced legal challenges from the day it was issued. What are the obstacles the rule faces, and what is the likelihood that some form of federal rule will be created?

Before analyzing these questions, it should be noted that state laws on the enforceability of non-competes are, literally, all over the map. In his article, Fifty Ways to Leave Your Employer: Relative Enforcement of Covenants Not to Compete, 13 U. Pa. J. Bus. L., 751, 786 (2011), Norman Bishara ranked the states from 1 to 50 based on their willingness to enforce non-competes and had a separate ranking for each one. Based on his analysis, Florida is the state that has been the friendliest for enforcement, while California is the most hostile.

As Robert McAvoy notes in his article, How Can Federal Actors Compete on Noncompetes?, 126 Dick. L. Rev. 651 (2022), this panoply of laws is complicated by the employer’s efforts to use choice of law provisions to select the law of a friendly state even if the employee is employed in a state where non-competition clauses are invalid. In Stone Surgical, LLC v. Stryker Corp., 858 F.3d 383, 391 (6th Cir. 2017), for example, the court enforced a non-competition clause under Michigan law against a terminated employee even though the employee worked exclusively in Louisiana, whose law would have prohibited the agreement. CONTINUE READING →

24 April 2024

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The U.S. Federal Trade Commission’s recent decision to ban non-compete agreements marks a pivotal shift in employment regulations nationwide. This rule not only prohibits new agreements but also retroactively impacts existing ones. From its broad definition of “worker” to its exceptions and impending legal challenges, understanding the nuances of this rule is crucial for employers preparing for compliance. JMBM Partner Michael H. Strub, Jr. explains the implications of this landmark decision.

FTC Announces Rule Banning Non-Competes

by

Michael H. Strub, Jr., JMBM’s Litigation Group

Employers throughout the country should be aware that on April 23, 2024, the U.S. Federal Trade Commission adopted a rule that would generally prohibit non-compete provisions, which prohibit workers from accepting work in a competing business or operating a competing business. Specifically, the rule prohibits employers from entering into new non-compete provisions and acts retroactively to prohibit employers from enforcing existing ones.

The rule defines “worker” broadly, and includes, for example, independent contractors and unpaid workers.  The rule includes an exception in connection with the bona fide sale of a business and allows existing lawsuits to enforce non-compete clauses to continue. The rule also permits enforcement of existing non-compete provisions with senior executives—policy makers whose total compensation is at least $151,164 when annualized—but prohibits new ones.

The rule also requires employers to give notice of the new rule, so there will be yet another piece of paper that must be tacked to the cork board in the company kitchen. CONTINUE READING →

26 January 2024

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Global Hospitality Group® Chairman Jim Butler to receive [CLIC] Lifetime Achievement Award

LOS ANGELES—Jeffer Mangels Butler & Mitchell LLP (JMBM) is pleased to announce that Jim Butler, a founding partner of JMBM and chairman of the Firm’s Global Hospitality Group®, will receive the Lifetime Achievement Award at the 2024 California Lodging Investment Conference [CLIC].

“Jim was the obvious and unanimous choice to receive the third [CLIC] Lifetime Achievement Award,” said Craig Sullivan, founder/president, [CLIC] in a press release. “Not only did he co-found one of the leading hospitality law firms that has become synonymous with the industry, but he also has worked on thousands of acquisitions, sales, developments, brandings, repositionings and financings throughout his career. He has graciously taken the time to mentor new hospitality professionals, helping to make the industry a better place. For this and so many more reasons, he is the perfect recipient.”

Jim is one of the top hotel lawyers in the world, and he devotes 100% of his practice to hospitality, providing unmatched hotel business experience and practical legal advice.

Jim and his team represent lenders, owners, developers, independent management companies and capital providers on their hotel projects worldwide. The Group brings more than 30 years’ of hotel experience with more than 4,700 hospitality properties located around the globe valued at more than $125 billion. They have worked on more than 2,700 hotel management and franchise agreements and more than 100 hotel mixed-use developments.

“I am honored to accept CLIC’s Lifetime Achievement Award,” said Butler. “I would like to extend my gratitude to the thousands of clients who have trusted the Global Hospitality Group to help them accomplish their goals.” CONTINUE READING →

07 December 2023

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On December 5, 2023, the Los Angeles City Council removed a contentious measure from the March 2024 ballot which would have required hotels in the city to provide accommodation for homeless individuals alongside paying customers. The proposed ordinance, initially sponsored by hospitality worker union UNITE HERE Local 11, was withdrawn at the request of the union following a compromise ordinance.

UNITE HERE Local 11’s original proposal would have compelled hotels to report their vacancies to the city of Los Angeles Housing Department. Individuals or families would then be given a “market rate” voucher for payment at these locations which the hotels would not be able to refuse.

The measure faced sharp criticism from the American Hotel & Lodging Association (AHLA). AHLA President and CEO Chip Rogers accused Unite Here of creating “an atmosphere of dangerous uncertainty for hotel employees, hoteliers and the City of Los Angeles.” He characterized the proposal as a bargaining chip rather than a genuine effort to tackle the homelessness issue. Following the withdrawal of the ballot measure, Rogers expressed gratitude to the LA City Council for brokering a compromise that removed what he called UNITE HERE’s “ridiculous homeless-in-hotels proposal” from consideration. He emphasized the importance of prioritizing the safety and security of hotel employees and guests, urging leaders in LA and other cities to learn from this episode and put safety first in future dealings with Unite Here. CONTINUE READING →