Yes. WHAT IS IT? The Corporate Transparency Act (CTA) became effective on January 1, 2024. For the first time, the United States now will require certain legal entities to report to the federal government identifying information about the individuals who directly or indirectly own or control a company within the scope of the new legislation. […]
Not only is it true . . . it’s worse than you think. When it comes to LLCs, the FTB collects a tax (the FTB calls it a [ahem] “fee”) above the $800 if the LLC’s revenues meet or exceed $250,000. Here’s a link to the graduated fee scale. The fee is capped at $11,790 […]
There’s some paperwork . . . corporations tend to have more paperwork, which is why some people might immediately gravitate to LLCs, or nothing at all. And, yes, if you want to maintain your status as a corporation, and maintain your limited liability, don’t cut corners on the paperwork. It’s important.
If you have an existing business, then its assets and contracts should get transferred to your corporation. This can look like an assignment, or a bill of sale. There are tax considerations regarding contribution of the assets of your existing business. You may also need to notify third parties, such as vendors and landlords. A […]
The answer in most situations is going to be yes. One of the virtues of an LLC is its simplicity. Once you choose to form your business as a corporation (and then an S Corporation), or to have your LLC elect to be taxed as an S Corporation, costs for tax returns, payroll, corporate state […]
That would be nice, but this is the beginning of you needing to think about why you formed the corporation to begin with: to make it separate from the sins of the past. So, no, you will need a new bank account, with a new tax ID number. Sorry.
A share represents a shareholder’s ownership in a corporation. This can either be evidenced by a paper certificate or an entry in the corporation’s books.
Authorized shares are the number of shares your corporation is authorized to issue. You do not have to issue all of your authorized shares, and frequently it can be a mistake to do so. Authorized shares merely sit on the corporate books as shares available to issue. If you need to issue more shares than […]
Directors are the individuals who direct or guide the corporation with respect to its overall business model and, well, direction. The board sets policy and votes on major or extraordinary decisions. Shareholders elect directors, and directors elect officers. The “board” is the entirety of all of the directors.
Whether for a corporation or in any business or political setting, bylaws are the rules that govern the procedures of the particular entity. In a corporation, the bylaws is the set of rules which address, for example, when meetings will be held, and what the duties of the officers are. Though it’s a standard document […]