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The IRS is Cracking Down on Trust Promoters

The IRS is Cracking Down on Trust Promoters

By: Ted Sutton, Esq. There are some promoters out there who claim that they have a trust strategy whereby the trust avoids paying income taxes. But recent IRS rulings have started to crack down on this practice.   The most recent ruling came from Chief Counsel...

The Difference Between Certificated And Uncertificated Securities

The Difference Between Certificated And Uncertificated Securities

By: Ted Sutton, Esq. A security refers to an ownership interest in a business or a financial instrument. These ownership interests can be in a private LLC, or corporation, or in a publicly traded stock or bond. There are two choices for holding ownership interests in...

New York LLC Transparency Act

New York LLC Transparency Act

By: Ted Sutton, Esq. Marissa was an aspiring barista who lived in New York City. After she graduated high school, she started her own coffee shop in Brooklyn. She properly formed a New York LLC. However, she forgot to report her beneficial ownership information to...

Protecting Your Business and Investments

It is well recognized that limited liability for shareholders, officers and directors is the number one reason to incorporate. Indeed, the origin of the modern day corporation in England five hundred years ago was due to limited liability concerns. Why invest in a manufacturing plant, why send a sailing ship to trade around the world, if by doing so you increase your exposure? As an investor you’ve already put your money at risk once by venturing into the deal. You’ve done your part to advance the local economy and, hopefully, your prospects as well. By doing so, why should then all your other assets be at risk if the plant burns down or the ship sinks at sea?

Gradually, governments came to understand that in order to promote economic development, to create jobs and, yes, to collect more taxes, they needed to protect investors. And so the modern day corporation came into its own: an entity that encouraged investment for a larger good by limiting the liability of investors to the amounts contributed.

The corporation was followed by the limited partnership and the limited liability company. Now, all three good entities offer asset protection, shielding owners from personal attacks against their business. Indeed, the good entity is one of the key developments in the history of business. With a good entity, entrepreneurs can pursue opportunities without worry of losing absolutely everything. A key development, you’d have to agree.

Given this evolution to protected entities, why would you use the old fashioned, unprotected variety? If your advisor continues to recommend sole proprietorships and general partnerships perhaps you need a new advisor.

The IRS is Cracking Down on Trust Promoters

The IRS is Cracking Down on Trust Promoters

By: Ted Sutton, Esq. There are some promoters out there who claim that they have a trust strategy whereby the trust avoids paying income taxes. But recent IRS rulings have started to crack down on this practice.   The most recent ruling came from Chief Counsel...

The Difference Between Certificated And Uncertificated Securities

The Difference Between Certificated And Uncertificated Securities

By: Ted Sutton, Esq. A security refers to an ownership interest in a business or a financial instrument. These ownership interests can be in a private LLC, or corporation, or in a publicly traded stock or bond. There are two choices for holding ownership interests in...