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Is an LLC a Separate Legal Entity?

Is an LLC a Separate Legal Entity?

Is an LLC a separate legal entity? First let’s answer what an entity is. An entity is a business organized according to state law to limit owner liability.

Know the Hazards of Personal Guarantees

Know the Hazards of Personal Guarantees

What is a personal guarantee? If you’re pursing a business loan, you may be asked to sign a personal guarantee. Know what it could cost you before signing.

When States Raise Their Fees…

When states raise their fees, people vote with their feet. We described Nevada’s new corporate fees in our last issue (a jump from $325 a year to $650.) We also described how you could ‘continue’ your Nevada entity (or any state entity for that matter) into Wyoming,...

New Increased Nevada Entity Fees (and a Solution to Them)

The state of Nevada legislature and governor approved higher business taxes last week. Some of the changes have been identified. Others have not seen the light of day. We do know that business license fees have increased. For profit corporations will have annual fees...

Before You Invest In Real Estate, Educate Yourself

I’m not suggesting that you need to know everything. You don’t. You’ll continue to learn as you go. But you must educate yourself in the basics to get started on the right foot. A little education goes a long way in accomplishing four essential goals: 1. Demystify...

Real Estate Investors: 2 Passive Loss Rules Can Save You $25,000

The biggest tax challenge for real estate investors are the passive loss rules. Under these rules, passive losses can only be used to offset passive income. A business activity is passive if the owner does not spend much time (typically less than 500 hours per year)...

Winning With Trademarks

Winning With Trademarks

Registering a trademark is an important step in any business venture – one that should not be overlooked. By protecting the name of your business, products or services, you ensure that others cannot use the trademarked words or designs.

Is a B Corporation or a Benefit Corporation Right for You?

You have a great idea that will help your community. You want to benefit the environment, as well as your bottom line. Everything looks promising. But how should your social entrepreneurial venture be organized? Many are starting to use the new benefit corporation –...

Keep in Mind These Home Office Zoning Issues

By Garrett Sutton, Esq. Where you do business will certainly affect costs, but that should not be your only concern. Here are 5 hazards to consider before deciding to work from home. 1. Zoning & Residential Restrictions If you’re doing business out of your house, you...

The Four Ways To Protect The Biggest Asset You May Own: Your Home

By Garrett Sutton, Esq. There is one asset most people forget to get complete asset protection for. It's an asset that for the average population, is the biggest asset they will ever own. What is it? Their home. It's an asset worth anywhere from around $100k to a...

Seven Steps for Successful Asset Protection When Buying Real Estate

You have made your decision to invest in real estate. You know what property you want to buy. Your offer has been accepted. Now what do you need to do to make sure your property is protected from the start? Here is a checklist of the seven steps for asset protection...

Why Bearer Shares Are A Bad Thing

By Garrett Sutton, Esq. Bearer shares have been used by some to engage in fraudulent conveyances. As a result, Nevada and Wyoming have outlawed the use of bearer shares. Bearer shares are stock certificates that, instead of listing the owner by name, list the owner...

How To Present Your Business Plan

How To Present Your Business Plan

Business plans are meant to be seen. Follow our instructions on how to professionally present a business plan and maximize your chances of success.

Real Property and Personal Property Insurance

If you own the building you’re working out of, it is in your best interest to insure it. If you’re a tenant renting space, you may be listed on your landlord’s insurance agreement. Even so, it’s probably a good idea to have your own renter’s insurance policy rather...

What if property values go down on my investment rental property?

Keep in mind that in cash flow investing, your rent determines your income. If the property value goes down slightly but you are still able to charge the same amount of rent, you will see no change in your cash flow. However, if your property depreciates so much that...

Why the IRS Cares About Your Debt Troubles

By Garrett Sutton, Esq. People in debt should, and often do, explore every option before filing for bankruptcy. One option is to settle your debts for less than owed. The company owed takes a partial payment and forgives the rest of the debt. And that forgiveness of...

Tax Scams to Avoid

The Internal Revenue Service has recently issued a guidance list of forty frivolous positions that taxpayers (or more precisely “nonpayers”) have attempted in the past. The IRS released this list to put the public on notice that these positions have no basis for...

When You Owe Taxes…

Of any debt, tax debt is perhaps the most stressful. The IRS can be very aggressive in its collection efforts, and has strong, some may say extreme, powers that mere lenders don’t, such as placing a lien on your property (or even seizing it), garnishing your wages, or...

10 Steps for Payroll Compliance

Payroll definitely requires good bookkeeping and a healthy paper trail. Whether you are hiring a bookkeeper or a bank or payroll service or not, you must make certain that all of the employee payroll-related documentation is on file. The W-4 and I-9 forms signed by...

The Basics of Bankruptcy

In my book, The ABCs of Getting Out of Debt, we discuss several ways to deal with debt. While not a popular option, for many people bankruptcy is the only option. Before you jump into any debt reduction program, make sure to know all of your options available to you....

Credit Reporting is Big Business!

Whether you’re a real estate investor, business owner, or just a consumer who has paid bills, you’ve got a credit report. And that report is probably more important to your financial life than any report card you ever received in school. In fact, it plays a key role...

What is a Professional Corporation (P.C.)?

In many states, professionals who want to incorporate their business can do so only as a “professional corporation.” In other states, professionals have a choice of incorporating as either a professional corporation or a standard corporation. What services constitute...

What is The Duty of Care and Why Should Landlords Care About It?

The Duty of Care – what does this really mean to a rental property owner? Case law and legislation by lawmakers across the country have established the public policy that landlords exercise reasonable care in managing their properties to prevent foreseeable injuries...

Maintaining a Stock Ledger to Protect Your Corporate Veil

By Garrett Sutton, Esq. I frequently mention documents that you need to maintain to protect your corporate veil. Maintaining your stock ledger is another way to help protect your veil, which protects your assets. Read on to learn more about a stock ledger. When stock...

Continuing Education Considerations

By Garrett Sutton, Esq. Most professions offer some kind of continuing education.  By state or industry rule the courses are required for professionals working in medicine, accounting, law, engineering and other fields. In addition, many industries have their own...

The Two Goals for Real Estate Investing

By Garrett Sutton, Esq. There are two goals for real estate investing. One is for the value of your property to appreciate over time so you’ll be able to sell it for more than you bought it. Those are the two crucial points in time for your property: When you buy it,...

What is the Best State to Incorporate?

What is the Best State to Incorporate?

You might be better off incorporating in a state hundreds of miles from your home office. So, what is the best state to incorporate an LLC or a Corporation?

A General Partnership is an Ugly Entity

If you thought Sole Proprietorships were bad, just wait. The General Partnership really is the ugliest entity. A General Partnership offers no asset protection and doubles the liability because you are also responsible for your partner's mistakes. Unlike a Sole...

A Sole Proprietorship is a BAD Idea!

By Garrett Sutton, Esq. Each entity choice has its pros and cons. There is no one-size-fits-all corporate entity that will be the best for every situation. (And beware of the advisor who tells you there is.) However, there is one entity that we call the "bad entity."...

Your corporate veil is the shield that protects your assets.

Your corporate veil is the shield that protects your personal assets from corporate attacks. The strength of your corporate veil is determined by how well you follow the laws, regulations and requirements of your corporation. Piercing the corporate veil sounds...

The Duties You Owe

When you own, run or manage a company you have certain duties. You owe a duty to the others involved as well as a duty to the company itself. At its core these duties require you to act with ‘due care.’ Courts have held that this means the degree of care that an...

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...

New Help For Entrepreneurs

The Jumpstart Our Business Startups Act (or JOBS Act) flew through Congress and was signed by the President last week. It is heartening to see a good idea get through Washington once in a while. The JOBS Act loosens restrictions for raising money for new businesses,...

Have a Nice Trip. Don’t Forget to Write Down Expenses!

The lowdown on business travel and taxes starts with recording everything. Even if you’re entertaining for business reasons and the amount of the entertainment is less than $75 and you’re not required to have receipts, get them, record them and keep them. According to...

Ask An Attorney

Single Member LLC taxed as an S-Corp Does the single member LLC that elects to be taxed as an S Corporation need to issue stock, have minutes and basically behave like a corporation instead of using the LLC members certificates and operating agreements? The LLC taxed...