Veil Piercing & LLCs

I’ve had conversations with business owners who are operating as an LLC that have led me to today’s post. In these conversations it’s clear that most business owners believe that the concept of “piercing the corporate veil” doesn’t apply to them. After all, they’re an LLC not a Corporation. Right?
Well, the answer is more like, [...]

Confused About FSLA?

As an employer, you are faced with a large number of statutes, regulations and rules governing your relationships with your employees. Failure to abide by this body of rules can create significant liability for your business. Laws governing employee treatment are constantly changing and potentially dangerous new pitfalls are constantly appearing. The Fair Labor Standards [...]

Two “Flavors” of Corporations

My last blog post might have raised a couple of issues with some folks who are looking at choosing between a “C” Corporation or an “S” Corporation. Let me add some details here. Corporations come in two basic flavors. The default is a “C” Corp. However, you can also make an “S” election. “C” and [...]

Choosing “C” or “S” Status

When you incorporate, you must choose either “C” or “S” status. Depending on which form you choose, there are differences in corporate governance rules. It’s important for business owners to understand the requirements for their particular entity type, so they can maintain proper compliance behaviors.
For a number of privately held businesses, an S Corp has [...]

Additional Insights for Using Business Entities to Transfer Assets

A few weeks ago (Protecting Your Assets Even While Getting Rid of Them) I wrote about using business entities to make asset gifts or sales. Something I didn’t mention then, but is critical in this discussion, is the need to keep in mind that the IRS and the courts use something called the “bona fide [...]

Is Your Employee Handbook Doing Its Job?

Most employers have some sort of employee handbook. This document can be an employer’s worst enemy or best friend.
The most important part of an employee handbook is the “At-Will Acknowledgment” that an employee signs when he or she receives the employee handbook. The ‘At-Will Acknowledgment” requires an employee to confirm that the employee is “at-will,” [...]

The Problem of Commingling

All corporate governance for privately held businesses can be summed up with two broad statements:

Owners must maintain proper corporate behaviors;
Owners must maintain proper corporate documentation.

“Proper behaviors” means observing required governance actions, protocols, and formalities. “Proper documentation” means consistently maintaining records of proper behaviors so you have a “paper trail” providing evidence of ongoing [...]

Using Business Entities to Make Asset Gifts or Sales

You can use business entities to make asset gifts or sales.   While it’s true there are pitfalls business owners face when they violate asset gifting rules, adherence to the “bona fide sale” rule, a test used by the IRS and the courts to determine whether a “real, actual, or genuine” sale has taken place, will keep [...]

Questions to Ask Your Advisor

Do you have an adviser? You know, an attorney, a CPA, or other financial adviser to help you run your business? Many business owners mistakenly believe they are receiving comprehensive corporate governance support from their CPA or attorney. Here are six key questions, and suggested answers, you need to be asking your adviser to be [...]

Your Business and the Bear Stearns Crisis

I loved this article found in this month’s issue of the Bulletproof Veil newsletter. They cover how your business could be impacted by the crisis at Bear Stearns. Because the courts used common law theories rather than the narrower statutory law definition of “employer” when considering a lawsuit against Bear Stearns, it’s more likely now that you [...]