SINCE 1974
Most entrepreneurs are optimistic when starting a new business venture. However, many understand that commerce is inherently risky. According to the U.S. Bureau of Labor Statistics, 20% of new businesses fail within two years, and only 50% make it to their fifth year. It’s ok if you decide to close your business. However, you need […]
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The Limited Liability Company, or “LLC”, is the most popular business entity type in the United States. LLCs are simple and flexible business structures that combine the tax treatment of a sole proprietorship with the personal liability protection of a corporation. Despite LLCs being so common, you might not know exactly what an LLC is. […]
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Permanent residents of the United States are able to start businesses and form LLCs in Delaware. This includes US green card holders. In fact, individuals from almost any country in the world (except restricted countries) can form a Delaware LLC. If you are a permanent resident looking for your piece of the American Dream, forming […]
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Owners of a Delaware LLC can add or change members at any time simply by amending the LLC Operating Agreement. Delaware does not require owners to make any additional public filings to add members to their LLC. However, existing members should take certain steps to avoid conflict when transferring membership. We cover exactly how to […]
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If you are looking to incorporate a business, you likely have sifted through tons of legal jargon. Corporations, LLCs, partnerships, sole proprietors, the list goes on. Here’s another one: Special Purpose Vehicles. People typically associate Special Purpose Vehicles, or “SPVs”, with major corporations; however, they can be useful for businesses of all sizes. Companies can […]
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If you are a business owner looking to form an LLC, you’ve likely researched some of the legal requirements. Setting up a Delaware LLC on your own can be complicated, and stressing over the details of your legal structure can take focus away from your business plan. You may be asking yourself whether you need […]
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People often throw around the term ‘subsidiary’ in business, but you might not know exactly what it means. Subsidiaries play an important role for nearly every large corporation, however, they often do not get the recognition they deserve. We discuss what subsidiary companies are, how they are used, and the best way to structure them. […]
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An increasing number of people are finding themselves either self-employed or engaging in short-term employment arrangements. These individuals are typically actors, content creators, gig economy workers or consultants. These employment arrangements can come with many benefits, however, they may also pose a tricky tax situation. An effective strategy for self employed individuals to reduce their […]
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If you have your own business, you may benefit by forming an LLC. An LLC keeps an owner’s personal assets separate from any business assets. LLCs can protect owners from liability in the event of a legal dispute with a creditor, or even a business partner. This is true even if your business does not […]
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“The only ship that doesn’t float is a partnership”. This is common when consulting entrepreneurs who are considering bringing on a business partner. While a general partnership is the oldest business organization, it is the worst choice possible. This is because general partnerships are laden with traps that could easily end in financial ruin for […]
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A serial entrepreneur will often form multiple “brother-sister” companies to keep their assets from becoming commingled. But having partners that own an interest in each of these companies can generate separate partnership tax returns for each entity. One way to simplify this is to form a holding company with the partners. You can reduce the […]
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Philanthropists often ask if an LLC can be a non-profit. What they are referring to is the 501c3 tax-exemption status. 501c3 status is a coveted designation because it exempts a company from federal, sales, and property taxes. These exemptions are crucial to the function of non-profit organizations. IRS regulations do not allow LLCs to be […]
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You may be asking “What does LLC stand for,” “Which entity should I choose,” “What is Inc.,” “What does Co. mean,” “What is LLC,” or “Ltd vs. LLC?” Before you incorporate, you need to choose which type of entity is right for you. This isn’t something you’re born knowing, and they don’t teach it in […]
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At some point, you may be asked to show proof of ownership, also known as proof of entity, for your LLC. The request often happens when you open a business bank account. If you’ve never needed to prove that you own your LLC, it’s understandable that you might be unsure of what to do next. […]
Continue ReadingPeople throw around the term ‘subsidiary’ in business. Google, for example, recently made headlines when it was announced that its parent company, Alphabet Inc., is breaking into subsidiaries. It’s understandable that you might not be exactly clear on what it means. Subsidiaries are important but often fail to get the attention they deserve. Business and […]
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Before forming an LLC, it is important to understand how it will be structured and managed. LLCs offer business owners complete flexibility to create unique management structures. This includes choosing officer titles, delegating management responsibilities, and structuring ownership interest. Here we breakdown common management and ownership structures for LLCs, including who the LLC Members and […]
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The concept can be confusing at times, but there is a difference between forming a business and incorporating. Interested in incorporating your business, but not sure exactly what it entails? Here’s the definition of incorporating, plus what it means to incorporate. How Do You Define Incorporate? In the U.S., incorporating a business is something that […]
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Many companies are LLCs. While the abbreviation can be spotted at the end of many company names, it’s understandable that you might not be entirely clear on what, exactly, an LLC is and its purpose. Each state has its own unique statutory law that sets forth requirements to form a Limited Liability Company (hereinafter “LLC” […]
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In April 2021, the Financial Crimes Enforcement Network (FinCEN) issued an Advance Notice of Proposed Rulemaking to solicit public comment on a wide range of questions related to the implementation of the beneficial ownership information reporting provisions of the Corporate Transparency Act (CTA). IncNow provided four responses. The first response addressed the Series LLC and […]
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United States business formation law is state specific. Within the footprint of the state, companies formed in that state need to maintain an “agent” at all times. This agent has to have a fixed office address on record with the company’s file. That makes this office the “registered office” and the business or individual servicing […]
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Members of an LLC are subject to capital contributions and profit distributions based on terms they agree to in the Operating Agreement. Below we talk through several key issues for you to consider as you receive and distribute capital for your LLC. What is a capital contribution? A capital contribution is the cash or property […]
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How you can protect your businesses from the liabilities of your other businesses Does a D.B.A. offer you any legal protection? Are there alternatives to setting up a separate LLC for each business or property? If you have multiple LLCs, it’s only natural to wonder if you should set up an LLC holding company. In order to determine […]
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We often get questions about LLC stockholders, bylaws, stock certificates, directors, minutes and sometimes a Limited Liability “Corporation.” It’s understandable to have questions about how LLCs are structured and operate. Here’s what you need to know. Do LLCs have stock? Typically, “stock” is not the term used for LLC ownership shares. In most LLCs, the […]
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Forming a Delaware LLC is an exciting time for your company, but it’s important to operate your company the right way afterward. Unfortunately, mistakes are sometimes made. These are some of the biggest issues we see—and how to remedy them. Mistake No. 1: The Operating Agreement is returned to the formation agent. Some business owners […]
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It’s understandable that you want to find the best price when it comes to forming your LLC. But what does a cheap LLC setup look like, and how much should it cost to form an LLC? Here’s what you need to know. What Fees Are Required with an LLC? Every LLC registered in the State […]
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Traditionally, non-profit companies are corporations. However, there is a way to get the protection of an LLC while retaining the structure of a non-profit corporation. When expanding the operations of their non-profits, existing non-profit corporations may consider adding higher risk assets to subsidiary LLCs. These LLCs exist under the umbrella of the already qualified 501(c)(3) […]
Continue ReadingAn increasing number of people are finding themselves either self-employed or engaging in short-term employment arrangements. These individuals are typically actors, content creators, gig economy workers or consultants. These employment arrangements can come with many benefits, however, they may also pose a tricky tax situation. An effective strategy for self employed individuals to reduce their […]
Continue ReadingBecoming an LLC is an easy and inexpensive way to protect yourself from personal liability for business obligations. It’s definitely worth considering if you have your own business—even if that business is you.
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We often hear these questions from small business owners: What is the cheapest option for incorporating my company? How much does it cost to incorporate? Should I form an LLC? What incorporation fees can I expect? Across all fifty states, Delaware is near the median for incorporation costs. Among the top-tier states such as Florida […]
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When it comes to incorporation and LLC formation, there is Delaware and then there is the rest of the world. By dedicating itself to the needs of businesses, the state of Delaware has distinguished itself as the leader in desirable corporate and LLC legislation. Combining reasonable filing and maintenance fees, responsive administrators and an exemplary […]
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When deciding whether to form a Delaware LLC, you may wish you had gone to law school so that you could understand everything you are reading. But attending law school would not help you. Law schools do not teach law students the mechanics of incorporating. Most law schools dedicate no more than one lecture to […]
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It’s no secret that COVID-19 is changing the lives of many people. On the job front, some people are facing unemployment or job insecurity, and workplaces are starting to discover that the standard office model may not be efficient or even needed anymore. The pandemic has also delivered a blow to the economy, causing some […]
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The Delaware LLC is the most popular type of legal entity amongst small businesses. A Delaware LLC provides bullet proof liability protection for business owners’ personal assets while avoiding the red tape involved with maintaining a corporation. Entrepreneurs prefer LLCs because they are flexible, cost effective, and easy to set up. Forming an LLC is […]
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Most businesses end up cutting into profits simply by not taking advantage of the rules the IRS has laid out for them. The most susceptible to this common downfall is the sole proprietor or single-member LLC. It’s possible to save on single member LLC taxes—you just need to know the right steps to take. What is […]
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One person can form an LLC in Delaware. These LLCs are known as “single-member LLCs”. You can use a single-member LLC for everything from financing real estate transactions to solo consultant practices. Why Create a Single Member LLC Operating Agreement? Despite having only one member, it is still wise for single-member LLCs to have a […]
Continue ReadingTo have access to the gold standard of business laws, you should form an LLC in Delaware. Delaware offers an abundance of protection for business owners who choose to form a Delaware LLC no matter where you live and work. The shield of Delaware protects business managers from litigation risks and compares favorably to businesses […]
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In both single-member and multi-member LLCs, the owners need to have a plan for what happens in the event that a member dies. Should the LLC continue or should it automatically trigger cancellation? Who has the right to buy the deceased member’s interests? Do family members obtain voting rights or just assignment of distributions? These […]
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Keep your Delaware LLC from sinking prematurely as a result of member business divorce. Plan ahead for inevitable partnership disputes by drafting membership prenuptial provisions from the outset. In this article we teach you the vernacular of LLC member buyout options, such as “Baseball” versus “Shotgun”, “Tag-Along” versus “Drag-Along”, and “Rights of First Refusals” versus “Rights of First Offers”. These are ways […]
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The issue of when interests in an LLC can be transferred or bought, and by whom, and with what restrictions, is an issue that must be covered in an Operating Agreement. It is natural for business owners to be optimistic and overlook the possibility that the company may fail to live up to their initial […]
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The excitement of a new business venture can sometimes make the prospect of litigation seem distant, or even impossible. It is that very optimism and conviction that drives entrepreneurs to launch out in the first place. But as the old saying goes, “Those who fail to plan, plan to fail.” Should push come to shove, […]
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Two hundred years ago, if you were to invest in a shipping sailboat going across the ocean, the owners were personally responsible for not only the cargo and the ship but everything that went wrong; if it ran into a dock or another ship, the owners were responsible. This caused the owners to be afraid […]
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In order to explore what makes corporations and LLCs different, it is important to first note the one primary way in which they are similar: both have a barrier that prevents business debtors from collecting against the personal assets of an owner. This means the owners’ personal assets are not available for collection by a […]
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Can I save money on taxes with a Delaware LLC? Here are ways that a Delaware LLC could save Federal income and employment tax. After forming an LLC, there are three alternative tax regimes. No action is required for the first one, and the other two tax elections can be elected into if you think […]
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The American Bar Association tackles Delaware LLC operating agreements and general business practices in a new article featuring IncNow President, John Williams. Williams serves as a key contributor in “Operating Agreements Today: The Foundation to Avoid Controversy Tomorrow,” found in the ABA’s Probate & Property magazine. The passage outlines common oversights when forming an LLC, […]
Continue ReadingUPDATE: In the aftermath of the Green Hunter Energy case, Wyoming legislature recently added two new subsections to its LLC Act that will make “piercing the veil” of a Wyoming LLC more difficult. The law has been amended to address the limited liability of Wyoming LLC Members, which was weakened by the Green Hunter decision: […]
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For acquisitions or refinancings over $5 Million, the borrower may be able to obtain more competitive interest rates though Commercial Mortgage Backed Securities (“CMBS”) loans instead of traditional bank financing. CMBS loans meet special requirements allowing them to be bundled and sold in blocks on capital markets. Usually income properties with tenants are the most […]
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Can you specify a future filing date for a business? Must a business be formed on a weekday? Can you “back date” a business filing? Dear IncNow, I would like to form an LLC on a date that happens to be on a Saturday this year. Can the LLC’s formation papers still have this date, […]
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If the Certificate of Formation does not list owners, what document proves I am an owner? My bank won’t accept the LLC Agreement. Do I have another option? Is it necessary to amend my Certificate of Formation to list the owners? Dear IncNow, My bank is telling me that I need my registered agent to […]
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IncNow President John Legare Williams, Esq. was recently published as a guest author in the American Bar Association Business Law Section’s online newsletter, Business Law Today, in the January 2016 edition. John’s article, Rural Metro: Gulping Advisers and Practitioner Guidance, was featured in the Delaware Insider column, which highlights recent cases and trends in Delaware […]
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How much you should be paying to maintain your LLC and when Do you need to register your company where it is transacting business? Tips to keep your personal and business assets safe Dear IncNow, Thank you for sending the formation documents. We are updating the Operating Agreement and will sign it within a couple weeks. I will […]
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“Why does Delaware have such business-friendly corporation laws?” Dear Customer, Delaware has the most pro-business laws of any US state and has a “goldilocks” balance of being stable and slowly evolving. When teaching corporate law, professors across the country teach Delaware corporate law. The United States Chamber of Commerce has recognized Delaware’s business dispute and […]
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If I form a Delaware LLC, will I need to register it in my home state where I do business?” Dear Customer, A Delaware company can be operated from any state within the United States. The question is whether you will need to file with the other state(s) where you are doing business. The answer is […]
Continue ReadingOver Labor Day weekend, after over a decade of development efforts, the Delaware Division of Corporations (the “Division”) successfully launched a new web-based system to administer its business entity and UCC filing systems. Fortunately, Delaware state administrators and the agent community had a long period to train, test and update the system to make sure […]
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“I want to start a LLC and one of my investors is a disabled veteran. Can I state that my company is a disabled veteran owned business?” Dear Customer, Usually the majority of owners (51%) need to be part of the qualifying category to be recognized as a disabled veteran-owned business. That also applies to […]
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Serial entrepreneurs should consider the Delaware Series LLC, the most cutting-edge type of business on the market. While it is advisable to set up a new LLC for each different business interest, if the cost of managing a dozen or more companies is overwhelming, consider another alternative: the Series LLC. Are you someone who is […]
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“One of the Members of my Delaware LLC is no longer active in the company. What records do I need to update to reflect this change?” Because the names of the LLC members are not usually filed with the State of Delaware, there is no “amendment” that needs to be filed with the Division of […]
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IncNow’s Complete and NOW Delaware LLC packages include the documents your LLC will need to get started. In your package of formation documents, you will receive your Certificate of Formation that shows your company has been filed and Operating Agreement, which lays out the agreed-upon terms of the LLC’s operations and its ownership. An LLC […]
Continue ReadingDelaware Courts will enforce your Delaware LLC Operating Agreement as written. It’s important to document the essential business understanding from the outset. Anyone starting an LLC in Delaware should have a written Delaware LLC Operating Agreement detailing the management and ownership structure. An LLC Agreement is required in Delaware and although the verbal agreement is legal, […]
Continue ReadingShould you create another LLC to insulate hot assets from cold assets? The main reason to segregate assets into ring-fenced islands of brother-sister LLCs is to prevent a fire on one part of your business destroying assets in another part of your business. Let us say you are planning to open a fitness center business. […]
Continue ReadingA few years ago, pressure from U.S. Treasury and International countries prompted Delaware to require a “communications contact” for each LLC formed in Delaware. A 2014 Amendment clarified what is required of this communications contact, including access to ownership and management contact information. What is a Communications Contact for a Delaware LLC? Before these 2014 […]
Continue ReadingKevlar, a protective fabric in bullet-proof jackets, has saved countless lives of police officers and military personnel. Kevlar is a DuPont fiber product, invented in Delaware. Delaware has another invention with protective properties in its incorporation laws, which have saved countless business owners from creditors who would have pierced the corporate veil had the judgment […]
Continue ReadingWhen financing real estate projects over $3,000,000 from across the country, often the best rates are available when Commercial Mortgage-Backed Securities (CMBS) loans are used instead of traditional bank financing. We have seen these requests made for a variety of business properties such as storage facilities, student housing, multi-family housing, retail centers and commercial office […]
Continue ReadingMommy Blogs have exploded in popularity in the last few years. Now anyone with a computer or smartphone is able to express her opinion to potentially millions of female household decision-makers on easy-to-use and often free or inexpensive platforms such as Tumblr and WordPress blogs. Due to the perceived informal nature of a blog, mommy […]
Continue ReadingDelaware may be known for being “business friendly”, but Delaware can be a buzzkill when it comes to blatant “marijuana” business names. The Delaware Secretary of State rejects certain names it administratively determines are not engaged in a “lawful business, purpose or activity.” Delaware does not mind if you want to export entity products, but do […]
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If you want the benefit of an LLC in Canada, you will need to form an LLC in the United States. Most people from Canada who want an LLC will form it in Delaware. Surprisingly, Canada has no equivalent to the LLC under national or provincial laws. The process of forming a Delaware LLC and […]
Continue ReadingA limited number of commercial registered agents have access to a dedicated online connection to the State of Delaware. This online filing system is not web based. It is a MS-DOS based terminal where the user has direct access to the Delaware Secretary of State Division of Corporations mainframe. DCIS stands for Delaware Corporation Information […]
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One of the most commonly asked questions is whether a business address or physical address is a requirement to incorporate in the state of Delaware. Both domestic and international customers ask this question. Since most of the businesses filed in Delaware are located outside Delaware; this is a common concern. Do not let this concern […]
Continue ReadingA new Delaware law confirms that the charging order is the sole and exclusive remedy for judgment creditors. This means that other remedies, such as attaching, garnishing, and foreclosing on the interest are not permitted under Delaware law. Charging orders mean that a debtor’s interest can only be assigned to a judgment creditor, giving only […]
Continue ReadingChances are you are located outside Delaware, but your friends suggested Delaware to you. The question is why? Why would you incorporate in Delaware, when you could incorporate in your home state? We have created an infographic that explains why to incorporate in Delaware. Why is Delaware the best place to incorporate? The simple answer is […]
Continue ReadingIncnow is excited to announce that John Williams will be presenting a seminar on the Series LLC to the American Bar Association’s section on Real Property, Trusts and Estates titled: Why Everyone Could Use a Series LLC. The seminar will be a 1.5 hour teleconference at noon on Tuesday, May 14, 2013. Having set up […]
Continue ReadingI thought it would be helpful to explain the Delaware Limited Liability Company (“LLC” or “company”) formation process after Agents and Corporations, Inc. (“we” or “our”) receive an order through www.incnow.com. Our office upon receiving your order will first log into the State of Delaware Secretary of State Division of Corporations (the “State”) computer system […]
Continue Reading1. LLC’s have stock. No. LLC members’ ownership derives from the agreement with the company and its other members, not from the possession of a certificate. While an LLC can issue membership certificates, it is not recommended and such membership certificates are misleading. The ownership interest is derived from the contract, not possession of a […]
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