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Category Archives: Business & Startup Law

Legal Lowdown For Corporations: S-Corp Vs. C- Corp

18 Monday Jul 2016

Posted by danielrosenfeldblogs in Business & Startup Law

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business lawyer, c-corp, entity formation nyc, s-corp

If your small business is doing well you may want to consider incorporating it in order to avail of the multitude of benefits corporations enjoy. Setting up a corporation takes a lot of time and effort. In previous times, you would need a qualified attorney to help you incorporate your small business, but now you can find online websites that offer special incorporating resources, it can be done with reasonable cost and ease. When setting up a corporation you need careful guidance, knowing how to submit the correct forms to the right agencies. However, one of your more difficult choices would be choosing what would be the most suitable entity for your business.

S-Corporation:

These corporations are more suited to small-scale business operations. An S-corporation must have fewer than 75 stockholders, stocks must be US-owned, it can only offer one class of stock, and the corporation can only be domestic. Additionally, if the company accumulates debt, the debt is passed on to the owner; it will not be considered a separate entity, unlike with a C-corporation. The business has to hold stockholder and board of directors meetings annually and keep corporate minutes of the meetings.

One of the best benefits of S-corporations is the self-employment tax benefit. In an S-corporation you can save as much as 50% on Social Security Taxes and Medicare. It also does not pay corporate tax therefore you avoid double-taxation, which C-corporations experience. The income distributed to its shareholders will be taxed on an individual basis.

C-Corporation:

C-Corporations are suitable for large-scale business operations. They are more complicated to operate over S-corporations. Requirements of upholding a C-corporation include holding annual stockholders meetings, board of directors meetings, and keeping track of the minutes of these meetings. Record keeping for C-corporations is complex and the corporate structure is very expensive to operate. You have to file a tax return for the company and one for your personal self. Depending on which state you are operating in, there may be additional taxes.

Despite all these setbacks C-corporations have just as many benefits. They are allowed full deductions for disability and health insurance, including medical expenses beyond existing coverage. They also have benefits such as life insurance, pension plans, and dinner allowances.

When deciding whether to incorporate as a legal S-corporation or a C-corporation you must take your future plans into account too. Do you plan on expanding interstate? Do you want to go international? Which tax and fringe benefits are more suitable for your business? The tax structures and restrictions on shareholder equity can make a huge impact on the profitability of your business. You will need to analyze if the change will be worth it.

If you need assistance in determining in which type of corporation you would like to confirm you can consult an experienced lawyer to help you with your decision-making. An excellent lawyer can help you maximize the potential of your business by determining which benefits are most suited to your business and help you with all the paperwork you need to get your business incorporated. Consult your local business attorney today!

 

Launching A Startup: Why You Need a Business Lawyer

05 Tuesday Jan 2016

Posted by danielrosenfeldblogs in Business & Startup Law

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business law, tech startups

When it comes to starting a business, it is essential for business owners to seek the help of business lawyers because, as the saying goes, “An ounce of prevention is better than  a pound of cure.” Many startups are prone to committing big legal mistakes that can be avoided by consulting a lawyer on some legal business matters.

While most new businesses see the obvious benefits of hiring an accountant to set up its “chart of accounts,” most people overlook how essential it is to hire a business attorney. Seeking out the services of a good legal professional can give the startup company the advice and assistance it needs in certain aspects of the business such as basic zoning compliance, trademark, copyright, formal business incorporation, liabilities, lawsuits, and more.

3 benefits of having a business lawyer:

3) Avoiding lawsuits

Given the nature of our legal system, you have to be prepared to be sued. It doesn’t matter if the company is big or small, so long as your business causes large numbers of people to interact in some way, chances are that you will deal with a legal issue at one point.

2) Prevent legal issues from escalating

Do not commit the big mistake of waiting till the last minute to get a lawyer when dealing with legal problems. Those who wait till the last minute usually have more things to attend to, more documents to comply with, and more expenses; not only for attorney’s fees but also for documents that will be required.

On that note, having legal representation you can call on is helpful should you ever have to deal with certain employee matters such as harassment, injury compensation, etc.

1) For all legal matters & paperwork

Business lawyers can handle matters such as negotiating your office lease, filing a patent or trademark, drafting software license agreements, overseeing the corporate meetings for legal input.

Attorneys can deal with contracts. Having a lawyer who already understands the nature of your business on call makes it easier to prepare contracts with your clients, suppliers, and clients.

You might also need advice on taxes and licenses or perhaps you just need a lawyer to register your business for you. Whether you would like it to be a corporation or a limited liability company (LLC) your attorney can provide information to help you decide which type of business is ideal for you. They can even help you organize the business and prepare the required paperwork.

For companies specializing in design, media, and other creative-type businesses, a lawyer who is experienced in intellectual property can help register your products and services for copyright protection and trademark.

Since lawyers are essential in starting a business, it is also important that business owners know how to ask the right questions to choose the best representation for their business’ legal needs. If there is a law firm or a lawyer who can perform all the legal matters of the business then it would be advantageous for the company so they can avoid dealing with many attorneys in assisting the business regarding different legal needs.

Fisher Law Group, P.C. 25 Broadway Fl 9 New York, NY 10004 (212) 256-1877 FisherStoneLaw.com

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