Tag Archives: company

Asset Protection

Is a Limited Liability Company the Right Entity for your Business?

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If you are starting a new business and you want to incorporate it as a separate legal entity, you should educate yourself regarding the pros and cons of the different available business structures. It is important to understand that if a business is not properly organized from the start, it can have costly consequences. If you want to save yourself time and money in the long run, contact us to ensure your business is properly organized.

One business entity you may want to consider is a limited liability company (LLC). Below are a few of the benefits of a LLC:

  • Members (owners) enjoy limited liability
  • There is no limit on the number or type of members
  • Centralized management is available (in other words it can be managed by a Manager or President or other structure you want to set up)
  • Profits from the business are subject only to one tax (at the individual member level)
  • Members can use business losses to offset other income on personal income tax returns
  • Unequal distributions can be made to members

There are some disadvantages to forming a LLC, including:

  • Certain formalities must be met for organization and operation
  • Your business must qualify to do business in other states
  • Reporting to governmental entities may be required
  • Member interests are not freely transferable with all rights intact
  • Business profits are taxed as income to the individual members (which could result in self-employment tax or income tax, even if no distributions of income are made)

To learn more about creating a limited liability company or for assistance in determining what type of business structure would be most advantageous for your business, contact our business formation attorneys today.

The Astill Law Office has provided high quality legal services for over 30 years. We specialize in wills, trusts, estate planning, and asset protection. If you have any questions about creating a Trust, Will, or estate planning in general, contact The Astill Law Office at 801-438-8698.

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Starting a Business? Avoid these Pitfalls

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Handshake and teamworkEntrepreneurs make a wide variety decisions when starting a new business. It is important to make the right decisions and get your entity off to a successful start. If you are a first-time business owner, you must understand the legal risks involved in each of your decisions. Below are a few common pitfalls you should avoid:

  • Relying on verbal promises. When you first start your company, people will make you promises that you want to rely upon, but you shouldn’t. Even if you have a personal relationship with the other person, you should still get the agreement in writing. You should not rely on your ability to work out any disputes later. Having a written contract in place can not only protect both parties, but it can also help preserve your relationship.We like to think that a contract is like a good fence. Good fences make good neighbors and good contracts keep partners honest and clear on what is expected. A buy-sell agreement between partners is critical to success.
  • Patent infringement. If your business is going to be based upon a certain idea, it is imperative that you conduct a search to ensure the idea doesn’t already exist. Being sued for patent infringement can be very costly. You also don’t want to invest in your idea until you are certain it belongs to you. A patent or intellectual property attorney can conduct a search to determine if your idea has been patented already or if you should take action to obtain a patent to safeguard it.
  • Unfair competition. Recruiting your competitor’s employees can seem like a good strategic move, but it could also result in litigation. You do not want to hire an employee to convert business from the competitor in violation of unfair competition laws.
  • Form of Business Entity. The type of business entity and tax elections for that entity are crucial decisions for a new company. Many people think that they can make those decisions later. But the formation of the company is the best time to make these decisions.

The business world can be full of legal pitfalls, so one of the most important actions you can take is to retain an experienced business attorney to help protect your best interests. The Astill Law Office has provided high quality legal services for over 30 years. We specialize in wills, trusts, estate planning, business law and asset protection. If you have any questions about creating a Trust, Will, or estate planning in general, contact The Astill Law Office at 801-438-8698.