Friday, July 29, 2011

Incorporation 101: What Is C-Corporation?

What Is a Corporation?

Corporation is a legal form of organization of persons and material resources, chartered by the state, for the purpose of conducting business. Corporation is owned by shareholders, the Board of Directors governs the business, and elected officers manage the day-to-day activities. Corporation must adhere to corporate tax laws and file corporate taxes regularly.

A Corporation, also referred to as Standard Corporation, C-Corporation, or Regular Corporation, may have an unlimited number of shareholders, including foreign citizens, may be public (when shares are offered for sale to the public) or privately held (when shares are not sold to the public). Usually shares of the corporation are held by the founders, board members and private investors, such as venture capitalists, who may or may not sit on the board of directors.

C-Corporation is the most common type of incorporation. C-Corporation is considered to be a for-profit, state-incorporated business. Registration is done with state authorities and must abide by corporate laws in the state where it is incorporated.

Corporation provides protection to its shareholders from the corporation's liabilities, thus the term "limited liability". However, C-Corporations also have what is called "double taxation" - first the corporation is taxed on its profits, and then shareholders are taxed on the distributions they receive, such as profit sharing payments or dividends.
To incorporate you will need to register your business name, file a certificate of incorporation or articles of incorporation, and pay a fee. You will also need to draft corporate bylaws and hold a board of director's meeting.

Why Should I Incorporate?

Incorporating is one of the best ways to protect your personal assets while doing business. Most people choose to incorporate solely for this reason, but its not the only advantage of incorporation.

For example, owning a corporation can save you tax money, allows for a greater business flexibility, reduces your chances to be audited, provides tools for better itemization, and makes raising capital less complicated.

Advantages of Incorporating

Limited Liability: A corporation is a legal entity that exists separately from its owners or shareholders. With some exceptions, shareholders are not liable for the debts and obligations of the corporation or from any litigation where the corporation is the defendant. Some form of insurance may still be necessary, but incorporation contributes an added layer of protection (also called "corporate veil").
Tax Savings: Careful planning of your business expenses can result in lower overall tax rates. There are many tax benefits for doing business under incorporation, depending on your business income. Even if your young business becomes quite profitable soon, a corporation is entitled to many deductions otherwise not available to you, resulting in significant tax savings. An example of such tax-deductible expense would be salaries of your employees and yourself.
Reduces Likelihood of IRS Examination (Audit): Non-incorporated businesses, particularly of higher gross income levels, are targets of many IRS Audits. Incorporated businesses have a much lower audit rate, even if they have high income levels.
Anonymity: Depending on the state where you choose to incorporate in, a corporation can be established in such a way that shareholders/owners remain anonymous. Often same level of anonymity can be provided for officers and directors.
Added Credibility: A corporate structure communicates permanence and credibility. Even if its a company with only one stockholder and employee.
Easier Access to Capital Funding: With a corporation it is much easier to attract investors through the sale of stock.
Easier Transfer of Ownership: Ownership of a corporation may be transferred without substantial disruption of operations through the sale of stock. This way the need for complex legal documentation is reduced.
Flexibility of Share Ownership: Owning shares gives you the flexibility needed, among other things, to effectively capitalize your business, or to retain key employees. To further capitalize the business successful C-Corporation can be taken public in a process called Initial Public Offering (IPO). You can also issue stock or stock options to your key employees, "binding" them to the business and thus retaining them (common in hi-tech industry among others).
Longevity: The board carries on the corporation, not the owner. That means that a corporation formation can last longer than an owner-based company such as an LLC.

Main Disadvantages of C-Corp.

C-Corporations have certain disadvantages. The main disadvantage is the fact that the profit of a C-Corporation is taxed to the corporation when earned, and the corporation does not get a tax deduction when it distributes dividends to shareholders. Then when dividends are distributed to the shareholders they are taxed again at the shareholder level. This phenomenon is called "double taxation".

Similarly, when C-Corporation has a loss, its shareholders cannot deduct it from their personal income.

C-Corp. vs. S-Corp. vs. LLC

Other forms of incorporation of business organization include S-Corporation and LLC. Each of those types of entities have certain advantages and disadvantages when compared to the common C-Corporation, but a more detailed comparison between those entities goes beyond the scope of this article.

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Thursday, July 28, 2011

Reasons For Keeping A Medical Power Of Attorney

Medical power of Attorney is also known as living will or advance health care directive which is only related to the decisions made for your medical care and health. You have to organize a medical directive according to your state's law authorizing that your partner should make the decisions on behalf of you in case of any illness or accident. Families of couples who are unmarried may raise their brows or may object on your decision to keep your partner as the medical power of Attorney. So you have to be very clear on that in the legal document, but then also there is no guarantee that the blood relations will not try to block your wish.

You should not keep the originals of your medical directive in the safe because when the legal documents are unavailable, wrong decisions might be taken on your treatment. Provide one copy of the HIPAA form, medical directives and other information related to your living will so that your agent can make right decisions. You must have the extra copies of your medical power of attorney as the doctors, hospitals or other persons who would like to know your decisions regarding the medical directives can go through it.

It is always wise to appoint an agent as your medical power of attorney, if you are in the later stage of your life. You agent can make decisions on behalf of you when you are not mentally strong to do so. You can select any individual you like as your agent or attorney-in-fact. Even though you have a living will, you should have a medical power of attorney as both are completely different from each other as legal documents. Living will shows the person's wish on the decision that should be made regarding the medical care, if there is a need of life support system whereas the medical directive is used to make important choices on medical care like using a life support system when the person is unable to make a decision.

This kind of power of attorney is not only used for older persons who are suffering from serious diseases, but also suited for young individuals who met with an accident or suffering from some serious health problems. The agent should perform the wishes mentioned in the document, even though the wishes made by you may contradict with your agent's wish. The agent should follow your instructions, even though they wish you to be alive disregarding your health condition. You should discuss your wishes with your agent so that you can assure that everything will go smoothly according to your wish when you are mentally incapable of executing those wishes. When you become mentally incapable, the agent will get the responsibility to act on behalf of you including the handling of all your money.

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Wednesday, July 27, 2011

How Does A Quit Claim Deed Work?

People who own several real estate properties may, at some point in their lives, turn over a house to another person such as a sibling, give it as a gift to a child or grandchild or sell it. During these instances, the owner is required by law to execute a quit claim deed to make sure that he or she will no longer claim interest on the property.

A quit claim deed is a legal document that clears title to the property. It is used in the transfer of an interest on a property to another person. By its name alone, it means the owner quits any claim on a house or land. The person who is quitting claim is known as the grantor while the one who accepts the property is called the grantee. The grantee assumes all risks especially if no guarantees or warranties are made on the title.

The deed, however, only transfers interest and does not guarantee if the grantor actually has ownership rights on the property concerned. It also does not ensure that the property is without debt.

In order for it to be enforceable, the deed has to be signed by the grantor after which a notary public should sign and stamp it. In some states, though, the grantee and other witnesses are required to affix their signature as well. Apart from a notary public, officials from states other than where the property is located can also notarize the deed.

There are different situations in which a quit claim deed can be of great help. For married couples, a spouse who was able to purchase a property before marriage can add or remove the name of his husband or wife to or from the property title. In a divorce situation, a couple can transfer ownership of their conjugal property to one spouse.

During the sale of a house, a quit claim deed executed at closing transfers the property interest from the seller to the buyer. In other words, the seller totally disposes of the property rights and guarantees that he or she will no longer go after it whatever happens.

Another situation where the deed can be used is if a certain homeowner plans for an estate or a living trust. In this case, the deed transfers the ownership of his house into a trust fund.

If a life estate is involved, the grantor can still keep his right to possess the property even after signing a quit claim deed. A life estate usually gives the owner the absolute right to stay at the property until death. It is only after the owner's death that the grantee is able to get the right to possess the property.

It is important to understand that once the deed is signed, it will be hard to reverse or undo the deed. Only if the grantee agrees to quit claim the property back can the previous owner possess the property again. Otherwise, the grantor will have to show proof that the transfer was invalid.

A quit claim deed is a valid option for giving up property interest. But since transfer of title or ownership rights is not guaranteed by this document, it is best accompanied by a warranty deed.

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Monday, July 25, 2011

What Is a Family Estate Trust?

A family estate trust helps married couples retain an estate tax exemption and protects from remarriages taking money from the family. Find out what a family estate trust is from an estate planning and probate lawyer in this free video on estate law.

Sunday, July 24, 2011

Estate Planning : What Is a Durable Power of Attorney?

Durable power of attorney allows the power of attorney to manage funds even in the event of incapacitation. Find out what durable power of attorney is from an estate planning and probate lawyer in this free video on estate law.

Saturday, July 23, 2011

Using A Quit Claim Deed In A Divorce

A divorce is always a hard decision to make whether the husband and wife were together for only a short time or for long years. Not only does it involve emotional distress but division of conjugal properties as well.

When couples decide on who should get this or that conjugal property which they acquired as husband and wife, legal documents known as deed are necessary. These documents are crucial to legally transfer a certain property from one person to another. One vital form is called the quit claim deed.

A quit claim deed is referred to as such because it quits or ceases a person's claim or interest on a real estate property and passes it to another person. There is no guarantee, though, when it concerns the rights of the person receiving the property.

Divorce situations

A divorce is just one of several situations where a quit claim deed proves necessary. An example would be a husband foregoing interest in the property that his wife owns. In this situation, the husband who quits claim on the property is referred to as the grantor while the wife who owns the property is called the grantee. Whatever risks involved here especially since there's no warranty on the title will be taken care of by the wife.

A quit claim deed is also needed if a married person who solely owns a property, which he or she bought prior to getting married, sells the property concerned to a third party. Executing a quit claim deed, in this instance, serves to ensure that the other spouse no longer has any interest to reclaim the property later on. With the absence of this deed, it is possible that the spouse could come back to claim ownership of the property.

In another divorce case, one spouse say, the wife, may want to stay in the conjugal home. The wife then needs to ask for a quit claim deed from her husband so she could claim sole interest in the residential property.

Names and mortgage

A quit claim deed should show the legal names of the parties involved in the transaction. In the case of divorced couples, the deed should bear the husband and wife's legal names or the same names that appear in their divorce decree. However, should both spouses wish to live in separate homes and would like to retain ownership of their conjugal property, this document will not be necessary.

As for mortgage concerns, a quit claim deed does not release the person quitting claim from his mortgage obligations. However, to remove the person who quits claim from the mortgage, the mortgage has to be refinanced through the name of the grantee or the person to whom the interest has been transferred.

In a divorce, a spouse can only claim ownership of the property and mortgage by refinancing the mortgage after the home has been conveyed to him or her. It is important to note, though, that many lenders will only allow a divorced individual to refinance a property if he or she has been on title to the said property for at least one year.

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Friday, July 22, 2011

Transfer Of Ownership By A New Deed

There are some of you who many need to make changes in the ownership of your property. If you have owned a property in your own separate name and are now newly married and want to add your wife as part owner to the property, you would create a new Deed which would add her as a new part owner of that property. Normally a Quit Claim Deed is used to do this. In this case the title of this property would then be under your name and your wife as Community Property with Right of Survivorship. In this case if either party dies the property can pass directly to the surviving spouse without a court probate action.

A Deed is a legal document which transfers ownership or an ownership interest in a home, commercial building or parcel of land to another person, trust, living trust, partnership, limited liability company, corporation or any other legal entity which may own property under the law of that state. Real Property is always under the jurisdiction of the
state in which it is located.

This deed must describe the address of the property and have the legal description which legally describes the property printed or typed on the Deed. The party granting the deed transfer is called the "Grantor", and the party receiving the deed transfer is called the "Grantee."

This document lists all of the names of the parties that are involved in the real estate transfer. Once the deed has been signed it is recorded in the County of Record by the County Recorder and is made part of the public record, and any member of the public can view the deed transfer if they examine the public records.

There are many kinds of deeds with which real estate property is transferred. For example, a warranty deed guarantees that the "Grantor" owns the title, while the quitclaim deed only transfers the interest in the real property that a "Grantee" has. Most married couples normally hold title to real property under community property with right of survivorship. People who are not married can hold real estate ownership as Joint Tenants with right of survivorship. This means if one party dies then the other party's ownership interest will pass directly to the surviving spouse or partner.

Most deeds are recorded as a title transfer from a sale by the use of a title company which searches the public record and insures that the "Buyer" gets a clear title from the "Seller." This insurance policy assures the Lender there is a real estate loan being used to acquire the property that their loan documents will be in first or second position and that there are no deed restrictions, unpaid taxes, easements, bond assessments or other possible easements or encroachments on the property.

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Tuesday, July 19, 2011

The Probate Process Explained

Probate is one of the most common and least understood legal proceedings. It basically comprises the settlement of all financial matters pertaining to the estate of an individual after their death. This includes paying any outstanding debts or tax liability, collecting any amounts due to the estate and, where necessary, determining the validity of the decedent's last will and testament. If no will is found, the probate process typically includes a fair and equitable division of assets among the heirs of the deceased person; in community property states, the entirety of the estate passes to the spouse and no probate proceedings are required. Typically an administrator is appointed to handle the legal and financial concerns of the deceased; this individual is known as the executor, and deals with all administrative concerns relating to the disposition of the estate.

The probate process is generally lengthy, lasting up to a year or more, and typically begins with the appointment of an executor or administrator. Executors are usually specified in the will of the deceased. The executor's first act is usually to file a Petition for Probate of Will and Appointment of Executor; a hearing is then scheduled to review the will and to approve the selection of executor. Once the will has been certified as genuine, the executor is usually approved to begin the probate process. If no will exists, then an administrator is appointed by the probate court to handle the financial affairs; usually this is a family member or close friend. Both executors and administrators are paid an hourly fee for their services.

The initial stages of the probate process involve itemization, inventory, and appraisal of all assets belonging to the estate. This includes real estate, bank accounts, investments, life insurance policies, and all other items of value that constitute a financial asset. Some assets, including antiques, motor vehicles, and real estate holdings, require a professional appraisal of their value before they are added to the total worth of the estate.

Debts and liabilities are also assessed; typically, these financial responsibilities are dealt with in a predetermined order. A small allowance is sometimes paid to the immediate survivors, including the spouse and children of the deceased. After that, administrative costs are paid first, including the fees due to the executor or administrator. Funeral expenses and burial costs are dealt with next, followed by all other debts and claims. Pending lawsuits against the estate are typically paid after they are decided in court, although a settlement may be offered at any time during the probate process.

Once all outstanding and pending debts have been paid and a legally-required waiting period has elapsed, a final settlement is approved by the probate court and the remainder of the estate is distributed by the executor in accordance with the will or, if there is no will, the administrator makes distribution in accordance with the applicable state law. At this point, the assets of the estate may be directly provided to the heirs in their original form as real estate, financial securities, or other assets, or those same assets may be sold and the proceeds distributed as required by the provisions of the will or state law. This final disposition concludes the probate process and dissolves the estate as a legal entity, allowing the survivors of the deceased closure on the inheritance process.

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Monday, July 18, 2011

Why Artists Change Their Names

Mind you, some people do go by the name they were given as a child - more power to them. But here are some reasons why you or some other artist (self-proclaimed or merited) may look for another name:


I suspect that is where Lady Gaga came from - I have never known another Lady Gaga - have you? Someone with a very common name will try to find one that stands out from the rest. People are less likely to forget a strange name.

Their given name is too hard to remember:

Some artists during the Renaissance Period in Italy had nicknames that stayed with them. For example, Donato di Niccolo di Betto Bardi is much better known as Donatello, Jacopo Comin is known as Tintoretto, and Alessandro di Mariano di Vanni Filipepi is best known as Boticelli.

Their given name is too Common:

If your given name brings up thousands of people with the same name on Google search, you might want to stand out from all the rest by finding a name that no one else has.

Their given name is too hard to pronounce:

We have that problem in our family, because most people have difficult saying the name Kongaika (it means part fish). We always have to tell people to say it with a soft "g" like in singer, or King Kong, but most people say it with a hard "g" like in digger.


Some artists, actors or writers like to separate their private life from their public life. With social networking sites being so popular these days, many individuals like to remain anonymous so they can say what they like online.

What fits the genre of their art:

Personally, my given name does not suit the type of art that I do, but the name I have chosen to go by sounds more Polynesian. Much of my art and articles I write are Polynesian in nature - hence Elayne is a better fit.

To Switch Brain Modes:

Some artists claim they can think better with their right brain when they assume their "other" name. They can slip into a different personality to perform best. Sounds kind of weird, but I identify with this.

SEO (Search Engine Optimization):

If someone wants to appear on the front page of the Google results, one name would be easier to find than a longer name. Consider the name Picasso as opposed to Francis Bacon which could bring up a myriad of pages including recipes.

Other reasons: Other reasons that a performance or visual artist may change their name could include ethnicity (either wanting to be identified with or not, and also to avoid discrimination) or family connections (any skeletons in their closet?). Maybe they just feel that their name is dull, uninteresting, or sounds like a swear word in another language, or brings about an undesired image. Perhaps their name is just too long to write over and over - think of all those autographs!

Changing a name and committing to it is a very interesting process which should not be considered lightly. It is a rebirth, a commitment with confidence of marking a change in your life.

Most performance artists call it a stage name. A well-thought-out name can make a big difference to the success of their career. Using their given name may inhibit their success.

For actors in the United States and The United Kingdom there are guilds that stipulate that no two members may have the same name. So do not try being another Lady Gaga - try to come up with something different. Often times, agents choose a name for a rising star.

Writers call it a pen name.

Professional wrestlers call it a ring name.

I guess visual artists would call it their artist name or alter ego. Others feel that an artist is not authentic when they change their name. That is one way to look at it.

If someone else has the same name as you, at least you can be the BEST of them all by your reputation.

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Sunday, July 17, 2011

The Purpose Of An Irrevocable Living Trust

Irrevocable living trusts are rare and mainly used to keep the IRS from taxing the death benefit of a life insurance policy. Learn the purpose of an irrevocable living trust from an estate planning and probate lawyer in this free video on estate law.

Saturday, July 16, 2011

Power Of Attorney Terminology

Completing the forms that need to give power of attorney to a person or corporation may be the easy part, the terminology that you should know can be a little more confusing. However, it is a good idea to be familiar with the terms used when power is being granted. This will ensure that you understand what you are signing and what your rights are.

Power Of Attorney is when a person gives power to another person or organization to act on their behalf. There are different types of power that can be granted, however they all still involve one person giving power to another person to act for them while they can not.

Advanced Directive is considered a general term that encompasses all methods of planning to be done for the possibility of incapacitation. This does include Durable and the Heath Care Surrogate as well.

Attorney In Fact is the person that has been granted the authority to act on another person's behalf. Sometimes it is also called the proxy or the agent. This also includes co-agents or successor agents as well.

Springing Power is when a certain act or event has to take place for the power of attorney to become effective.

Durable or DPOA means that the attorney in fact stays in place even when you are incapacitated. This must be explicit in the document.

Principle is the person that is initiating the power of attorney. This is the person that will be allowing another person or organization act on their behalf.

Capacity means that the person understands the documents they are signing, they know who they are, who their relatives are, who they are granting the power to and what their assets are. Capacity does need to be determined by a doctor if during the signing of power to another person has stated that the person has diminished capacity or is not mentally sound. In a situation of this nature a physician must perform an exam and give a written evaluation stating that the person either has capacity and is mentally sound or that they are not.

Monitor is a person that is appointed that helps to prevent elder abuse and abuse of power by the appointed agent. Currently it is a law in NY. A monitor can be appointed by the principle and they are given the power to request all documents, receipts, records, disbursements and transactions that the agent has performed on behalf of the principle.

SMRG or Statutory Major Gifts Rider is a document that the principle adds to the power of attorney short form that authorizes the appointed agent to make major gift transactions and other transfers. Currently, this is only in practice in NY. This form and the power form must read together as one document.

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Friday, July 15, 2011

Uncontested Divorce - Do You Know How It Works?

An uncontested divorce is a divorce in which both parties can agree to the terms of the divorce. With an uncontested divorce, both parties negotiate the terms of the divorce without court proceedings. One lawyer represents one of the parties and prepares the divorce documents. Generally speaking, the lawyer will meet with the party they are representing and start the divorce proceedings. The parties negotiate the terms until both parties are satisfied. There are advantages and disadvantages to an uncontested divorce.

An uncontested divorce is considerably cheaper than going to court. If you can negotiate the terms of the divorce agreement before contacting a lawyer to begin the divorce proceedings, the cost is minimal. It saves time for everyone involved. When facing a divorce, saving money is a huge benefit. This is money that can be used for making necessary changes and for living expenses.

An uncontested divorce can also help maintain a level of civility between the parties. If the parties to the divorce have an amiable relationship, it is best to try to protect that mutual respect, especially if there are children involved. Another advantage is the privacy that an uncontested divorce offers in contrast to court proceedings. The divorce will be a matter of public record, but the visibility of the negotiations and the actions taken is potentially private and limited by what the parties disclose in the documents.

Just because the parties do not immediately agree to terms of the divorce doesn't mean that they should put the decisions in the hands of a judge. It may just mean that more negotiations are needed. However, there are times when an uncontested divorce is not necessarily the best route. There are some disadvantages to uncontested divorces.

If one party is exerting power and control over the negotiations or if there is a history of domestic violence, then an uncontested divorce is usually a bad idea. The victimized party is not in a position to look out for their own best interest. An uncontested divorce does not ensure that the agreement will be fair and just. Therefore, if one party is unable to do this for themselves, an uncontested divorce is not for them.

An uncontested divorce will not work if the parties cannot tolerate each other enough to negotiate the terms of the divorce. If they can't have reasonably civil discussions and come to an agreement, then attempting an uncontested divorce is a waste of time. Sometimes, this hostility will lessen with time and an uncontested divorce will become a viable option.

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Thursday, July 14, 2011

Incorporation 101: The Nature of Limited Liability Companies

What is LLC?

Limited Liability Company (LLC) is a relatively new business structure allowed by state statute. It is neither a partnership nor a corporation, but a distinct type of business structure that offers an alternative to those two traditional structures by combining the corporate advantages of limited liability with the partnership advantage of pass-through taxation.

Limited Liability Companies are becoming more and more popular, and it's easy to see why. LLCs combine the personal liability protection of a corporation with the tax benefits and simplicity of a partnership. In addition, they're more flexible and require less on going paperwork than corporations.

Owners of an LLC are called "members". Since most states do not restrict ownership, members may be individuals, corporations, and other LLCs and foreign entities. There may be unlimited number of members. Most states also permit "single member" LLCs, those having only one owner.

Members in an LLC are analogous to partners in a partnership or shareholders in a corporation, depending on how the LLC is managed. A member will more closely resemble shareholders if the LLC utilizes a manager or managers, because then the members will not participate in management. If the LLC does not utilize managers, then the members will closely resemble partners because they will have a direct say in the decision-making of the company.

Why Should I Form an LLC?

If you decided to start your own business, you will need to figure out which type of business entity you want to set up. Today LLC is one of the most popular business entities established by new businesses because of the many advantages it has. Forming an LLC helps protect your personal assets, reduces your taxes and saves your time and efforts by eliminating excessive paperwork. In other words, LLCs are often favored over other types of business entities because they combine the limited liability protection of a corporation and the pass through taxation of a partnership.

Single- vs. Multiple-Member LLC

In general, LLCs can be formed with unlimited numbers of members, in which case it is called Multiple-Member LLC. Nevertheless, most states also permit Single-Member LLCs, having only one owner (member). A Single-Member LLC is taxed as a sole proprietorship, while a Multiple-Member LLC is taxed as a partnership.

Advantages of Forming LLC

LLC is a relatively new type of business structure that combines the best features of the corporation with those of the sole proprietorship or partnership. LLC has many advantages and benefits which cannot be enjoyed together in any other type of business.

  • Personal Liability Protection:

LLC is an entity separate from its owner(s). Being legally distinct entity, the personal assets of the owner (such as personal residences, and personal bank accounts) are not reachable by business creditors. The LLC owner's liability is generally limited to the amount of money that person has invested in the LLC. Thus, LLC members are offered the same limited liability protection as corporation's shareholders.

  • Tax Advantage:

LLCs allow pass-through taxation, and that advantage is the prime reason for the recent popularity of the LLCs. Pass-through taxation means that earnings of an LLC are taxed only once, basically being treated like the earnings from a partnership, sole proprietorships and most S-Corporations.

  • Ease of Transfer:

With LLCs its easier to sell ownership interests to third parties without disrupting the continued operation of the business. As a comparison, selling interests in a sole proprietorship or general partnership require much more time and effort. An owner must individually transfer assets, business licenses, bank accounts, permits and other legal documentation.

  • No Ownership Restrictions:

LLCs have no restriction on the number or types of owners. By comparison, S-Corporations cannot have more than 100 stockholders, and each must be a resident or citizen of the United States. None of these restrictions apply to an LLC.

  • Easier to Raise Capital:

LLCs allow for many ways to raise capital. You can admit new members by selling membership interests. You can even create new classes of membership interests with different voting or profit characteristics.

  • Greater Credibility:

As a registered LLC, your business will enjoy legitimacy and greater credibility when dealing with other companies, banks and potential partners/investors.

  • Flexible Management and Ownership Structure:

Like general partnerships, LLCs are generally free to establish any organizational structure agreed on by the members. Thus, profit interests may be separated from voting interests.

How to Form an LLC?

After you decide to form an LLC, Articles of Organization must be filed with that state and initial fees must be paid. After your Articles of Organization are filed, your LLC should have an organizational meeting where an Operating Agreement is adopted, interest certificates are distributed, and other preliminary matters are completed. LLC Kit includes all of the information and paperwork to make this process easier.

  • Publications:

Three states require notice to be published in a newspaper that an LLC has been formed - New York, Arizona and Nebraska.

  • Federal Tax ID Number:

A Federal Tax Identification Number, also known as an Employer Identification Number or EIN, is basically a social security number for businesses. It is the number the IRS uses to identify the business, and it must be included on tax filings the business makes. If you operate your business as a sole proprietorship or partnership and are now looking to incorporate or form an LLC, you must obtain a new EIN for your business.

  • Single-Member LLCs:

The IRS does allow Single-Member LLCs to qualify for pass-through tax treatment. However, taxation of one person LLCs at the state level may be different.
Corporation as an LLC Member

A corporation can be a member of an LLC. This allows you to create an additional level of ownership, which is designed to create an entity that can offer such traditional fringe benefits as retirement plans and an additional level of protection from liability.

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Sunday, July 10, 2011

Estate Planning : Does A Will Trump Life Insurance?

Life insurance policies list beneficiaries, and those beneficiaries are not changed through wills. Learn about conflicts between will and life insurance policies from an estate planning and probate lawyer in this free video on estate law.

By The People of Fairfield has helped thousands of people in the Solano County Area since 2004. We have assisted people in preparing the paperwork for many different uncontested legal matters, including wills and living trusts, and we can help you, too! We try to make each process is simple and fast as possible, as well as affordable. Our fees are a fraction of the cost that you would pay at an attorney’s office. Please call or stop in for more information. There is no cost or obligation to stop in and have an initial consultation with us. We offer a friendly and relaxed atmosphere at our office, which we think you will find very comfortable.

Saturday, July 9, 2011

Durable Vs Springing Power of Attorney - Which One Do You Need?

One of the most important documents you should have in your estate plan is a Power of Attorney.

But do a little research on POAs and you'll discover there's more than one type: General, Durable and Springing. So which one do you need?

A General Power of Attorney is typically used when you need someone to handle legal affairs on your behalf for a short period of time. This could be because you're going out of town for example, or perhaps you want an attorney to negotiate a contract on your behalf. The General POA will grant that authority within the constraints you define.

A Durable Power of Attorney works the same way but unlike a General POA, it is not automatically revoked when you become mentally incapacitated. This type of POA is a useful tool for spouses or partners who want to ensure that someone they trust always has access to financial accounts and the ability to pay bills, talk to creditors and deal with other normal financial affairs.

The Springing Power of Attorney works just like the first two but only comes into play when you've been diagnosed as mentally incapacitated. This is often the POA of choice for people who want to ensure that their estate is protected if they become disabled. As long as you are mentally sound, the POA remains inactive, but if something should happen and you are no longer able to handle your own affairs, the Springing POA would "spring" into action.

So which one is right for you?

That of course will depend upon your individual needs. To learn more about POAs and how to use them in your estate plan, consult with a qualified estate planning attorney.

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Friday, July 8, 2011

Parents in Action: When Parents Decide To Divorce

How to keep your children from suffering during divorce.

By The People of Fairfield has helped thousands of people in the Solano County Area since 2004. We have assisted people in preparing the paperwork for many different uncontested legal matters, including divorce, and we can help you, too! We try to make each process is simple and fast as possible, as well as affordable. Our fees are a fraction of the cost that you would pay at an attorney’s office. Please call or stop in for more information. There is no cost or obligation to stop in and have an initial consultation with us. We offer a friendly and relaxed atmosphere at our office, which we think you will find very comfortable.

Thursday, July 7, 2011

Warranty Deed vs. Quit Claim Deed

When you're in the process of selling (or purchasing) a house, you will most likely, encounter several kinds of documents: all with different names and with different uses and functions. Two of the most misunderstood documents are the warranty deed and the quit claim deed. Many think that these two forms are alike, but they are not.

A warranty deed is a document which the seller presents to you and is used in majority of all sales transactions. The warranty deed simply states that the seller owns the property being sold and that it is free from any sort of liens. By presenting a warranty deed, the buyer is assured that the holder of the title has the legal right to transfer ownership of the unit and is assured that no one (financial institution or other creditors) would come after him to make a claim on the property. In the eventuality that someone does lays claim to the property that has just been purchased (or that the claims stated in the warranty is erroneous), the buyer is further protected by law, and would be entitled to receive a form of compensation. Warranty deeds seldom stand alone as these documents are usually backed up by a title insurance policy.

A quitclaim deed, on the other hand, is presented to a buyer by someone who does not necessarily own the property being sold, but holds responsibility for it. This occurs due to several reasons such as when the owner dies and bequeaths the property to one of his heirs, or when there is a marriage and the owner wants to include the name of his/her spouse to the title (among others). A quitclaim deed offers a lower level of protection to buyers. This kind of document is used primarily when the property in question will just stay within a family.

Incidentally, there are times when both a warranty deed and a quitclaim deed are presented to a potential buyer. An example is when the property lies on the border of rivers and or lakes; where ownership of the underwater land on which his property stands on remains unclear.

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Wednesday, July 6, 2011

Quitclaim Deed

A quitclaim deed is explained.

By The People is a Document Preparation Service located in Fairfield, California available to help you represent yourself in many uncontested legal matters.

Tuesday, July 5, 2011

Valid Reasons To Contest A Will

Sometimes when an individual passes away and leaves a will, controversy arises over whether the will should be probated. Family members may find themselves being pitted against one another if the wishes described in a testator's will are disputed. While no one wants to find himself in the position of contesting a will, sometimes there are valid reasons to do so. If you believe that a will is invalid for one reason or another, and you are a potential beneficiary, it may be in your best interest to contest the will.

Who Can Contest a Will?

Before submitting a reason for contesting a will, is important to first know whether you are even eligible to contest. To be eligible, you must have some stake in the outcome of the will. Perhaps you are a beneficiary but feel that you should have been given a greater share, or maybe you were left out of the will entirely but believe you are entitled to be included or would have been included under intestacy laws. If you stand to gain financially from contesting a will, you will likely be permitted to submit a contest if you wish.

Criteria for Contest

There are several reasons that an eligible individual may contest a will. The valid reasons for opposing a will's probate include:

  • Fraud: The supposed testator did not actually create the will being submitted, the signature of the testator was forged, or the testator was tricked into thinking that s/he was signing a different document other than a will.
  • Undue Influence: Through blackmail, threat, bribery, or other influence, an individual convinced the testator to change his or her will or to write a will that benefited the offending individual over others.
  • Mental incapacity: The testator was not "of sound mind" to write and/or sign the will.
  • Improper procedure: The will does not meet the validity requirements as listed under state law. For example, the will was not signed by the testator or witnesses were not present.

If an individual can provide evidence that a will is invalid for any of the above reasons, the will may be declared invalid by the court. In this case, an earlier will draft may be admitted to probate or, if a different valid will draft doesn't exist, the estate may be divided according to state intestacy laws.

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