unemployment insurance

Business Basics: State Unemployment Insurance

Unemployment insurance, at its root, is pretty easy to understand – it’s just a program meant to protect workers that become involuntarily unemployed. But because it is run on a hybrid state-federal system, and is often calculated based on weird variables like experience ratings, the entire concept quickly becomes muddled. Most states also change rates and maximum taxable wages on a year-by-year basis, so what was paid last year may not be the same this year. Thankfully, as long as you learn a little bit about unemployment programs and stay on top of those annual changes, UI shouldn’t cause too many problems. (more…)

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annual meeting

Business Basics: Annual Meeting for Small Corporations

Corporate meetings aren’t exactly fun; they’re tied to board rooms, suits, and a lot of financial talk. And so smaller corporations – especially those with just a handful of shareholders – often ask whether they really have to hold a meeting every, single year to effectively rubber-stamp the same board of directors and file their annual report. The answer, of course, is yes. Annual shareholder meetings are legally required for private and public corporations, regardless of size. But your annual meeting doesn’t have to be a stodgy affair. In fact, one of the best parts about being a smaller corporation is the extra little bit of freedom you have in how these meetings are run.

Forget the Board Rooms and Offices

You have to set the date of your annual shareholder meeting in your bylaws, but the location is up to you. Plenty of corporations opt for the traditional, formal meeting – everyone gathers in the office, there’s a podium, people wear suits, and everything is very cut and dry. But what if you run your business from home, as nearly half of all small business owners do? Or what if you want your annual meeting to be a bit more enjoyable? There’s absolutely nothing wrong with meeting at a restaurant, or around your kitchen table. In fact, we’ve talked to plenty of CEOs who make their annual meeting a potluck; the few shareholders they have all bring a dish, they sit down, do their formal meeting, and then spend the rest of the day eating and talking. Some states actually do set a minimum for the number of shareholders that must be present, so hosting a more laid-back meeting can help ensure people do come.

Have the agenda laid out and ready to go

The chair can technically “wing” the meeting if they have a good idea as to what needs to be voted on. Normally these meetings are to appoint and/or remove directors, modify corporate bylaws, vote on shareholder initiatives, and approve transactions requiring shareholder approval like mergers or asset sales. But it’s a better idea to list out what, exactly, needs to be brought up so you can keep the formal part of the meeting as quick and easy as possible. Different states may also require different numbers of votes depending on the transaction – sometimes a simple majority is not enough – so planning this out lets you know what numbers you actually need.

Keep your minutes light

You must keep the minutes of your annual meeting, but you do not have to transcribe every, single thing said. Note the date, time, and place of the meeting, take attendance, lay out the agenda, and record votes. If anything new is brought up during the meeting, make sure to note that as well. Otherwise, your minutes can effectively be a quick sketch of your annual meeting. Just make sure, before everyone leaves, you pass around the minutes so everyone can review them. These constitute an official document and it’s important they portray the meeting accurately.

Every corporation must host an annual meeting for its shareholders, but there’s no reason why it has to be this dreaded, boring affair. Corporations, especially those with just a handful of shareholders, have a bit of leeway as to what the meeting will actually look like. Set out the agenda, keep minutes, and vote, but feel free to make this a meeting of friends, as well as a meeting for the shareholders.

Have any questions about corporate governance? Want to form your own corporation but not sure where to start? Click here for a free consultation, or give us a call at 1-877-692-6772 and we will be happy to answer any questions you may have!

 

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LogoGardenPhoto

Business Basics: An Employee Review… When You’re the Only Employee

Employee reviews get a bad rap – a lot of people assume they’re meant to judge a person’s work and weigh whether or not they are worth their wage. In reality, reviews are a great way to force a person to reflect on the past year, figure out what they’ve done well, and highlight potential growth areas. And you don’t suddenly outgrow their use after creating your own business. Too few small business owners actually take time to reflect on the past year; we assume we made money so, therefore, we did well enough. That’s a dangerous attitude, as it leaves you open to stagnation and contraction. This year, instead of just closing out the books and handing them to your accountant, do an employee review and really figure out just how well you did.

What do you ask?

Think back to your last employee review, and remember your manager brought up. Reviews are usually pretty standard, so you’ll be asked to come in with some accomplishments and possible improvements. There’s then a quick ten to twenty minute back and forth to sketch out goals and ideas for next year, and you’re done. Your one-person review does not need to look any different. It’s the end of the year, so you have a good idea how you did financially, but think of a few ideas or initiatives you’re particularly proud of and jot them down. Then ask what you’d change if you could do it over, and write those down as well. You’ve just outlined a plan of attack for next year. Keep doing what you do well, adjust as needed to help spur improvement, and plan out whatever new initiatives need adoption to ensure those improvements happen.

Do you have to talk to yourself?

No – in fact, if you can, involve someone else. You’re more than capable of doing this “review” on your own, but outside perspective is invaluable. We are our own echo chambers – we always wind up thinking our own ideas are good. But what you need is someone to bounce ideas off of. Someone to poke holes in your plan, and refine that sketch you just put to paper. Involving someone else also adds a bit of culpability to the process. Not only does it force you to actually think about, and write down, that list of accomplishments and improvement areas, but talking about that list means someone else knows your plan, and may ask about it periodically over the next year. Extra, external motivation is always helpful.

What’s the point?

Honestly, this process is something every business owner should do already. But running a business is tough, tiring work. And at the end of the year, when life is already hectic and you have tons to get done before January first, the last thing you’ll want to think about is next year’s plan of attack. Small business owners are great at mapping out big plans and focusing in on microscopic details. We usually aren’t great at connecting them. This employment review exercise helps by forcing us to see what works, and how we can leverage our talent to meet attainable, worthwhile goals over the course of the next year. Then, when 2016 hits, you aren’t forced to fly by the seat of your pants.

Ready to start your own business? Need some help with the process? Click here, or give us a call at 1-877-692-6772!

 

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delayed filing

Business Basics: Should You Opt for a Delayed Filing?

Procrastination tends to hit business owners hard when it comes to incorporating or forming an LLC. A lot of small business owners resolve to file the necessary paperwork, and then never do. And now they’re facing the end of another year and wondering if it’s even worth filing this late in the game. Believe it or not, it is! But around this time of the year, we usually tell customers to consider a delayed filing over a traditional, immediate action. Delayed filings are the perfect option for businesses owners who know…

They want to form an LLC or Corporation

Forming a limited liability company or incorporating is easily on of the best ways to protect yourself and your personal assets from any debts associated with the business. The government treats corporations and LLCs as their own legal entities, separate from the owner or owners. Any debts it incurs, loans it takes out, or judgments against it are therefore its responsibility and, in most cases, your personal assets will not be seized to pay for those debts. However, forming an LLC or incorporating requires the company’s managers to jump through a few extra loopholes, like paying fees and filing reports annually. Incorporate or form an LLC now, and you may be on the hook for 2015’s fees, even though the company only existed for a month. Plus, depending on your state, you may have to file different returns for the months your business was not its own entity, and the month it was.

That’s where delayed filing comes in. A delayed filing allows you to file the proper paperwork now, and set an “effective on” date a month or so into the future. That way you finish out this year as a sole proprietorship or partnership and, early next year, your LLC or Incorporation is officially approved and formed.

They do not want to be rushed

There is a lot of work that needs to be done at the end of the year. You have to put your books in order, evaluate the staff, and make it through the holiday season. But forming a legal business entity comes with its fair share of responsibilities as well; if you rush through your paperwork, and anything is amiss, the state will reject your filing. We are right at the cusp of December, so take this brief bit of time to make sure your ducks are all in a row – you have a registered agent, a physical address, and a protected DBA name – and then fill out your forms and opt for a delayed filing. That way you won’t have to struggle through all of the normal, extra work that comes in December and January.

They don’t mind waiting a little bit

I know how frustrating it can be to wait on the government to approve your paperwork, but trust me, patience pays off. You actually save a bit of time filing now and opting for a delayed filing instead of filing at the beginning of next year because a lot of businesses wait until the start of the year to send in their forms. State offices get swamped, the delay gets longer, and then you’re stuck waiting until February or March to hear whether your LLC or Corporation was formed. A delayed filing means your paperwork is approved before that rush or, at the very least, that the state will put your paperwork at the top of next year’s pile.

Ready to form an LLC or Corporation? Want us to help you file the right paperwork or opt for a delayed filing? Click here or give us a call at 1-877-692-6772

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MyCorp Recommends: “The Power of Failure”

A fear of failure can be paralytic, especially to a small business owner or would-be entrepreneur. It means losing all the time, effort, energy, and money risked on an enterprise. But what if someone said that failure was a good thing? That, in fact, feelings of failure and defeat carry the true key to success?

Our good friend Fran Tarkenton argues exactly that in his new book “The Power of Failure“. TarkentonBookFran Tarkenton is no stranger to failing – he helped bring the Minnesota Vikings to the Super Bowl three times during the 1970’s, and each time lost. After turning to business, the first two companies he founded eventually folded. But he didn’t allow himself to be engulfed by that failure and now, as CEO of Tarkenton Companies, is a wildly successful entrepreneur.

Failure, he posits, is a gift that brings incredible power. In “The Power of Failure” Tarkenton shares never-before told stories of his time in the NFL, and the personal, occasionally painful, moments he experienced. Through his own hard-learned lessons and invaluable advice given to him from friends and mentors like Sam Walton and Bernie Marcus, Tarkenton lays out the myths and truths of failure, and how to follow through to success. (more…)

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MyCorp FAQs: Does my Online Business Have to Collect Sales Tax?

All businesses pay a federal income tax, whether its as its own entity or through the income tax of the owner. But, sales tax is a completely different story. Sales tax is determined by each individual state and the requirements for multiple state businesses are often complicated. sales taxThose requirements get further complex when you are an online business as you may not have any physical presence in the state itself. Whether or not your online business has to pay sales tax all depends on the states’ definition of one word: nexus.

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MyCorp FAQs: How do I start collecting payroll taxes?

The IRS, nearly every state tax agency, and even some cities require employers to withhold a certain amount from their employee’s paychecks to cover income tax, social security, and medicare obligations. payroll taxesThese are payroll taxes, and it’s your responsibility, as a small business owner, to collect and send them in. The amount varies from state to state, and in some cases city to city, but there are three main steps to collection.

Calculate
Everyone you hire fills out a W-4, which gives you some basic information like family size and other deductions. (more…)

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MyCorp FAQs – What do you need to know about payroll?

Payroll may seem like a straightforward topic, but there is a lot more to it than just tracking hours and cutting checks. Unfortunately a lot of small business owners don’t realize that and, before they know it, they’re up to their ears in tax forms and reports they’ve never even heard of. Calculating, and staying on top, of payroll can actually be pretty complicated, especially if you don’t have a background in accounting. payroll system So what do small business owners absolutely need to know about setting up a payroll system?

You must withhold taxes

The federal, state, and local governments can all levy tax on income, and it is your responsibility as an employer to withhold the necessary amounts from your employee’s paychecks and send that into the proper agency. (more…)

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MyCorp FAQs: Do I Have to Send in Estimated Tax Payments?

Estimated tax payments are a pretty straightforward topic. You probably remember that, back when you worked for someone else, you had your taxes taken out of your paycheck. You don’t get out of having to pay tax when you start your own business – the IRS still expects you to pay what you owe. But what if you’re just starting out and not making much money? estimated tax paymentOr you’ve had a bad quarter and don’t have the money to cover what you normally send in? Do you still have to send in your estimated tax payment?

If you expect to owe more than $1,000, then you very likely have to pay estimated taxes. (more…)

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MyCorp FAQs: Do I Need an Employer Identification Number?

An Employer Identification Number, also called an EIN or a Federal Tax Identification Number , is a unique set of digits assigned to a business by the IRS. With it, tax agencies can easily track the financial activity of your company, and make sure that you pay your taxes. employer identification numberBut, if you run a sole-proprietorship, the IRS can already do that using your personal social security number. So in what cases do you need an Employer Identification Number?

When you hire someone

The only time you can really get away with using your social security number is when your business is considered a sole-proprietorship, and you’re the only employee. The IRS figures, in cases like that, the company’s profit flows directly to you, and you pay your taxes from that. But that changes the minute you bring anyone on to help run the company, and that includes a business partner. Once you start hiring, your company must have an EIN.

When you form an LLC or Incorporate

Incorporating or forming an LLC separates you and the business. (more…)

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