All my properties are owned out right, there are no mortgages. My LLC is setup for my real estate investment business. I am now starting to buy rehabs that I an gonna buy, fix and flip.
I generally advise clients to create a separate LLC for each property. The member of each LLC could be a single member LLC in which you are the single member. The reason is that as you now hold the properties, should anything ever give rise to a claim against you all of your properties plus your personal assets are fair game for the plaintiff. With separate LLC's and rational management, you liability is limited to the single property from which the claim arose. For the modest cost of the LLC's I strongly recommend the use of them.See question
We have not incorporated yet, no written agreements, thinking of EU and Delaware (R&D - IP). Bootstrapping + sweat equity has resulted in 0 debt and minimal investment (500 USD). All involved are top professionals in their respective fields (codin...
I do a lot of start up work with both U.S. and foreign companies. Let me see if I can address your questions.
I think the Delaware link is a good one--I organize there whenever feasible for a host of reasons.
My understanding is that you have nine "core" persons. I assume you mean persons who are active in the company and not passive investors..
I suggest you begin by trying to determine the value of the company now at its inception. It may be as little as the $500 in capital, but it may also be much more depending upon projected earnings. I suspect it is worth a good deal more than book value.
If I follow you correctly, you will put in about $20,000. Other than the $500 on hand it appears no one is investing money for awhile. If I follow correctly, up to 50% of the equity can go to passive investors, leaving, I infer, 50% for core persons. You expect to add perhaps 10 persons in coming months.
I would be very interested in speaking with you further, regardless of whom you retain as counsel, as your issues are rather interesting. If my assumptions are correct, you begin with 50% of the issued and outstanding equity going to the "passive investors" and the rest to the "core" persons. The former will invest money and the latter sweat equity. If the company could not exist in th absence of the core team, giving them 50% is quite reasonable. Outside investors typically are seeking at least 51% or more to give them control--you may want to factor that into your thinking.
If shares vest over time, which makes sense, you should have clear employment agreements to protect the core folks.
With the caveat that I may be misreading your facts, I think you could fairly give at least 50% and preferably 51% to the core persons who are going to make the company work and 50% to those investing primarily for a return on investment. You can choose to authorize more shares thatn you need and keep some of them unissued for future staff, or you can issue all and authorize more later. If you are seeking serious money, you will need to do that in all likelihood anyway.
Again, there are too many facts that I do not have here, but in principle I would suggest your core persons--those whose talent and contributions have made made and will make the company successful should get at least half of the equity and possibly more. If you are the only one to put cash in there shoud be compensation for that in the form of extra equtiy.
The rest of the equity can go to investors. I would be inclined to create enough shares that you can give equity now and sell more equity from the same pool when you seek bigger somes of money.
All other things being equal, i would favor Delaware incorporation and a nexus between the two companies. Whether one is a parent and one a sub may depend upon where your shareholder reside.
As noted above, I would be happy to discuss without charge or commitment. I can also refer you to some sources for a reasonable cost evaluation.
Washington International Business Counsel
I have researched online lots of different ways to assess the value of my Business but it varies greatly. I need a local lawyer to help assess that value and represent me in a merger!
I believe you need two resources. First, you need an accountant or other professional skilled and experienced in valuing businesses. As you no doubt know, businesses can be valued based upon book value, multiples of earnings, as well as other measures.
Second, you need legal representation in the merger, both to discuss with your personal interests an long and short term goals, as well as to help you protect your investment.
Washington International Business Counsel
Which State should I set the LLC up in?
Mr. Callahan is correct, that you will need to register a MA LLC in Ohio if it "does business" in Ohio. Owning rental real property will almost certainly be deemed to "do business."
Ohio is a fairly easy state for setting up your LLC. Since LLC's are disregarded entities for tax purposes, i.e., the LLC pays no tax but rather profits and losses flow to you, consult with your CPA to make sure you do not get hit with OH and MA income taxes. I think that is unlikely, but I would make a quick call to your CPA just to be certain.See question
5 companies all by one owner will like for them to fall all under the same corporation or tax id number is that possible
If you would prefer that all companies operate under one tax id, that is possible in a couple of ways. First, you could integrate all of the companies into one and operate them as divisions of the same company. Each would be its own profit center. You may need separate EIN's for banking purposes, but if they are all part of the same enterprise you should be able to file only one tax return, etc.
Alternatively, I believe you can make four of the companies subsidiaries of the fifth company and file a single consolidated return. I defer to the tax specialists on that issue. It may make a difference whetheryou have C corps or S corps as well.
In short, if for business reasons you want to bring your companies under one umbrella with one EIN that should be possible. Recognize, however, that you have both a corporate issue of how best to integrate the companies an a tax issue, i.e., whether you can file a single return or whethr you must file multiple returns.See question
2 step process is proposed to convert a c-corp to a s-corp. Then convert the same s-corp to a llc. Possible? Tax issues? Time issues?
The threshold question is what are you trying to accomplish. Why do you wish to make the change? Some states make such conversions simple, while others make the task arduous. Your question poses both tax questions and business issues.
On the tax front, a competent CPA may be able to provide guidance. On the structural front, again it will depend upon the state or states in which you are registered.See question
I am looking for business attorney who has drawn partnership agreement for E2 visa. I am buying 70% shares out of my friends company who runs restaurant business in California. Please forward me your contact information if you are from California.
I am not from California, but our firm represents businesses around the U.S. and abroad. My colleague is an experienced immigration attorney thoroughly knowledgeable regarding E2 visas and the requirements, whereas my experience is in the drafting of the agreements. In fact we are working on such an arrangement now. My colleague is in fact admitted in California as well. I would be happy to speak with you about your needs.
Since the website is targeting U.S. visitors, they want to register a C-Corp in Nevada. The CA person will be a passive investor owning 70% who will not participate in the operation of the business at all. The tech person in Europe wi...
Let me raise a couple of questions, as I deal with these kinds of internationally owned companies regularly.
First, why Nevada as the choice for incorporation. I have a strong preference for Delaware and use it regularly, though I understand that Nevada is trying to compete with Delaware in the market for incorporating. I just find the service superior and it is more convenience should anyone in Europe ever have to appear for anything. There are other reasons for the preference as well, though I confess there are some subjective criteria.
When seeking an EIN there are questions to be answered. It is possible that the CA soon to be shareholder could in fact register the company using his own SS number, though that is a longer conversation than this space allows.
If the CA person has authorization from the directors and/or officers and has in hand the EIN letter and the Articles of Incorporation, he may be able to open the account.
The use of the residential address should not be an issue.
Having said all of that, there are myriad other things to consider, among them the ultimate tax consequences. If the tech person is in Europe is he in a country that has a tax treaty with the U.S. Are things structured to avoid double taxation?
My concern here, as often is the case in these situations, that you have adequate information to make informed choices in the structure and operation of the company. One question that leaps to mind is why one would own 70% and not insist on a Board seat.
I suspect that there are other factors to be evaluated.
I would be happy to speak with you off line without charge. to discuss your needs and strategy.
Washington International Business Counsel, LLP
Hi, our company has recently formed as an LLC in California. We plan to raise a seed round soon via convertible notes and then in around 12 months raise further funding with a series A round. Some people have told us that most angel investors that...
My experience is that investors want C corporations. The LLC operates differently, and the C corporation works better for outside investors. The cost of setting up you C corporation is not all that great--several hundred dollars at most.See question
A friend of mine has starting a company. It is an llc. She has done all the proper paperwork and is good to go. Her company has a website with the same name. However, she has another website that offers different services. She is trying to promote...
If I understand you correctly, this should not be a problem. Let's say her company is "Jane Smith, LLC." She has JaneSmithLLC.com. Her other site is XYZ Services.. JaneSmithLLC.com offers real estate services and XYZ Services sells cosmetics. She has a couple of options One site could be Jane Smith, LLC presents "SuperWeb.com" and Jane Smith LLC presents "Super Cosmetics.com" She could also use a doing business as identify for the second company.
There is no requirement that a company market under its own name, though it is often good business. She can run the ABC Website selling one product and the XYZ site selling another. In her terms and conditions on the site she must reveal the true identify of the company.
That is one way and there are others.