Legal Best Practices for Small/Family Businesses
Business owners want to spend time focusing on their businesses—as they should—and not on their legal documents. But it is important to pull those documents off the shelf every now and then and make sure that what they say about how decisions are supposed to be made, what types of meetings are supposed to take place annually, etc., are being followed. If the documents no longer reflect reality, it’s time to update them. Otherwise, the owners could be in for unexpected difficulties and frustration when it comes time to take out a loan, sell a property, expand the business or pass it on to the next generation—or if the company ever ends up in court. Effective tax planning is also crucial. Getting the tax planning right can save a lot of money over the long term, and getting it wrong can be very costly. There are a number of tax issues to consider—not just the business taxes paid by the company and how to minimize those, but also how the business fits into the owners’ personal tax situations and estate planning. Federal and state taxes should be considered, as well as foreign taxes, if applicable.
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