CORPORATE COUNSELING

 

Our firm provides comprehensive business and corporate counseling to new and existing entities, including consumer cooperative corporations, non-profit public benefit and mutual benefit corporations, limited liability companies (LLCs), limited liability partnerships (LLPs), S-Corps, and C-Corps. We assist with corporate governance, compliance, contracts, tax concerns, intellectual property rights, licensing, zoning laws, and business strategy.  Utilizing our cutting-edge knowledge of business trends and the evolving legal landscape, we help you start and grow your business.  Our firm’s proactive and solutions-driven approach achieves our corporate and business clients’ goals and objectives, while ensuring compliance with all rules and regulations.

Some of the legal and strategic issues that arise for business and corporate entities about which our firm specializes include:

• Proper Corporate and Business Formation,

• Corporate Filings, Licenses, and Permits,

• Zoning and Finding The Right Location,

• Bylaws and Corporate Records,

• Corporate Governance,

• General Corporations and Subchapter S Election,

• Limited Liability Companies,

• Non-Profit Corporation Tax Status,

• “Non-Profit” Collectives/Cooperatives and Transparent Accounting,

• Contracts and Other Transactional Documents, and

• Political Organizing.

 

Proper Corporate and Business Formation

Choosing the right corporate entity and business form is key to any venture.  By acting as strategic partners, our firm helps clients choose the proper entity, formulate, and execute a solid business model.  We handle all steps of incorporation and business formation, including filing articles of incorporation and organization, drafting bylaws and operating documents, and other required Secretary of State filings, as well as securing proper State and local permits and licenses.  We also offer an expedited service to allow you to incorporate in less than one week. 

 

Corporate Filings, Licenses, and Permits

Corporate and business entities must have certain licenses and permits with the State and, in most instances, local government and agencies, in order to lawfully operate.  For example, incorporated entities must annually or biennially (depending on the corporate form) file Statement of Information with the Secretary of State, which includes the principle office address, the name and address of the registered agent for service of process, and the name and address of Corporation’s CEO, CFO, and Secretary.  Depending on the type of business, a seller’s permit from the State Board of Equalization is required, as is a business tax registration certificate from the city, and other specialized permits and licenses for businesses such as medical marijuana dispensaries, adult entertainment clubs, or establishments selling alcohol or tobacco products. 

 

Zoning and Finding the Right Location

The location of your business is critical.  We help clients find the ideal location that meets zoning and distance (or “sensitive use”) rules.  We assist with lease negotiation and securing conditional use permits and other necessary city/county permits and licenses.  Where needed, we outreach to local officials and the surrounding community.  We work closely with competent real estate professionals who are also available to help you find the perfect location.

 

Bylaws and Corporate Records

All corporations, whether “for-profit” or “non-profit,” are guided by bylaws, an operating agreement, or other operating structure under which the entity, its board, officers, and members function.  Operating rules help establish the responsibilities of, for example, officers and members, as well as set forth the time and manner in which voting and membership meetings occur.  Our experienced team tailors the rules by which your corporation/business operates to fit your needs and ensure compliance with all relevant laws, rules, and regulations. 

 

Corporate Governance

Most entities are required to hold membership/shareholder meetings where issues of the entity are discussed and officers are voted for.  Records of corporate meetings and board decisions are critical to the maintenance of the entity.  Our firm assists with organizing membership and shareholder meetings, drafting and maintaining corporate resolutions, minutes, corporate actions, board meetings, and other actions.

 

General Corporations and Subchapter S Election

What sets the corporation apart from all other types of businesses is that a corporation is an independent legal entity, separate from the people who own, control, and manage it.  In other words, corporation and tax laws view the corporation as a legal “person” that can enter into contracts, incur debts, and pay taxes apart from its owners.  Other important characteristics also result from the corporation’s separate existence: A corporation does not dissolve when its owners (shareholders) change or die, and the owners of a corporation have limited liability — that is, they are not personally responsible for the corporation’s debts.

 

A Subchapter S Corporation (S-Corp) is a general corporation (C-Corp) that has elected a special tax status with the IRS.  Subchapter S election allows “pass through” of income, expenses, depreciation, profits, and losses directly to the shareholders without taxation at the corporate level.  When a general corporation makes a profit, it pays a federal corporate income tax on that profit.  If the corporation also declares a dividend, the stockholders must report the dividend as personal income and pay more taxes.  So taxation occurs twice, once at the corporate level and again at the personal level.  Corporations that elect Subchapter S avoid this double taxation because all income or loss is reported only once on the personal tax returns of the stockholders.  A corporation must file to become an S Corporation for tax purposes within 75 days of incorporation.  For many small businesses, electing Subchapter S offers the best of both worlds, combining the tax advantages of a sole proprietorship or partnership with the limited liability of a corporation.

 

Limited Liability Companies

A limited liability company, commonly called an LLC, is a business structure that combines the pass-through taxation of a partnership or sole proprietorship with the limited liability of a corporation.  Like owners of partnerships or sole proprietorships, LLC owners report business profits or losses on their personal income tax returns; the LLC itself is not a separate taxable entity. Like owners of a corporation, however, all LLC owners are protected from personal liability for business debts and claims — a feature known as “limited liability.”  This means that if the business owes money or faces a lawsuit, only the assets of the business itself are at risk.  Creditors usually cannot reach the personal assets of the LLC owners. 

 

Non-Profit Corporation Tax Status

Most non-profit corporations are formed to carry out a charitable, educational, religious, literary, or scientific purpose.  Non-profits do not pay federal or state income taxes on profits made from activities in which they engage to carry out certain objectives.  This is because the IRS and state tax agencies believe that the benefits the public derives from these organizations’ activities entitle them to a special tax-exempt status.  Non-profit corporations include 501(c)(3) organizations (public charities, public foundations, and private foundations), 501(c)(4) organizations (social welfare organizations), 501(c)(5) organizations (labor unions), 501(c)(6) organizations (business leagues), and 527 organizations (political organizations).  There are very specific organizational and operating rules governing the different types of non-profits.  For example, all non-profits can engage in advocacy work, but the scope and extent of their lobbying activities vary according to the tax-exempt status of the organization.  Non-profits must apply to the IRS for the tax-exempt status sought based on the objective and activities of the corporation.

 

Non-Profit Collectives/Cooperatives and Transparent Accounting

In California, and certain other states with medical marijuana laws, cooperatives and collectives must also be so-called “non-profit corporations.”  However, unlike the non-profits described above, which are exempt organizations per the IRS, medical marijuana collectives and cooperatives must pay all federal, state and local taxes, and donations made to these corporations are not tax deductible.  Put simply, the goal of accounting in a non-profit business formula business model is to recoup overhead and operating expenses and that is all. 

Contracts and Other Transactional Documents

Companies require legal contracts and counseling in order to protect employers and memorialize agreements made with distributors and independent contractors.  Our team handles the drafting and review of any type of business document, such as employment agreements, purchase or lease agreements, vendor contracts, contracts for goods and services, independent contractor agreements, and confidentiality and non-disclosure agreements.

 

Political Organizing 

Forming and maintaining a proper political organization requires careful adherence to federal and other guidelines.  It is important to understand the strict guidelines regarding lobbying and tax deductions as well as all the proper documents that must be filed.  Our firm provides step-by-step advice in creating the proper type of political organization and corporate form. We assist clients as to the proper lobbying conduct, issues related to political fundraising, and successful filing for and creating a tax-exempt organization.