Never before has it been easier to form a Corporation or LLC. Once you have made a decision between the two structures, the details of establishment can be implemented relatively quickly.
With agencies boasting 15-minute forms and 24-hour Articles of Organization, the convenience often belittles the subsequent maintenance.
We would like to take this opportunity to highlight the importance of Corporate and LLC maintenance, including the legal requirements set forth by your chosen business structure.
Corporate and LLC Maintenance
An often forgotten aspect of corporate establishment is the ongoing maintenance required to remain compliant. Depending on the legal structure your organization has chosen, it’s important to understand you will be obliged to fulfill certain requirements to remain in good standing.
Requirements include internal record keeping such as meeting minutes, issuing of stock, transfers and interest of members, as well as external compliance of local and foreign status categories. Not to mention the administrative details of annual registration and bylaw updates. The details of how and where your business operates will dictate the maintenance requirements.
On the surface, failing to comply with the regulations set forth by your state could result in the dissolution of your company. But in terms of the day-to-day operations, compliance will provide protective measures in cases of litigation and general liability.
In short, by properly maintaining your Corporation or LLC, not only are you remaining legal, but you are also providing your organization with a protective form of insurance.
Compliance and Protection
Remaining compliant according to the rule of law provides the additional benefit of security. In case your company is forced into litigation, it’s the current standings supported by records of maintenance that will protect you in court.
Countless LLC’s have been sued in court only to find their limited liability status was no longer valid. In these cases, infractions caused by improper maintenance led to unexpected exposure and the resulting consequences. Consequences that can prove to be detrimental to the business and everyone involved. It’s this “Piercing of the Corporate Veil” that leaves company members personally liable since the court will regard them as sole proprietors or general partnerships.
Fortunately, these instances can be avoided with the proper upkeep provided by well-informed counsel. Maintenance provided by legal professionals will guarantee the integrity of your company and ensure its associated protections are in good standing.
The San Diego Corporate & Business Law division at Lee Shome & Kennedy specializes in comprehensive services for Corporations and LLC’s. From advisory, to establishment and on through to maintenance, our agency will ensure that you remain compliant and protected.
Our legal and advisory services extended to new companies in the process of formation, as well as restructures, mergers and acquisitions. In each instance, we have the expertise to manage the legalities of your organization, leaving you to proceed with confidence on your core business functions.
At LSK, in San Diego, we provide a free 30 minute consultation for anyone interested in forming a corporate entity.
With Lee, Shome & Kennedy, LLP, your solution starts here.