Half a Car, No Way! Half a Business, Why Not!
Would you feel safe driving a car with no side panels? What about living in a house with no roof? The answer is almost universally, NO! This is why it is surprising how many business owners don’t give a second thought to operating their LLC, Partnership or even corporation without all the proper formalities and documents in place.
We hear it all the time… setting up a business is EASY! “All you do is go on Sunbiz.org and fill out their form. Then you go to the IRS website and fill out their form to get your tax number.” Yes, these are 2 of the steps you need to take… but depending on your structure and situation you could have up to 8 more steps to complete to be properly organized and have the protections you likely think are in place.
We often see clients who don’t even realize they are not properly structured or memorialized until they apply for a loan, a government designation, have a conflict with a partner or end up in a lawsuit. In all of these situations formation documents are critical. If you don’t have them your company could be in jeopardy and you could be at risk for personal liability.
All entities should ensure they meet all requirements. This includes documents that get filed with the government (Articles and IRS forms) and those that do not (Operating Agreements, Shareholder Agreements, Bylaws, Resolutions, Minutes, etc.). It is the unfiled documents that are often overlooked, and that are often the most critical.
Many of these documents are required by statute and those that are not may be advisable depending on your situation. It is important to discuss your needs with a business attorney to determine what protects you in your business and circumstance.
The business attorneys at KLG are here to properly structure you from the outset, or to review and audit your current structure and fill in the gaps to ensure you are following the technical requirements of the law and functioning as you should. Contact us today for an evaluation of your business governing documents or if you are just starting the formation process. We can ensure that big or small, you have the protection and peace of mind that comes from knowing you have all the pieces and parts necessary for safety and success.