When you first started your business, it was just you, and you formed it as an LLC. Now, the Foundry group, or a finicky Angel has come calling, and they want you, an LLC, to convert to a corporation. How big of a deal is it to change from one to the other? Today, this … Read More
An S corporation is a business entity that combines many of the advantages of an LLC with the advantages of a corporation. Practically, the biggest hurdle for someone looking to start a corporation is the problem of double taxation. That is, paying taxes for the activities of the corporation and also for profits that are … Read More
(Updated June 14, 2017) If you’re in the startup world, you may be at least vaguely aware that most hugely successful startups are Delaware corporations. Indeed, there are many smart people who say this is the only right answer to the question, “What type of entity should I form for my startup?” I don’t think this is true, however. There … Read More
While most people associate the business form the Limited Liability Company (or LLC) with small companies such as a dry cleaners or hobby stores, the reality is that there is no limitation to how large an LLC can get. The Limited Liability Company is a newer entity. The first LLC statute was drafted by the … Read More
The most expensive legal documents are the ones you never knew you needed until it was too late. For one example, filing a timely 83(b) election can be the difference between paying no taxes on an appreciating ownership interest in a startup and paying hundreds of thousands of dollars at a time when you don’t … Read More
I recently had a client come to me to ask about the appropriate business entity for a startup with foreign investors. This is one of those questions where if we eliminate what’s impossible and what’s not a good idea, what we are left with is the best choice. First, according to the tax code, non-US … Read More