There are only 4 days left in 2012 and this means that it’s time to start thinking about the sometimes dreaded New Year’s Resolution.  Chances are you’ve been reviewing your past year - deciding what worked, what didn’t, and what to do in 2013. Since this can be a hectic time for many businesses, we’ve created a checklist of 4 Key New Year’s Resolutions For Small Business Owners.

Protect Your Assets.

• Form  a Corporation or a Limited Liability Company. If you have not done this already, you should form a Corporation or a Limited Liability Company in order to gain protection. In doing this, you’ll separate your personal assets from the assets of your company, leaving you less vulnerable to personal damage in the event of a lawsuit.

• Review Annual State Requirements. Most states require Corporations and LLCs to file an Annual Report or pay an annual fee. These requirements do vary by state, so it’s best that you review your state’s specifications. You can find the requirements on most Secretary of State Division of Corporation websites and can also review our State Specific Information section. Take note of due dates and schedule reminders for filing and payment deadlines.

• Maintain an active Registered Agent. You’ll also find that your state of incorporation or formation requires you to maintain an active Registered Agent. To review the duties of a Registered Agent, you can take a look at our previous blog article.

• Obtain or update all required business licenses. Business licenses are handled at state and county levels. If you need help obtaining a business license, you can visit our Business License section. If you have already obtained a business license, check the expiration date and arrange for any necessary renewals.

Update Your Website.

• Do a Review. Check pricing, contact information, and general content for accuracy. If you have changed your phone number or email address, it’s crucial to provide this updated information. Your website is the main way your clients will contact you and you wouldn’t want your clients being lead to a dead end. If you provide time sensitive information, make sure you have someone consistently updating the content.

• Update design for a better user experience. Outdated web design can be a turn off for many potential clients. Make sure that your site is easily navigable and provides a friendly, easy experience for both current and potential clients.

• Include links to your social media pages. Make sure that you’re linking to your Facebook, Twitter, LinkedIn, and other social media accounts. These are great ways to expand your online presence and attract new clients. You’ll find the guidelines for adding buttons on the social media form’s website. For example, take a look at Twitter.

• Provide relevant educational information. This can be displayed on your blog or frequently asked question section. Any educational information is a great takeaway for your clients and it is something that they’re inclined to pass on to other people. This is a great way to start having the web link back to your site.

• Check for mobile viewing optimization. You’ll find that many people are probably viewing your website from their cell phone, or other mobile viewing device. Make sure your site is still easily navigated, even in the mobile view.

Introduce Something New.

• Create Social Media accounts. Create a Facebook page, Twitter Account, and LinkedIn page for your business to get started. These are great outlets to find new customers, announce promotions, and stay in touch with your audience. You’ll find many other social media outlets out there, including Pinterest, which is great for retail based businesses.

• Start a Blog. Starting a blog can help your organic search engine optimization. This will help drive traffic to your website, and it is also a great way to provide your clients with resourceful, educational information.

• Offer Coupons or Deals. This can be done through new platforms such as QR Codes linking to social media, or can be done in more traditional format, such as postal mail. Either way, a coupon or deal is a great way to ramp up visits to your website and increase revenue.

Expand Your Network.

• Join LinkedIn. LinkedIn is a social network for business professionals. This is a great way for you to connect with industry professionals and spread the word about your business and services. LinkedIn recently introduced company pages, where you can list your products or services and share your company background. You can also help answer questions in group discussion boards and find local networking events in your area.

• Attend networking events. Your social network should extend beyond your social media websites. Take time to find local events where you can share your knowledge and make connections. 

We hope that these resolutions can alleviate some stress from your new year! If you have any questions or needs to check that you've completed your annual requirements, please contact our office. 

You can download the Checklist for free below to help keep you on track in 2013!

As we’ve mentioned in past posts, you have a number of options when it comes to finding resources to jumpstart or expand your business. Today, we’re going to highlight one common way of raising capital for your business – issuing stock.  If you incorporate your business as a Corporation, you are able to issue to stock. Limited Liability Companies, also known as LLCs, do not issue stock. For a detailed comparison of business entity types, review our comparison chart.

Stock is typically issued by share. When you incorporate, you designate an initial number of shares that can be issued at a certain par value. You can then issue these shares to investors in order to raise capital to start or expand your business.

In order to help you understand some of the basic information regarding raising capital with stocks, we’ve answered 5 of our most frequently asked questions below.

1. What is stock? Stock represents ownership in a corporation. It can be represented by a certificate and can be common or preferred, voting or non-voting, redeemable, or convertible. The classifications and special designations, if any, of the stock are set forth in the articles of incorporation.
2. Who is a stockholder? Stockholders may also be referred to as shareholders. Stockholders are the owners of a corporation based on their holdings of share. They own an interest in the corporation rather than specific corporate property.
3. What is par value? Par value is the minimum price of a share below which the share cannot be issued. The par value is designated in the Articles of Incorporation of your business. 
4. What is the required minimum number of shares? The minimum number of shares required to be issued by a corporation varies by state.  After reviewing state regulations, you can decide the minimum number of shares you’ll be issuing for your corporation.
5. What is a stock purchase agreement? A stock purchase agreement is an agreement between the shareholders and the corporation. It provides a mechanism to regulate the transfer and sale of corporate stock. Often, a stock purchase agreement will provide a right of first refusal in favor of the corporation or remaining shareholders in the event of a proposed sale of stock by a shareholder. A stock purchase agreement can also provide for a purchase upon the death, disability, retirement, discharge, resignation, or bankruptcy of a shareholder.

If you are interested in learning more terms involved with issuing stocks, you can visit our Terms & Definitions page. Here, you’ll find an alphabetical list of terms that will help you maintain your business. 

Our Free Raising Capital With Stock eBook also answers stock questions in detail and includes a list of commonly used terms. 

During the course of your business, you may want to make changes to your corporation or limited liability company that will be legally recognized. One common question our Incorporation Specialists encounter is, “How do you change your corporate name?” In order to formally do so, you would need to file and “amendment” with your company’s state of incorporation or formation.

An amendment to your corporation or limited liability company is a formal filing with your state of registration that officially changes the details of your business structure. The 3 most common types of amendments that are filed are :

1. Name Change Amendments. You can elect to “amend” or change the name of your corporation or limited liability company for any reason. Once you’ve filed the amendment with the appropriate state, your new company name will be legally recognized.
2. Stock Change Amendments. You may have incorporated your company with the intentions of issuing stock to raise additional capital and expanding your corporation. If you have issued all of your stock and need to increase the number of authorized shares, you can legally do so by filing a Stock Change Amendment.
3. Change in Directors or Members. It is not rare for the members or directors of businesses to change throughout time. When one of your members or directors listed on the Articles of Incorporation leave the organization or a new member or director needs to be added, you can formally note these changes by filing an amendment.

As with all corporate filings, regulations regarding amendment filings will vary from state to state. After you’ve filed your amendment, you’ll receive your Certificate of Amendment that legally recognizes the changes you’ve made. Keep in mind that filing an amendment does not change your Federal Tax ID (EIN) because your company is still technically the same legal entity. However, the Internal Revenue Service (IRS) does require that you notify them of any amendments you’ve made.

If you have any questions about amending your corporation or limited liability company, let us know! You can also find state regulations in our State Information Center.

We’d also like to announce that we’ve recently launched our Small Business Resource Center! Inside, you’ll find trusted partners and resources that will help you maintain and expand your business. We want to continue to help you, so please let us know of any services you’d like to be added. 

“Where do I incorporate?” is a question that our incorporation specialists answer on a daily basis – and it’s a very good question to ask.

The fastest answer is “it depends.” When you’re deciding to incorporate your business, there are many things for you to consider. We’ve compiled these 3 important questions for you to ask yourself when deciding what state is best for incorporating your business.

• Where will you be conducting business?

We recommend incorporating your business in the state where you will be handling the majority of your business transactions. For example, if you live in Connecticut and will be conducting your business primarily in Connecticut, we would suggest Connecticut as your state of incorporation. Keep in mind that this is not a requirement, but is highly recommended to avoid any possible complications.

• Where do you plan on opening your business bank account?

Some banks may require that your business be incorporated or qualified (defined here)  in that bank’s state. So, if you’ve incorporated your business in Texas, but you try to open the bank account in Oklahoma, your bank may deny your request to open a business bank account. This is not always the case. It is best to review this with your bank of choice prior to incorporation. Try asking them if they require you to be incorporated or formed in that state in order to open a bank account.

• Are you familiar with the desired state of incorporation’s annual compliance requirements?

Nearly every state requires corporation and LLCs to pay a variation of an annual fee in order to keep your company in good standing. The name of this fee varies by state, but may be referred to as “Annual Report,” “Franchise Tax,” or “Annual Registration.” The following components of the annual compliance may vary as follows:

Price. Some states have annual fees as low as $9, while others can reach upwards of $500.

Due Date. Certain states only require you to file once every 2 years, while others require a yearly filing. You’ll find that the actual due date can vary from a specific date or month, to simply the anniversary of the company’s incorporation.

Filing Options. Many states are offering online filing options, but some states still require reports to be sent in through mail.

Our State Specific Information section is a great resource to find thorough information regarding incorporation requirements and annual report information. If you do your research and ask the necessary questions, you’ll successfully incorporate your business in your state of choice. These inspirational articles are great examples of entrepreneurial success across the nation:

John Pepper’s Boston Burrito Empire

Chicago Cupcake Makeover Success

Don’t hesitate to ask any questions or share your incorporation success story!

Last week, we did a brief overview of the characteristics of a Limited Liability Company. This week, we’ll outline some of the key characteristics of “Corporations” – another type of entity that may be best for your business.

A Corporation can be defined as an artificial entity created under and governed by the laws of the state of incorporation. Similar to an LLC, you must file the appropriate documents with the state in order to have your Corporation legally recognized.

If the following traits sound pertinent to your business, you may want to consider forming a Corporation as opposed to an LLC…

1. Corporations issue stock. Stock can be used to raise capital (operating funds) to run or expand your business.
2. Corporations are owned via shares of stock.
3. When maintaining a Corporation, you’re required to hold an annual meeting of shareholders and directors. During these meetings, you must keep written minutes, or notes.
4. The profits of the General Corporation (which are distributed to the shareholders of the corporation as a dividend) are taxed at the corporate rate. The dividend is subject to personal income taxes.

These characteristics describe the general functionality of a Corporation, but it is best to fully research and understand your options before deciding which entity type is best for your business. While Corporations are one of the more common business entity types, there are a few other types that you may want to consider.

Along with our Answer Desk, there are many great resources for you to utilize while researching your development options. Entrepreneur Magazine provides a great overview of business structures and is a consistent resource for industry updates.

After you’ve reviewed your options, you may be ready to form your corporation online. If you’d like to receive information on doing so, or if you’re ready to incorporate, visit our Quick Quote section to get started!

What resources have you found helpful when developing your business or corporation? 

Over the next week, we'll focus on helping you understand the basics of company formation. Before you start your business, it's best to have the business become legally recognized by the state through incorporation or formation. Today, we'll do a quick overview of 5 important things to consider during LLC creation. 

An "LLC" or "Limited Liability Company" is a legal entity created by filing the appropriate certificate with your selected state of formation. This entity has "Limited Liability," which helps to separate your personal assets from your business liabilities. 

Here are 5 Important Things to Consider During LLC Creation: 

1. LLCs do not issue stock. Stocks are specific to Corporations - a different type of business entity that offers different benefits.
2. An LLC is a "pass through" tax entity. It is taxed like an "S" Corporation, where the profit or loss generated by the business is reported on the personal income tax return of the owners.
3. LLCs are typically owned and managed by the members of the LLC. On a related note, LLCs have members and managers, not officers or directors. Officers and directors are specific to Corporations.
4. LLCs are not required to create or maintain by-laws, but instead use an Operating Agreement. Operating agreements are set up internally within your company, and structure how you handle your business.
5. LLcs are not required to hold annual meetings. This provides more flexibility and offers a benefit if your members are located in varying distances.

Keep in mind that these are brief points and that there is much more involved when creating an LLC. You can learn more in our Learning Center.

Corporations are another type of business entity that may work best for you. If you'd like a quick overview of the differences between Corporations and LLCs, you can download our free Fact Sheet.

These articles from Inc.com also share some great points about what to consider when creating an LLC:

• More tips on determining if an LLC is best for your business 

• Tips for setting up an LLC Operating Agreement

What have you found helpful when setting up or managing your own LLC?