Business Legal Questions

An LLC is the least expensive to open, operate and manage. An LLC offers pass-through taxation, which means taxes are not paid at the business level. If you choose to become an LLC, income/loss would be reported on your personal tax return. Corporations have a set management structure where directors oversee the major business decisions and officers are responsible for the day-to-day running of the business. LLCs do not have the same formal management structure.  However, a corporation offers tax advantages as well. The "S corporation advantage," allows business owners to use business losses — like those incurred during the startup phase — on their personal tax returns as deductions. C- corps are often the preferred incorporation choice of developing businesses. Owners can hold different types of stock interests (including preferred and common stock), which allow for different levels of dividends. This is one reason why venture capitalists choose C corporations when they offer funding to a business. Investors are attracted to the prospect of dividends (often higher dividends) if the corporation makes a profit.  But for simple basic protection of your personal assetts, an LLC will do just fine. ... Read Answer

It may be possible to force a sale on the properties through a Partition Action or perhaps a disolution of the corporation in order to get you compensated. There may be several options available to you but I would advise seeking legal counsel very soon.   Please feel free to contact me for further assistance... Read Answer

Regardless of whether a non-disclosure or non-competition agreement exists, the former employee can't use the trade secrets of his/herformer employer.  As long as he/she does not utilize his/her former employer's trade secrets, absent an agreement to the contrary, a normal employee (as opposed to an employee who originally sold hte business to its new owner) has no obligation not to compete with his former employer.... Read Answer

If your former customer is making false statements of fact which are hurting your business, you (and/or your business entity.d depending on the circumstances) may have a claim against him for defamation.  If, however, the former customer is merely stating his her opinion, he has every right to do so.... Read Answer

The contribution of the trust of the house to the LLC is likely fine, but how does title to the house get into the trust?  Or is it in the trust? If there is a mortgage on the house, the transfers might trigger a due on sale clause.  That would need to be examined as well.  You also do not want the transfer to terminate the title insurance on the house. The LLC should have an Operating Agreement for purposes of maintaining liability protection.      ... Read Answer

If you loaned money to the non-profit, you can certainly pay be repaid for that.  You should document the loans and repayment terms.  Its a bit too early to answer questions about dissolution.  Sounds like you had an attorney involved at some point.  I'd suggest getting some governance advice from that attorney on an ongoing basis.... Read Answer

If there were litigation in which test messages you received or sent were relevant, they could be subpoenaed whether they were personal or business-related.  However, messages which were not relevant to the litigation could not be subpoenaed, again, regardless of whether they were personal or business-related.  Of course, the side seeking the records will often claim that communicaitons are relevant which the person who has the information says is not relevant, and often courts will err on the side of giving greater latitude in discovery.... Read Answer

You are confusing two issues, I think.  If you are a non-profit, you pay no income tax.  However, you need a 501(c) filing with the IRS for your donors to deduct their payments to you as a charitable contribution.  This filing is unrelated to your status with NY state.  You will find it easier I think if you incorporate, but an accountant will handle the tax elections.... Read Answer

What does you operating agreement provide?  Does it have a buy/sell or other provision which alows the majority member to compel the minority member to sell his interest?  If not, and if you haven't breached your duty to the llc in some way, you are under no obligation to accept any offer to buy you out.  As a practical matter, however, the majority (and presumably managing) member has a lot of power to make matters difficult for you if you stick around.  For example, you don't indicate whether you are employed by the llc or only an investor, but if you are employed it is possible (depending on what your employment agreement provides) that the majority mamber can fire you.  You would remain a member of the llc, but not an employee, and wouldn't be drawing any salary.... Read Answer

I know of no reason that you (whether "you" is the individual owners of the businesses or the businesses themselves) can't enter into a joint venture agreement which governs the way that you will interact in connection with a particular venture  This would not create any sort of general partnership.  You can also create a separate entity, of which you would each own 25% (or however you wanted to divide it), to operate the joint venture.  However, this doesn't address the issue of your non-profit status, which could be endangered if the non-profit entity enters into a for profit venture.   Incidentally, I don't know what you mean about forming an "association."  To the best of my knowledge, an "association" is not a form of legal entity, like a corporation, llc, limited partnership, etc. (at least in New York; I don't know about Texas) and I'm unaware of any "statutes for an association."... Read Answer