- What is business law?
- What factors should be considered in choosing the proper business entity?
- How can I protect myself from personal liability?
- What is the difference between a subchapter C and a subchapter S corporation?
- What is the difference between a joint venture and a partnership?
- What is a non-profit corporation?
- Is a Buy-Sell Agreement a good idea?
- What is involved in a corporate merger?
- What is an H-1B Visa?
Business law focuses on the rules, statutes, codes, and regulations governing commercial relationships and provides the legal framework within which business is conducted and managed. There are many legal areas involved in the practice of business law, including (but not limited to):
- Business planning
- Business formation and organization
- Transactional law (contracts)
- Mergers and acquisitions
There are many factors to consider, including:
- Tax implications
- Business capitalization
- Whether you intend to have a publicly traded company that issues stock
- Management structure
- Your personal liability and that of other owners
It is vital to shield personal assets against liability arising from business obligations. Personal liability is not restricted to business losses, but can also result from lawsuits, tax issues, back wages, benefit payments and a host of other issues. We can show you a number of ways to separate your personal assets from those of your business.
Subchapter C corporations include most large, publicly held businesses. These corporations face double taxation on their profits if they pay dividends. They file their own tax returns and pay taxes on profits before paying dividends to shareholders, which are subsequently taxed on the shareholders’ individual returns.
Subchapter S corporations allow the business to insulate shareholders from corporate debts as well as avoid the double taxation imposed by subchapter C, as long as certain criteria are met.
A joint venture is basically a type of partnership in which two or more entities join together for a particular short-term purpose or goal. Each partner has the same ability to legally bind the entire entity. A partner can represent the entire organization and his or her legal actions on behalf of the joint venture or partnership create legal obligations. It is important to note that third parties are not bound by these obligations.
This is a corporation formed to carry out a charitable, educational, religious, literary, or a scientific purpose. It does not pay federal or state income taxes on profits it makes from activities in which it engages to carry out its objectives. Because the most common federal tax exemption for nonprofits comes from Section 501(c)(3) of the Internal Revenue Code, they are sometimes known as 501(c)(3) corporations.
If a corporation has more than one shareholder a Buy-Sell Agreement should be considered. Why? A shareholder’s death, divorce, disability or termination of employment can create serious problems for shareholders and the corporation itself. These are minimized by a Buy-Sell Agreement since it provides for an orderly succession.
Mergers are regulated at the state level, but many aspects of the process are similar throughout the U.S. In most cases, the board of directors for each entity must approve a resolution adopting a merger plan. Then, each entity must notify its shareholders that a meeting will be held to approve the merger. If the required number of shareholders approves the plan, the directors sign the papers and file them with the state. A merger involves a number of very specific requirements, variables, and potential pitfalls. An attorney experienced in this area of the law should be consulted to help avoid potential problems in the future.
An H-1B Visa allows a foreign national to stay and work in the U.S. for three years. In many situations, it can be extended for three more years, although the foreign national must leave the country after six years and wait a year before a second such visa can be approved.