If you're the kind of entrepreneur who wants to make a real difference while you're in business and leave behind a body of work that continues to do good for your family, your customers, and the world after you're gone, you've come to the right place.
We help our clients leverage their IP, establish a competitive position for the future, and achieve important milestones for growth. Our chief goal is to identify key areas in which IP protection is the most critical for achieving the company's business objectives, determine the most effective methods of protection, and create strategies to avoid issues with third-party patents.
The traditional law business model is flawed. It incentivizes lawyers to spend more time on matters (since they are billing for every hour in six-minute increments), increase conflict (the more conflict there is, the longer the engagement), and constantly focus on the next new client (one off transactions are the norm in most legal practices). Plus, the world has shifted and quite a lot of legal work has become commoditized into online legal drafting software, documents on demand and do-it-yourself lawyering.
Lawyers, not being entrepreneurs, tried to compete and became mere shadows themselves - document drafters, doing one-off transactions for clients, such as incorporating business, and then went on the hunt for the next new client.
Not us! We build lifetime relationships with our clients. Because a legal relationship not built upon a lifetime foundation is worthless. Really. If you want a transaction, go online and find a document drafting service. If you want someone great that will help you move your awesome idea into a revenue generating business, take your existing business to the next level of excellence, and prepare you and your business to leave behind a legacy of significance, you've come to the right place.
Sky Unlimited Legal Advisory will work with you to grow your business from day one. We support startups and small businesses through their exciting lifecycle, from business formation to sale - and every challenge and opportunity in between.
But for some businesses, operations would come to a grinding halt without certain essential contributors—key persons as we call them. If your business includes any key persons, key-person insurance should be a part of your business insurance planning.
What is a key person?
A key person is someone associated with the business that provides a significant, direct economic benefit. Economic benefit not only includes profits, but also considerations such as cost savings, goodwill, credit access, and customer access.
Business owners—particularly those of a small business—are often key persons. Some additional examples of key persons are:
How does key-person insurance help?
Key person insurance compensates the business for any financial loss or cost incurred because the key person suffers an insurable event (death or extended disability).
Hanging a shingle starts with an idea that develops into a business plan, but not without careful financial and legal considerations. Among the decisions that new business owners grapple with is whether to form a limited liability company taxed as a partnership (LLC) or a corporation making an S election (S corp).* There are similarities and differences between LLCs and S corps that business owners should understand before choosing between the two.
-Both entities are created by filing the necessary paperwork with the state. Unlike a sole proprietorship or a general partnership, LLCs and corporations are not recognized under state law until the filing has been made. In addition to state filings required to form the corporation, a special filing on Form 2553 is required for the state-law corporation to elect S status for federal tax purposes.
-Both entities provide owners with limited liability, meaning the owner’s personal assets are protected from any business creditors’ claims.
-Assuming an LLC does not make an election to be taxed as a corporation, both LLCs and S corps are pass-through tax entities, allowing business profits and losses to flow through and be reported on the owners’ personal tax returns.
Although businesses do this from time-to-time as part of routine updates, practically all of the latest notices are aimed at complying with a new European Union (EU) law known as the General Data Privacy Regulation (GDPR).
Some of you probably don’t even know what GDPR is, and for those of you who do, I’m betting only a fraction of you have made serious efforts to comply with the new law.
The good news is—you’re not alone.
Surveys have shown that up to 90% of U.S. business owners are currently not in compliance with GDPR, which went into effect on Friday, May 25th. But just because only a few people are following the law doesn’t mean it’s something you should ignore.
With the maximum fines for non-compliance as high as 4% of your annual revenue or $24.6 million (whichever is higher), doing nothing could potentially devastate your business. But before you go into panic mode, realize that a lot of the hype surrounding the law has been overblown, particularly for small US-based companies.
The GDPR’s vague language, conflicting media reports, and fear-mongering from newly minted “GDPR consultants” have all fanned the flames of anxiety. Fortunately, we’ve thoroughly researched the
GDPR, and we’re going to highlight our findings here to clarify what the new law is, who it applies to, and what—if anything—you should do to comply.
Just as experts advise us to step away from what we’re working on for short breaks throughout the day to maximize creativity, the same applies on the macro scale. An ideal way to escape the insane pressures of running a company is to attend one of the numerous different entrepreneurial retreats available.
Entrepreneurial retreats are specifically designed to remove stressed-out business owners from their demanding daily routines, so they can focus on improving themselves mentally, physically, and/or spiritually. While there are dozens of different retreats to choose from, most offer a blend of personal and professional development activities aimed at giving attendees a chance to relax and recharge their creative batteries.
If you’re not sold yet, here are four reasons you should consider taking a little extra “me time” by attending a retreat. They can be one of the most beneficial events you can attend for both yourself and your business.
1. You need to regularly step away from your daily duties to see the bigger picture.
It’s far too easy to stay trapped in the “busy bubble” by throwing ourselves into the daily demand of running a business for months—or even years—at a time without a significant break. This can easily lead to tunnel vision, exhaustion, and health issues if you don’t disconnect from those responsibilities on a regular basis.
By attending a retreat once or twice a year, you’ll have the much-needed time and space to slow down, relax, and look within to more fully develop yourself, not just your business strategy.
Recharging your creative energy in this way frequently results in a renewed sense of motivation, focus, and vision, which you can use to enhance your business upon returning.
Indeed, corporations and LLCs exist as separate legal entities from their owners, meaning the business itself can acquire assets, enter into contracts, and take on debt. In turn, if a corporate entity is unable to pay its debts, creditors are typically only allowed to go after the company’s assets, not the owners’ personal assets.
However, there are several circumstances whereby business owners can be held personally liable for corporate or LLC debts.
Sometimes, business owners simply make innocent mistakes when running a business that leave them personally liable.
Other times, when business owners take certain actions, such as using the corporation to promote fraud, failing to observe corporate formalities, or even just inadvertently commingling corporate and personal assets, a court can hold the owners personally liable for the debts and liabilities of the corporate entity. When this happens, it’s known as “piercing the corporate veil.”
If you’re a business owner who’s thinking of incorporating, or if you already own a corporation or LLC, be aware of the following considerations, which can leave you personally on the hook for business debts.
The most effective and efficient way to provide this legal bedrock is by putting a set of key legal agreements in place.
Gleaned from years of business experience and advice from seasoned and highly successful entrepreneurs, we’ve outlined the core four legal documents that a company’s founders should put into place as soon as your business “idea” evolves into a reality.
Business Entity Agreements
When starting a business, it’s crucial to select the proper business entity structure in order to maximize tax savings and minimize personal liability. Some of the most popular entity structures include sole proprietorships, general and limited partnerships, C corporations, S corporations and limited liability companies (LLC or even an LLC taxed as an S-Corporation).
Once you choose the most advantageous structure, you should—and are sometimes legally required to—draft the proper entity agreements to lay the groundwork for how the business will be governed and operated. Different entity structures require different types of agreements. For example, C corporations require corporate bylaws, while LLCs use an operating agreement.
This is especially true for business owners, as the most dramatic changes under the law are aimed at how businesses are taxed.
We’ve highlighted the most significant changes to business taxation that will likely affect you here, but to clearly understand the law’s full effects and take advantage of the benefits offered, you should contact us as your Family Business Lawyer™, so we can meet with you and your CPA right away.
Reduced corporate tax rate
The new law sets a flat 21% tax rate for corporations. However, this flat rate only applies to C corporations, and not so-called “pass-through” businesses, which are taxed at the business owner’s individual rate.
Obviously, this would eliminate the competitive benefit of the pass-through status if the individual rates were higher than 21%, so the law was revised to provide a new deduction for pass-through
entities, which is covered below.
Outside of a healthier and happier team, such programs can also increase productivity, save money, and even enhance your brand’s image among current and prospective employees.
If you’re looking for a relatively simple way to motivate your staff and increase loyalty, workplace wellness programs should be at the top of your list. The following are just a few of most powerful benefits participating companies can experience.
Improved employee productivity
The most valuable benefit of employee health and wellness programs for business owners is improved productivity. The healthier your employees are, the better they’ll be at their jobs.
In fact, one study published in the Journal of Occupational and Environmental Medicine found that employees who participated in health and wellness programs each gained an average of 10 hours in additional productivity annually. This boost saved their companies $335 in productivity costs per person per year compared to non-participants.
Indeed, the Centers for Disease Control and Prevention estimates that productivity losses related to personal and family health problems cost U.S. employers $1,685 per employee per year, or $225.8 billion annually.
Wellness programs that help employees develop healthier lifestyles will ultimately improve their productivity—and your bottom line.
But the fact is, intellectual property (IP) makes up between 40% to 90% of the total value of some companies, according valuation experts. Given this, it’s extremely important that these assets are well protected if you have them—and you probably do, even if you’re not aware of it.
However, IP is a somewhat murky area of law, and if you’re not educated about how things like copyrights, trademarks, and patents work, you can be at a huge disadvantage. You should always contact us as your Family Business Lawyer™ to secure your IP assets, and to give you some idea of how complicated this legal landscape can be, here are four popular myths about IP protection for business owners.
Myth 1: Businesses automatically own the intellectual property created by their staff.
You might assume that you automatically own the IP rights to the work your employees and/or independent contractors create while employed by you. However, unless you’ve had that individual sign a contract that explicitly states that you own all rights to any IP they create, using what’s called a “work for hire” clause, you might not actually own any of it.
Be sure all of your employees and/or contractors sign a contract stating that the company owns the rights to everything they create while working for you. And if your team members have access to any trade secrets, make sure they sign non-disclosure and non-competition agreements. Note, there is no legal registration for trade secrets, so an NDA is the only legal way to keep your proprietary systems and formulas a secret.
If you think you may be at risk here, contact us immediately.
If your child is an adult, you may have decided that it’s up to him or her to pay for tuition, but if you do want to help your adult child (or grandchild) with college tuition, there is a way to do that—at least part of it—tax free.
One method is to hire your child as an employee and set up a Qualified Educational Assistance Plan, which allows employers to provide up to $5,250 per year, per employee, in tax-exempt tuition benefits.
Under Section 127 of the federal tax code, employers can offer this tuition assistance to employees (who don’t have to report it as income) and then deduct the cost of the benefit as a business expense on their company’s taxes. What’s more, the assistance includes any form of instruction or training that improves or develops the capabilities of an employee, not just job-related or degree programs.