"Covering Closely Held Small Business Company Governance: Meetings, Minutes and Resolutions, More"
My article review is written generally from my personal perspective on a closely held small business entity operating as a “C” or “S” corporation, a limited liability company, in some cases a limited partnership, and even certain types of trusts. This article was published by Inc. and it is copyrighted 2000 by Nolo.com. (I love […]
UPDATE: I first wrote this post in 2011 for another one of my publications, and it is certainly relevant today. This is a fine example of things gone terribly wrong in a small company where the directors did not follow corporate protocol or make a record. Talk about insider loans and company stakeholders’ with differing […]
Recharacterized* The Internal Revenue Service regularly scrutinizes loan transactions involving shareholders and other corporate insiders. This is especially so with small, closely held companies. Like yours. Why play loose with these transactions? The IRS checks carefully to see if loans are actually shams intended to create favorable tax situations for shareholders without having any actual […]
Part 3: Loan Docs* Small, closely held corporations many times prefer to borrow money from their shareholders instead of from a bank. The shareholders may also be actively involved in managing or directing the business, and are usually willing to loan money to the corporation when it needs operating funds, or to make a major […]
Full Disclosure* Following the rules that pertain to “insider” loans (i.e. loans to officers, directors or shareholders with a financial interest in the loan) can help avert a future challenge by another shareholder, a creditor, or other party that might claim an interested insider should be personally liable for any advantage or financial gain they […]
