Here are five (and a half) things to remember about your corporation.

Corporate Charting1.  Don't forget to have your annual meeting every year.  The Bylaws will tell you when it's supposed to take place, but the timing doesn't need to be exact.  Put the date on one of your calendars as a reminder. A lawyer isn't required to do this.  I can give you an easy form to use.  You can do it yourself.  Really. 

2.  In California, every year you'll get a form in the mail called, "Statement of Domestic Stock Corporation."  Fill it out and send it back to the Sectretary of State.  Don't stick it in your pile of things to do later.  Your corporation will be suspended if you don't return the completed form.  It's easy.  No lawyers here either.

3.  When you get your income tax return from your bookkeeper or accountant, be sure to ask him or her if there are tax advantages of incorporation you're not taking advantage of.  A CPA is a more reliable source of money saving ideas than anyone else.  CPA's are worth it.  If anyone will ever understand Obamacare, he's probably going be a CPA.  

4.  Don't pay for non-business expenses out of the corporation's check book.  Although it's every patriotic American's duty to pay the government as few taxes as possible, overdo it and you'll be in trouble.  Tax evasion is not OK, but tax avoidance is. Since Supreme Court Justice Oliver Wendall Holmes said so, we know it's true.

5. and a half.  If you have employees, you must have workers compensation insurance.  If you don't have it and one of them gets seriously injured, which doesn't take much, your corporation may be forced out of business. Same thing for paying withholding taxes.  Big penalties, and personal liability that won't go away in

bankruptcy.  Sell the Harley if you have to.

By Attorney Stan Prowse
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