Maintaining corporate compliance is an important task that you as a small business owner can accomplish by simply staying organized and keeping current with recurring tasks such as holding annual meetings and paying your taxes. Most companies are in fact required by law to fulfill certain tasks on a regular basis and company owners can encounter costly fees, loss of personal liability protection and even company dissolution as the result of losing good standing status.
You can easily maintain your company’s good standing status by starting with the up-to-date organization of your Corporate or LLC Minute Book. Your Corporate Minute Book should hold your Articles of Incorporation, Corporate Bylaws, the corporation minutes from your first Organizational Meeting, the stock ledger that tracks who owns which percentage of the company and copies of all Annual Meeting minutes or Special Meeting minutes documenting all major company decisions.
For LLC compliance, your LLC Minute Book should hold your Articles of Organization, LLC Operating Agreement, the board meeting minutes from your Organizational Meeting, the member ledger tracking ownership of the company and copies of all Annual Meeting minutes and Special Meeting minutes documenting all major company decisions. Keep your current Corporate or LLC Minute Book handy at all times for inspection by the IRS, legal professionals and potential investors or buyers of your company.
To maintain corporate and LLC compliance you will also want to familiarize yourself with all the dates that your compliance tasks must be completed. At minimum your company will probably need to file an Annual Report or other required state filing, pay all federal, state and local taxes and schedule and keep minutes of an Annual Meeting each year.
Annual Meetings are typically required under state law and serve several purposes including providing written records of company decisions, keeping stakeholders up-to-date on company happenings to ensure the safety of their investment and preventing potential problems in the future by getting a written agreement now. Some institutions such as government entities and banks even require documented proof that an Annual Meeting was held before they will do business with a company. To that effect, all meetings should be properly documented.
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