TLD's General Counsel Blog

South Asian Bar Association of Southern California Public Interest Foundation Holds 5th Annual Banquet at Union Station

The South Asian Bar Association (SABA) of Southern California Public Interest Foundation held its Fifth Annual Public Interest Foundation Banquet on April 24, 2008 at historic Union Station.  The banquet, which is the non-profit organization’s primary fundraising event, drew approximately 300 influential members of the Southern California legal community, business community, local state and federal judges, and elected officials.  Tredway, Lumsdaine & Doyle attorney Pamela Tahim is the Vice-President of the SABA Foundation and has been elected to be President for the 2008-2009 term.  The Foundation is a 501(c)(3) organization dedicated to supporting public interest projects which assist the South Asian communities in Southern California.  The Foundation provides grants to grassroots organizations that provide critical legal and social services to South Asian communities and fellowships to law students who wish to devote their careers to public service.

Training Alert – OSHA Compliance and Workers' Compensation

When: Wednesday, May 14, 2008
Time: 12:00-2:00
Light Lunch Provided – Please Arrive Early

Don't miss this one-time opportunity to hear Peter Riley of CALOSHA review tips for employers on how to reduce your liability as an employer and safeguard your workplace.

In addition, we will be reviewing the rules and regulations of First Aid Injuries versus Recordable Injuries and how you can reduce your costs by paying claims direct.

No Cost for Advisor clients. $49/all others.
This class will fill up so please rsvp early if you are planning to attend. Call or email Monica to reserve your seat.

Monica McMahon
HR Coordinator
HR NETwork, Inc.
Phone: 714.799.1115
Fax: 714. 898.2731
monica@hrnetworkinc.com
www.hrnetworkinc.com

Tax Season Comes To A Close: One Way To Lower Tax Liability Of Your LLC.

Many businesses are beginning to understand the flexibility and usefulness of a limited liability company as a way to conduct business within California.  However, with tax season coming to a close, many successful business owners were stunned to discover the Gross Receipts tax levied upon California limited liability companies and foreign LLC's which register to do business in California.

The gross receipts tax is a state tax imposed upon LLC's conducting business in California.  The minimum gross receipts tax for an LLC is $800.  However, the gross receipts tax works on a graduated scale based upon the gross receipts of the company.  Once a company has gross receipts in excess of $250,000, the tax increases from $800 up to $11,970, depending on the level of gross receipts.

Tredway, Lumsdaine and Doyle partner, Mark C. Doyle, with the help of associate Brooke M. Pollard, recently helped an existing LLC convert to a California corporation pursuant to California Corporations Code section 1150 et. seq.  The existing LLC had increased its revenues over the past four years, and was paying in excess of $6,000 per year to the State of California under the gross receipts tax, exclusive of Federal and California income taxes.  By converting the existing LLC to a corporation, the business was able to save significant amounts of money and lower their annual tax liability. 

The conversion of an LLC to a corporation or a corporation to an LLC can have significant tax implications above and beyond the gross receipts tax.  These implications must be reviewed by both the attorney and CPA of the company to determine if this is in the business' best interest.  Please call us if you have any questions or would like additional information about either the gross receipts tax or the conversion of an LLC to a corporation. 

Article Submitted By: Attorney Brooke Pollard

Estate Planning and Small Business Owners

One important aspect for small business owners is to make sure that their estate plans are also put in place along with their appropriate business entities. If you own an interest in a Corporation (C or S corp), LLC or partnership, it is important to address what happens to that business interest should something happen to you or if you pass away.

A buy-sell agreement is one option (which won't be discussed here in this post) and setting up an estate plan is another option often considered. If you set up an estate plan to include a revocable living trust, you can assign or transfer your business interest into your trust and specify what happens to that share of the business interest.

One common approach for married couples is to transfer the business interest to the trust and allow the surviving spouse to manage the interest and upon the death of both spouses, the interest is then transferred to the surviving children either in equal shares or to the child who is most interested in the business interest (for whatever reason). Additonal lanugage can be included depending on the type of business interest involved and what your wishes are in case something happens.

Please consult with an estate planning attorney to determine if your business interest should be included as part of your personal estate planning. Tredway, Lumsdaine & Doyle has four estate planning attorneys to assist clients with these kinds of issues. One of our partners, Mark Doyle, is also a corporate and tax attorney who can provide additional insight and expertise in this area should you have a very successful small business in need of estate planning or other corporate work.

Article Submitted By: Attorney Jennifer Sawday

ARC Walk - ARC of Southeast Los Angeles County

A rowdy gang of 34 TL&D supporters showed- up to the ARC Walk on Saturday, April 5, 2008 to show our great support for ARC of Southeast Los Angeles County. TL&D also donated $2,500 to become a diamond sponsor of this special event.

Arc of Southeast Los Angeles County is committed to providing for people with mental retardation and other developmental disabilities the ability to form and work towards goals through training and education, based on their individual abilities. Arc of Southeast Los Angeles County is further committed to helping to reduce and limit the incidence and consequences of mental retardation through education research, advocacy and the support of families, friends and community.

Tredway, Lumsdaine & Doyle has supported ARC for many years through special events such as this, and by hiring people with developmental disabilities as support for the law firm. “Community service is important for any business, but its particularly important for lawyers,” said Joe Lumsdaine, senior partner for the firm, “Lawyers serve in a privileged position. They should be willing to support the community in return.”

Corporate Updates

The purpose behind incorporating a business is normally to limit the liability of the owners of the business.  Once an owner transfers the assets of a business to a corporation, he or she becomes a shareholder of the corporation.  California Corporations Code Section 600(b) requires each California corporation have an annual meeting of the shareholders.  The purpose of this meeting is normally to elect the board of directors and any other matters deemed relevant to the shareholders. 

Annual meetings are one way the shareholders of a corporation can protect themselves from personal liability in the event of a lawsuit against the corporation, because the corporation is acting as an entity separate and distinct from the shareholders; thus mitigating any attempts to "pierce the corporate veil."  Tredway, Lumsdaine & Doyle keeps a record of the date of annual meetings of the shareholders for each corporation, sends reminders to have the annual meeting, and will prepare minutes of meetings for execution by the shareholders. 

Be sure to speak with your corporate attorney for advice and guidance in drafting and executing shareholder minutes. 

Article Submitted By: Attorney Brooke M. Pollard