Starting a Business

Starting a Business

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Kenneth Vercammen & Associates A Law Office with Experienced Attorneys for Your New Jersey Legal Needs 2053 Woodbridge Ave. Edison NJ 08817 732-572-0500 1-800-655-2977 Personal Injury and Criminal on Weekends 732-261-4005

Starting a Business There are four main types of Business Organization: 1. Sole Proprietorship 2. Partnership * A. General Partnership * B. Limited Partnership 3. Corporation 4. Limited Liability Companies ADVANTAGES AND DISADVANTAGES OF BUSINESS ORGANIZATIONS Sole Proprietorship Advantages 1. Low start-up costs 2. Greatest freedom from regulations 3. Owner in direct control and asset ownership 4. Single level of taxation and both federal and state levels of taxation 5. Profits belong to owner 6. Reduced levels of annual reporting

Kenneth Vercammen was the Middlesex County Bar Municipal Court Attorney of the Year

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Disadvantages 1. Unlimited liability 2. Lack of continuity 3. More difficult to raise capital 4. Limits in tax deductions of medical and group life insurance

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Partnership Advantages http://www.njlaws.com/starting_your_own_business.html?id=1123&a=

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Starting a Business

1. Ease in formation 2. Low start-up costs 3.

Additional sources of capital 4. Broader management base

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Disadvantages 1. Unlimited personal liability 2. Lack of continuity 3. Divided authority 4. Hard to find suitable partners

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1. Limited liability 2. Ownership is transferable 3.

Continuous existence 4. Legal entity Disadvantages

Kenneth Vercammen was the Middlesex County Bar Municipal 1. Closely regulated 2. Most expensive to organize 3.

Court Attorney of the Year Difficult to liquidate investment Corporation Advantages 1. Tax deferral @ l5% for first $50,000 of income 2.

Medical Insurance is deductible 3. Group term life insurance is deductible Disadvantages 1. Maximum tax rate is 34% 2. Double taxation 3.

Favorable liquidation tax treatment is no longer available resulting in double taxation.

S Corporation Advantages 1. Single level of federal taxation 2. Single level of taxation upon sale or liquidation of business Disadvantages 1. Medical and group term life insurance is not deductible Limited Liability Companies http://www.njlaws.com/starting_your_own_business.html?id=1123&a=

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An LLC is a new, non-corporate entity combining the operational flexibility and tax status of partnerships with the limited liability protection traditionally associated with corporations. Profit and non-profit activities may be pursued through LLCs. Generally, in New Jersey as well as other states that have adopted LLC legislation, an LLC expressly constitutes a separate and distinct legal person. The basic components which are derived from both corporate and partnership laws, are as follows: * Articles of Organization * Management * Operating Agreement * Limited Liability * Membership * Limited Life DOCUMENTS YOU MAY NEED 1. Prepare/Review lease agreements or purchase agreements 2. Prepare/Review franchise agreements 3. Prepare/Review buy-sell agreements 4. Obtain licenses, zoning variances 5. Provide specific legal advice 6. Prepare/Review and File Certificate of Incorporation and establish Registered Agent 7.

Prepare/Review By-Laws 8. Prepare/Review initial meeting of shareholders documents 9.

Prepare/Review and File Trade Name Certificate 10.

Prepare/Review Partnership Agreement 11.

Prepare/Review Agreement of Sale 12.

Prepare/Review Promissory Note 13.

Prepare/Review and File Annual Report 14.

Suggestions on workers compensation coverage IS THE CORPORATE STATUS UP TO DATE? IS THE CORPORATE STATUS UP TO DATE? 1. Is the minute book up to date? 2. Are the minutes signed? 3. Do the minutes reflect the following? * a.

Annual shareholders meeting? * b. Annual directors meeting? * c. Special meetings? * d. Retirement plan contributions? * e. Bonuses? 4. Are stock certificate books properly up to date? 5. Are by-laws properly up to date? 6. Are proper records of expense reimbursements being kept?

You should have your accountant contact your attorney to be certain these and the following questions are taken care of: http://www.njlaws.com/starting_your_own_business.html?id=1123&a=

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1. Has corporate tax been estimated? 2. Have deposits on federal and state taxes been paid? 3. Are there any earnings accumulation problems? 4. Have state and federal tax returns been prepared? 5. Have all tax returns been filed on time? 6. Should a subchapter S election be made or recorded? 7. Are proper depreciation guidelines being followed?

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Kenneth Vercammen is the Managing Attorney at Kenneth Vercammen & Associates in Edison, NJ. He is a New Jersey trial attorney has devoted a substantial portion of his professional time to the preparation and trial of litigated matters. He has appears in Courts throughout New Jersey each week for litigation and contested Probate hearings.

Mr. Vercammen has published over 125 legal articles in national and New Jersey publications on elder law, probate and litigation topics. He is a highly regarded lecturer on litigation issues for the American Bar Association, NJ ICLE, New Jersey State Bar Association and Middlesex County Bar Association. His articles have been published in noted publications included New Jersey Law Journal, ABA Law Practice Management Magazine, and New Jersey Lawyer.

He is chair of the Elder Law Committee of the American Bar Association General Practice Division. He is also Editor of the ABA Estate Planning Probate Committee Newsletter and also the Criminal Law Committee newsletter. Mr. Vercammen is a recipient of the NJSBA- YLD Service to the Bar Award. And past Winner "General Practice Attorney of the Year" from the NJ State Bar Association. He is a 22 year active member of the American Bar Association. He is also a member of the ABA Real Property, Probate & Trust Section.

He established the NJlaws website which includes many articles on Elder http://www.njlaws.com/starting_your_own_business.html?id=1123&a=

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Law. Mr. Vercammen received his B.S., cum laude, from the University of Scranton and his J.D. from Widener/Delaware Law School, where he was the Case Note Editor of the Delaware Law Forum, a member of the Law Review and the winner of the Delaware Trial Competition.

RECENT SPEAKING ENGAGEMENTS ON WILLS, ELDER LAW, AND PROBATE Edison Adult School -Wills, Elder Law & Probate- 2007, 2006, 2005, 2004, 2003, 2002 [inc Edison TV], 2001, 2000,1999,1998,1997 Nuts & Bolts of Elder Law - NJ Institute for Continuing Legal Education/ NJ State Bar ICLE/NJSBA 2008, 2007, 2006, 2005, 2004, 2003, 2002, 2000, 1999, 1996 Elder Law and Estate Planning- American Bar Association Miami 2007 Elder Law Practice, New Ethical Ideas to Improve Your Practice by Giving Clients What They Want and Need American Bar Association Hawaii 2006 South Plainfield Seniors- New Probate Law 2005, East Brunswick SeniorsNew Probate Law 2005 Old Bridge AARP 2002; Guardian Angeles/ Edison 2002; St. Cecilia/ Woodbridge Seniors 2002; East Brunswick/ Hall's Corner 2002; Linden AARP 2002 Woodbridge Adult School -Wills and Estate Administration -2001, 2000, 1999, 1998, 1997, 1996 Woodbridge Housing 2001; Metuchen Seniors & Metuchen TV 2001; Frigidare/ Local 401 Edison 2001; Chelsea/ East Brunswick 2001, Village Court/ Edison 2001; Old Bridge Rotary 2001; Sacred Heart/ South Amboy 2001; Livingston Manor/ New Brunswick 2001; Sunrise East Brunswick 2001; Strawberry Hill/ Woodbridge 2001; Wills and Elder Law - Metuchen Adult School 1999,1997,1996,1995,1994,1993 Clara Barton Senior Citizens- Wills & Elder Law-Edison 2002, 1995 AARP Participating Attorney in Legal Plan for NJ AARP members 1999-2005

Contact the Law Office of Kenneth Vercammen & Associates, P.C. at 732-572-0500 for an appointment.

The Law Office cannot provide legal advice or answer legal questions over the phone or by email. Please call the Law office and schedule a confidential "in office" consultation. The Law Office now accepts payment by American Express, Visa and http://www.njlaws.com/starting_your_own_business.html?id=1123&a=

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Disclaimer This web site is purely a public resource of general New Jersey information (intended, but not promised or guaranteed to be correct, complete, or up-to-date). It is not intended be a source of legal advice, do not rely on information at this site or others in place of the advice of competent counsel. The Law Office of Kenneth Vercammen complies with the New Jersey Rules of Professional Conduct. This web site is not sponsored or associated with any particular linked entity unless specifically stated. The existence of any particular link is simply intended to imply potential interest to the reader, inclusion of a link should not be construed as an endorsement.

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