Businessmen traditonally get incorporated or form a businesses and stop there. They get involved in the day to day operations and forget that they need to maintain the corporate formalities to keep the company shield in place.
Orem, UT (PRWEB) August 07, 2013
Have a business? Are the corporate formalities in order? Could a commingling disaster be in the company’s future? Every small businessperson should ask these questions. A newly released article by Attorney Lee Phillips explains the reasons to keep corporate formalities in order. Entrepreneurs and small businesspeople should read this article. Anyone who is thinking of starting a business should read it.
As Attorney Phillips observes, “Businessmen traditionally get incorporated or form a businesses and stop there. They get involved in the day to day operations and forget that they need to maintain the corporate formalities to keep the company shield in place. Company asset protection is only as good as the corporate formalities. Business owners need to pay attention and tighten up their corporate formalities."
The article cites an example of what happened to a successful high profile businessman who in the heat of a lawsuit, commingled funds. He had also failed to take care of the corporate formalities. Without the appropriate minutes and records, and with large commingling mistakes, the case was unfortunately headed to a judge to make the final decision.
As Mr. Phillips observes, “In many cases of commingling funds, when a lawsuit is filed, the businessman will lose personal protection. In the end, a complaint will be filed against the business owner accusing them of not having a “good faith basis” to justify any money taken out of the company. This will happen because there were no records as required to prove otherwise."
Mr. Phillips serves as a counselor to the Supreme Court of the United States. He is the author of 11 books, including his latest book, Protecting Your Financial Future. He has written hundreds of articles for professional people assisting them in finding various strategies to allow them to use the law to protect their property, save taxes and make additional money. Lee enjoys helping others to attain new financial heights.
LegaLees was founded in 1982 by Lee R. Phillips. It is a legal self-help publishing company and produces products designed to help people understand the law. Based on his own personal experiences, Mr. Phillips realized that people needed to be able to understand how the law works so they can direct their own legal professionals, or do their own work. LegaLees has designed many products to help individuals structure their personal and business affairs.