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Tax Deadlines for Startups
Most entrepreneurs who form an LLC or incorporate a business are not aware of their tax and government filing requirements. Entrepreneurs often think there are no filing requirements because they are in the startup phase and there is very little or no financial activity. Unfortunately, this often costs the startup thousands of dollars in penalties more…
83(b) Elections For Dummies
First, a few basics: • If you have stock options, you do not need to file an 83(b) Election Form. • If you purchased/received founder’s stock and there are no restrictions, such as vesting, you do not need to file an 83(b) Election Form. • If you purchased/received restricted stock in a growing startup, you more…
The Best Kept Secret – How Your State Will Fund Your Startup’s Cash Flow Gap
Smartco Corp is a 2-year old startup that recently started selling product to a few large customers. They have 30 employees and a $250K monthly payroll. Recently, Smartco ran into a serious cash flow problem due to a late-paying customer. Most startups will experience cash flow problems. They often rear their ugly head when the more…
The Dumbest and Most Dangerous Startup Financing
Dumbo Corp is a 2-year old startup that recently started selling product to a few large customers. They have 30 employees and a $250K monthly payroll. The employees are paid on a monthly basis and Dumbo runs its own payroll through QuickBooks. Recently, Dumbo ran into a serious cash flow problem due to a late-paying more…
You Incorporated Yesterday, Ten Things You Need To Do Today…
Well, maybe not today, but certainly within the next month. Get an Employer Identification Number (EIN) from the IRS. You have an SSN – this is the corporate equivalent. Get it here https://sa1.www4.irs.gov/modiein/individual/index.jsp Register your business with your State’s DOR. Most states require you to file and pay taxes and unemployment insurance online. more…
VC Term Sheet Lingo
To help those legalese challenged, we took the 10 most common terms found in a typical Venture Capital (VC) term sheet and tried to explain them very simply. Many of these terms can take on many different meanings, though, so we tried to use the most typical definitions. When reading this, keep in mind one more…
How to Negotiate your Equity Compensation in VC-Backed Startups
In our work at venture-backed startups, we are amazed at how hard new employees will negotiate pay, benefits, workspace, duties, titles, etc. and just totally accept their equity compensation. So, we have prepared six questions that will make you look really smart and help you understand your equity compensation. It may also make you a more…
UPDATE: Carried Interest. Inter-Partner Loans
As a follow-up to our recent post regarding the proposals to tax carried interest as ordinary income, there is a significant tax planning opportunity for service partners (partners actively providing services) who have inter-partner loans. Our discussion covers President Obama’s American Jobs Act of 2011 and the bill introduced by Rep. Sander Levin (D-MI) on more…
Carried Interest Tax Debate: Here We Go Again
President Obama released his FY2013 budget plan on Monday, February 13, 2012. As expected, it contained the usual assaults on the 1% of taxpayers (Adjusted Gross Incomes above $344K) who are already paying close to 40% of the total personal taxes collected. One of the “usual suspects rounded up” was taxing Carried Interest at ordinary more…
Stop! Think Before You Incorporate
We work with a lot of college student entrepreneurs, young entrepreneurs and first-time entrepreneurs. We are often asked “..should we incorporate or form a Limited Liability Company (“LLC”)?” Sometimes, these entrepreneurs have visited a lawyer first, and have already incorporated or formed an LLC. Based on our experience of often, “picking up the pieces”, we more…
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