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Featured Articles
Alphabet Soup and the Entrepreneur You have a great idea for a business and want to be your own boss. Or, you’ve decided its time to get serious about that side business that you’ve found you enjoy more than your full time job.Somewhere between working on your business plan, finding working capital, planning your working environment and putting your marketing plan in place, you realize that you should look into proper business organization. Some of the questions that come to mind may be “What is the best way to protect my personal assets from creditors?” “What is the best way to position my company to maximize tax savings?” “What if my business needs to obtain additional capital, take on new investors or use debt financing to grow?” “Do I need a federal EIN number or state tax ID?” So you go to the usual resources – the Secretary of State’s web site, the local business form seller or the library and quickly discover that the sheer number business entities in Minnesota can be both confusing and overwhelming: Sole proprietorships, general partnerships, PAs, LPs, LLPs, PLLPs, LLLPs, LLCs, Incs and Corps. Which one to choose? Am I protected as a sole proprietor? Can I do business as a limited partnership? Would I want to? What is a limited liability company? Furthermore, the IRS web site can also lead you through a maze of documents and publications which are meant to provide you information, but just further muddy the situation (I recently spoke to a business person who thought he was a properly organized corporation with a subchapter S election, only to find that he had not filed the right IRS form, didn’t have subchapter S status and would not be able to carry forward over about $40,000.00 in losses – meaning he might lose $40,000.00 in future deductions). The good news is there is help. One of the most rewarding parts of my practice is helping clients realize their dream of opening a new business or formalizing a part time business so that they can go full time. I work with a variety of extremely competent accounting and tax advisors to make sure my clients get what they pay for: a business organization that puts them in the best position to have a successful and resilient business. And, I understand that starting a business can be a daunting task and often budgets are tight. Therefore, I am mindful of the importance of discussing a budget with my clients and sticking to it. Plus, most legal fees are tax deductible in the year you start your business. I am committed to the delivery of quality legal services at competitive rates to individuals and small to medium businesses. I take pride in providing the best personal service to each client that I am able and appreciate the importance of each client’s legal matter to that client. Personnel Records Minnesota’s Personnel Records Statute, Minn. Stat. §§ 181.960-181.966, requires employers with 20 or more employees to permit employees to review their personnel files up to once every six months upon the employee’s written request. In addition, employers must provide a copy of the file to a current or former employee at no cost to the employee. If the employee disputes information contained in the file, the employee may negotiate for removal of the disputed information, or may submit a written statement explaining the employee’s position on the disputed information which must be kept with the disputed material in the employee’s personnel file. Typically accessible information includes payroll, discipline, performance and employment history data. Not all information in the employee’s personnel file must be divulged to the employee, however. The employer may deny employees access to written references; education records some results of employer testing; information regarding the employer’s salary system and staff planning; written “personal” comments regarding persons other than the employee where divulging such comments would intrude upon the other person’s privacy; information created by and kept in the employee’s supervisor’s possession; privileged or otherwise nondiscoverable information (such as attorney/client communications); coworker’s statements that would identify the coworker; information regarding an investigation relating to a criminal or civil statute (unless the employer takes actions adverse to the employee based upon that information); medical reports and records; and documents in a supervisor’s possession. In addition, the statute establishes a cause of action for employees whose records have been kept from them unlawfully, and provides for a damages remedy in the event the employee’s action is successful. * See, generally, Minnesota Practice, Business Law Deskbook, § 14.3, Brent A. Olson, West 2004. Considering Purchasing Real Estate on a Contract for Deed? There are a variety of reasons to purchase real estate on a contract for deed - the buyer may have difficulty qualifying for conventional financing, a desire to avoid involving banks altogether, or the parties to the transaction are relatives - are just a few scenarios. However, the parties entering such a transaction must do so wisely. As a seller, you must remember that you are essentially underwriting the buyer’s purchase. What have you learned about the buyer’s debts and obligations? The buyers spending habits? The buyer’s income? Most contracts for deed are forms with blanks that can be filled in, but have you done so such that other parties can discern the parties’ intent and terms? What if the buyer defaults? Have you reviewed the statutory cancellation process and its requirements? Buyers on a contract for deed should be just as careful, because the event of a default can be disastrous. Unlike the foreclosure of a mortgage, which has statutory redemption period of up to twelve months after the foreclosure sale, the cancellation of a contract for deed can occur in a matter of days, with no right of redemption. Under Minn. Stat. § 559.221, upon proper service of notice to the buyer, a seller may cancel a contract for deed in as little as 30 days for a contract executed prior to August 2, 1976. For contracts executed after that date, the cancellation period may be as many as 60 days. In any case, the buyer is not given much time to correct the default and make the statutory payments due the seller or to challenge the cancellation in court. If the contract is cancelled, the buyer will lose all the payments made to the seller prior to the default, the right to posses the property and the right to assert any claims or defenses against the seller. Disclaimer: The information in this newsletter is provided for general informational purposes only and is not intended to constitute an advertisement or solicitation for specific legal services. Nor is the information provided in this newsletter legal advice nor should it be relied upon as legal advice. The information contained in this newsletter is provided without knowledge of your identity or your specific circumstances. This newsletter is not a substitute for consultation with an attorney or other professional licensed in your jurisdiction. The application and impact of relevant laws change over time and vary from state to state and jurisdiction to jurisdiction, and the applicability of any legal principles discussed may differ substantially in individual situations. |
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