Costly Mistakes to Avoid as an Officer of a Corporation or Manager of an LLC!

Oct 10, 2017 by

Forming a separate legal entity is a huge step in separating your personal and business liability. You obtain liability protection with a separate legal entity the day you file the LLC or Corporation.

What most people do not realize is that after day 1 and beyond you are not protected unless you operate the entity as a separate legal entity.

That involves avoiding commingling of funds, proper capitalization and proper minutes and resolutions as your role as the director, officer, shareholder or manager, member or member of an entity.

Typically as a director of a corporation or a manager of an LLC, your liability is limited personally. As long as you operate within your role as the manager of an LLC or director of a corporation. Nevada will protect you as long as you do not commit fraud. Other states have a minimum fiduciary duty or duty of care.

Let me cover for you the biggest mistakes we have seen over the years that have caused unnecessary liability to directors, officers and managers:

Not using your corporate or LLC title
when signing contracts, checks, documents, licenses…followed by the name of the entity. Signing your name without any title or reference to your company may mean that you are representing yourself personally and that brings personal liability to you. You presented yourself as an individual vs. the manager of an LLC. That is a huge mistake.

Continuing to operate as a sole proprietorship even though you have formed a separate legal entity.
This is a big one. This means you are operating a business in your own name, for a month or several months before you formed the LLC or Corporation. Perhaps you filed a DBA name (doing business as) like Marketing Solutions
and the new LLC is Marketing Solutions, LLC and you are still doing business under Marketing Solutions with the bank account in that name under your SSN. That is a huge mistake! Reconnect that DBA name to the new LLC or Corporation. You do that by dissolving the DBA linked to you as the applicant and re-file that same day a new application with the LLC as the applicant. Now the DBA name is connected to the LLC or Corporation for liability and tax purposes.

read more

Extreme Productivity for Your Business and Life

Oct 10, 2017 by

We are living in a time where our life and business is constantly getting interrupted with thousands of commercial messages every day, from e-mails, texts, instant messages, phone calls, social media, appointments, family, kids, staff….interruptions all over the place!

For many, it is becoming hard to believe what was life like before FaceBook, where so many people are addicted to checking out what all their “friends” are up to, or who liked your post multiple times per day. This was similar to how e-mail was 10 years ago when each new e-mail had a little ding that would tell you that you have mail, and most would stop what they are doing to check that email. That is now happening with texting. With all this happening no wonder it has become more difficult than ever to become productive, much less experience extreme productivity

Let’s go for ideal. I have learned a lot from the marketing guru, Dan Kennedy in this area, who is prolific at cranking out a ton of content, getting a lot of accomplished and still has plenty of time to play (for him it is harness horse racing-he actually rides in the races).

The starting point is to be clear on what your outcome or goal is that you want to achieve. If you are not clear on your outcome for your business and personal life that is the first challenge. That alone would cause you to jump from one thing on your checklist to the next allowing for a lot of interruptions that totally destroy your productivity.

Let’s assume you have your outcome and goals organized. The next step is your belief system as to why you are continuing to allow someone to consistently interrupt your time. Most of you, if you are really honest, may find out that you are your own worst enemy when it comes to interrupting yourself consistently. If, I am being very honest, I will fall into this group from time to time and immediately look to get back on track to being focused and productive.

It is always important to look for a great person to model when it comes to any skill set or goal you want to accomplish. When you do you are in a better position to calibrate what is different from what you are doing vs the person that has what you want. There is where you have to be really honest with yourself.

For example, do you think Donald Trump always answers cell phone calls, IMs, during meetings or other engagements? Do you think you can just call him up and interrupt him and get him on the phone? Or do you think his day is very structured? The reality is that those who are highly productive are extremely structured in their schedule. I know that some of you do not like structure because somehow it means you are giving up flexibility or your creativity. Again, this is a belief system shift. Those who are extremely productive are very structured. If you have a 30-minute consulting call with Dan Kennedy and are 5 minutes late, you will end 5 minutes early. Right at 30 minutes, you will hear the phone hang up. You can be in mid-sentence, but he will not take an extra 2-3 minutes with you. He is very structured and very productive.

read more

Related Posts

Share This

How to Work Backwards to Solve Any Business Problem

Sep 12, 2017 by

Short and long-term success in your business will be the result of your ability to solve business problems which may include everything from legal, tax, management, marketing, lead and client issues. Successful entrepreneurs make decisions quickly and are slow to change their mind and unsuccessful people are slow to make a decision and change their mind quickly and often.

The first step is to look at any problem as an opportunity. If you have a client who complains about a portion of your website that does not work, instead of getting frustrated at the client, look at that as a real opportunity to improve your website. When you think about it, you are not even paying these people to point out your flaws and areas you need to improve. You are receiving free advice on areas that need fixing! Reframing what the problem means is step 1. You are changing the meaning to be that of an opportunity to improve!

One of the main reasons business owners do not solve many problems and it feels and looks like their business is not moving forward, they immediately conclude that is not working so let’s do something else.

A common example if your business is looking for more lead generation and you put more time and energy into social media this past month and you notice you have very little results and you immediately stop that next month and focus on article writing. After that does not work you invest your time in video marketing. You are consistently jumping around from one lead generation strategy to the next vs. digging deeper into “what part” of the first strategy did not work to the level you were hoping it would.

Here is my formula to solve any business problem

1. Clearly, define the problem and avoid generalization. Example, my lead generation is not working vs. my Facebook ads are not working to the level I had estimated. I am only receiving 100 clicks per week but only 10 opt into my list.
2. State your goal specifically and a time frame. My goal is to receive 100 opt-ins to my list per week starting in three weeks.
3. Focus on what part you can change (or test three parts at one time) to determine if that will help solve your problem. If you do have a team or a group to mastermind, allow others to give input to solve the challenge. I would recommend you use the Disney approach and when you brainstorm solutions allow for those ideas to flow without evaluation in the moment. If you start to evaluate ideas while people are still offering solutions you will find that many will shut down because their idea may be “dumb” or of no value.
4. Implement the new ideas to solve your problem.
5. Measure if you are getting closer to solving your problem. Specific measurement is a must. If you have leads you are looking to manage you may want to measure the ratios between a call to approach, approach to presentation, and presentation to close. Measuring ratios will help you isolate what part of your presentation is not working for you and where you need to focus your improvements.
6. Repeat steps 4 and 5 until you solve at least a PART of the problem or the entire problem. Other tips for success:

  • Model someone else who has solved the problem already. Find out what they are doing differently than you.
  • Find a coach or mentor who has experience in the area where you have problems. For me I did not have any management experience so I hired mentors in the area of management.
  • Focus on making small improvements in your business!
  • Allow yourself to win the game!
read more

Related Posts

Share This

The Ultimate Business and Asset Protection Structure to Protect Your Net Worth.

Aug 21, 2017 by

Here is the problem: Lawsuits are at an all-time high. Over 80 million lawsuits per year!  The more that people struggle the more they are concocting ways to extract your wealth from you. Perhaps you may not feel you have a lot of wealth, but to others, you may appear rich. Your insurance policies are like blood in the
water that the sharks can smell from a mile away!

Don’t fall prey to thinking; no one has sued me yet, so why do I need to take these extra steps? My question to you is simple. What is your current risk tolerance given your age and net worth? Can you afford to
start over? I have know many have had to do that since 2008.

Keep in mind, simple vs. asset protection is inversely related. Meaning, those are successful, rarely have all their assets in one legal entity. Why? If that entity were to be sued you could lose all the assets in that one entity! Perhaps you will be protected personally, but your business may be gone.

Let’s assume, you are thinking, “Ok, Scott…I want to protect everything, how do I do that”? Let’s take a look at what that structure would look like.

  1. A separate legal entity for your main operating business. That may be a corporation or LLC.
  2. Another separate legal entity to separate your business into two parts. If you are brand new this is not
    necessary. But if you have been in business for 20 years in one legal entity, that means one lawsuit could cause 20 years of business to go down the tubes. You may want to split up your product lines or services. If you do seminars that may be a different entity from your information product business.
  3. If you have a business with partners and operate through LLCs, each partner should own their
    membership interest in their own LLC, not individually. Why? The LLC has the charging order protection that makes it more difficult for someone to come after the owner of the LLC, which is great. When you have partners, even with the charging order, you do not want any disruptions if the owner is sued for something unrelated to the operating entity. A second layer LLC will prevent that from happening.
  4. A separate legal entity for each piece of real estate you own (your primary residence will be a different
    approach). If you own rentals in Wisconsin where you can buy a house for $40K, you may not need a separate LLC for each piece of real estate. In California, the same house may be $930K. In that case, a separate LLC may make sense. California has an $800 per year franchise tax fee so you may consolidate based upon that fee.
  5. A separate LLC for your safe assets. That includes investments in the market, gold, silver, ownership in other
    companies (like any C corporations). Any entity taxed as an S corporation, there are limits on who may be the
    shareholder, only a single member LLC can be a shareholder. NEVER have your safe asset LLC be the
    owner of a risk asset, like real estate or a business.
  6. A separate LLC for your domain names. Domain names are virtual real estate free and clear. They may become quite valuable over time. If owned by your main operating company and that is sued, you could lose control of your most valuable asset.
  7. A personal residence trust for your home. If you have equity that is not covered by your state homestead laws, this may be the best option to protect your equity and not have the negative consequence that placing your residence in an entity would entail. Attorney Rob Bolick is a great resource and referral partner with NCP and covers more details about the personal residence trust.
  8. A life insurance trust for your life insurance policies. This is part of the estate planning for your estate. Life insurance is not subject to income taxes but is subject to estate taxes and that is why the life insurance trust is a must. Attorney Rob Bolick, an attorney in Las Vegas would be a great resource for this also. His number at his law firm is 702-870-6060.
  9. A Nevada Asset Protection Trust. This is like having an offshore trust onshore. It would be the owner of your LLCs and the living trust would be the beneficiary of the Nevada Asset Protection Trust. Nevada has a two-year statute of limitations and when two years go by you are home free from almost all creditors. Attorney Rob Bolick is the resource for this also.
  10. A living trust. Estate planning is very important and most Americans do not have a living trust established. This will help pass your assets to your heirs and avoid probate when properly funded.
  11. An offshore entity. This is the top asset protection tool because the entity is in another country with different rules than the U.S. There are NO tax benefits to an offshore entity. The U.S. person would need to pay all taxes associated with it. The IRS is all over this type of entity, so again, just to be clear, you must pay all taxes as a U.S. citizen.

Other keys point to consider:

read more

How to Increase Your Odds of Success at Any Business System.

Jul 20, 2017 by

Have you invested in a business system that was supposed to deliver great results to you and your business but the results were far less than what was promised? I know I have over the years, probably over $100K worth or more. You saw the great testimonials by people that did not look half as intelligent as yourself. You may have been thinking…”If they can do, so can I”! Many times the great system only leads to a great disappointment. Another system that didn’t turn your business around and didn’t bring in all those new customers or clients. Why is that? Was it the system, or was it you (or both)? In some situations, the marketer was just overpromising and the system could no way produce the results promised or the system was just crap, to begin with. I am sure we have all invested in a few of those. I do believe that most systems are really good and will help you produce amazing results. If that is true, then what is the challenge? It is you. Before you get upset, this is a good thing.

Being accountable and learning a new distinction or shifting a belief can make a major difference in your future results. Let me break down the steps why the system is not producing results for you and what you must do differently in the future (even if you go back to your bookshelf and dust off some of those CD, DVDs and other systems you have already invested in and now go back with a new attitude and mindset to get a better ROI.

Three Reasons Why the System Did Not Work for You and How to Turn that Around

  1. You were sold on simple steps to get the results in your business or life. Unfortunately, that is what sells, but it rarely ever works that way. Dan Kennedy has over 100 steps for every live event he conducts. These are complex marketing funnels to get attendees to sign up, to get them to actually come to the event after paying, and the following funnel after the event. He actually tracks revenue PER HOUR at his four-day events. It is a business and he runs it like one. Now if you want to put on events and have 700 people in the audience and have a $4 million event with ticket sales, upsells, speaker splits…it is a massive undertaking. You may go to or invest in training on how to run high ticket events and the headline will not be…”100 Simple Steps to Run a Profitable Event”. It may be 7 steps, 3 steps…That is what people want, the simple solution. Rarely is that the case. Now, the 7 steps might be an overview and very accurate but each step may have 10 other sub-steps to get the result. No one can tell you that up front because you would never invest in the program.The solution is to realize that it isn’t that simple. You invested in an outline, blueprint or pathway to get the result (which was worth the investment). Just realize that each step may be very involved with many other steps and when you have the mindset this is going to be twice as much work, take twice as long to get the results. This is the first step to realize, there is more work involved in this system. No different than the long hours you have put into your business or your skill set. You may have been up late nights, early in the morning and working long hours to find that most still do not appreciate or want to pay top dollar for your trial and error and resulting expertise. Even my title, three reasons… really tells you there may be 40, but I am going to give you the top 3.
  2. Your mindset is not focused on small incremental improvements. I have found when interviewing people over the years, especially in the direct sales industry and I ask them how is business going for them, many times it is not going well and usually their reason is that they are doing everything that the guru or top leader is doing but they are not getting the same results. They incorrectly conclude that the “system” does not work. The harsh reality is that if you were doing EXACTLY as the top leader you would get EXACTLY the same results. It should be quite clear you are NOT taking the EXACT same approach to the system. If you start with that new belief, that is half the battle. The solution is to get really excited about modeling EXACTLY how the top leader or guru is using the system to get results. If it is a direct sale opportunity where everyone has a similar website or opt-in page (and usually on an opt-in page to capture leads there may be 20 different distinctions from headlines, to the color of headlines, the video used, pictures, language to opt in…). Even if you have molded that in the detail usually the process to bring in a new member is to speak to them on the phone. Now, this is where the big differences show up immediately. You have to measure your call, approach, presentation and close ratios to better determine what part of your call process is not working so you can improve it. If you can record the top leader and record yourself and compare, the differences may be subtle or massive. They all will make a huge difference in your results
  3. You did not implement all the steps. Most people I find quit on step 3 of a 10 part system then conclude it did not work. You never even poorly implemented all the steps. At least if you would have done that you would have gotten some results. I have done this over the years and that is a big part of my success. At least I poorly implemented all the steps as a minimum. That is ahead of 90% of the group right there. The solution is to not only implement all the steps but then go back to improve the implemented steps. As you know you will get better with improved repetition. If you are doing all the steps incorrectly and you repeat that process all you end up with is more incorrect repetitions or no results. No wonder you are so frustrated. If you are not frustrated and you are one of the few who is getting results with the system, congrats to you! That is a model of success for you and others you may influence!  It boils down to the psychology, your mindset that will determine your success with the system in most cases. When you realize more work will be involved, and you focus on small incremental improvements, implement all the steps and improve them with repetition you are on your way to getting a much higher ROI on your investment in any system you have invested in the past or future!
read more