Do You Need to Form Another Entity in January to Really Protect Your Assets? Or, Are You Starting Another Business?
As another year comes to an end, we hope yours was successful and you are looking forward to the New Year.
As part of your New Year goals and plans it is really important to determine if there are other areas to protect your business or assets. Let me ask you an important question that comes out often this time of the year.
Are you considering forming another entity in January (or December)? Here is a list of the Top 10 Areas to Protect Your Current and Future Assets and Form another Entity.
Here are the top reasons our research shows you should consider: 10. An LLC to protect the stock of your C Corporation.Even if your living trust owns the stock of the C corporation that will not provide protection from liability (the exception is a Nevada C corporation because Nevada is the only state in the country with the charging order protection for corporations). Are you a part of a C corporation as a majority owner with other partners? How do they hold their ownership interest? If they own it personally that is an issue. Don’t let happen to you what did to a prospect a few years ago when he lost his $3 million computer company from a personal lawsuit! 9. A Single Member LLC to protect the stock of your S corporation. If you own an S corporation and you are sued personally you can lose control of the entire company. If your S corporation provides consulting services and the day you stop there is no value, that may not be a huge concern. If you have any value or residual income that is a big problem. The single member LLC (the only solution, can’t be taxed as a partnership) will provide the charging order protection (in most states, there are a few exceptions). 8. An LLC to be the member of your successful LLC. Even with an LLC if you or your partner are sued personally that will cause a disruption to the operating company with accounting records being reviewed and other legal issues. If you have a successful operating LLC with partners and you are concerned a lawsuit may show up out of the wood work to one of the members personally (which happens often when money shows up) it would be best to have EACH MEMBER have their own separate LLC. Now, the charging order is against their own personal LLC, not the operating company. Make sense? 7. A single member LLC to own the equipment of your business to separate it without tax problems. If you are looking to invest in equipment for $10K or more why own it by your main operating company? I know you want the depreciation, but what if you could get the depreciation AND have it better protected? You may have equipment that is worth $100K, $250K or $1 million or more. This is a simple yet powerful approach. 6. Another entity for your business if you have survived past two years of business. Consider all the effort you put in over the last two years, would you want to start over? You have heard the old saying, “Don’t put all your eggs in one basket”. This is so true when it comes to protecting your assets. You would never put all your investments in one stock would you? Why would you run your entire business empire under one legal entity? Diversification is key. 5. An LLC to own your safe assets like stocks outside retirement plans. If you have a brokerage account tied to your living trust or your name with investments they are NOT protected from liability. If they are in a retirement account that depends upon state laws. There is NOT a taxable event (in most cases) if you transfer the investments in your brokerage account to a NEW brokerage account in the new LLC name (Sec. 721 of the IRS Code). 4. An LLC to own your domain names. If your website generates a lot of leads for your business, why risk it being owned by your main operating company. Your domain names are virtual real estate that is free and clear. Your domain name may be worth $5K, $25K, $100K or more. If it is owned by your main operating company or you personally that is the wrong approach (but most common). 3. A single member LLC to own your rental properties all owned by an LLC taxed as a partnership. Get the best of both worlds! This is stronger then the series LLC which is untested. If you have five rental properties with a lot of equity in each property and you establish five LLCs taxed as partnerships you have five 1065s to complete each year. That adds up. 2. Another entity to separate out part of your services. If one service brings more risk to your company than others, separate it out! Again, don’t put all your eggs in one basket. Conducting seminars brings its own risk separate from your own day-to-day operations. 1. You just don’t want to be a sitting duck with all your businesses in one entity; that is too easy of a target! Worse, did you establish a separate LLC and you are still operating your sole proprietorship?
As you know NCP incorporates in all 50 states and will help your new entity properly build a business credit profile with the important business credit bureas (Dun & Bradstreet®, Corporate Equifax® and Corporate Experian®). Plus we can show you how to best minimize your taxes and lessen the impact of the looming “fiscal cliff” going into 2013. Did you find some areas that need more protection so you can sleep better at night knowing if you were hit with a big lawsuit you would not lose everything? Starting over is no fun.
Our goal is for your business to be part of the Top 5% that succeeds and beats the odds five years from now. If you discovered some areas where you need to form an additional entity (you may have a few strategy questions first) I would like to help you make it a very easy decision to form that new entity in the month of December with two special bonuses for you Our offices are open next week, the day after Christmas and into the New Year. This is a very busy time for us and we are here to serve you.
Here is what happens every year towards the last week of December; we get dozens and dozens of calls from people that want to incorporate or form an LLC the second day of January.
Unfortunately, because of the Secretary of State’s budget cuts around the country the process is much slower with the higher volume at the beginning of January and it make take longer for your new entity to be in place.
Our staff at NCP still has time to file your entity now in December to help you get in a position to be ready to do business going into 2013. Depending upon which state you choose to file will determine the time frame for filing and opening your bank account. The most common concern that comes up is that if you file an LLC in December and the tax year end is December 31st does that mean you will have to file a short year tax return? Not if we choose January 2013 as the start date! In other words, we are able to file your new LLC in December and choose a January 2013 start date on the SS4 application when we obtain your EIN number. That will mean there is no tax return due for 2012 for the one week the LLC was filed. This just gives you a jump going into 2013.
Take the next step and call NCP today at 1-888-627-7007 and we will help you determine which entity and state is best for you.
Also, if you have any partners or referrals that may plan on starting a new company at that time, please have us call them now.
Two Special December Bonuses When You Form Another Entity on or Before December 31st
Special Bonus #1: The fastest way to grow any business is to leverage joint ventures. Specifically, getting in a position for other organizations to promote you at no cost to you! The last three years we have conducted The Ultimate Joint Venture Boot Camp where we brought in the best trainers in the world on this one subject and all three years have been recorded and are online plus training guides to help you leverage this strategy! When you form an entity in December, you will receive 12 months access to the Ultimate Joint Venture Tool Box which will give you immediate access to all three years of training to help you grow your business in 2013 and beyond ( www.UltimateJointVentureToolBox). A $997.00 Value Special Bonus #2: Plus when you form a corporation or LLC in the month of December with NCP you will receive the following extra special bonus: Estate Planning Survival Package: -15 point review to ensure your assets are protected from creditors and your kids will never have the State (or unwanted family members) raise them if you are gone. -½ Hour consult with attorney Joseph Dadich, the creator of Blueprint ($499 Value);
-Autographed Copy of new book ‘Celebrity Estate Plans Gone Bad – Secrets Every Woman Needs’;
–FREE Life-Saving Medical Release document ;($477 Value); (authorize someone to get access to medical records);
–FREE VIP WILL ($677 Value) (will help to distribute to properly, nominate a representative…at least put your intentions in writing (don’t let the state dictate how your assets will be distributed…still need a living trust to avoid probate; A $1653.00 Value
Ready to get started? Or if you have any questions about whether your situation would benefit from another entity please call us at 1-(888) 627-7007.
Are you assets really protected in today’s uncertain financial economy? Perhaps you have already formed an entity to protect your business from audit, taxes and liability. Now, I have an important question: Have you taken the time to protect your other assets? Here are the Top 5 Areas where Your Assets May be Exposed: 1. The ownership of your current company (especially if you have a S or C corporation). High revenue and profit LLCs may be at risk also).
2. Domain names. If you have any value in your “virtual real estate” the worst place to hold your domain names is in your name personally or the name of your operating business.
3. Safe assets being owned in your own name, living trust (does not protect assets or investmetns from liability) or operating company.
4. New joint ventures operating through your current operating business.
5. Your intellectual property owned personally. Do you see an area where you may be vulnerable? Here is what your current or future assets are up against: Shocking Lawsuit Facts: 1. There are nearly 80 million lawsuits filed every year!
2. Frivolous lawsuits cost the U.S. over $200 BILLION per year!
3. Internet lawsuitsare increasing more than ever before!
4. As the economy struggles with massive debt, lawsuits will increase to all time levels coming soon. Do you need some help? Call my company Nevada Corporate Planners at 1-888-627-7007 and let us
help establish the best foundation to protect your current and future assets. NCP has helped
entrepreneurs since 1997 protect their businesses and assets. We incorporate in all 50 states and
help build business credit for business owners.
Forming a separate legal entity is a smart move when it comes to developing credibility, lowering your audit risk and protect your personal assets. Most people do not complete the transition and are still operating part of their business as a sole proprietorship and part as a new entity.
This creates a lot of problems as you can imagine including exposure to your personal assets when you probably thought you were protected.
Below is a checklist that will help you double check to see if you are on the right track with your
___1. Form a separate legal entity. The most common choices are either a corporation or LLC. A corporation
may be taxed as a regular corporation or an S corporation. An LLC can be taxed as a disregarded entity, an
S or C corporation or a limited partnership. All choices have advantages and disadvantages. An LLC has
an extra layer of protection called the “charging order” that protects the ownership interest if a partner is
sued personally for something unrelated to the operating company. ___2. Obtain a NEW EIN number (each separate legal entity requires a new EIN number). ___3. Obtain a corporate or LLC record book with the proper bylaws or operating agreement. If an LLC, the
operating agreement should match the number of members (owners) and the taxation type. For example,
a two-member LLC taxed as an S corporation has a different operating agreement than a single-member
LLC taxed as an S corporation. ___4. Obtain support with the completion of the corporation or LLC record book with both online support
and live offi ce support. When you work with NCP, our staff will schedule a 30-minute record book review
with you and you will have full access to our NCPmembers.com members area. ___5. Open a new bank account in the name of the corporation or LLC (even if you have one with a similar
business name as a DBA, you will need a new one under the corporation or LLC and the EIN number.
If you have a DBA name now linked to the corporation or LLC (that is key), you may have the new
corporation or LLC name and DBA name on the new checking account. ___6. Capitalize the new corporation or LLC. This means you will put money in the new bank account in
exchange of ownership interest in the corporation or LLC. This may be $1,000.00 or more of capitalization
to get the company started. A husband and wife with a two-member corporation or LLC should each
capitalize the corporation or LLC separately. ___7. Obtain a business debit and credit card. The business debit card will be automatic. The business credit
card you will need to apply for. Ask the banker where they pull your personal credit (which bureau) and
what the minimum your personal credit score has to be. Also ask what your revolving debt level has to be
and if you have any major derogatories, if those will be an issue before you apply. ___8. Move your merchant account to the name of the corporation or corporation or LLC (if you accept
credit cards in your business). Most in network marketing are processing their orders on credit cards to
the main company for processing. If you do accept credit cards directly, make sure you complete a new
merchant application in the name of the corporation or LLC and point that revenue to the new bank account
under the EIN number of the corporation or LLC. ___9. Transfer any business assets to the corporation or LLC. This may involve any equipment or tools
of your business. Check with your CPA fi rst to determine if any assets have been depreciated or written
off that may create a taxable event moving to the entity. It may make sense in some cases to leave the
business assets in your name. This is a case by case basis that will require more professional help. ___10. Obtain a new business license in the name of the corporation or LLC. You should check on local
requirements to determine if you are required to have a business license for a home-based business. You
may live in an area that does not allow home-based businesses, which may force you to hang a business
license as an offi ce location (if required). ___11. Establish a 5-year business plan (avoid being classifi ed as a hobby). ___12. Set up the chart of accounts for the new entity with some type of accounting software. ___13. Use a payroll service when it comes time to start payroll. NCP recommends ADP for payroll nationally
and we have a resource for you. You may also want to check with your accountant and attorney for any
legal and tax implications from hiring employees. ___14. After everything is up and running with the new LLC/Corp, close out the bank account to your sole
proprietorship and dissolve the DBA name linked to you personally. A common mistake is to continue
operating the sole proprietorship at the same time you are operating the new corporation or LLC. ___15. Update any contracts, agreements, insurance, and licenses in your name personally as to which ones need to be transferred over or redone in the name of the corporation or LLC. ___16. Update your status with your networking company that future commissions be paid to the
corporation or LLC under the EIN number, not to you personally any more. ___17. Update all your sources of income with the new Tax ID number of the new entity. Your goal is
to avoid receiving unnecessary 1099’s (meaning you want the money, just not to yourself individually
anymore) for affi liate or referral fees by the end of next year. Make sure all your affi liates are updated
with the new entity information. ___18. Update any insurance to now be in the name of the corporation or LLC. Make sure this does not
change your policy or premiums (and coverage). ___19. Get new business cards. Don’t be cheap even if the only difference in the name of your company is
“LLC” or “Corporation.” ___20. Check with your attorney or CPA for any steps missed at the state level, involving sales tax, or any
other state compliance issues. ___21. A Nevada corporation or LLC and you live in another state. The corporation or LLC should
foreign register to do business in the state where you live and operate your business. If you formed a
corporation or LLC in your home state, this step is not necessary.
Need more support? Looking to transition from a sole proprietorship and form an entity to help protect your personal assets? Call my company, Nevada Corporate Planners, Inc. today at 1-888-627-7007 for a free consultation to help
determine what may be best for your situation. Don’t just click online and pick and entity and hope it was the best choice for you.
Here are the Top 6 Areas where Your Assets May be Exposed:
Operating your business as a sole proprietorship. Not only are all your current and future assets exposed you are risking an audit especially with the new health care plan being approved (over 16,000 more IRS agents are being hired for more audits).
The ownership of your current company (especially if you have a S or C corporation). High revenue and profit LLCs may be at risk also).
Domain names. If you have any value in your “virtual real estate” the worst place to hold your domain names is in your name personally or the name of your operating business.
Safe assets being owned in your own name, living trust (does not protect assets or investments from liability) or operating company.
New joint ventures operating through your current operating business.
Your intellectual property owned personally.
Do you see an area where you may be vulnerable?
Here is what your current or future assets
are up against:
Call NCP immediately at 1-888-627-7007 to protect your assets today. Just ask to schedule an appointment to review your situation to take advantage our July Special Offer!
Here are the top mistakes to avoid when forming an entity for your business:
There are nearly 80 million lawsuits filed every year!
Frivolous lawsuits cost the U.S. over $200 BILLION per year!
Internet lawsuits are increasing more than ever before!
As the economy struggles with massive debt, lawsuits will increase to all time levels coming soon.
Have you completed your estate planning? That is another area your assets are at risk!
Who are the owners of your LLC or corporation? I hope it is not you. If something happens to you will your loved ones be protected? Will the business pass to your heirs or will the ownership get tied up in the probate courts?
Unfortunately this happens way too often and can be avoided with proper estate planning. To avoid costly mistakes get answers to these tough questions….
What are the 3 Myths of Estate Planning and the shocking truth every responsible family needs to know?
What are the five most important documents everyone must possess?
What are typical mistakes people make when they do name a guardian?
What happens if you die without a will or a declaration of guardianship for your kids?
What will happen to your business with no estate planning in place?
If you have not formed an LLC or corporation (or you need another one) and you do that with NCP (NCP incorporates in all 50 states) by July 31st you will receive two powerful bonuses to help you avoid these costly estate planning mistakes and also help keep the IRS off your back!
If you have already incorporated….do you separately protect your safe assets like stock, investments, gold, silver…? Did you protect your real estate from your operating business? These are other costly mistakes we would like to help you avoid.
Call NCP immediately at 1-888-627-7007 to protect your assets today. Just ask to schedule an appointment to review your situation to take advantage our July Special Offer! Watch this special video by attorney/CPA Joseph Dadich on how your business and loved ones will be protected with this special bonus: http://www.nvinc.com/special-tax-bonuses/
Here is the BEST PART: When you incorporate with NCP in July, you will receive the following AMAZING TWO BONUSES for FREE…a $1,892.00 VALUE (this is for a limited time)!
SPECIAL INCORPORATING BONUS #1:
TAXBOT-One Touch Tax Relief-Save Thousands on Business Taxes, 12 Month Access. I will be able to track business mileage automatically with GPS, store receipts quickly bulletproofing against an audit and be assured knowing my records are synced securely in the Cloud. I will receive 24/7 access to 3 minute tax tips from North America’s #1 small business tax trainer, Sandy Botkin, who will teach me how to save thousands on taxes!
Estate Planning Blueprint- By Attorney/CPA Joseph Dadich. If you own a home, have retirement assets, loved ones you want to leave your values and assets with when you pass on, then you can discover the most powerful Estate Planning Strategies to protect your assets from thieves and unyielding in-laws. You will receive the following powerful bonuses:
15 point review to ensure your assets are protected from creditors and your kids will never have the State (or unwanted family members) raise them if you are gone;
½ Hour consultation with attorney/CPA Joseph Dadich ($499 Value);
Autographed copy of new book ‘Celebrity Estate Plans Gone Bad – Secrets Every Woman Needs’;
FREE Life-Saving Medical Release document ($477 Value);(authorize someone to get access to medical records).
FREE VIP WILL ($677 Value)(will help to distribute to property, nominate a representative…at least put your intentions in writing (don’t let the state dictate how your assets will be distributed…still need a living trust to avoid probate).
Portion of profits from Book go to Women’s Charity’s
“The Average American and their Family is Set to LOSE 93.5 % of their Inheritance…”
This offer expires July 31, 2012 at 4 pm PDT.
Call today at 1-888-627-7007 or 1-702-367-7373 and let us know you have questions and want to take advantage of the July 2012 special to form an entity to protect your assets, update your estate planning and keep the IRS off your back!
Why this is a Great Opportunity Now:
Keep in mind that JANUARY is the MOST POPULAR MONTH for entity filings throughout all 50 states.
This is the time of the year; people will evaluate their business structure and make the switch from a sole proprietorship to a separate legal entity.
They may be searching online for solutions and pricing. Most are guessing at what type of entity may be best and many times do not have the correct operating agreement or filings with the IRS (which all cause problems down the road). The Easy Process to Refer to NCP: You can simplify the process for them and refer them directly to NCP. The simple way is to just have them call NCP at 1-888-627-7007 and have them speak to our staff. When you advise a business associate to call our company to inquire on how we may help them, just say:
“I came across a great company that has been helping business owners get off to a fast start for the last 13 Years. They help you with everything — from incorporating your business, to building business credit, to keeping the IRS off your back. Plus they have great tools to help grow your business. Check out their powerful new FREE CD, Get Your Business Off to a Fast Start to Profits™, which will cover costly mistakes made when form an LLC or corporation and other value tips to protect your assets. Just go to their website, www.nvinc.com and call them at 1-888-627-7007. Let them know you were referred by me and they will take great care of you!”
When they call we will ask who they were referred by and you will be credited with the sale (and we do all the work).
Many of your friends and businesses associates may be searching right now to incorporate or form an LLC and now you can help them out and be paid for it (as you should be) for directing them to NCP.
You can use your current website, blogs or facebook page to earn cash every
month (or the old fashion way, of talking to people and referring them to NCP -we track every new lead).
Go to www.nvinc.com/GetYourMonthlyCheck and you can go to http://www.nvinc.com/affiliates.htm and register as an affiliate for additional tools. It is NOT necessary to register as an affiliate to get paid. It offers additional tools to help you make more money!
In fact, we would like to send a referral check to you every month making this added “windfall” income a profit center to your business!
Imagine receiving checks for $250, $500 or $1,000 per month! With no cost of goods sold, that’s pure profit (would that help pay for the holidays). About the author:
Scott Letourneau is the founder and CEO of Nevada Corporate Planners, Inc. Over the past 13 years NCP has assisted more than 5,500 business owners form LLCs and corporations to get their business off to a fast start to profits™! Questions? Call NCP at 1-888-627-7007. www.nvinc.com
Nevada Corporate Planners wants you and your company to have the most protection, security and business advantage possible for your new corporation or LLC. Call us at 1-877-515-0505, and let us show you how we can help you. But whether you become our client or not, consider these points in your choice of strategic partners in this all-important decision process:
Seven Criteria the Company You Choose Must Meet
BEFORE You Let Them Form Your
Next Corporation or LLC!
Look for a company that will ask you questions to determine the best entity for your situation—before they quote you a price! Imagine seeing your doctor for a physical. He walks in the room, says hello and goodbye as he hands you a prescription — and never gives you an exam! You might as well have diagnosed yourself by the “dartboard method.”
Look for a company that understands—and will explain to you—multi-state taxation rules. These rules affect the state(s) in which your entity will have to register so you can do business. Beware of companies that tout tax savings in a tax-free state when you live and operate your day-to-day business in another state. States like Nevada do have powerful benefits, but tax savings are not typically one of them unless you live and work in Nevada.
Look for a company that fully discusses your situation with you, so you know you’re making the best decision about which entity will maximize your outcome. Your “exam” should involve many in-depth, tailored questions, rather than a following a “cookie-cutter” approach. What cures someone else is not necessarily what will cure you! Remember, if you’re looking for “easy”… if you’re looking for minimal effort – expect proportional results—or worse.
Look for a company that knows the subtleties. Ask them why 71% of all C-corporations, if audited, would pay 35% tax on all profits earned, along with hefty penalties and interest that might cripple their businesses. Does the company you’re considering know why?
www.nvinc.com Call within 72 hours of downloading this free guide at 1-877-515-0505 and
receive a Bonus GUIDE, a $47 value, The Top 20 Costly Mistakes BEFORE And AFTER Incorporating! and a 30 minute free consultation, a $200 value plus a special one time offer after you call!
Nevada Corporate Planners is in its twelfth year in business. In that time we have worked with more than 5,000 business clients! NCP is used exclusively in Nevada bynationally-renown attorneys, such as: NCP develops tools to keep you on track. You’re going into business to do what you do best, NOT to become a corporate or LLC expert. That’s our job. NCP sends you key reminders via e-mail during the first six weeks of your business to keep you and your new entity on track. Plus, you receive tax e-mails at important times throughout the year to ensure you’re in compliance. You’ll also find our extensive “Members Only” section invaluable for keeping abreast of every step in the corporate protocol process. NCP constantly updates its research. What does the IRS say about S-corporation salaries versus distributions? Is the charging order still powerful? What’s the latest on trusts? How can you best protect your residence? You’ll be on top of the latest information and research about your business and how to protect your financial future.
NCP provides business support after formation.Most business owners think the most difficult part of forming their new entity is determining which structure to choose, in which state, and when to get started. The truth is, that’s only the beginning! NCP’s PROACTIVE support is the key to getting your business off to a fast, successful start during those critical first 90 days. You’ll receive follow up calls and e-mails, plus a comprehensive walk-through of your corporate or LLC record book. NCP surprises you with frequent bonuses. We believe that you deserve — and should get — more than just what you pay for, and we know that it’s is in our best interest to see you succeed. That’s why we give you many powerful bonuses after you become a client. Just for starters, you’ll learn all about asset protection with the latest book by a top U.S. attorney. Marketing genius Jay Abraham’s transcripts then teach you how to exponentially grow your business (and at $5,000 an hour, Jay knows what he’s talking about!) With gifts like these (and many more) you’ll be fully armed for whatever the business world throws at you.
NCP has many happy, successful clients.When all is said and done, it all comes down to results — consistent, ongoing success. Virtually every website has testimonials, but NCP is one of the few that date our testimonials. Why? We want you to know that our many success stories from satisfied clients continue to come in, week after week. How Does NCP Compare to The Competition?
I actually encourage you to compare! I want you to feel comfortable knowing you’re getting the best value for your money, and the best support and commitment to help see you succeed!
The key is to compare “apple to apples.” It’s hard to know the questions to ask until you have a grasp on the big picture of what to expect from truly great professional service. To help you, I have assembled a list of criteria… listed in the xt blog post. www.nvinc.com Call within 72 hours of downloading this free guide at 1-877-515-0505 and
receive a Bonus GUIDE, a $47 value, The Top 20 Costly Mistakes BEFORE And AFTER Incorporating! and a 30 minute free consultation, a $200 value plus a special one time offer after you call!
Is your business located outside the United States? How would it help your business to secure more U.S. customers or clients? Do you even know why you may be losing revenue in the U.S.?
The key is to develop trust. When your company, whether you are based in the UK, New Zealand or Australia develops trust in the U.S. market you are more likely to bring in a share of revenue. The best way to develop trust is to be a U.S. company.
Meaning, if you have a company in the UK you would also have a company in the U.S. Now the U.S. consumer will see that you actually appear to be bigger than just a U.S. company. The key to this strategy is to properly set up a U.S. company with the proper steps so you or your company does not have IRS or legal issues.
This includes the proper U.S. entity, U.S. bank account, U.S. Merchant Account (which is almost impossible unless you have the steps in order), a U.S. Office Address, a U.S. phone number with staff, mail fowarding, the EIN and ITIN number for you and the company.
There are many online solutions but many cut corners and only give you a piece of the puzzle (like forgetting to have a CPA tell you how to get money out of your U.S. company).
For a full report on how to properly establish a U.S. company call Nevada Corporate Planners, Inc at 1-888-627-7007. You will be sent a complete report on all the steps required.
Are you protecting one of your most valuable assets? Did you realize that if you own domain names, you own virtual real estate free and clear? Yes, when you paid $8 or so to reserve you domain name, you or your company own it free and clear! Who should own your domain names? What is most common? Usually most entrepreneurs own their domain names either through their own name personally or their operating company. Both of those are probably a mistake, especially if your “virtual real estate” has value!
If you owned a free and clear piece of real estate, like a rental property that was worth $500,000, would you own it personally or in your operating business?Never! If you owned it personally you are exposing a very valuable asset for lawsuits! If you had it owned by the business you are unnecessarily exposing your valuable asset to lawsuits that could occur against your business. Regular real estate is a risk asset by itself. But “virtual real estate” like a domain name does not necessarily bring much risk to it. The exception is; if you reserve a domain name and later discover that you may be violating someone’s intellectual property or a claim is made against you.
If your domain names is responsible for 60-90% of your leads to your operating business it may be a very valuable asset. For example, NCP’s website, www.nvinc.com, which we have owned since 1997, is a very valuable asset. It generates about 60% of our leads and is owned by a separate operating company and leased back to Nevada Corporate Planners, Inc.
Many of you may want to consider forming a safe asset holding LLC to own all your domain names and lease them back to your operating company. Typically it would be an LLC taxed as a partnership.
If you are just starting your business and there is no value to your “virtual real estate” other than the price you paid for your domain name, then leaving it your name or the business name may be ok short term. My preference would be to be owned by your operating company as a first step. If that is not the case, you can transfer the ownership to your operating company.
In summary, make sure you properly protect your domain names, especially as they gain value. A separate legal entity may make sense for many of you. For specific questions on your situation, call NCP at 1-888-627-7007!
Is it the best of times or the worst of times? There is a famous story where a shoe salesperson is looking to expand his territory for shoes. He travels to a country in Africa and sees that no one is wearing shoes. When he gets back he reports to his boss. His boss asks, is there an opportunity in Africa to sell shoes?
The sales person reports back, “Not at all, no one is wearing shoes!” The next sales person working for the competitor goes to the same country in
April and reports back his sales results. When asked by his boss to evaluate what he sees his response is totally different. He says, “This is the greatest opportunity for us to expand our business because no one is wearing our shoes. What a great market opportunity for us!”
Opportunity is a matter of perspective. Where is your focus on the opportunity with the financial uncertainty around us? With unemployment rising and more and more looking for better financial choices this may be your greatest opportunity since the great depression! No one said it would be easy. If you are committed and focus on adding value and providing solutions, financial opportunity will come your way quickly!
You may very well be in an industry where your competition is going out of business due to the shrinking market. That is great for you! Even if your market shrinks and there are less choices, that means you have better odds as you implement ways to improve your product and service for your market place. Search for more ways to add value!