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NEW HAMPSHIRE TAX DEVELOPMENTS

For those interested in New Hampshire state taxation, the following update from CCH will be of interest: ———————— S.10,New Hampshire—Corporate Income, Utilities Taxes: Correction: IRC Conformity Updated and BPT/BET Rates Reduced,(Jul. 12, 2017) Governor Sununu of New Hampshire has approved legislation that reduces the tax rates of the business profits tax and the business enterprise […]

NEW ARTICLE ABOUT TAX CHOICE OF ENTITY

Tax choice of entity is a critical task in any LLC formation.  Below is the cite to a new law journal article about LLCs and tax choice of entity: 9 Elon L. Rev. 311 Elon Law Review 2017 Article Caolan J. Ronan Copyright © 2017 by Elon University; Caolan J. Ronan START-UPS: WHY INVESTORS PREFER […]

SELLING LLCS

LLC lawyers sometimes need expertise about the special issues involved in buying or selling family-owned businesses.  The post under the following link contains excellent advice about valuing these businesses: http://www.taxlawforchb.com/2017/06/unreasonable-compensation-the-family-business/

TEXAS SHOOT-OUT PROVISIONS

Texas shoot-out provisions, also known as “shotgun” provisions, are very common in the operating agreements of multi-member LLCs, but they are often inappropriate.  Under the link below, in a post by Peter Mahler, is the best short discussion of these provisions I’ve ever read. Aim Carefully Before Pulling Trigger on Shotgun Buy-Sell Agreement

DERIVATIVE SUIT BY LLC 50/50 MANAGING MEMBER

The post under the link below addresses an interesting Delaware Court of Chancery decision on derivative rules in suits between the two equal managing members of an LLC.  The decision is likely to be influential outside Delaware, and it’s a significant angle on an all-important task for LLC lawyers—handling member deadlocks. Here’s the link: https://delawarechancery.foxrothschild.com/derivative-actions/derivative-demand-requirements-equally-apply-to-actions-asserted-by-5050-member-of-an-llc/?utm_source=Fox+Rothschild+-+Delaware+Chancery+Law+Blog&utm_campaign=2c211dbca2-RSS_EMAIL_CAMPAIGN&utm_medium=email&utm_term=0_86821ff155-2c211dbca2-70733165

MINNESOTA LLC ACT

Below are the citation and first paragraphs of a article about the soon-forthcoming new version of the Minnesota LLC Act.  The article will of course be of interest to Minnesota lawyers but also to people (like me) who try to follow LLC statutory developments nationwide. 74-JUN Bench & B. Minn. 27 Bench and Bar of […]

GRANTS OF RESTRICTED STOCK TO EMPLOYEES

More and more LLCs are electing to be S corporations, and, as such, can issue restricted stock to their employees under clear tax rules.  However, the new post under the link below raises questions about whether this is ever a good idea. http://www.taxlawforchb.com/2017/05/restricted-stock-employee-shareholders/

“PROPER PURPOSE”

When non-manager members have disputes with managers, the access of the non-managers to LLC records is often a key issue.  The issue is whether the non-member members have a “proper purpose” for obtaining those records.  The post under the link below discusses a Delaware Court of Chancery case about that issue. Here’s the link:  https://delawarechancery.foxrothschild.com/books-and-records-demand-2/chancery-finds-that-mismanagement-exists-warranting-section-220-books-and-records-demand/?utm_source=Fox+Rothschild+-+Delaware+Chancery+Law+Blog&utm_campaign=c83185548b-RSS_EMAIL_CAMPAIGN&utm_medium=email&utm_term=0_86821ff155-c83185548b-70733165

2017 PROPOSED AMENDMENTS TO DELAWARE’S LLC AND PARTNERSHIP ACTS

The Delaware Limited Liability Company Act is the most prestigious U.S. LLC act, many sophisticated investors and lenders will deal only with Delaware LLCs, and when two or more LLC founders from non-Delaware states disagree about whose LLC act will govern, they often choose the Delaware Act.  Sophisticated LLC lawyers should have a detailed understanding […]

SELF-EMPLOYMENT TAX OF LLC MEMBERS

Most multi-member LLCs are taxable as partnerships.  A key task of lawyers forming LLCs is often to minimize the Self-Employment Tax exposure of the members of these LLCs.  The post under the link below discusses a recent Tax Court case addressing the SET liability of the members of a multi-member LLC whose members were lawyers, […]