Some Key Clauses in Shareholder Agreements

Here are a few key practical considerations about shareholders’ agreements for founders to keep in mind. Management & Operations. Parties to the agreement should have their roles and obligations well defined. This should include the composition of the board of directors, as well as the relationship between minority and majority shareholders. Appointment of Board of […]

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Delaware Corporate Annual Report and Franchise Tax Payments

All corporations incorporated in the State of Delaware are required to file an Annual Report and to pay a franchise tax. Exempt domestic corporations do not pay a tax but must file an Annual Report. The Annual Report filing fee for all other domestic corporations is $50.00 plus taxes due upon filing of the Annual […]

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S Corporation vs. LLC

Many small business owners choose between an S corporation and a limited liability company (LLC) when choosing a formal legal structure for their business. Both LLCs and S corporations offer their owners limited liability protection. If you run your business as a sole proprietor, then business creditors can reach your assets even if those assets […]

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Why Have a Shareholder Agreement?

Although though there is no legal requirement to have a shareholder agreement, every company with more than one shareholder should have one. Shareholder agreements ensure that the rights and obligations of the shareholders are properly thought through. The agreement works together with a company’s articles of incorporation, but will give shareholders greater protection than can […]

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Transfer pricing regulations between the United States and Canada

In general “transfer pricing” can be defined as the internal pricing of goods or services when a company transfers goods or services internally across national borders. Usually this relates to a multinational company that has subsidiaries in several countries, and when these subsidiaries transfer goods, services, software, intellectual property etc. between each other. The general […]

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Are You A U.S. Person for Tax Purposes?

The United States taxes U.S. persons based on that person’s worldwide income. It does not matter where the U.S. person lives. If he/she is a U.S. person, that person is subject to U.S. tax. A U.S. person who owes U.S. taxes and does not pay the taxes when due may be liable for substantial penalties […]

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How to calculate the Franchise Tax for your Delaware company

All corporations incorporated in the State of Delaware are required to file an Annual Report and to pay a franchise tax online at http://corp.delaware.gov/paytaxes.shtml Franchise tax is the fee imposed by the State of Delaware for the right or privilege to own a Delaware company. If you have a company incorporated in Delaware, the annual […]

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Canadians Using LLCs to Purchase U.S. Real Estate

Many Canadians wish to purchase a vacation home or investment property south of the border. However, few carefully consider how they will structure the purchase and its tax implications before buying. Many U.S. lawyers suggest buying properties intended for rental purposes through a limited liability company (LLC). LLCs are popular in the United States since […]

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Who Must Pay California Use Taxes?

Sales Tax vs. Use Tax: Sales tax generally applies to transactions within California. If a sale originates in California, and possession of the item is taken in California, then sales tax applies. Use tax is to be paid by any purchaser who purchases tangible personal property from an out-of-state seller (unless the vendor charges sales […]

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Should Your Online Canadian Business Collect U.S. Taxes?

It depends. Do your business activities create nexus in a particular state? The term nexus means that a business has a presence in a state and is therefore subject to state income taxes and/or is subject to sales taxes for sales within that state.   Nexus is determined differently for income taxes and for sales […]

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Should You Incorporate Your U.S. Subsidiary In Delaware?

Delaware is a favored state for incorporation for a number of reason It has historically offered the best franchise tax rules and has been the most pro-management. Delaware’s General Corporation Law is one of the most flexible business formation statutes in the United States. Delaware’s Court of Chancery uses judges instead of juries. Since cases […]

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