While most people are focused on last minute gifts and preparing holiday meals, business owners are getting their corporate affairs in order before the clock strikes midnight and we ring in a New Year. Here are five questions small businesses and medium-sized businesses should be thinking about as we approach January 1.
1. Do I need to renew any business licenses?
Have you dusted off your business licenses recently? Do you have any continuing education requirments ? Don’t fret. Both New York and New Jersey provide the following free resources to answer all of your licensing questions to make sure you are current:
New York: New York Business Express (ny.gov).
2. Do I need to file an annual report for my business?
In New York, domestic/foreign business corporations and domestic and foreign limited liability companies must file a Biennial Statement every two years with the Department of State. The filing period is the calendar month in which the original Certificate of Incorporation, Articles of Organization, or Application for Authority was filed. Owners and officers of small businesses and medium-sized businesses in New York can file their annual registration with the state using this link: Biennial Statements for Business Corporations and Limited Liability Companies | Department of State (ny.gov)
In New Jersey. Owners and officers of small businesses and medium-sized businesses in New York can file their annual registration with the state using this link: State of New Jersey Online Annual Report (njportal.com)
3. Do I need to amend my corporate formation documents?
Did you change the name of your business? Did you sell any shares or bring in new partners? Did you change the way the business was managed or appoint any new officers? If you’ve answered yes to any of these questions for your small business or medium-sized business, odds are the documents that govern your business need to be amended albeit the Articles of Incorporation or a corporation or Articles of Organization for a limited liability company (LLC). Also, take a look at your company’s bylaws and any shareholder agreements (for corporations) or operating agreements (for limited liability companies) to make sure they still work the new way your business is structured and run.
4. Do I need to provide year-end financials to investors?
Many (but not all) corporate bylaws, shareholder agreements (for corporations), and operating agreements (for limited liability companies) require managers to supply regular updates concerning the company’s finances albeit it on a monthly, quarterly, or annual basis. Now is a good time to check these critical documents to see what financial information you must disclose to other owners, investors, partners, or shareholders. Getting in touch with an accountant to produce financial statements can be tough at year end, so don’t delay in reaching out to your CPA. Doing so might help you avoid a partnership dispute.
5. Do I need to hold an annual meeting?
Aside from being required by most corporate bylaws, shareholder agreements (for corporations), and operating agreements (for limited liability companies), holding quarterly or semi-annual meetings with shareholders is just one of the many “corporate formalities” that business owners should follow to avoid being held personally liable for the debts of their small businesses or medium-sized businesses. And if your business pre-dates modern videoconferencing, you should also consider having a New York business lawyer or a New Jersey business lawyer look at these documents to revise them so you have the flexibility to hold these meetings through electronic means.
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