Category: Business Law
Get Your Company Records Right with Help from BGS
July 10, 2024 | Carole Clark Isakson
Almost weekly, I am contacted by a small business owner who needs their company’s corporate records to be “updated.” This “update” request is usually prompted by ownership changes, the sale of the company, or a potential lender doing its due diligence. In all cases, those other parties want to make sure that the company they are buying or investing in has been properly formed, is properly managed, and has designated those with authority to bind the company. And—in at least half of these cases—the reason the company records need updating is because the owners initially formed the entity without legal help. Many people know that the Minnesota Secretary of State provides forms for the initial Articles, but this is not enough. If all you do is file the Articles, you have done nothing more than create a shell of a company. It is unlikely that a lender will be satisfied with this, and anyone buying your company (except perhaps another existing owner) will insist that the company records be completed and corrected. Filing Articles of Incorporation (for a corporation) or Organization (for an LLC) is only the first step. To complete those online, you will need the following: Proposed name of the entity Registered office and agent How many shares are authorized (in the case of a…
Read MoreEarned Sick and Safety Leave Law
December 11, 2023 | David R. Schaps
Minnesota’s new Earned Sick and Safety Time Leave Law (ESST) is approaching, and Minnesota business owners need to have policies in place and prepared to go live on January 1, 2024. Employers must provide each employee in Minnesota with at least one hour of paid sick and safe time for every 30 hours worked, up to at least 48 hours of accrued ESST a year. An employee is anyone who works at least 80 hours a year for an employer in Minnesota and is not an independent contractor. An employer’s existing leave policy, such as paid time off (PTO), may already fully or partially meet Minnesota’s earned sick and safe time requirements. Local ordinances such as those in Bloomington, Duluth, Minneapolis, and St. Paul may also affect the requirements to provide ESST leave time and differ from the new State requirements. Please note that an important part of the new law is that employees do not have to live in Minnesota to be eligible for ESST accrual but must work at least 80 hours in Minnesota in a year to be eligible; time worked in Minnesota will apply to ESST accrual. If an employer is based in Minnesota but has employees who work in another state, those out-of-state employees are not covered by…
Read MoreTHE CORPORATE TRANSPARENCY ACT WILL APPLY TO MANY U.S. BUSINESSES – ARE YOU READY??
November 9, 2023 | Carole Clark Isakson
The Corporate Transparency Act (“CTA”) is a federal law that will go into effect on January 1, 2024. Unless a company is exempt from reporting (see below) all business entities formed in the U.S. will need to complete and file a beneficial ownership disclosure form (“BOI”) with the U.S. Treasury’s Financial Crimes and Enforcement Network (“FinCen”). Will it apply to my company? The CTA applies to all entities formed in the U.S. with several significant exemptions, including but not limited to: 1) entities that are already heavily regulated (like banks and insurance companies), 2) large companies with a physical U.S. office and more than 20 employees and more than 5 million per year in revenue, 3) certain tax exempt entities, 4) accounting firms and 5) public utilities. The CTA sets out twenty-three exemptions. In addition to those exemptions, entities that are not created through a filing at a state office do not have to comply with the CTA; those entities include trusts and general partnerships. What timelines apply? Companies created before January 1, 2024 will have an entire year to make the required filing. Entities that are created on or after January 1, 2024 must make the filing within thirty days (this timeline may be extended a month or two, this has yet to be…
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