So you want to have Nevada incorporation? Well, it may be just what you want and need, or it could be a nightmare. It may very well be that Nevada incorporation is the right step for one company, and a misstep for the next. Besides the low cost for a Nevada incorporation, it provides owners with beneficial and unparalleled asset privacy. The filing fee for Nevada incorporation is $125, and is more affordable than most states. Another advantage of Nevada incorporation is privacy of ownership and the absence of a state income tax.

Most companies do NOT qualify to take advantage of Nevada incorporation's benefits, so be sure that you check out the various requirements. Your resident corporation can maximize profits by taking advantage of the tax laws, and members of an LLC (owners) pay taxes on the income, yet have the advantage of limited liability as the shareholders of a corporation do. You can get every advantage used by big corporations at low cost which is one of the benefits of tax savings by a Nevada incorporation.

The state of Nevada has issued requirements for incorporation, primarily a residency test. In order to properly form a substantiated Nexus base in Nevada the following requirements should be met: (1) a compliant Nevada formed Corporation or LLC; (2) A Nevada office* (leased or owned) with physical and mailing address; (3) Nevada staff working in Nevada; (4) Nevada bank account; (5) Nevada phone number; (6) Nevada Business Registration; (7) Continuously maintain appropriate records, filings, and accountability. Anything less is a facade that requires home state registration and may negatively affect protection, privacy and tax advantages. A non-resident can have Nevada incorporation as long as he/she registers in their home state as well. This will generate additional filing fees; however, if you want total privacy, it might be worth it.

The benefits of Nevada incorporation are amazing! Numerous benefits are offered to existing and new businesses that incorporate in Nevada and they enjoy many benefits just not available anywhere else. For one, no taxation upon shares of stock held by non-residents and no inheritance tax upon non-resident holders. Pro-business Nevada, unlike almost every other state, has taken a stand! No Corporate Income Tax. * No Taxes on Corporate Shares * No Franchise Tax * No Personal income tax No IRS Information Sharing Agreement

Nevada's corporate statutes started with those of Delaware and then went even further, establishing a corporate entity that allows investors and owners of Nevada corporations to remain off the public record - an advantage that is unique throughout the world. Since these statutes took effect in 1991, the number of new incorporations in Nevada has exploded. The bullet-proof protection inherent in Nevada corporations, however, takes it to a new level, making it virtually impossible for creditors and litigants to get at your hard-earned assets. That just might be the main reason there were over 40,000 incorporations in Nevada last year alone. It looks like more and more business-savvy people are discovering the tremendous advantages that complete protection offers! Unlike most other states, there has never been a case in which the corporate veil was pierced in Nevada, except in the instance of fraudulent activity. This means your personal assets receive maximum protection when separated from business activities by a Nevada corporation. Nevada's Supreme Court consistently stands strong on preserving this protection, even when a corporation fails to maintain basic corporate formalities (though we strongly recommend you do so). Some other important benefits are a Nevada incorporation can be organized with very little capital, if desired. Many states require that a corporation have at least $1,000 in capital. One person can hold the offices of President, Secretary, Treasurer, and be the sole Director. Many states require at least 3 officers and/or directors. Thus, there is no need to bring other persons into a Nevada corporation if the owner does not desire it. A corporation can be formed by mail, fax, or phone and the person incorporating in Nevada never has to visit the state, even to conduct annual meetings. Meetings can be held anywhere in the world at the option of the director(s). No reciprocity with the IRS. Nevada is the only state in the union that does not share information with the Internal Revenue Service. Many tax professionals also believe that this reduces your chances of an audit because less matching of tax return information means fewer chances of something standing out. We trust that this information on forming a Nevada incorporation has been helpful. We cannot stress enough...get all of the facts and requirements for a Nevada incorporation, and contact a professional for advice in your particular situation. The purpose of this article is not to give you legal advice or recommendations, but to point out to you some of the requirements and caveats.

By: Gust A. Lenglet
Gust A. Lenglet is an accountant and financial advisor for many years. He is President and CEO of HBS Financial Group, Ltd. and offers online tax filing as well as income tax articles and information.

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Do you understand the difference between “case law” and “statutory law”? Have you ever wondered what the term “common law” meant? If you struggle with these legal terms, this article will help.

Judge-made law. Statutes come from the legislative branch of the government, while case law is the product of the judicial branch. Black’s Law Dictionary defines “case law” as “the aggregate of reported cases as forming a body of jurisprudence, where the law of a particular subject . . . is formed by the adjudged cases . . ..” The definition of “common law” in Black’s states, in part: “the body of those principles . . . which derive their authority solely from usages and customs . . . or from judgments and decrees of the courts recognizing, affirming and enforcing such usages and customs . . ..” The labels of common law and case law essentially are interchangeable.

Legal precedent/ stare decisis. These concepts play an important role in the development of case law. Borrowing again from Black’s, legal precedent is a prior decision of a court that furnishes authority for a similar, future case involving a similar question of law. Courts decide cases largely on the basis of principles established in prior cases, which are close in facts or legal principles to the case at hand. A court’s decision on a new matter will create a rule of law for a particular type of case that will be referred to in the future when a similar case is decided. The doctrine of stare decisis, which is defined by Black’s as “to abide by, or adhere to, decided cases,” is a significant principle in the creation of case law. Trial courts and courts of appeals stand by precedent so as not to disturb a settled point. Note Black’s: “when court has laid down a principle of law applicable to a certain state of facts, it will adhere to that principle, and apply it to all future cases, where facts are substantially the same; regardless of whether the parties and property are the same.”

From where does a case come? Much of the case law applicable to Indiana foreclosures comes from the Indiana Court of Appeals (http://www.in.gov/judiciary/appeals/) and the Indiana Supreme Court (http://www.in.gov/judiciary/supreme/). This is how case law is born: Lawsuits are filed and litigated in trial courts (circuit and superior courts in each Indiana county). Parties who are the subject of an adverse ruling by a trial court, either in connection with a pre-trial motion or at trial, can appeal the decision to the Indiana Court of Appeals. The Indiana Court of Appeals studies the trial court’s record of proceedings and then decides the appeal. Often the appellate court will issue a written opinion, commonly called a case (hence, “case law”). The opinion typically summarizes the facts, states the issues, outlines the applicable legal rules and provides an analysis applying the rules to the facts. The opinion ends with a conclusion, sometimes called a “holding,” which states whether a party won or lost on the question(s) presented. A party can appeal the Indiana Court of Appeals’ decision to the Indiana Supreme Court. The Indiana Supreme Court, if it accepts the appeal, then will issue its own written opinion. These written, appellate opinions are published in hard-bound law books (reporters) and electronically (for instance, through LexisNexis). They also can be accessed through the Court’s websites.

Cases equal education. The appellate court’s opinions, which collectively constitute case law, deal with a wide range of issues from specific rights and obligations of a party, to the interpretation of a statute and how it applies to a given circumstance. Because the opinions provide the reasoning behind the court’s conclusion, they offer insight into a particular rule of law. That reasoning is valuable to lawyers and parties, who use it as guidance for future conduct and decisions. This is why providing “court commentary” on my blog is so important. Relevant decisions by courts teach banks and commercial lenders, who deal with loans in default and the collection of commercial debts, about their rights and duties. If you need to know whether Indiana law previously has addressed a particular question, lawyers like myself are trained to do the legal research necessary to find the answer, assuming a definitive answer exists. But don’t be surprised if there isn’t a case on point. Frequently, there are gaps in the law that create uncertainty. Lawyers often are called upon by their clients to advise how a specific matter may be determined when there is neither a case nor a statute directly on point.

By: John Waller
John D. Waller is a partner at the Indianapolis law firm of Wooden & McLaughlin LLP. He publishes the blog Indiana Commercial Foreclosure Law at http://commercialforeclosureblog.typepad.com John’s phone number is 317-639-6151, and his e-mail address is jwaller@woodmclaw.com.

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There comes a point in every person's life where it is appropriate and prudent to begin planning for the post death division of property and assets. It is necessary to anticipate and plan for the quagmire that is probate. For many facing the task of planning their estate, the mere idea of paying an estate planning attorney can be painful and many simply choose to forego such a task by using cheap or free online forms. While choosing the easy way out may save you money now, it will cost your estate significantly more in the future. The pitfalls of cheap online wills and trusts writing programs are many.

The premise is simple enough. You want a means of distributing your property after your demise but you do not want to pay more than necessary. The problem is dead serious. On their face, online wills and trust programs appear to be a bargain. You can prepare your own will or create a trust for less than $20.00, a tiny fraction of the cost of a good estate planning attorney. Unfortunately for your family though, the inherent inadequacies of such services are not discovered until after your death. Any remaining heirs will be forced to pick up the remains of your estate and force it through probate, taking substantial amounts of both time and money. The money spent today on a good estate planner will save your estate exponentially more in the future.

Numerous amounts of problems arise when deciding to use online wills and trusts services. Most often these services do not take into account specific state law regarding the administration of probate or trusts. Only an attorney in your state can effectively advise you regarding the various jurisdictional issues that may affect many of your decisions regarding your estate. Many states have varying requirements regarding the number of witnesses that must attest to the creation of a will. Failure to comply with state requirements regarding the order of attestation and witnesses will sometimes lead a court to completely invalidate your will as a means to distribute wealth and property. See, Stevens v. Casdorph, 508 S.E.2d 610 (1998). By refusing to extend the Doctrine of Substantial Compliance, many state courts, like the Casdorph court, have stressed the importance of proper will execution. Online will services do not take into account the varying requirements among states. Only a skilled estate planning attorney can advise you regarding the proper methods to ensure that your will is upheld during probate. Failure to comply with these requirements will force all property through intestacy, which is where the state decides who gets what. Moreover, intestacy is not something that the online services will tell you about. Additionally, the plain meaning rule, which instructs court's to look only at the plain meaning of words contained in the will, stresses the importance of obtaining professional advice. Using an incorrect word or clause can dramatically alter the effect of the will, invalidating the very purpose of its creation.

Trusts are often used as a tool to avoid the probate system completely, and many online services use this very idea as a marketing tool. There are many kinds of trusts used in estate planning (i.e. revocable, irrevocable, discretionary, spendthrifts, marital, special needs and testamentary trusts, to name a few) and only an experienced attorney has the knowledge and ability to advise you regarding the proper form of trust for your desired purpose. In addition, online services do not address the various issues faced when creating a trust. As trustee, beneficiary or settlor, there are various rights and obligations associated with each party. Violation of any imposed obligation or duty can serve to completely invalidate the trust document itself. In order to properly address your needs, an estate planning attorney considers all relevant factors and will recommend the best option for you.

Online services fail take into account all available means of wealth transfers and do not begin to address all pertinent issues, such as tax impacts, ease of administration, imposed rights and duties and the potential pitfalls. Only a qualified attorney can ensure that your estate does not find itself stuck in the murky and troublesome world of probate and intestacy. Wise planning now could spare your family the unpleasant pain of probate in the future.

By: Nicholas J. Deleault
This article was written by Nicholas J. Deleault, Pierce Law Center '07. Nicholas writes select legal articles for the Law Firm' Blog of Goldstien and Clegg, a Massachusetts Estate Planning Attorney.

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While music to a lawyer’s ears, at least to his wallet, this phrase should make every business person cringe. Litigation absorbs time and money, often astonishing amounts of both. Worse, it signals a major breach in what is presumably a valuable relationship. Worst of all, it means the business problem the contract was meant to address has not been solved. Instead of one problem and a plan to resolve it, you now have two, neither of which will add to your bottom line. Avoiding such a situation requires time, thought and some effort, but all are a worthwhile investment if they produce a transaction that moves forward smoothly and efficiently.

Let’s explore some of the common causes of deal failure:

• The vendor is dishonest. (Customers may also be dishonest, but that raises issues outside the scope of this essay.)

In some ways, this situation is the easiest to deal with. The more blatant the vendor’s misconduct, the easier it is to “pull the plug” and look for an alternative vendor. Time and money will still be lost, but the customer who acts promptly will at least limit his or her losses. If the vendor is dishonest, but conceals it well, is incompetent yet earnest, customer may attempt to nurse the project along, allowing losses to mount. (Of course, a vendor who is honest but in over his head may eventually admit the fact and negotiate a buy out, thereby avoiding the need for either side to proclaim “So Sue Me.”)

• Happily, genuine vendor dishonesty is relatively rare. More frequently the parties have almost complete power to avoid contractual disputes simply by negotiating and documenting their agreements thoroughly. That requires time and effort, and it requires each side to leave their comfort zone and ask “What will happen if things go wrong.” That question is contrary to the mindset deemed necessary to “do the deal.” Negotiators are trained to be positive, to “get to yes” and NOT to rock the boat. But really making sure that the deal will work requires recognition that things can, and probably will, go wrong.

Problems fall into two general categories: the unforeseen and the unforeseeable. A good contract goes to great lengths to eliminate the unforeseen, and provides mechanisms to deal with the unforeseeable. “The unforeseen” is simply a polite name for “the overlooked.” Overlooking a key condition or a vital contingency is not a career enhancing exercise. While there are no sure and certain guarantees against oversights, there are safeguards that can substantially reduce the exposure:

• Take your time.

Easier said than done in a world in which everything is needed yesterday. But which is more damaging – a delay to get the project right or damage control when the project comes apart? Consider what a commitment to “first at all costs” did for General Custer.

• Do your homework.

o What needs to be done?
o When?
o By whom?
o What contingencies must be addressed?
o HOW will they be addressed (and by whom)?
o Which project/product features are “must haves”?
o Are there key personnel who need to be identified?
o Are there target dates?
o Which of the targets are guideposts and which are central to successful completion?
o If there are no target dates, why not? After all, time is money.
o What is the business problem you are attempting to solve?
o What are your standards for success?

If you are not solving a specific and defined business problem, or meeting a specific need, why are you spending time and money on the project?

If you cannot identify what will constitute success, why are you spending time and money on the project?

This brings us back to “take your time.” If the project is so rushed that its fundamental goals have not been defined, trouble may not be far off.

• Play “Devil’s advocate.”

o WILL this project solve the specified business problem?
o What CAN go wrong?
o How will you respond when things do go wrong?

It is tempting to cut corners at this time. Planning to respond to problems is hard work. But failing to put in the necessary effort will simply invite one side or the other to proclaim, at the worst possible time: “So sue me!”

Even the most thorough and searching project plan cannot anticipate all problems. Key personnel may leave abruptly. A third party’s product may not arrive on time, or may not work as promised. Management may cut the budget. Business changes may render the project unnecessary, or may require substantial revisions.

Enter the change control provisions, which can serve a number of useful purposes:

• Eliminate time wasted on finger-pointing

• Eliminate (or at least reduce) the possibility of one side taking undue advantage of the other

• Keeping the deal alive.

But did you include change control provisions in the contract? Did you specify:

• Who will respond when problems arise?
• Who is authorized to amend the agreement?
• A problem escalation procedure?
• A dispute resolution procedure?
• Cost controls?
• Specific buy-out or exit mechanisms?

Hard work? Yes.
Boring work? Sometimes.
Valuable work? Would you rather manage a portfolio of projects that run more or less smoothly and contribute to the bottom line or would you rather spend your days putting out fires?

Copyright 2006, Thomas J. Hall. All rights reserved

tom@tomhalllaw.com

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