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Accredited Investors

Accredited Investors: An Overview The term "accredited investor" is commonly used in financial circles, but what does it actually mean? In essence, an accredited investor is an individual or entity that meets specific criteria set forth by the Securities and Exchange Commission (SEC), making them eligible to participate in certain...

Corporate Transparency Act

Navigating the Corporate Transparency Act In the ever-evolving landscape of corporate regulations, staying informed is key to ensuring compliance and maintaining the integrity of your business. One such recent development is the Corporate Transparency Act (CTA) that went into effect January 1, 2024, a significant piece of legislation that aims...

Startup Fundraising: SAFE v Convertible Note

When startups seek early-stage funding, they often turn to various financial instruments to secure capital from investors. Two popular options are a Simple Agreement for Future Equity (SAFE) and Convertible Notes. Each of these instruments has its own set of advantages and disadvantages, making it essential for entrepreneurs to understand...

Does a single-member LLC in MA require an operating agreement?

While it is not legally required to have an operating agreement for a single member LLC in many jurisdictions, it is still highly recommended to create one. An operating agreement is a legal document that outlines the ownership, management, and operating procedures of an LLC. Here are a few reasons...

Capital Contributions

A "capital contribution" is a contribution of money (cash), property (assets), services, or a promise to contribute one of the aforementioned in the future to a business in exchange for an equity ownership interest.  Each business owner (a member or partner) has a "capital account" which is a line item...

IRS EIN Responsible Party

In order to obtain an EIN with the Internal Revenue Service you must elect a "responsible party".   This is one of the individuals who controls, manages or directs the entity.  It must be a real person, not another entity and the filing will include their individual Taxpayer Identification Number (SSN,...

Do I need an EIN?

An EIN is an Employer Identification Number obtained with the IRS for business purposes.  Despite it's name you may need or want to  obtain an EIN even if you do not have employees.  Think of it like a social security number for your business that can assist you in keeping your...

Do I need a Registered / Resident Agent?

A registered agent (also known as a resident agent in Massachusetts) is required for all registered businesses (like an LLC or corporation) to accept service of process on behalf of the business and receive communication from the state.  Service of process is when a party initiates a lawsuit and provides...

Member-Managed v Manager-Managed: Management Structure in the LLC

When forming a limited liability company (LLC) you need to determine if you wish to be Member-Managed or Manager-Managed.  In Massachusetts this election is made by including the name of a Manager on the Certificate of Organization and in the Operating Agreement (this is the contract between Members and the...

Making the Most of Small Business Saturday

Everyone knows Black Friday, and the chaos that ensues with massive chain stores and companies offering great deals on their products, and often times in limited quantities.  Cyber Monday has become a newer “holiday” where online retailers offer similarly attractive sales, coming the Monday after Thanksgiving.  Lesser known, but possibly...