The HBS Blog offers insight on Delaware corporations and LLCs as well as information about entrepreneurship, start-ups and general business topics.
The 4th quarter of the year has arrived. For some, it is time to start thinking about future business goals. However, for others, it may be time to consider officially closing your company, which is called cancellation for a Delaware limited liability company and dissolution for a Delaware corporation. Harvard Business Services, Inc. can explain how to cancel your LLC or dissolve your corporation.
We file thousands of companies each year, and the unfortunate truth is that not all of those companies will continue to operate year after year. While we don’t like to see a business close, we do appreciate the opportunity to serve as your Registered Agent, and we are here to help you officially close your company, if you deem it necessary.
For those businesses that will not be operating in the next year, now is the time to consider a cancellation or dissolution. Officially filing the Certificate of Cancellation or Certficiate of Dissolution before the first of the year will save you from paying another whole year of Franchise Tax.
This is how it works: The Delaware Franchise Tax is due on March 1 for a corporation and on June 1 for an LLC. However, Franchise Taxes are paid for the previous year. So when you pay Franchise Taxes in 2015, you are paying for the 2014 calendar year. These taxes are not pro-rated; that is, if your company is in legal existence even one day in 2015, you must pay the entire year’s Franchise Tax when you cancel or dissolve it.
Contact our friendly customer service specialists at Harvard Business Services, Inc. for help with this service. We will prepare a Certificate of Cancellation or Dissolution for signature, and forward via fax or email—or you can authorize us to use the conformed signature option. Once signed, we will file the Certificate with the Delaware Division of Corporations. The state typically takes three to five business days to return the receipt of filing. As soon as the approved Certificate of Cancellation or Certificate of Dissolution document is available, we will forward it to you for your records.
This document is the official legal document proving the company has been legally closed. Your bank will ask for it when you close your company's bank accounts. Your accountant will also need the document to include with your final tax return to the IRS, which is a federal IRS requirement.
If you would like Harvard Business Services to cancel a Delaware LLC or corporation for you, simply call us at 1-800-345-CORP.
Recently, we’ve been exploring lots of different ways to promote your small business—from social media to flash sales to press releases. The promotional video is another great low-cost tool that entrepreneurs can use to tell their stories and spread the word about their companies. In order to produce a professional-looking video you’ll need to focus on two things: engaging content and strong production values.
The content for your video needs to serve a few different purposes. It should give viewers a quick overview of what your company does, how it helps your customers and why it’s better than the competition. And it should also reflect the unique culture of your firm in order to form a personal connection with the viewer.
Because it should be only about two minutes in length, it can be helpful to think of the video as an extension of your elevator pitch. No matter how polished that pitch is, you’re going to need a written script that you stick to before you’re ready to sit down and shoot your video. As you’re writing that script, a good rule of thumb to keep in mind is that 150 written words equates to about one minute of video.
The bulk of your video will probably be composed of you or a spokesperson talking about the business, but you can make it more engaging by leaving a bit of time for a few cutaway shots. These are quick snippets that show your business in action and help to illustrate what you are talking about in your script.
No matter how good your script is, your video will reflect poorly on your company if it looks unprofessional. Luckily, it is now fairly easy and inexpensive to shoot and edit a polished video. If you follow these five simple rules, your audience should be happy with the results.
1.) Use a tripod – This is the easiest and most important thing you can do to make your video look good. Nobody wants to watch shaky hand-held footage, it looks amateurish and even makes some people queasy. So get a tripod and use it every time you shoot a video.
2.) Shoot in high definition (HD) – Because high-def cameras have become quite affordable, shooting in HD is now mandatory for anyone who is even semi-serious about making videos. Standard definition looks cheap and dated by comparison, so don’t use it.
3.) Light the room properly –Try to use soft lighting from a variety of different angles, with a particular emphasis on lighting your subject from the side.
4.) Quiet on the set – Make sure your shooting environment is free from any distracting background or ambient noise such as outside traffic or the humming of computers and electronic equipment.
5.) Follow the rule of thirds – This is a timeless rule from still photography that also applies to making videos. Placing your subject in the left or right third of the frame, rather than dead center, makes for a more pleasant viewing experience.
You’ll probably need to shoot several takes of your dialogue and the cutaway shots in order to get the raw footage you need to complete your video. Watch each take after you shoot it, and don’t call it a wrap until you’re happy with the results.
The final step is to edit the footage into a cohesive piece and maybe add a title, and some music and/or graphics. If you’ve got a Mac or a PC then you should have all the software you need to make this happen.
When your video is complete, you’ll want to post it to your company’s website as well as its Facebook page, You Tube page and any other social media outlets that you use. Once it is live, you’ll have the advantage of being available to promote your business twenty-four hours a day to anyone who chooses to click the play button.
In attempting to open a new company bank account, many new business owners will contact our office during their visit the bank’s branch office. Usually they are in a panic. Most often, it’s because they have walked into the bank empty handed expecting the bank to provide them with everything they need. When the bank requires certain documents, and you don’t have them, people get frustrated, and you are wasting your time and the banker’s time. Remember, the bank can refuse to open an account for you.
Harvard Business Services, Inc. is happy to rescue you in this type of situation by scanning and emailing or faxing any applicable documents that are available to us as your Delaware Registered Agent, but in order to save you time, money and frustration, we’d like to bring to your attention the following steps that will set you up to be prepared and look smart.
Selecting the right bank for you and actually opening an account is not a service Harvard Business Services, Inc. provides our clients. But we can help you to be prepared for the process so that you don’t waste time.
So, to get started, the best way to find the bank that suits your business needs would be to ask a fellow business owner, search on line or visit a local bank to inquire about their small business banking products.
Most banks offer online applications with detailed descriptions of what they have to offer for business accounts. It is in your best interest to carefully research your choices so you can identify the right account for your business needs. A comparison of the options may be available to help you make sense of the differences. Once you find the best account type, find out what is needed to apply. All banks are different, but they should provide you with a list of documents and information needed.
YOUR GOAL: MAKE SURE YOU HAVE ALL THE DOCUMENTS NEEDED BEFORE YOU VISIT THE BRANCH.
Typically, if your company is a corporation, the bank will want to see your Certificate of Incorporation, a copy of your initial “minutes”, a “Board Resolution” authorizing the opening of a bank account, and the names, addresses and social security numbers of all the Directors and Stockholders. If your company is a Limited Liability Company, the bank will usually require a copy of your Certificate of Formation, a list of “Members” -- including their addresses and social security numbers, and a signed copy of the “LLC Company Agreement” as well as a “Resolution of the Members” approving the opening of a bank account.
In both cases, you will need an “EIN” issued by the IRS. This is often called a “Tax I.D. Number” or an “Employer’s Identification Number”. This is obtained by filing an SS-4 form with the IRS or using Harvard’s IRS service and saving you the hassle. The bank will definitely require this so don’t go to the bank without it.
Before going to the bank, make a copy of all the documents, and clip them together with a paper clip (Don’t staple them). This “package” can be presented to the bank so they will not have to take the time to copy your original set. Your banker will definitely be impressed that you are equipped with all the necessary paperwork as well as copies for the bank. It’s always an advantage to get off on the right foot with your banker, right from the beginning.
Feel free to give us a call to clear up any questions you may have as you prepare. We are always here to assist!
The 2012 State Liability Systems Ranking study conducted by Harris Interactive has just been released and Delaware is again ranked first among all fifty states. The study was conducted to assess how fair and reasonable the states’ tort liability systems are perceived to be by U.S. businesses. Delaware has achieved the top spot since the annual survey of senior litigators and top executives began in 2002. Perhaps that’s why many think of Delaware as the “Home of the Corporation.”
Delaware’s modern and highly respected corporation statute, well-developed case law, nationally recognized Court of Chancery, user-friendly Secretary of State’s Office, along with a legislature that continues to recognize the importance of keeping Delaware’s business laws current, are the main reasons why companies continue to select Delaware as the Number One choice for forming a Corporation or Limited Liability Company (LLC).
You can see the rankings of all 50 states and review the report.
In recent blog posts for HBS we looked at using Facebook and Twitter, two quintessentially modern technologies that didn’t even exist a decade ago, in order to help promote your business. In addition to harnessing the latest in social media, entrepreneurs should also learn the decidedly old-fashioned skill of writing a press release in order to help promote their companies. And when it comes to crafting a winning press release, you’ll need to get two things right: the structure and the content.
Structure is the easier part, as press releases follow a fairly standard format. Begin with a catchy but succinct headline and follow that up by giving the reader the who, what, why, where, when, and how in a few short paragraphs. Then go on to flesh out the why—as in why this matters to a newspaper or magazine editor and why anyone would be interested in reading an article about what your business is doing. Make sure to include one or more quotes from relevant sources. If you need help getting started, try doing a web search for “press release template”, and you should be able to find a sample that you can adapt for your company.
Now that you’ve got the structure down, it’s time to focus on the heart of the matter: the content. There are two golden rules to follow here. First is that a press release must describe something newsworthy. Second is that press releases are not marketing materials. There is no faster way to turn off an editor or writer than to give him a thinly veiled promotional piece or sales letter disguised as a press release. Make sure to stay away from hyperbole, exclamation points, and industry jargon if you want your press release to be taken seriously.
So what constitutes newsworthy when it comes to the world of small business? You are probably excited by all sorts of things that your company does, but you need to ask yourself the question, “Why should anyone else care?” For example, if you’re opening a large new retail location, it’s probably a big deal for you, and you want to get the word out to as many consumers as possible. Unfortunately, opening a new store is not a newsworthy event—thousands of them open every day. But say you’ve managed to convince some local VIPS from the community to take part in a ribbon-cutting ceremony and provide free entertainment. Now that’s something that people might want to show up for, and that news outlets might want to highlight.
As you are crafting your press release it also helps to think about how you can tie the release in to other current events or trends that have captured the public’s attention. If you can demonstrate how your firm is in the middle of something that is “hot” at the moment, you’ll give editors a great reason to produce a feature about your business.
Once you’ve completed and proofread your press release, it’s time to get the word out. Compile a list of all of the relevant local and national publications—both print and online—that may have an interest and email them a copy of the release. It’s best to indicate in the subject line that you are sending a press release and to include the release in the body of the email, not as an attachment. If you wind up generating some interest from the press, you may get asked for an interview. If so, then stick to the same principles you used to fill the content of your press release—a focus on newsworthiness and not sales—and let the writer do his job of making your business sound exciting and relevant to the public at large.