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What is an LLC?

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An LLC, which stands for Limited Liability Company, is a type of business entity that offers limited liability protection for its ownership and management. They are a type of business entity designed by the states to combine the limited liability protection offered by a corporation, with the “pass-through” single tax status offered by a partnership. […]

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What is the Difference Between an LLC and an S-Corp?

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Although S Corporations and LLCs share similar characteristics – both provided limited liability protection to ownership and management, and both are taxed by the “pass through” system like partnerships –LLCs are more flexible and have fewer restrictions than S Corps. The first major difference is that an S Corporation’s size and ownership composition are limited […]

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What Clauses to Include in an LLC Operating Agreement?

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There are several important clauses that an LLC Operating Agreement needs. If you are considering having an operating agreement created for your LLC, be sure to consider these clauses and discuss them with your attorney: Equity structure – how much each partner is putting into the new business, and what their economic and management interest […]

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Why is Limited Liability Important?

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John and his wife, Mary, own a flower delivery business. They’re equal partners, sharing decision making and other responsibilities 50/50. They own a small building downtown for their shop, near the two-story townhouse they bought together, and in addition to the family sedan also own a delivery van with “John and Mary’s Flowers” written in […]

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What is an S-Corporation?

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An S-Corporation (S-Corp) is one of two types of corporations defined by subchapter of the tax code they are governed by. Like more common C-Corporations (C-Corp), or publicly-traded corporations, S-Corps provide limited liability to management and shareholders, protecting the personal assets of those who would otherwise face personal liability in case of a creditor’s claim. […]

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Maryland Business Contracts: The Importance of Grammar

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When your business is contracting with another business, employee, contract staff, or other client, it is important that each clause, and each sentence, is properly worded and has the appropriate legal grammar. The lack of a serial comma—aka Oxford comma—in a Maine milk company’s contract is now going to cost them millions of dollars. Read […]

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Maryland S Corporation vs. C Corporation: Taxation

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When considering whether to establish your Maryland business as an S corporation or C corporation, something you, your tax advisor and attorney should consider are the tax implications. Maryland corporate law does not make a distinction between S corps and C corps for purposes of corporate law, however the Federal tax distinction is significant. The […]

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Maryland Business Law, Contracts: The Importance of Confidentiality in Contracts (“Confidentiality Clause”)

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When your business is entering into a contract with another business it is important to include a confidentiality clause in the contract. The other business is likely to become privy to otherwise private information about your business. Your contract should contain a mutual promise clause that ensures both sides will keep confidential any business information […]

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Maryland Estate Planning Information: What Happens to Credit Card Debt When I Die?

Many clients ask me a variation of the following questions. What will happen to my credit card debt when I die? Will my credit card debt be passed on to my children? Will my spouse have to pay for my credit card debt? There are two factors that will determine who, if anyone, is responsible […]

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Maryland Business Law: What is a Memorandum of Understanding?

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There is often confusion over the difference between a Contract and a Memorandum of Understanding (MOU) as well as a basic misunderstanding of what a MOU does. A MOU is a written agreement between two or more parties. A MOU specifies mutually accepted expectations and intentions between the parties, however the agreement is typically not […]

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