Protect Yourself From Our Litigious SocietyWritten by Jim Williams
Continued from page 1
At first, John thought he should form a C Corporation so that he could protect he and his wife’s assets while also reducing their taxes. After learning he could be construed to be a Personal Service Corporation by IRS because his product sales were less than 50% of his overall sales, John decided on an S Corporation for business and a Limited Liability Company for his real estate. By separating his business into one entity and his rental properties into another, John and his wife accomplished a number of positive things: 1.They moved rental properties out of their name reducing possibility that some overzealous lawyer might come after them personally because on county records they were showing a great deal of wealth. 2.They protected themselves personally from a potential lawsuit generated against one of rental properties. Any lawsuit filed against properties would stop at LLC and would not put their other personal assets at risk. 3.If they did have a personal judgment declared against them, properties would be protected through a charging order. 4.They have protected their real estate and other personal assets from any lawsuits against business. Since business was set up as an S corp. all of income flows through to John and his wife personally. Therefore, only assets in company would be those needed to maintain day to day business. In other words, John can move profits out of company, and protect them from litigation at same time. 5.They saved money on taxes by taking all of their fringe benefits right off top by having things like automobile expenses, health insurance, travel, business entertainment, etc. paid for as legitimate business expenses by new legal “entities.” They also increased their options on certain retirement plans. 6.They saved an additional $6120 on self employment taxes by splitting $80,000 in half and taking $40,000 as salary and $40,000 in distributions. The 15.3% self-employment tax for Social Security and Medicare (FICA) is “not” applicable on distributions. In addition to all of protection they received, total tax savings for John and his wife should be well over $8,000 per year. The total “one time” cost to set up both entities was approximately $1500! If you would like to find out more about how to protect your personal assets, and have government pay you to do it, call American Business Development toll free at 1-866-249-2472 for a free consultation. We would also love to have you visit our web site at www.abd2win.com where you can learn a little more about us, or send your questions by e-mail.

Please see www.abd2win.com "Our Company" page
| | Protect Your Ideas With Copyrights and PatentsWritten by Tim Knox
Continued from page 1
You can register a copyright without assistance of an attorney. Simply visit U.S. Copyright office website at http://lcweb.loc.gov/copyright/ and download appropriate form. Complete form and send it in with a $30 nonrefundable filing fee. This must be done for each individual work you wish to protect. A patent is a form of protection granted to an inventor that protects his invention in United States for up to 20 years from date of application. Patent law states that, "whoever invents or discovers any new and useful process, machine, manufacture, composition of matter, or any new and useful improvements thereof may obtain a patent." Owning a patent gives you legal right to stop someone else from making, using or selling your invention (or one that's very close to it) without your permission. However, proving that someone is infringing on your patent is often difficult and usually requires a trial to settle dispute. Since first U.S. patent was awarded in 1790, more than five million patents have been awarded. The patent office receives more than 230,000 patent applications every year and I can tell you from personal experience that a turtle on Prozac moves faster than patent process. Patents can take several years, truckloads of paperwork, and considerable legal fees to obtain. The cost of obtaining a patent can run from $500 for a simple design patent to $50,000 and more for a complex utility patent. However, if your company has a truly patentable idea, you would be wise to invest time and money required to secure your rights. A good patent can be a valuable business asset. While you can file a patent yourself, I strongly advise that you use an attorney since a naively written patent application often isn't worth paper it's printed on. Just recently my attorney did a patent search for me only to discover that a patent for a similar product was already in place. However, due to ineffectual language of patent application, patent was practically impossible for owner to enforce. Good news for me. Not so good news for wise man who wrote his own patent. Here's to your success! Tim Knox tim@onlineprofits4u.com

Small Business Q&A is written by veteran entrepreneur and syndicated columnist, Tim Knox. Tim serves as the president and CEO of three successful technology companies and is also the founder of OnlineProfits4U.com, an ebusiness dedicated to the success of online entrepreneurs Tim is also the Ebusiness Startup and Design Expert for Entrepreneur.com, the website of the national publication Entrepreneur Magazine.
|