How do I protect my business from being sued?
Biggest Point. If your business type allows, prescreen all of your customers and clients. If they are rude, unrealistic, and entitled, those are your red flags. Don’t do business with those people. If the relationship sours by no fault of your own, stop doing business with them. Never drag it out.Keep your word. It's not always possible. Fate will conspire against you. Do whatever you can to deliver what you promised. And if you don't, try your damnedest to fix it.Standardize your transactions. If you have a standard sales or service, have a lawyer draft a written agreement or form. Say that your goal is to minimize your legal liability.Manage risk actively. If you ever think, “Gee, that could have gone wrong,” be proactive and fix the issue before it happens.Join a trade group. Industry groups exist to share information relevant to your industry, including best practices for doing all kinds of things. Learn what others do and from their mistakes.Insurance. Get it.Limited liability entities. Do your business through a limited liability entity, such as a corporation or a limited liability company. If you have multiple owners, you must talk to a lawyer about writing a shareholder or operating agreement. Failing to do so begs being sued.
What are some red flags in businesses?
Hey Kane, thanks for requesting my answer to this.This is similar to another question I was recently asked about how to know what to “stop doing” in a business.The biggest thing with this question and the other is to make sure you’re keeping track of what’s going on in a business in the first place. It’s very hard to know if there is a problem if you’re not keeping track of what’s going on in the business with documentation.I think the biggest thing to look out for is cash flow issues. So if you’re constantly running into cash flow issues or running at a loss then you need to look at what’s going on with your numbers - and work out whether or not you have a viable business (ie. a reason to exist),The other big thing to look out for is co-founder conflict or a potential split with a partner - if you don’t have an exit strategy and you’re not feeling too good with the way things are, don’t ignore it pay attention.Problems with cash flow and co-founders are the two biggest reasons for viable businesses failing.If the business isn’t viable you will know pretty quickly because noone will want to buy what you want to sell - if the business isn’t solving a problem for the market then you either have the wrong problem or the wrong market (best to find this out before you launch full time into your business)I’ve been getting a lot of requests to answer questions about business, marketing and success (over 50 in the past week!) so I decided to select my favourite and answer them in a LIVE Q&A session.I chose this request as one of 5 I answered during this video - you can watch it on Facebook here (this question is the first one I answered).Cheers,Lauren
Can I make myself a business to reap the tax benefits?
The owner of a closely-held corporation pays US taxes on the corporate income regardless of where the business is incorporated. Foreign subsidiaries of US corporations pay US taxes on the income. You can form a corporation or LLC if you wish, however YOU are NOT the corporation or LLC. The corporation would pay you a wage or salary and that wage is fully taxable in the US, as are the total profits from the corporation. With an LLC, it's a disregarded entity at the Federal level so any income goes straight to Schedule C on your individual income tax return. Celebs who form corporations are employees of the corporation, are paid a wage or salary, and pay taxes on that salary. The corporation pays taxes on the profits and the shareholders pay taxes on the dividends. This typically results in HIGHER taxes in total though there are other benefits in forming a corporation aside from the tax angles. Anything you earn as an employee would NOT go through the corporation or LLC regardless of where it was formed. (You'd pay MORE taxes if you did it that way!)
How much CASH can you deposit into a business bank account......?
As a former business owner, there is no limit to the amount of cash you are allowed to deposit. If your deposit includes a cash transaction over $10,000, it may be questioned. But as long as you can show the IRS a copy of the Invoice, customer account statement, or other proof that the deposit's legit, you should not have any problems. If you cannot substantiate a large deposit of cash into a bank account, do not deposit it.
What are some major friendship red flags?
It depends on the person, but let me share you my own red flags in friendship:When they talk about the private lives of people I barely don’t know (ex. friends of friends, bf/gf of friends). I consider this as the MAJOR red flag of all. I value privacy so much— not just my own but others’ private lives as well. When my “friend” starts talking about others’ personal issues, it’s a turn off.When they don’t own their words. Example, when we have a plan of meeting at this certain time and last minute, they would say they couldn’t make it because of shallow reasons.When they expect “freebies” from you or a huge discount on your business because “you’re friends”. No-no. It’s very common here in my country that when you are friends with a business owner, you are entitled to get a product and service for free or for a huge discount. When a friend is like this, I feel like they are just taking advantage.A lot of people think I have a small circle of friends because I’m an introvert. I’d rather have a small circle of friends who are trustworthy and nice, than have 100+ of them who gossips and take advantage.
How does the IRS determine who gets a "lock-in" letter?
Co-workers and I are debating how the IRS determines who gets the lock -in letter for claiming too many exemptions on their W-4's. Do they have a red flag system or is it just luck of the draw? One co-worker has claimed exempt for the past 3 years while another claimed exempt for a short period of time. Who is more likely to get the lock-in letter? How? Why? Thank you!
How to not be scammed on westside rentals or Craigslist when renting an apartment?
I'm going to be getting my first apartment this summer so I've been looking at Craigslist and westside rentals. My one concern I have though is how could I avoid a scam. My biggest fear is putting a deposit down for a place and then never hearing from the landlord. What are some tips/signs that I should know of when trying to avoid a scam. Thank you!