One of the beauties of setting up a corporation is the protection you get from personal liability for company debts. One of the headaches that flows from setting up that same corporation is the extra paperwork required to properly maintain it – and thereby preserve your protection from personal liability.
So, what does that paperwork look like? At a minimum, it will include corporate Bylaws, a stock certificate for each shareholder, a stock ledger chronicling all stock transfers, minutes of annual shareholder and director meetings (or annual consent resolutions in lieu of annual meetings), and promissory notes for any loans from a shareholder to the corporation or from the corporation to a shareholder.
In addition to the extra paperwork, it is essential that you carry appropriate insurance, maintain corporate books and a corporate bank account, and keep personal assets segregated from corporate assets.
If you think your corporate records could use a review or an update, please give us a call at (248) 477-6300!