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Entrepreneurial Forum

Entrepreneurial Forum. Timothy K. Cutler, Esq. Connie C. Dai, Esq. CUTLER P.C. 10 Milk Street, Suite 720 Boston, MA 02108. Kenneth Der, CPA, CFP Richard SooHoo, CPA FAS Corporation 1661 Worcester Road, Suite 104 Framingham, MA 01701 The Business Partner to Businesses and Individuals.

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Entrepreneurial Forum

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  1. Entrepreneurial Forum

  2. Timothy K. Cutler, Esq. Connie C. Dai, Esq. CUTLER P.C. 10 Milk Street, Suite 720 Boston, MA 02108 Kenneth Der, CPA, CFP Richard SooHoo, CPA FAS Corporation 1661 Worcester Road, Suite 104 Framingham, MA 01701 The Business Partner to Businesses and Individuals Presenters

  3. Timothy K. Cutler, Esq.tkc@cutlerlegal.com • Practicing 24 Years • 10 Years in Los Angeles & 14 Years in Boston • Founded CUTLER P.C. in 2004 • Served as a Mediator • Completed Over 30 Trials in 4 States • Overseen Legal Matters in 8 States • Represented Start-ups and Emerging Companies in the Areas of Software, Internet, Retail, Engineering and Marketing • Represented Chinese Companies • Creates Legal Entities • Drafts: • Licensing Agreements, Contracts and Employment Agreements • Handles: • Employment Matters, Disputes Between Shareholders, Unfair Business Practices and Contract Disputes • Handles: • Purchase and Sale of Businesses

  4. Connie C. Dai, Esq. MBAccd@cutlerlegal.com • Practicing business, immigration and real estate • Experience in cross border transactions, contract review and drafting, judicial internship, work and business visa, naturalization, green card petition • Business and financial consulting in Canada • Anti-trademark infringement management, joint venture negotiation, and IP training in Coca-Cola China • Volunteer – unemployment Insurance appeals • NECINA Engagement Officer • J.D., Suffolk, MBA, University of Calgary, B.A., Shanghai • Native Mandarin speaker

  5. Kenneth Der, CPA, CFP • Individual, corporate, trust tax returns and financial planning • Founder and President of FAS Corp for 10 years • Financial operations, risk management, controllership, operational analysis, internal controls, and corporate strategy • Cisco Systems, Digital Equipment Corporation, and Price Waterhouse Coopers • Adjunct at Babson College for 4 years • MBA, UC Berkley • BA, Tufts • MST, Bentley • Board member of AACA

  6. Richard SooHoo, CPA • Partner, FAS Corp • Tax planning-business, individual, corporate, LLC, partnerships, non profits, estates, trusts, international, accounting services, retirement plans, audits • Financial executive with extensive experience in financial operations, risk management, controllership, operational analysis, internal controls, and corporate strategy • Dassault, National Grid, Getronics/Wang, Millipore/Waters, Texas Instruments, and Price Waterhouse Coopers • MBA, Stanford • BA, Harvard

  7. Corporate & Business Law

  8. Setting Up a New Entity Why is it Important to Have a Legal Entity? • Liability • Credibility • Holding Intellectual Property • Allows for Multiple Owners • Disadvantages of Partnerships

  9. What Type of Entity is Best For Your Business? • “C” Corporation • “S” Corporation • Limited Liability Company or “LLC” • Sole Proprietorship • Partnership or Limited Partnership • Delaware Entity

  10. Management Issues • Who Is The General? • Fiduciary Duties • Exit Strategies • Bringing in Partners

  11. Tax Planning for Entrepreneurs FAS Corporation

  12. Tax Treatment of Start-Up Cost

  13. Incorporating a Business • Tax considerations • Funding the corporation with asset transfers • Cost of incorporation • Organization costs • Start up costs • Corporate filing and on going taxes at both federal and state levels • Administration and structure • Board of Directors • Director Fees • Directors and Officers Insurance • Meeting minutes • Formality • Recording of minutes

  14. Tax Consideration When Forming a Corporation • Contributed capital • Cash for stock • Transfer of assets for Stock under section §351 • A nontaxable transaction to contributor as long as no cash or debt is received by the contributor • Basis of the stock is the basis of the asset that is transferred • Under section §267, related party rule: • a loss is on a sale to the business is prohibited • If the asset has declined in value consider other alternatives to contributing capital so as not to lose the loss for tax purposes

  15. Tax Free Incorporation Conditions • Non recognition of gain or loss on the transfer of assets and liabilities to a newly form Corporation ( C or S Corp) is mandatory when all the following are met: • One or more persons transfer property to the new corporation • The transfer is solely for stock( no debt, warrants or preferred stock) • Other assets received is deemed “boot” and gain is recognized • Control • The persons making the transfer, taken as a group, must own at least 80% of the corporation immediately following the exchange( Voting powers and shares outstanding)

  16. Corporation - Considerations • IRS may not recognize the Corporation • Was the Corporation under capitalized • Cash flow issues • Tax issues • Was the Corporation used for personal reasons • Co-mingling of personal and corporate assets • Were transactions at “Arms Length” • Was the purpose to convert personal expenses to business • Must ensure that the Corporation has a legitimate business purpose and can pass the scrutiny of a true business vs. a hobby

  17. Comparison of Single Owner Business

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