Do I Need to Keep Corporate Minutes?
Video Summary
Do I need to keep my corporate minutes? Yes, you do need to keep your corporate minutes, which consist of your shareholder minutes and also your director minutes. If you want to be considered a corporation and be limited or shielded from liability for the corporate acts as a shareholder or an officer of the corporation, you need to have these minutes and you need to have them in the corporate record book annually. They should also correspond with the annual report that you file with the Secretary of State which goes through the president, vice president, secretary, treasurer, director and resident agent.
You need to be sure that you have corporate minutes that reflect the shareholders met and elected directors. Then you need to have director’s minutes that they met and elected or appointed directors, and also ratified or approved substantial matters involving the corporation that the president may have done. This is true even if you’re a one man band and you just have one shareholder and you’re the chief cook and bottle washer. You still need to do your corporate minutes if you wish your business to be treated as a corporation rather than a sole proprietorship and the shareholders be limited on their liability. If you don’t have a corporate book and you don’t have corporate minutes and if you haven’t issued any stock, well, you’re just fooling yourself in that you really don’t have any protection from liability.
So if you set up your own corporation and you don’t have any corporate minutes, well, give me a call at (727) 847-2288.
- Published in LLC's and Corporations, Videos
What is the “Save Our Homes” Amendment?
Video Summary
What is the Save Our Homes Amendment? It is an amendment to the Florida Constitution that caps the annual increase in the assessed value of your home. Whenever you apply for homestead exemption, you receive the Save Our Homes assessment. This keeps your tax bill from rising, as a result of the assessment, by no more than three percent in any particular year. Your assessment is capped at the cost of living increase or three percent, whichever is less. These past few years it’s been very, very small. (This amendment has been in effect, I think, since 1996 or ’98.) But anytime that you apply for a homestead exemption, you’re entitled to the Save Our Homes Amendment which locks in your assessed valuation for the year in which you apply for homestead exemption.
They’ve added a feature to this amendment which allows you to transfer your exemption if you buy another home in Florida- that’s called portability. You have to buy a home within two years in order to be able to transfer your Save Our Homes Amendment valuation to your new property. (There’s a formula that is pro rata if you’re upsizing or downsizing on how they calculate the benefits you have.) If you’ve been a resident of Florida for some time, you’re able to transfer it if you buy another property here in Florida and sell your old property. You do have to notify the property appraiser that you do wish to use portability in transferring your Save Our Homes assessment.
So it caps your assessment and was passed back in the ‘90’s whenever we had fast depreciation, particularly in waterfront property. People who were on fixed income were getting priced out of their homes because they couldn’t afford to pay the taxes. So, they passed this amendment in order to keep people in their homes and not have the tax bill go so high that they couldn’t afford to stay in their homes. The longer you stay in your home, the better you’ll like it. Of course, with the recent decline in property values, the value of Save Our Homes has diminished substantially, but it’s always a nice in a depreciated market. If you buy now, you’ll love it if you stay in the same house, hopefully in about five or six years when the prices take off again.
So if you have any questions about the Save Our Homes Amendment, give me a call at (727) 847-2288.
- Published in Real Estate - Foreclosure, Videos
What are Corporate Minutes?
Video Summary
What are corporate minutes? With corporate minutes, you first have minutes of the shareholder’s meeting. The shareholders should meet once a year, and they need to elect the directors of the corporation. A shareholder who invests money into a corporation controls their investment by electing a director. In addition to the shareholder’s minutes, you should also have director’s minutes. The directors, as their name indicates, give direction to the corporation and they then elect or appoint the officers of the corporation (they’re the ones that elect the officers rather than the shareholders). They should meet annually, approve any major policy decisions and ratify or authorize the president to take various actions. Part of this is that you can have the distinction in that the officers are the management and the directors are the ones that set policy and give direction to the corporation.
Many people who listen to this may be in small businesses and say, “Look, Waller, you don’t understand this. I’m a chief cook and bottle washer. I do everything. I’m the shareholder. I’m the officer, I’m the director and I do everything, so that sounds like a bunch of hooey to me.” Well, it isn’t- if you don’t treat your corporation and have these annual minutes, you’re not going to be afforded the limited liability that you’re probably seeking in doing your business as a corporation. It could be taken that you’re just acting as if it were your business, and therefore not afforded limited liability for the acts of the corporation. So I’d strongly suggest that you have your corporate minutes annually for both the shareholders and directors.
Sometimes folks just get incorporated and they don’t bother to get a corporate book, they don’t bother having corporate minutes, and furthermore, they don’t have any stock issued. They really don’t have much at all and they’re only fooling themselves if they think that they have limited liability under those circumstances. In addition, we have no idea who even owns a corporation if you don’t issue stocks.
So if you’d like for me to write up minutes for your corporation, give me a call at (727) 847-2288.
- Published in LLC's and Corporations, Videos
What is a Notice of Commencement?
Video Summary
What is a Notice of Commencement? A Notice of Commencement is a portion of the Florida Construction Lien Statute. The Florida Construction Lien Statute provides notices to contractors, owners, subcontractors, material men and laborers so each has everybody else’s notice that they’re working on the job. One of the first things the owner must do is to sign a Notice of Commencement that sets forth that they are the owner, how they can be contacted, the legal description and who the contractor is. This is recorded in the public records and also posted on the jobsite so that anybody working there would know who to give notice to if they’re working there and make sure they get paid (that’s called sending a Notice to Owner). Once the owner receives Notice to Owner, then they need to ask their general contractor for a partial lien waver anytime they make a disbursement to the general contractor on the job.
In order for the building contractor to obtain a building permit, he must have a signed Notice of Commencement which is presented to the Building Department, and then it has to be recorded in the public records before the Building Department will issue a building permit. The Notice to Owner is an obligation of the owner to record. If the owner fails to record a Notice of Commencement, then they can be subject to paying more than once for the home in the event that there are unpaid material men or subcontractors, or if the contractor goes south with the money or doesn’t pay their contractors and the property is liened. So be sure that you always have a Notice of Commencement that’s filed and put in the legal description, and construction is commenced shortly after recording the Notice of Commencement. I believe it’s 60 days after the Notice of Commencement is recorded. Maybe 90 days. But construction needs to start shortly after you file the Notice of Commencement.
If you have any questions about your Notice of Commencement or the Construction Lien Statute, give me a call at (727) 847-2288.
- Published in Videos
What is a Homestead Exemption?
Video Summary
What is a homestead exemption? Under our Florida constitution, it provides that each property owner is entitled to exempt the first $25,000.00 of their home from taxes, provided that they are a Florida resident and applied for this exemption. In addition to the first $25,000.00, there’s an additional $25,000.00 exemption for the assessed value between $50,000.00 and $75,000.00. The difference between the first $25,000.00 and the second $25,000.00 is the school taxes are not included in the second $25,000.00. So, if you apply for homestead exemption and the assessed value of your property is $75,000.00 or more, then you will save approximately $800.00. In order to apply for a homestead exemption, you must own the home prior to the year which you apply for a homestead exemption and you must be a resident of the state of Florida and reside in the home; you need to be a permanent resident in the state of Florida.
You cannot claim homestead exemption from anyone else or any other state or any other place, so you can’t have two homestead exemptions. Your homestead exemption is provided for under the Florida constitution and you save about $800.00 a year in taxes with a homestead exemption. In addition to homestead exemption, they have Save Our Homes Constitutional Amendment, which once you apply, it locks in your assessed valuation for that particular year, and the constitution provides that the assessed value will not increase by more than the cost of living index or three percent, whichever is less. Lately, the values have been declining rather than increasing, but if we get back into a market whenever the values continue to increase, then, Save Our Homes can be a huge benefit to property owners.
Also, I might suggest it if you’re selling your property here in Florida and either downsizing or moving – or increasing your homestead, you can transfer that. It’s called portability, so be sure to tell your property appraiser when you apply for a homestead exemption on your new home that you’re transferring your homestead and ask them whether or not you can get any benefit by transferring your homestead exemption from one house to another. If you have any questions about what is a homestead, you can give me a call at (727) 847-2288.
- Published in Real Estate, Videos