Why do I need to maintain a company?

• Annual corporate meetings are required by state law. Failure to comply and document minutes may cause you to lose the limited liability protection provided by your corporation.
• In California, failure to file a Statement of Information with the Secretary of State can result in a $250 penalty and suspension of the entity. Other states have similar penalties.
• Formally documenting key corporate actions is a prudent way to keep shareholders and directors informed of major corporate decisions. As time passes and memories fade, a written record of important decisions and agreements will help avoid controversy and dissension.
• Your legal documents provide a “paper trail” of important corporate transactions. Use this paper trail to show your creditors, suppliers, the IRS, and the courts that you acted appropriately and in compliance with applicable laws, regulations, or other legal requirements.