Myths And Facts About Statutory Compliance For Corporations And Limited Liability Companies
When you have incorporated a new business or you have formed a limited liability company (LLC) in West Palm Beach, it can be complicated to know with certainty what your business compliance requirements include and what steps you must take in both the short-term and the long-term in order to ensure that your company remains in good standing. Generally speaking, business compliance requirements for LLCs and corporations in the United States include both internal and external compliance requirements. Internal requirements include things you must do within your business, while external requirements include steps you must take and reports or filings you must make to entities outside your business.
What are some of the most common myths and facts about compliance for corporations and limited liability companies? Our West Palm Beach business law attorneys have some information to help explain.
Common Myths Concerning Business Compliance
There are many different myths related to internal and external business compliance. The following are some myths that circulate, and which should not be used as information around which to make business decisions about internal and external compliance:
- Myth: Every LLC must have an operating agreement in order to be a lawful entity;
- Myth: LLCs must hold annual meetings of members under Florida law;
- Myth: Corporations only are required to have director and shareholder meetings when they reach a specific size;
- Myth: Corporations can decide whether or not to adopt bylaws;
- Myth: All corporations must submit quarterly and annual reports to the U.S. Securities and Exchange Commission (SEC) regardless of whether they are public or private, and regardless of their size;
- Myth: Corporations and LLCs only need to file annual reports with the Florida Division of Corporations when something in the business changes or requires amending; and
- Myth: Corporations and LLCs can decide whether or not to maintain internal company records.
Facts About Business Compliance
What we listed above are myths and misconceptions about compliance requirements for corporations and LLCs. Now get the facts:
- Fact: Corporations have extremely stringent internal and external compliance requirements under Florida law, including creating bylaws, abiding by internal recording requirements, and required annual shareholder meetings in most circumstances;
- Fact: LLCs are not required to hold annual meetings or to create and update an operating agreement, but both can be beneficial for the company;
- Fact: SEC reports are only required for public companies and companies of a particular size or value;
- Fact: Both corporations and LLCs must file annual reports with the Florida Division of Corporations regardless of whether any changes to the business have occurred; and
- Fact: Corporations, LLCs, and most other businesses in Florida must keep internal records for compliance purposes but also to protect themselves in the event of litigation.
Contact a Business Law Attorney in West Palm Beach
Do you have questions about internal or external compliance requirements under Florida or federal law? It is extremely important for your corporation or LLC to know what it must do in order to remain in compliance with various statutes and rules. One of the West Palm Beach business lawyers at our firm can assist you. Contact Kelley, Fulton & Kaplan to learn more about the services we provide to a wide range of business entities in South Florida.