Mark Kohler explains two costly LLC mistakes: skipping annual state filings, which can get your business dissolved without notice, and failing to keep corporate minutes. Without proper records, you're defenseless in a lawsuit.
the most common mistakes business owners make that I want you to avoid. And let's list these out directly because these are the ones that get people in trouble. First, they ignore annual filings. In most states, your company has to file annually to keep it in good standing, pay a fee, file a piece of paper online or in the mail. Most states require a yearly renewal, and if you miss it, your LLC can be what's called involuntarily dissolved, suspended, and stripped of its legal status essentially. And here's the kicker, you may not even realize it happened. Second problem, not keeping annual minutes or good records. Now I don't care what someone told you, you need to do minutes. Oh, you want to argue with me? Like, "Mark, LLCs don't have to do minutes." You know what? Okay, yeah, you don't have to floss either, right? But what do 4 out of 5 dentists tell you? What do you know is going to prevent cavities and tooth decay? Flossing. Well, wait until you get into a lawsuit and your attorney goes, "Hey, can you bring in your corporate book and minutes?" "Well, I didn't think I had to." Yeah, you don't have to, but you sure damn well better, or else you're going to be hosed. It's one of those need to do things.
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