Your LLC May Be Useless Mark's First Day In Court

You know, I went on LegalZoom, I set up my LLC, and some of you out there, many of you out there probably are like, I'm done box checked, have my LLC thoughts.

I mean, number one, if you do want asset protection, you got to work for it.

So if you're going to set up an llc, maintain it yet, make sure it's set up properly, you have to go, well, how is it owned? How is it going to interplay or work with my real estate, my operations, my online business, my Uber driving? Welcome everybody to this week's episode of the Main street business podcast. My name is Mark Kohler and I'm not here with the usual illustrious Matt Sorenson. I'm here with the pleasant, intelligent, smart, witty and beautiful Katie Nitwick.

Thank you. It's a pleasure to be here.

Is this your first time on the show?

I've answered questions in the background, but this is my first time on camera. So how do I look?

Yeah, you're putting me to shame.

You're going to edit this, right?

We finally had makeup involved in our show. Before that it was just, you know, two sweaty guys from a locker room running onto a camera. So thanks for leveling up the show. Glad to have you here. So Katie is an attorney in our Phoenix office. She's also a licensed financial advisor and hail from Ohio. Is that where you.

I do, yeah. I'm a Buckeye. Yeah. Wait, that's not a good thing.

I don't know.

Don't break my heart.

I just. Ohio State fans, they're a different breed.

I'm just saying Ohio folks in general are different breeds, as you say. You're from there. That cuts both ways.

Yeah, there we go. So welcome. And she, with that financial advisory experience, she's been a huge addition to the firm. Many of you around the country have probably had a consultation with her where she can look at the legal, the tax and the financial aspect of this. She works in liaison with another financial advisory firm to ours that we really rely on for some great long term planning. But that's not the topic today, so someday. But we got to.

Do you have any questions?

Yeah. Yep. Okay. Today's topic is what is your LLC good for it? Could it be useless? Could it be everything you dreamed it would be in helping protect you or save you taxes? My own son this week, it killed me. I told you this. Yes. Yeah. He calls, texts me and goes, did you say I don't pay tax at the LLC level? I go, no, it's a pass through entity. And then he texts me back, well, doesn't the LLC save me taxes? I'm like, bless your heart. Now, he was. They do not. By the way, he was listening to our live YouTube yesterday. And it's just fun. My kids. Dylan is so. He's got his own business. He's so successful. But over the years, I thought when he was editing videos for me or coming to my workshops, he was really getting into the topics. Now he was just shooting bid.

The creative types are. They're a different breed as well.

Yeah, well. And the reality is, until you own your own business, you really don't care about this.

That's right. That's right. And he's venturing into that now. So we're excited for him and it'll be good.

It's cool. So for any of you out there that have thought, I need an LLC or you've set up an llc, you're like, what do I get with this? Is it really worth it? And I think asset protection is probably at the top of everybody's list. First, that someone cannot sue me personally for anything that could go wrong my business. That'd be number one. I don't know, do you want to add to that? Or what would you say, two and three, or what are your thoughts? Like, why do people do LLCs?

Asset protection, obviously, number one, but number two, to kind of consolidate things. I worked with a client yesterday that he's a big real estate investor, and he said he's an engineer as well, so he's extremely tactical. And he said, I like to have my commercial properties in one LLC and my residential in another. And I said, okay, whatever floats your boat. So some people, and there's a bunch of different reasons also if you. If you have partners.

Yeah, good one. I like it. And I think that's. This is a chance for you to get an EIN Electronic identification number, get your LLC bank account, start building separation, branding. Maybe you trademark your company name or your product, you're starting to build credit. But I think it all starts with this. That number one of asset protection, especially for those real estate investors out there.

Oh, absolutely.

So, well, Katie, does that one sheet of paper cut it? You know, I went on LegalZoom, I set up my LLC, and some of you out there, many of you out there probably are like, I'm done box checked, have my LLC thoughts.

Yeah, it's not going to cut it. Okay, that's my final answer.

All right, so pieces and parts thoughts.

So, I mean, number one, if you do want asset protection, you got to Work for it, or at least pay someone to do it for you. That's kind of what we specialize in. So you got to have an operating agreement that says how this thing works. Number one, you're obviously, if you got the LLC approved by the state, you're going to have the articles of organization. That's basics. That's usually the one sheet of paper. Gotta have minutes, too. You guys talked about this on one of the more. More recent podcasts. Although you're not statutorily required to have minutes, you should have them.

Yep.

It's part of the whole thing. You should have your bank account. I cannot tell you how many clients I work with that have an llc. They've had it for years and they just commingle everything with their personal bank account. And they say, oh, yeah, I took draws. And where'd you take draws from? Oh, you know, I just put everything in my personal account. It's fine. I say, okay, so you never opened a business bank account and you don't have people paying you under a W9 to that bank account? They say, no, yeah, that's a problem.

And that corporate book, that pretty little book that holds it all together, you pay your fees to your state every year. These are the pieces and parts that if you don't have, your LLC is not going to protect you. Now, by the way, I want to say this for all of you out there that have corporations, and it's the same story, it's the same rule. You're gonna have articles of incorporation, bylaws, board of directors minutes, shareholder minutes, and all brought together with stock certificates in that book. It was fun yesterday. I'm picking on Dylan, who I'm. And he listens to the show, so I wanna tell him how proud of him I am and I love him and he's got his business rolling and all that, but one of his questions was that I like too. And I was like, oh, my gosh, I don't talk about this enough. And I think it's. Again, I want all of you to start feeling the angles here. Questions that you may not even know to ask. He said, well, if I make my wife part owner of my llc, don't I get better write offs? Because I can write off expenses for her helping with the business. And I said, no, you don't need to add her to the business, but you can still get those write offs. And that's where the board comes in. How do you advise clients on this with the spouse, the board getting the write offs, the LLC structure, is really important at this level.

It is, right? Yeah. And I don't from. From an ownership standpoint, you know, obviously if you guys have a revocable living trust, we recommend that owns it. So ultimately it's going to go to your spouse anyway. But even if you don't have it set up like that, it's not really all about deductions. Sometimes people just want their spouse to work in the business to contribute to a solo 401k. You know, we devised the family management company structure so that maybe if they are helping in the business, but not to the point where they need to get a W2 wage. We have them work for the family management company.

Yeah. Now you're opening up a whole can of worms with that term. Let's not go there. So what I think is important for anybody out there that's married the way you write off your spouse's expenses. Helping in the business is through the board, the board of directors, the board of advisors. So I immediately told Dylan, don't worry about ownership. We want your spouse working in the business as an advisor, as a decision maker. And that board of advisors is something that we put in every one of our LLCs. Some of you, you're like, I've never even heard of this. Well, that's when you need to do a cleanup. And we're going to talk about that. We have a little cleanup special every year. It's that time of the month, that time of the year. So we're going to go over it and talk about this cleanup situation. But this is when you can create a board of advisors, much like a board of directors for a corporation. Very simple. There's no liability, they don't have ownership. It keeps the tax return simple. But now I unlock the write offs.

That's right. That's right. Yeah. There's so many ways to slice this and I think it's is really beneficial to talk with an attorney, even just getting a half an hour with us, an hour to kind of take a step back and really look at your. At your overall strategy, your strategy, your strategery.

Yeah, I'd love to. We were trying to debate this, right? Am I quoting George Bush or Will Ferrell?

I think we were all confused at this point. But I do, I did fact check it and it is Will. Will Ferrell.

Okay, so Will Ferrell was mocking our president Bush back in the day.

But the best part is he didn't even know whether he had said it or not. Bush was like, yeah, I probably said that.

Great. Guy. Oh, my gosh. So stratege, to play off that word for a minute is sometimes you not only need to clean up and fix your entity, that might need to be reorganized a little. We're not saying throw the baby out with the bathwater, but sometimes it's good to step back and go, oh, I've got two or three entities, or I've got two or three businesses. What's my coordinated strategy? And so, by the way, this is not an infomercial. I'm saying find a lawyer, a tax lawyer that knows what they're doing with the numbers as well. But in our office, you're around 1500 bucks at most to really get a comprehensive strategy, set up a new entity or clean up an old one. We have like a variety of packages so that you're getting what you need tailored to you. And that's where the strategy comes in. Sometimes you need to clean that up, not just the entity.

And I'll say the best vehicle for strategery is the trifecta. Honestly, you cannot do a consult without drawing a picture for someone.

You know, I was upset about this. Do you know across the street at the restaurant, they have a trifecta? What? It's on their menu.

Should I prepare the attorneys to sue?

It's their million dollar bacon and eggs and hash browns, and they call it the trifecta.

Yeah, yeah.

And I was like, I don't know what's better, llc, corporation, trust, or bacon, eggs and hash browns? Both of them amazing trifectas. Truly life changing. So anyway, when you meet with one of our attorneys, we're gonna diagram a color, literally a color PDF bubble chart that brings together your strategia, and it's called a trifecta. So this plays into your llc? Cause if you're gonna set up an llc, maintain it, get. Make sure it's set up properly. You have to go, well, how is it owned? How is it going to interplay or work with my real estate, my operations, my online business, my Uber driving, my spouse, my kids? And so those are all the questions that you want to vet in that hour or so with an attorney. And it really is powerful. If we don't save you 10 times what you're paying for our time, then we've. We failed. So we want to get excited. I'm constantly telling my attorneys, get excited, damn it.

Oh, I love it. Yeah. No, this is, this is what I live for. This is part of my purpose. 100%.

Isn't it fun? I like it. You just said that. Isn't it fun in life, you kind of find your calling, your purpose, and yours and mine are to be nerds and talk about legal and tax issues. But when you find that purpose, you're like, you do. You get jazzed about it. It gets exciting. Sorry, that's a digression.

Yeah, I love when that. When I see the light bulb go off for some people.

Okay, so we're gonna bring this together with a story. I asked Katie if I could tell this story. She said, well, I'll ad lib. I'll mock you during your story. Yeah, you can. You can interject. This was my first day in court. Literally, my. Well, other than traffic court, age 16. First, we won't go there. And I guess there was that vandalism charge. Anyway, this is my first day in court when I actually played lawyer on tv. I was so excited. So. And this plays into your llc, everybody, because some of you are like, what the hell are you talking about with this llc? And I'm grateful that many of you are hopefully just catching the vision here of maintaining your entities, getting a good overall strategy for your LLC or your corporation. But here's where the rubber meets the road, if I may. So back in college, I had a cleaning business. I was a janitor. I was very proud of that. I was a small business owner. I've got clients that I've seen your

office, Mark, and I don't know how you were successful. You clearly had a lot of people working for you.

Yeah, it was more of a delegation thing. Okay. Yeah, yeah. So good comment. Okay, no more comments.

Yes, sir.

All right, so I had a janitorial business, and we've got clients that are making over 200 grand a year as janitors. Oh, absolutely. Construction cleanup, home cleaning, commercial cleaning, carpet cleaning. Don't diss on this. I mean, I loved it. It got me through college. I sold the business to go off to law school. It was a great experience. Boy, I've got some stories Anyway. This is one of them. So here's one of my stories. So this guy stiffed me. Tristan, have you heard the story? You have not. So our producer. This is new for you, so I'm saying this to you. You're gonna love this. So anyway, this guy stiffed me for about three or four grand. What we had done is we'd gone into his hair cosmetology school. It wasn't a hair salon. It was the cosmetology school. So it was larger. And we had to strip and wax all the floors. Man. I had a Wet Draxis. Wet dry Vac system. That was incredible. I'd get the floor so clean, and then we'd lay wax and buff them out. Oh, you can.

It's like. Like lines in your lawn.

Oh, yeah. I mean, this is what janitors are proud of. When you go to a grocery store at 3 in the morning, you see what I'm talking about? Those janitors, they're buffing those grocery store floors. So I did all this work for this guy, and he didn't pay me close to three, four grand. So I was pre law. I was excited to go to University of Utah. Go Utes. BYU sucks. And is this where you go, Go Buckeyes. Michigan sucks. No, no, no. Oh, you like Michigan, too?

No, I just, like, there's a rivalry there. I mean. Yeah, but, like, tell your story.

All right, all right, all right. Okay. So whenever you can get a good, you know, sporting rivalry, you take it. So I was going to college, pre law. I'm going to sue this guy. So sued him personally. This was my. For many of you, Judge Judy, Judge Wapner, all the different court TV judges, this is what you dream of. Of going before the judge, having your day in court. And I started going to my professors. I've got this court date next month. I'm suing this guy. He just stiffed me 30 grand. How do I win? And I was so nervous. I'd never been to court where you actually aren't wearing handcuffs. No, I'm just joking. So I was in court. I was excited. I was ready to go, and I had prepared my strategy. And so, okay, I'm gonna give you play by play. The story's a lot more exciting.

First of all, he shows up to court with a wedgie and floods.

Yeah, that's right. I was not wearing the property. Yeah. So this guy. So now I'm gonna go into the storytelling portion here. So I show up the day of. And he literally, I'm not kidding, had two lawyers, which I thought was kind of cool at the time. He's all dressed up. I'm just in my college gear. Cause, you know, I wanted to be the little guy. I was kind of the Matt Damon and Rainmaker. You know, I wanted to play that role. So I'm the little guy against the corporate jerk. That was my ploy. So I was working that angle. I'd read John Grisham, you know, I knew what I was doing. So then I. I show up, and I remember vividly. I mean, this. I figure out that I'M on the left side. Because when you walk into the court, plaintiff's on the left, defense on the right. And I walk over to my little table, and I was nervous I was gonna be at the wrong table. He walks in, and his attorney put his briefcase on the table so loud, it kind of just echoed through the whole courtroom.

We call that a power move.

Is that a power move?

It's a power move.

I've never done that. Power move.

I've never done that either.

Well, I don't go to court very often. You know, I'm in the boardroom.

I've never. I've never been a court.

Yeah, but that was. It was. I mean, I was just like. It, like, literally kind of sent a chill for me. And I'm like, two lawyers. This guy, they're giving me sneers, and I'm like. I was nervous, you know? And so the judge comes in, we all stand up, yada yada, and I sit down, and then boom. This guy's attorneys, they're like, pop. Pop right up. I mean, and they're like, your honor, case dismissed. This yahoo over here, this kid, he cannot sue my client personally. My client's got a corporation. I can't remember. I have to say. I don't know if it was. I think it was corporation, not llc. My client's got a corporation. This Mark Kohler has sued him personally. This is your Honor, statute number 45321, and blah, blah, blah, blah. And case number Jones versus whatever. You can't sue my. He's just like. And the judge is just, like, getting verbally just. And then he takes control, like judge Wapner can, and says, I got it. Sit down. And then he goes, Mr. Kohler, do you have a comment? I got called Mr. Kohler. That was kind of exciting. Normally, it was like, hey, janitor, come over here and scrub the toilet. So he says, Mr. Kohler. And now, this was part of my ploy. This was phase one. My college professors had prepped me. They're like, mark, you're gonna pierce the veil. You got to get past this LLC or corporation. You got to get past it. So I was like, okay. So I show up. I go, your honor, this is the first I've heard of a corporation. He paid me with a personal. Well, actually, he never paid me, but I don't have a contract with his corporation. I've never heard of his corporation. This is all news to me. I just. This guy hired me. I went, shook his hand, and I did the work. He asked I don't know of any corporation that this guy's talking about. And the judge was like. Raises his eyebrows. I thought that was.

That's. That is an incredible lesson to everyone out there to have a contract.

Oh, yeah, there you go, too. I thought you're gonna say the eyebrow. That was a good move, you know.

Oh, yeah, yeah.

I mean, I'm reading the court.

Excellent.

You know, in the Murdoch trial, I was watching. You know, I was watching.

Brutal.

All the players, you know, it was. It was a show.

He's just dead behind the eyes.

Yeah, yeah, it's a show.

It is, yeah.

So I. So I see the judge give me a window, you know, and then he looks over at the other attorneys and goes, all right, you got a comment? What is it? Why is Kohler saying this? I mean, obviously you have a corporation. Well, yes, your honor, we do. And he goes, can I see your corporate book? And he did. He goes, like, do you have your minutes? Do you have your bylaws? Do you have. Are you in good standing with the state? He goes, well, your honor, under case number whatever and all the. And the judge goes, I don't care about that. Have you. Did you give Kohler a contract with your corporate name? Do you have a business card with your corporate name that you gave to Mark Kohler? All he knows, his name is Scott Wood. I'm calling him out right now. I mean, this is public record. Yeah, his name is Scott Wood. I'm gonna say it. And he goes, do you have a. Not that there isn't 32,000 Scott woods in the country. I think we're safe. But, you know, there's no slander when it's true. That's true. That's true. And so. And he goes, where. Where's your corporation? All he knows is Mr. Scott Wood, you know, that's all he knows. And they're like, well, your honor, we haven't, you know, followed some of those little protocol, you know, blah, blah, blah, blah, blah. But your case number whatever, and court number, you know, court case, this, and statute number, whatever, and they just start rambling again. And the Judge then says, Mr. Kohler, do you have a rebuttal? And this was the moment I'd been waiting for. I had practiced my line in front of the mirror at home. I mean, I. You know those moments where you're, like, kind. You're shaking inside. I mean, you can just feel your heart going, you know? And I was so nervous, and I stand up. I'm not kidding. This is true. And I Had practiced my line. And I looked at him and I said, you, Honor, if they don't respect the corporate veil, why should we? That was my line. And you could hear a pin drop, you know, and the judge thought for like, four seconds. And you said, you know what, Mr. Kohler? I totally agree, Mr. Wood. Kohler wins judgment in his favor. Pay him. And I would admonish you to maintain your corporation or your LLC the way you should have a good day. Stands up, walks out. I'm like, well, I'm standing up. I'm doing pelvic thrusts. I'm like, you know, I'm like pole dancing on the. You know, the bar there.

I mean, I'm like, doing the guy's judgment.

Yeah. I walk out, there's. There's reporters, you know. Yeah, yeah, they're interviewing me. I mean, it was just, you know, cameras. Well, no, there was none of that.

We call this big fish. Mark's a big fish.

Yeah. Maybe I embellished that last part a little, but I was so excited. And I was like, woo. And he was out in the hall, and I remember it was like one of those big, echoey marble floor halls at the courthouse. And he pulled out his checkbook and wrote it out. And he says. And he was like, here you go, you little brat, Snot, Whatever. He called me kind of a name. I can't remember what the name was. I was just looking at him right at the checkout. I'm like, yep, there's an extra. Yep. Mm. Write that whole thing out and. Cause I got my, you know, some. I didn't have legal fees.

Now. Now, was it a personal check or was it from his business?

All I know is I cashed it and it went through. I was excited and I got my money.

That's awesome.

But people. Oh, my gosh. Little did I Know. Now, that's from another Will Ferrell movie. Little Did I Know. Stranger Than Fiction.

Oh, I've never seen that.

Oh, my gosh.

It's one of the best. I know. I'm the biggest movie about that.

He's the IRS agent in that one. You would love so. And Dustin Hoffman was writing a book called Little Did I Know. Or he was giving lectures on it anyway. But little did I know at the time that that case would be the seminal landmark case in blog articles, videos, podcasts, trainings on how if you don't maintain your company, it is freaking worthless. And don't. You started with the IRS and audits. They're going to ask for the same stuff.

Yep. Absolutely.

So, I don't know. Do you have a good story you want to add to my. Embellish it?

No, other than my mom had a cleaning business that I worked in with her for years and years. So. Yeah.

Okay.

So I have the same experience. We were both former janitors.

Any legal advice? This is your window. This is your legal advice. Tell people. Look them in the eye right now and say people.

No, I say. I say that exact same thing to them. I say, you know, a good plaintiff's attorney, that's the first thing that they're going to try to do. The first thing that they're, especially if they have a deep pockets defendant, is they're going to say, we shouldn't respect these corporate formalities because they haven't been. So I kind of stole that line and I use it with a lot of clients.

I like it. Okay, well, I want to give you all some takeaways here. Let's be practical here. When you have a small business, it is critical you have an entity. Write these down. Down. Number one, you've got to have an entity to begin with. Number two, you need to make sure it's set up properly. Having all the pieces and parts now doesn't mean you have to start over. Any of you have the LLC or corporation, you. You can call our office and say, hey, all I've got. Some of you don't even know where that sheet of paper is. All I have is like, I can go on the state website, Alabama, and see that I have an entity, but that's all I got. So the paralegals can pull documents from the state, rebuild your corporate book, get you all the parts you need, and then make sure that you're at least coming out of the gate strong. You've got that. That would be number two. What do you say? Number three is? What do you like? You choose.

Have an entity set it up. Make sure it's. Make sure you're maintaining the corporate formalities.

You're going there next. Okay. All right.

I don't know.

So maintain. It's okay. I like that. Then you're going to maintain it.

Yeah, keep it.

I thought you were going to go with what you said before. Open your bank account.

Open your bank account.

Okay.

Come on. You were going bankrupt setting up the entity. You should.

Yeah. Okay. I'm going to go back, I'm going to say, number three, open that bank account.

Okay.

Okay. If I may. And then open the bank account. Start using it and respect it. The separation. Okay, then number four, tell her what's maintain it mean we're getting granular here. We're giving people action items.

Yeah. If you have a state filing requirement in your state, you better be filing. You better be paying your annual filing fee every year. Because the state, in a lot of states, they can just administratively dissolve your entity.

So they should note their calendar.

Absolutely.

No, they shouldn't. Or what should they do? Or okay, this was.

They should use kkos.

Oh my gosh. That's a damn good idea.

We have a, we're going to work

with you on this podcast thing we have.

I'll get better, I promise. We have a company compliance department. 150 bucks. And they'll do it for you so you're not banging your head against the wall, you know, once a year trying to figure out what the state wants and they reject your stuff. Just have our team do it. We'll keep your credit card on file. Pay us the 150 for our time. It's like a no brainer.

Yep. And that we're going to send you a quiz, if you will, that you get to go take a tax deductible board trip. Now you're going to write off your board meeting. Some call a juggernaut. And you're going to go to Vegas and take this little quiz with you. This, this questionnaire and you're going to hold your board meeting. And that board meeting, once you fill it out amongst maybe even at the roulette table, you could right there, free drinks. So you're getting free drinks and yeah, you're playing roulette and holding your board meeting with those critical board members. Then you send it back to the law firm. This is still all for the 150 bucks. And then they take it and type it up and make it look super impressive like the declaration of independence and send it back to you to sign and put in your corporate book.

That's right.

Bam.

And we maintain that record for you too.

So yeah, we got a copy. So when you show up in court like Scott Wood, you're like pen drop. Here it is, your honor. I filled this out in Vegas at the mgm at the roulette table. We had our board meeting. We are legit. And oh, KQS just sent me the report. We are in good standing with the state. I paid my fee and all for 150 fricking bucks. You're like nailing it. So that's, that's the maintenance. Easy schmeasy. Now on the setup, I'm going to go back to the setup. If some of you again have that, just that quote, unquote, one sheet of paper, that it's. It's garbage. Sometimes you can't polish a turd. Sorry, I have to say that in the ladies presence. Have you ever heard of that? You can't polish.

I have.

I have, yeah.

Also an athlete, so turds and athletes

go hand in hand. Well, I've.

I've had. I've had coaches tell me that about my tech.

Okay, fair enough. All right. Coaches. Yeah. Coaches will say all sorts of things to motivate a team. So sometimes we can't fix it. It's such a mess. But this is where the cleanup special comes in. We are going to look at your overall strategy. Build your trifecta. This is an option. We have a discount for this, and you can get a new entity. You can get the old one cleaned up. You can spend an hour on the phone with Katie and she's going to build your trifecta and email it to you. You're going to have your strategy for the whole year. And the easiest way to take advantage of this special is just go to kkoslawyers.com just go to the law firm website. You can make an appointment in the middle of the night with the calendar option. You can call during the day and say, I want Katie. I need my trifecta. I need a cleanup. I need my new entity. We do have other lawyers, but since

you're here, I mean, we all do the same thing, honestly. And that's, you know, iron sharpens iron. I think we're all communicating on a daily basis about client issues that, hey, I've never ran across this as any other attorney ran across this. And we always come to a consensus and help each other. It's a great team.

Okay, now I'm gonna say number five. So number one, get an entity. Number two, set it up properly. Number three, open your bank account. Number four, maintain it. Get right on the system. If some of you haven't done a cleanup, we can do that system immediately. Even if you've had your entity for five to 10 years. Let's tidy it up. Number five, I'm going to call Respect it. Respect it.

I like that.

And here's what I mean by that. This kind of goes back to the bank account, but the company. Think of Scott Wood. If you're going to hire someone, they should get a business card with your company name on it. They should know that you're the manager of this LLC or the president of the corporation. There should be a Contract. Your website should reflect the name of the company. Your email should reflect the name of the company. Not market, you know, you know, market Gmail, whatever it should be. Get your. It's not much to get your own company. URL, Gmail platform. It's what, maybe 20 bucks a month. And now I'm Mark at Marc J. Kohler Inc. I want to have that respect. It's all these little things. What are the things you're thinking?

I would say a big one is when to have another llc.

Sometimes people, we're talking about the respect part for a minute. Like we're talking about your email, your website, your business card. If you have a business card, maybe Your Venmo, your PayPal, your merchant account. You want all going to your company?

Absolutely. And guys, W9s. So many people put their personal social on a W9 instead of their business.

Use the ein.

That is huge. If the business is paying you personally, it's not paying the company.

Hold it. If it's. If someone else is paying you personally.

Oh, I'm sorry, yes. If the business that you're working for is paying you personally, they're not paying the company.

Yeah. Now on this note, I want to say I spoke to a group of realtors yesterday and they said, Mark, in my state we have. This is in Hawaii. This is common and most in a lot of states, brokers or the division of real estate telling brokers what to do will not pay a realtor or 1099, a realtor, their LLC or corporation. And so they go, well, I can't use my LLC or corp. No, no, no, no, you can. We are going to drive that 1099 through your personal tax return and back into your company. IRS allows for that, but no one, a lot of accountants miss that. And so you can still use the company Even if someone 1099 you personally. So when you fill out the W9 and your broker goes, no, we're not going to pay your corporation ein. Fine, here's my social. Not all is lost in that situation. It's okay. Sometimes there's a. They call it Department of Professional Licensing or a doppel issue where a chiropractor, a doctor, you got Medicare, you got Medicaid, you got insurance billing, you got brokers, you got engineers, you know, issues where they may not pay your company. It's okay.

Yep, absolutely.

I like that.

So but if you're operating as a sole prop just because you were too lazy to set up your business bank account.

Wow. Did you just call one of our listeners lazy?

Hey, geez, you know, man, call Spade is bait.

Sorry, people. I apologize for that. Indiscretionary.

You said turd.

I did say turd, but, well, but it wasn't personal.

Oh, that's okay.

All right. I'm just saying. Okay. Respect the veil. Use the in use contracts. Rental property. Oh, yeah. If you have an llc, you've got to transfer the title into your llc. What else would you say? I mean, I'm just opening some of these doors. Anything else? Title.

Oh, man.

Well, on the title I'll unpack. That is. You're going to call it warranty deed transfer. Don't worry about the quit claim deed in most counties. There's 3,500 counties around the country. You're not going to worry about a quitclaim deed. It's the same price to do a warranty deed in California. It's called a grant deed. And you have to transfer your, your rental into the llc. And I know some of you are like, well, I got a new on sale clause. Oh my gosh, the bank's gonna freak out and call me. They don't. In 20 years I've had one client that had the bank freaking out because they transferred the title.

Oh, I've written letters to banks and they. Oh, okay, okay, yeah, okay, we get it. Same ownership. It's not that big of a deal.

So that's part of respecting.

Make sure you transfer the title, but elaborate on why. I mean, we probably have a lot of real estate investors watching this. Why a general warranty deed versus a quick claim?

Do you want to say or do

you want to it, Number one, it. You're conveying the full breadth of rights that you have in that property. If you have a general warranty deed, if you just have a quick claim deed, they're saying, we don't, we don't know exactly what happened here prior to the, to this quitclaim deed. So we're only conveying, you know, the rights that we have right here. So it's a lesser, lesser, which is weird to yourself.

You want to give yourself, you want to give your entity all the rights and duties.

You know, it can, it can make buyers leery. So when you're going to resell the property and they see that, that you only have a quick claim deed to transfer, they're going to require a brand new deed search. They want the general warranty deed.

Well, they certainly are going to get one with title policy. But even transferring it to your own llc, you want your llc, treat your LLC like a third party. What would that third party want? Give that to your llc. You can, there's no liability, but it protects you and gives you better rights under your current title policy. See, when you bought a property, you got a title policy under your name, not your LLC's name. So when you transfer the property to your LLC with a warranty deed, you're transferring all the rights. And a lot of times that title policy and all the provisions are not going to be thwarted or violated by using a warranty deed. So make sure you do that. And I'm going to say the contracting is again, lease agreements, service of contracts, your website, your disclaimer policies, your everything on your website should be reflecting the company name everywhere possible. So that's how you properly, properly use your llc. If you need it cleaned up, give us a call. I'd like down when you do your strategy session. This is where the other LLCs, other corporations could come into play. But folks, we're trying to help you here succeed and you want you paid for this llc. Let's make sure you get every little, you know, wreak out every little drop of water you can have from it. Final advice, what would you tell these owners of these LLCs, corporations or setting them up? Anything we, you know, just some admonition or something maybe we've missed or what you want to elaborate on.

You guys are already successful. You're out there boots on the ground doing it. It's okay to need a little bit of advice or you know, just pick someone's brain that, I mean we do this with thousands of clients all over the country all the time. So you know, chances are we've seen someone similar to your situation or might be able to add something too that you know, you never really thought about.

And

I just enjoy getting to know people and what their story is as well. Honestly guys, it's a privilege, it's an honor to hear some of the things you guys share with us. I never take it lightly. So thank you guys in advance for contacting us and working with us.

I love it. Well, thanks everybody and we'll see you next week on your journey through your American dream. We'll see you here next week on another episode of the Main Street Business podcast. I think next week is going to be open forum so if you have a question, we've got so many questions on the the page. We've got to really maybe do two back to back shows and just cover so many questions that you listeners have. We want to really be there for you. So tune in next week we're going to make sure we cover a couple days worth of Q and A and keep living the dream. Thanks, Katie, for being here.

Thank you for having me.