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End-of-Year Business Checklist

As the year-end approaches, all business owners should review the status of their business planning and make sure the following issues have been addressed:

1. Incorporate or Change Your Business Structure

Many small businesses start out as sole proprietorships or partnerships, but then eventually transition to another entity. If your business is not a corporation or LLC, you could be exposed to personal liability and financial risk.


The California Revised Uniform Limited Liability Company Act (RULLCA) takes effect January 1, 2014 and adds detailed rules concerning the fiduciary duties of members and managers in both manager-managed and member-managed LLCs. If you have an LLC, you will need to review your Operating Agreement to determine if the provisions will be affected by RULLCA.

3. Review Your Estimated Tax Payments for 2013

Now that we're nearing the end of 2013, you should review what your business has made year to date and assess your estimated tax payments to avoid underpayments or overpayments. You will want to discuss this with your CPA or other tax professional.

4. Hold an Annual Meeting for Your Corporation or LLC

First make sure your entity is in good standing. Keeping good corporate books is a frequently overlooked corporate activity. The end of the year is a good time to hold your annual meeting for your corporation or LLC.

5. File "Articles of Amendment" for Any Changes

If you made any changes to your corporation or LLC by changing your business address, agent for service of process, authorized more shares, or a board member left the company, then you need to file an official notification with the California Secretary of State reflecting these changes. This step is critical to ensure that your LLC or corporation in good standing.

6. Close an Inactive Business

If you have started a business that is no longer operating, you still need to file a formal termination of that LLC or corporation. Otherwise, you will be charged fees associated with the business, you'll still be expected to file an annual report, and you'll still need to submit tax returns to the IRS and state.

7. Tie Up Any Loose Ends

The next two months are a perfect opportunity to tie up any loose ends you've been putting off throughout the year.

  • Apply for a Fictious Business Name;
  • Renew or reapply for a resellers license or permits;
  • Register your business in the county (ies) that your business does business in;
  • Review any contracts or agreement you have been contemplating with vendors or other third parties;
  • Evaluate you insurance policy limits; obtain additional insurance if necessary;
  • File for a trademark;
  • Make sure you have a tax ID number or employer ID number;
  • Have you hired new employees? Consider some of the following agreements to protect your business and manage expectations of your current and new hires:
  • Employment Handbook;
  • Non-Disclosure Agreement;
  • Trade Secret Agreements; and
  • Proprietary and Inventions Agreements.

At Mortensen & Reinheimer, we help clients with business formations, business succession planning, drafting and negotiating business contracts, employment matters and business litigation. Please call Marea A. Barsky for a one half hour free consultation to discuss your business planning. Call (714) 573-7149 or email: for more information.