BLOG: New IRS Requirements for EIN Applications Go Into Effect May 13, 2019

As we have all been scrambling to get our taxes completed this month, a new IRS requirement may have been overlooked that goes into effect on May 13, 2019. This new requirement impacts the process by which any new entity (including sole proprietorships, partnerships, limited liability companies, trusts, and corporations) can apply for an Employer Identification Number (EIN), the 9-digit identification number assigned to entities for tax filing and reporting purposes. The new requirements will impact all of our clients engaged . . . Read More

Avoiding Flat Tires When Acquiring IDIQ Contract Vehicles

With proposals costing hundreds of thousands of dollars and many IDIQs having 50 or more awardees, it can easily happen that some contractors who win a spot on a contract are unable to capitalize on it and simply stop trying to capture task orders. Whether it was because the initial win was based on sheer luck or perhaps because of a tragic, unforeseeable change in circumstances, making it impossible to bid or even keep the company doors open, a contractor . . . Read More

Growing Pains: Growth Capital Sources and Considerations Part 2: Private Equity Financing

At a certain point in a company’s life cycle, founders are likely to be faced with the financial pinch of requiring outside sources of funding to finance further growth and expansion of the business. Previously, I posted  an article  that focused on one of the two most common paths that companies turn to for growth capital financing: traditional bank debt. In this post, I will focus on the second of the most common sources of financing—private equity investment. Private equity investments can . . . Read More

You’ve Decided to Sell Your Business— How to Be Prepared to Execute the Deal

After years of building, growing, and investing in your business, there comes a point at which you start to think about an exit strategy. Perhaps your exit will be transitioning the ownership of your business to a family member or selling the majority of your ownership interest to an investor and taking a back seat going forward, or maybe it’s selling the whole business enterprise. Regardless of the type of exit you contemplate, selling a business is not for the . . . Read More

Growing Pains: Growth Capital Sources and Considerations Part 1: Debt Financing

At a certain point in a company’s life cycle, founders are likely to be faced with the financial pinch of requiring outside sources of funding to finance further growth and expansion of the business. Once bootstrapping ceases to be an option, there are two main avenues to pursue for growth capital: traditional bank debt or private equity investment. Both options present pros and cons, and they are not mutually exclusive. Ultimately, the route founders decide upon will depend on the . . . Read More

SBA Eliminates “Direct” Ownership Rules for HUBZone Program

On March 26, 2018, the U.S. Small Business Administration (SBA) issued a direct final rule that changed the wording of 13 C.F.R. § 126.200(b)(1) to allow indirect ownership by U.S. citizens of companies in the HUBZone program. The stated purpose of the rule change is to align more accurately the rule with the underlying statutory authority. Prior to this change the HUBZone rules required that a HUBZone company be “unconditionally and directly owned” by U.S. citizens. The rule took effect . . . Read More

Corporate Record-Keeping and Compliance, or “Do I Really Need to Hold a Shareholders’ Meeting If I Am the Only Shareholder?”

When we are asked to review client corporate record-keeping, it is far too often the case that such record-keeping has fallen by the wayside and been overlooked. We understand that, for small businesses and/or entities with only a handful of equity owners, corporate record-keeping can seem a tedious or expensive chore. Some clients have asked “Do I really need to hold a shareholders meeting if I am the only shareholder?” The short answer is, “Yes, you do.” Both corporations and . . . Read More

Cybersecurity Update—Round II

As part of our continuing effort to keep you updated with new developments relating to compliance with the Department of Defense (DoD) Federal Acquisition Regulation Supplement (DFARS) 252.204-7012, this blog post provides a link to the long-anticipated template for a system security plan (SSP) and other key information related to implementation of the security controls set forth in the National Institute of Standards and Technology (NIST) Special Publication (SP) 800-171. Template for SSP The Computer Security Resource Center portion of . . . Read More

HUBZone Definition of “Employee” Not So Black-and-White

In a recent decision, HUBZone Appeal of Q Services, Inc., the Small Business Administration (“SBA”) clarified that the number of hours worked by a person does not bar SBA from examining the totality of the circumstances to determine whether that individual qualifies as an employee for HUBZone program eligibility purposes. Under SBA’s HUBZone regulations, if a person works a minimum of 40 hours per month (whether employed on a full-time, part-time, or other basis), that individual will be treated as . . . Read More

The Risk of Certifying as Small Without Tax Returns

We are regularly contacted at this time of year, before tax returns are due, by companies that wish to pursue small business set-aside contracts but have not yet filed their tax returns. These inquiries stem from the belief by some firms that, because their tax returns have not been completed, they may still self-certify as a small business while knowing, or suspecting, that their immediate, prior year revenues make them large. This misunderstanding of the size regulations can have dire . . . Read More