Incorporate Your Business in Florida

Photo Courtesy of StockFreeImages.comFlorida is a wonderful state in which to incorporate and run a business.

All businesses can benefit from incorporating. As an owner, the most advantageous reason to incorporate is to protect your personal assets. This means if the company does not succeed, the owner is not personally responsible for the resulting debts and obligations. Incorporating also provides credibility for the company, name protection, and tax breaks.

There are five types of corporations in Florida: C corporations, S corporations, Limited Liability Corporations, Partnerships, and Sole Proprietorships.

Florida is considered a “business-friendly” state because entrepreneurs who incorporate their business in the state do so with many benefits and few hassles. The biggest benefit of incorporating in Florida is there is no personal income tax, and some corporations are exempt from corporate income tax, which averages 5.5% nationally.

Florida has business-friendly courts and legal systems, it requires only one director to incorporate, and it has some of the lowest annual fees and corporate reporting requirements in the United States. Florida is also home to a skilled, professional, and highly-educated work force.

Although there are sites online which allow you to incorporate your business, it is always best to contact an attorney because there are important tools that are not included with a regular filing. This is the foundation of your business, and an attorney will make sure it is a solid one.


Breach of Contract in Florida

When entering into a contract in both business and personal settings, it is important for the participating parties to be fully aware of all aspects of the contract.

There are two forms of contracts: verbal and written. In Florida, certain types of contracts are required by law to be in writing, but verbal contracts are generally otherwise enforceable.

Written contracts are usually preferred because the document may prevent or help with settling disputes about the terms and conditions of the agreement. Written contracts must contain a certain amount of detail in order for it to be enforceable, so they should almost always be drafted by, or at least looked over by, an attorney.

Photo courtest of StockFreeImages.comA breach of contract occurs when one of the parties fails to perform their end of the bargain. This can result in the offended party suing the breaching party. In this case the offended party usually looks for one of two solutions: for the breaching party to fulfill their end of the contract or monetary compensation for the act not being completed. The dispute may go to a certain court or to arbitration, depending on the terms of the contract.

If you are considering entering into a contract, you should consult with a lawyer to make sure you are aware of your rights, obligations, and the consequences if the contract is breached.

As the saying goes, “NEVER sign anything you don’t understand.”

Canadians are “Moving In” to Florida

Watch out, Brazil, Canadians are moving in!

           Last year, 2011, was considered the “year of the Brazilians” by realtors in Florida, but it looks like Canadian home buyers will surpass them in 2013. This was the topic of discussion at the “Doing Business with Canada” hosted by the Broward Council of the Miami Association of Realtors last Wednesday.

The three most popular Florida destinations for Canadians are the Bradenton-Sarasota-Venice area, Fort Lauderdale, and Naples-Marco Island.

Michelle Farber Ross, whose MMD Realty partner is Hall of Fame quarterback Dan Marino, was one of the guest speakers at the conference. She posted on her blog the day before the conference that she was excited about speaking. “The Canadian dollar is very strong, prices are still low and Florida offers a great escape to the long Canadian winters,” she said.

When it comes to aiding Florida’s economic development, Canada tops the list when measured by the combination of bilateral trade, foreign investment, real estate purchases, and tourism.

EB-5 Program Allows Residency for Foreign Investors

The EB-5 Immigrant Investor program, enacted in 1990, is a way for foreign investors to help boost the American economy and, in the process, gain residency in Florida or in other states across the U.S.

Foreign investors can obtain an EB-5 visa if they invest $1,000,000, or $500,000 in high unemployment areas, that leads to the creation or preservation of at least 10 jobs. These investors and their families receive a two year visa that allows them to live and work in the U.S., and if the investment is successful, they can eventually receive permanent U.S. residency.

Jupiter, FL, has used this program to construct an outdoor amphitheater, marina slips, and an entertainment hub,  San Bernardino, CA, has used it to redevelop its downtown theatre district, Jay, Vermont used it to help finance luxury condos, an ice hockey rink, and a waterpark at its popular Jay Peak Resort, and Philadelphia has used the program to expand a hospital complex and improve a school for disabled children.

Along with the benefits of the program, there are also risks. Some investors have failed to maintain or create theImage courtesy of required jobs, or failed to otherwise comply with the program, and faced deportation. Others have lost their investment, but have still secured their green cards.

Despite the risks, many foreign investors are still taking the chance. The EB-5 program is one of the fastest ways for wealthy foreign investors who lack the family ties or special skill required for a traditional U.S. visa to establish a permanent U.S. residency.

Sources: LA Times,

Securitized Loans are Creating Warfare

Rising commercial real estate delinquency rates are becoming a concern in the industry, and securitized loans are making the problem even more complex here in Florida and across the U.S.

When a mortgage lender securitizes a loan, it is pooled with similar debts in order to transform the loan into a similar asset that can be sold to another company without losing much value.Photo courtesy of

As a result of this, different classes, called tranches, are formed. There is a senior tranche, middle tranches, and a lower tranche, called the equity tranche. The senior tranche is the first to see cash flow, and the equity tranche is the first to see cash loss.

Therefore, the equity tranche is facing the highest risk. If a property faces foreclosure and the proceeds earned are less than the debt owed, the equity tranche could potentially lose all of their invested money.

The good news is those who hold these junior positions are the “controlling holders.” In order to make a decision, special servicers, or the middlemen, are required to get permission from the junior-most holder in order to act. The different interests of the different tranches are creating a major conflict, which many people have named tranche warfare.

The complexity and uncertainty of these securitized loans has created a need for more legal and professional assistance. Junior lenders need to be informed of their options in order to make the right decision.

Sources: , Bloomberg Law