Keeping You Informed About Your Case

Based in Cambridge, MN, McKinnis & Doom, P.A., is a general law practice you can have faith in. We’re dedicated to keeping clients informed throughout the legal process as we work towards innovative solutions. We never want you to feel like you’re being kept in the dark when it comes to your legal matter. Take a look at the FAQs below to bring clarity to your case.
We’re happy to speak with you about your case. Get in touch with us today.

Business & Corporate Law

Should I incorporate my business? What does the process involve?

Yes, you should absolutely incorporate your business! The main purpose for incorporating a business is to protect the owner of the business from personal liability for the debts of the business. The most common forms of business organizations used in Minnesota are the Limited Liability Company (LLC), S or C type Corporation, and Limited Liability Partnership (LLP).

You will need an attorney to incorporate your business. There is a common misconception that incorporating a business is as simple as filing the necessary Articles with the Secretary of State’s Office. The Articles, however, provide no guidance regarding the operation of business, the relationship between owners of the business, the resolution of disputes, etc. As such, hiring an attorney can provide you not only with the necessary tools to incorporate your business but all of the necessary agreements, etc., to ensure that the business runs as smoothly as possible during disputes, transfers of ownership, and termination.

In Minnesota, if your business is not incorporated and only has one member, it will be considered a sole proprietorship. If your business has more than one member, it will be considered a general partnership.

What is a sole partnership vs. a general partnership?

A sole proprietorship is a business owned by only one individual and does not offer limited liability to the owner. A sole proprietorship is not considered a separate entity for tax or legal purposes.

General partnerships are formed automatically when two or more persons engage in an activity for profit. The members of a general partnership are jointly and severally liable for the debts of the business.

What is an LLC?

LLC stands for limited liability company. 

A limited liability company provides the owners of the business the limited liability of a corporation with more flexibility in how to manage the day-to-day affairs of the company. The advantages of an LLC are organizational flexibility, unlimited duration, and pass-through taxation. The members of the LLC are typically taxed according to their ownership interest in the company but can elect through the member control agreement to allocate the profit and losses in a different way. An LLC can also have an unlimited number of members.

What is a "C" type corporation? What is an "S" type corporation?

A “C” corporation is treated as a separate entity for federal and state tax purposes. It also provides its owners with limited liability protections for tort and contract damages. The disadvantage of a “C” corporation is double taxation. The entity is taxed at the corporate tax rate, then the shareholders are taxed on the dividends from the corporation.

An “S” corporation is an entity that gets treated like a partnership for taxation purposes. The “S” corporation is limited to only 75 shareholders and lacks some of the flexibility of other corporate forms.

Probate Law/Estate Planning

Do I need a Will and estate plan?

Everyone needs an estate plan. If you are younger or do not have a lot of assets, you may wonder why having a Will is necessary. But, consider these questions: Who will take care of your minor children if you pass away unexpectedly? Do you have a family heirloom that you want to go to a certain beneficiary? Who should inherit your house? Who should take care of your pet in the event of your death? If you are not married, how can you ensure a significant other receives an inheritance? All these decisions seem commonplace, but they are important to consider. Furthermore, if you want to have a say in them, rather than placing the burden on your family or having a judge decide, it is necessary to have a Will in place.

The terms of your Will should be reviewed annually. Additionally, you should always review your Will upon any of the following: birth or adoption of a child or grandchild, marriage, divorce, death or disability of a beneficiary under your Will, death or disability of the personal representative under your Will.

What happens if I die without a will?

Dying without a Will, you are “intestate.” This means that the state, not you, decides how your assets are to be distributed. Minnesota’s rules of intestate succession dictate that your property be distributed in the following manner:

If you have a surviving spouse, then your spouse receives:

    • All of your property if you die without children
    • All of your property if your surviving children are children of your surviving spouse
    • The first $150,000 plus ½ of the balance if all of your children are not the children of your surviving spouse and your surviving spouse does not have children that are not yours.

If you have no surviving spouse, then your assets are distributed as follows:

  • Your children in equal shares, or if you have none, to their children, or if you have none;
  • Your parents, or if you have none;
  • Your brothers and sisters or their children, or if you have none;
  • Your grandparents or their children or their descendants, or if you have none;
  • Aunts, uncles, children, and grandchildren

What is a Health Care Directive?

A Health Care Directive is a legal document that gives a person the authority to make medical decisions for you, in the event that your attending physician determines that you are unable. The legal term provided for in Minnesota Statutes for this was “living will” up to 1998. In 1998 Minnesota Statutes were amended so that now the document is called a “Health Care Directive.”

First, it appoints an individual or individuals to make decisions concerning your health care in the event that you are unable to make those decisions yourself. Secondly, it may state your wishes and provide instructions as to how you want your care to be handled in the event that you are no longer able to speak for yourself. Additional provisions of the form allow you to state your preference as to whether to donate your organs and allow you to state whether you would prefer to be buried or cremated.

Simply drafting a Health Care Directive is not enough — you should talk with the person that you have named in the Health Care Directive to act on your behalf in-depth about your wishes. More specifically, situations regarding withdrawal of a feeding tube (giving food and water by artificial means), withdrawal of life support, administering pain treatments that may shorten life, or other specifics that seem appropriate. Just telling your agent to “unplug you” is not appropriate as it may mean different things to different people.

What is Power of Attorney & how is it different from a Health Care Directive or Will?

 A Power of Attorney grants another person full legal authority to act on their behalf should they become unable to handle their personal and financial affairs. Without it, the Court may have to become involved through costly legal proceedings in order to appoint a person to handle all legal affairs.

A Power of Attorney gives a person the authority to make financial and other decisions for you in the event you are unable. A Health Care Directive gives a person the authority to make medical decisions for you in the event you are unable. 

A Power of Attorney gives a person the authority to make financial and other personal business decisions for you pre-death. A Power of Attorney becomes inoperative once you die. After you die, your will becomes the primary document that expresses your wishes, and your Personal Representative will take care of the handling of your estate, not your Power of Attorney.

The above FAQs are for informational purposes only and should NOT be considered legal advice.

Our Areas of Specialization

Personal Injury & Wrongful Death

Business Law & Litigation

Criminal Defense

Criminal Defense

Family Law

Family Law

Personal Injury & Wrongful Death

Personal Injury & Wrongful Death

Additional Practice Areas

Additional Practice Areas

“I have been working with Sherwood for several years. He and his team are great to deal with. Extremely professional and knowledgeable.”
- Sarah

Law Firm in Cambridge, MN | McKinnis & Doom P.A.

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