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Do I have to pay taxes on kickstarter.com funding?

Chris Barsness, startup, finance, law, and tech nerdThe question is more of timing of revenue recognition.  In the new JOBS act type funding, it will be investment in equity, so there isn't really a tax issue for the issuer (there are some t…

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How can I reveal my ideas to VC's while protecting them from being stolen?

Chris Barsness, startup, finance, law, and tech nerdAs an attorney, I would answer that a good NDA is invaluable; however, in the world of business, finance, and VCs, asking any potential investor or business partner to sign an NDA right off the bat m…

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Can a crowd-funding investment be used for an issuing company to purchase property (that would only be offered for sale to them) for conversion to a business use?

Chris Barsness, startup, finance, law, and tech nerdWith the caveat that the SEC hasn't implemented its rules based upon the JOBS act yet, I will answer your question generally, but crowdfunding is not yet able to be used in many contexts until t…

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Credit Report Use Limited In California Employment Decisions per AB 22

Credit Report Use Limited In California Employment Decisions per AB 22

A common question asked by start-ups or even just average average businesses is what information they can ask or use in vetting their potential employees.  Some common forms used may be background checks, drug screening, and reference checks.  Due to the economy creating many credit problems for average citizens (even more so with entrepreneurs who often use their own personal credit to bootstrap their company), I will take a look at the use of credit reports in making employment related decisions. Existing federal law provides that, subject to certain exceptions, an employer may not get a credit report without prior disclosure of that the employer wants to obtain one and the employee consents. Existing federal law further requires, subject to certain exceptions, an employer, before taking any adverse action based on the report, to provide the consumer with a copy of the report and a written description of certain rights of the consumer. California enacted AB 22 which amended California Civil Code Section 1785.20.5 to provide additional protections in this state to protect the potential employee when dealing with similar uses of credit reports.  This law went into effect January 1, 2012.  In addition the California Labor Code added Chapter 3.6 to include additional requirements.  The law provides that the employer needs to follow the same federal requirements of disclosure that they want to obtain a credit report, but also requires the employer to state why they want it.  The law goes on to further indicate that credit reports can only be requested for the following certain categories of types of positions (except by certain financial institutions): (1) a position in the state Department of Justice, (2) a managerial position, (3) that of a sworn peace officer or other law enforcement position, (4) a position for which the information contained in the report is required by law to be disclosed or obtained, (5) a position that involves regular access to specified personal information for any purpose other than the routine solicitation and processing of credit card applications in a retail establishment, (6) a position in which the person is or would be a named signatory on the employer’s bank or credit card account, or authorized to transfer money or enter into financial contracts on the employer’s behalf, (7) a position that involves access to confidential or proprietary information, as specified, or (8) a position that involves regular access to...

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What standard terms and typical startup costs should an entrepreneur expect in an engagement offer from a startup lawyer/lawfirm?

Chris Barsness, Lead experience getting startups off the ground…It really depends upon the extent of work you need done.  You may not known until you meet with them to explain your business and where you are at in development.  There will …

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