Your Limited Liability Company, by Anthony Mancuso (Softcover, 2013)|
(You can print this review in landscape mode, if you
want a hardcopy)
Reviewer: Mark Lamendola, author of over 6,000 articles.
This book really isn't an operating manual. Its main text, consisting of 250
pages, is mostly about what you need to do to protect your LLC from attack by
the Institute of Reprobates and Sociopaths. At the end of this review, I'll
provide more detail on this.
My impression is that about 15% of this book had to do with preventing
other sorts of problems, such as preserving your LLC status (it's critical
to operate your business as a business so it doesn't become a sham) and
keeping transactions straight from an LLC perspective. And maybe 5% focuses
on other important aspects of running an LLC.
What's missing from this book, if it is to be an operating manual, is
extensive. I have an MBA, so I can say that with authority. I won't go into
the details here. Based on the devastation I have seen the Institute inflict
on businesses that did nothing wrong but just didn't know how to avoid an
attack, what's in this book is important nonetheless. I have seen what
happens to businesses when they don't know the "rules" that Mancuso
And he explains them very well. Not only are his explanations easy to
understand, but he uses clear examples to ensure the reader "gets it" and
can apply the knowledge.
The fact that this book doesn't deliver on what's promised in its
subtitle does not detract from the fact this book is a "must read" for all
LLC managers and owners. The subtitle of a book is often written by someone
who has merely glanced through the book, so it's best to discount those
anyhow. The three bullet points on the cover do accurately reflect what's in
the book, albeit mostly from perspective of avoiding or blunting an attack
by the Institute of Reprobates and Sociopaths:
- Hold legal meetings
- Document LLC actions
- Avoid mistakes and lawsuits
Though I found this book to provide thorough and accurate guidance to the
Institute of Reprobates and Sociopaths attack problem, it took me a while to
warm up to it. That's because I was immediately put off by the author's
highly anachronistic paper-orientation that was so evident early on.
For example, he talked about taking minutes at a meeting as if the
secretary is writing notes on paper. The last time I was responsible for the
minutes of a meeting was about 6 years ago, and even then it was done in
real time on a laptop. The minutes were e-mailed to all attendees right
after the meeting ended. And in the back of the book is a huge number of
paper forms; it would have been better to simply refer to a Website where
PDFs can be viewed and/or downloaded.
He also talks about keeping a "binder," something that isn't going to
accommodate the digital file modality of today's typical business. You can
adapt the discussion to a modern modality, but it would be nice if the
author did that work for the reader. I've helped several businesses that had
made a total hash of how they organize their electronic files, simply
because they didn't know how to organize them. Rather than hobbling
themselves with a paper binder, they need to understand information
hierarchy and such things as how to sensibly name their digital files.
Beyond the digital file keeping and the MBA stuff, there's a whole new
area that is important for the managers of any LLC to address. With its
paper-based perspective, this book totally overlooked this area. This area
includes such things as:
- How to properly represent your LLC on its Website. Getting this
wrong is easy to do, and it can be costly.
- Social media do's and don'ts. Talk about a landmine field!
- E-mail practices, such as disclaimers or filing and keeping of
- Whether to, or how to, provide your Articles of Incorporation to
customers/clients who want you to send those before they'll list your
LLC as a vendor.
- How to prepare your LLC's W-9 for vendors who demand a W-9.
- What to do about faxes, when they are only an image file and their
contents typically can't searched on your data drive (my advice: don't
send or accept faxes).
- Best practices for digital advertising, from an LLC preservation
- Issues affecting electronic banking and payments (e.g., PayPal
accounts, e-checks, recording vendor 3e-payments).
The above list is only partial. These items can have enormous impact on a
business, but the author ignored this entire domain of modern-day business
Here's yet another important question, though not really of the
electronic variety. It arises more often today, because of the electronic
nature of conducting business.
What should you do when the Institute of Reprobates and Sociopaths
classifies your LLC's legal name as a DBA, thereby causing your records to
mismatch when a client, vendor, or electronic marketplace company does
a check against the Institute's records?
The only solution I know of is to break the law and give the other party
the fictional name the Institute demands (e.g., "Bob Smith, DBA Arizona
Fishing Bait and Boat Tours, LLC").
When I commit this particular crime, I make a point of informing the
other party of the discrepancy so they understand this is NOT a DBA
(proprietorship) but an LLC. It is a separate legal entity, not a DBA of
anyone involved in the LLC. I also follow up with a real-time phone
conversation to make it clear I am not trying to dupe them in any way. Thus
far, everyone has understood the problem and agreed with the solution. And
that level of disclosure and follow-up is what I advise, if you decide to
"go along to get along" so that business can proceed despite this problem.
I think this is DBA thing is a trap the Institute puts LLCs into, so they
can later claim they have legal authority to disregard your LLC entirely.
Huge, huge issue. Not addressed at all in this book.
This book was the 7th edition. Clearly, it has not been really updated
since the first edition because its scope appears to remain confined to the
pre-Internet era. I don't know what the previous editions contained, but an
updated version would address the updated business environment per the
points I made above.
This core of this book consists of 16 chapters occupying 250 pages. It
also has three Appendices consisting of paper forms. These aren't
sequentially numbered, so I don't know how many there are. If I had to
guess, I'd say 100 pages. None of which should be in the print edition, as
they really serve no purpose but to bulk out the book.
On page 257 is a chart "Files Provided on Nolo's Website," and this
should be all that's retained from those Appendices. Giving the book a
shorter form factor so it can sit on a book shelf (as a reference) without
collapsing would also be nice; that, or give it stiff covers to achieve that
This book could use a good update, as noted above. Even though it's so
outdated, it's still essential reading because of what it covers. The core
advice is fairly timeless, and every LLC manager should become very familiar
with the advice given. What I've seen in the small business world
(admittedly, anecdotal and from a small sampling) is that many people go
from sole proprietor to LLC to get the legal protection of an LLC but then
don't treat their business as an LLC. The effect can be to destroy that
legal protection, even though that was not the intent of the LLC manager(s).
There's also that Institute of Reprobates and Sociopaths problem that the
author spends most of his energy addressing. Any good tax attorney can tell
you plenty of horror stories laced with "If only my client had...."
commentary. With this book, you will be the client of whom the attorney
says, "It's a good thing my client did...."
About the Institute of Reprobates and Sociopaths issue
It's interesting that when LLCs started (in Europe), they were classed as
corporations (for example, look up the meaning of the German "GmBH"--but
look for an older reference or an accurate translation ). The Institute
unilaterally changed that to "company" so they could more easily prey on
American small businesses (though many large businesses also have an LLC
formation). Allegedly, only our federal legislature can pass laws; this bold
move by the Institute is proof yet again that is not the case.
So because we Americans live in fear of a costly, useless, and
destructive organization that is inexcusably funded by our own tax dollars
and responsible to no authority other than its own, we must devote a
significant amount of resources to not giving that organization a flimsy
excuse to attack us. Not that they need an excuse, but it's best not to give
them one. Toward this end, I found the book very informative and helpful. In
the event you are attacked, if you've followed Mancuso's advice your
business' chances of survival are hugely increased.
In fact, the Institute will often back off when they can see a victim has
very strictly "played according to Hoyle." On reason why is individuals at
the Institute are seeking personal gain (for example, see Kevin Brown and
Lois Lerner's Hoyt Fiasco scam, in which they made $103 million
"disappear"). Like other criminals, they are looking for the easy score.
Just as locking your doors at night can often make the visiting burglar move
on to the next house, keeping your LLC in order can often make these
criminals move on to another LLC.
This book is essential reading, because the single biggest threat to any
business, and to LLCs in particular, is an attack by the Institute. This
fact is why the 1040 system compliance costs dwarf the revenue raised by the
Institute--businesses pay legions of accountants, advisors, and tax
attorneys to make it through the byzantine mine field of "tax" regulations
created by an unelected body of unaccountable psychopaths.
Note that when you count the economic drag of just these compliance
costs, you can easily produce the math that shows the Institute costs the
federal treasury more revenue than it raises. Members of CONgress, dim as
they are, must surely be aware of this.
In fact, every penny of the 1040 taxes raised goes to pay the interest on
the federal debt, meaning it goes directly to the nonFederal nonReserve,
which has stated before CONgress that it cannot be subject to an audit by
the GAO because it is a private corporation. What a scam! Nevertheless, we
can't break the rules these banksters and their Institute of Reprobates and
Sociopaths put into place.
Anyone who looks at the numbers can see that the purpose of this
organization is something other than funding the government since it works
in the opposite direction of such a goal. That, combined with the fact they
lack any meaningful oversight, makes them very, very dangerous. Advice like
what you find in this book is really your only viable defense.