Compliance resolutions: Keep your business in top shape

Have you made your New Year compliance resolutions yet? The end of a year and the beginning of a new one can trigger a multitude of compliance actions for your corporation or LLC. Filing annual reports, collecting online sales tax, reviewing business licenses, and updating your entity structure are just a few of the activities that will need auditing now, and on a regular basis.

To help you get your business in shape for 2026, check out these resolutions for a compliant business year. And don’t forget, CT Corporation is here to help you establish a happier, healthier compliance outlook.

To ensure your business is compliant for the upcoming year, consider the following resolutions:

• File annual reports to keep your corporation or LLC's records up to date.
• Collect online sales tax and review business licenses to ensure obligations are met.
• Update your entity structure, if necessary, to reflect changes in your business operations.
• Audit your company's licensing status, registered agent choice, and standing status to start the year on the right foot.

The consequences of ignoring compliance responsibilities

With a corporation or LLC, you must adhere to ongoing requirements, which can differ from state to state. Neglecting these obligations can lead to several repercussions, such as:

• Incurring late fees or fines for failing to renew permits and licenses
• Owners being held accountable for company debts
• Losing the company's good standing status

If a corporation or LLC cannot demonstrate compliance with all requirements, whether in a lawsuit or during a sale, the court may treat the business as a sole proprietorship or general partnership. This action, known as "piercing the corporate veil," removes the limited liability protection, making the owner's personal assets vulnerable to cover company debts