Tax Guru – Ker$tetter Letter

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Offering Stock

Posted by taxguru on February 25, 2006


Subject: Stocks to Offer
Good Morning,
We are a small group of R&D researchers looking to form a small C Corp and would like to offer stocks to investors in order to try and gain enough funds to prototype a few different models for producing liquid fuel with the co-generation of electricity of systems we’ve been designing and preparing to build out.

Can you tell me where we can learn about the stock offer limitations and total funds we can collect? I understand there are limitations on the number of offers that can be made as well as cap on total funds.

We are also looking at partnering (or possibly contracting with) a Canadian Company. Are there restrictions for receiving funds from their investors directly or through the Company and would one way or the other be better?

Thank you so much for your time and an advice you can offer. Have a great week.


This is area where you absolutely must work with an attorney and a CPA firm that both have experience in public stock offerings in your state.  The rules differ in each state and can get very complex in regard to several different aspects of this kind of thing.  Your attorney will inform you of the potential penalties, including investor lawsuits, that can arise from failing to properly dot every I and cross every T.

Good luck.

Kerry Kerstetter


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