Business Advice
Posted on Friday, July 30th, 2010 at 6:42 am.
Business Advice when your starting a new business:
There are 6 ways to structure a business:
When starting up a business, one of the first decisions you need to make is in regards to the structure of your business.The liability aspect involves whether you as the business owner are responsible for the debts and actions of your company. In companies structured as sole proprietorships or general partnerships, you are responsible for the business’s debts. In the cases of LLCs and corporations, you as the owner have little or no liability for the debts of the business. Depending on your situation, you can dicide to structure your company in several different ways, including as a corporation, partnership, or limited liability company (LLC).
When structuring your business, you have a basic choice of six options. The differences between these options are mainly due to the degree of individual liability and how each is subject to taxes. The six basic business structures are:
- Sole Proprietorship – You own the company and are responsible for both its assets and liabilities.
- General Partnership – You contract with one or more people to run the business with equal responsibilities and liabilities.
- Limited Partnership – Some of the partners in the partnership have less interest and liability in the company. In this type of partnership, there must be at least one general partner.
- Limited Liability Company – You structure the company so that you and the people with whom you are starting the company have less or limited liability.
- C Corporation – A traditional corporation that, when set up, leaves you with little or no personal liability.
- S Corporation – The liability aspect is the same as a C corporation. The difference is the way it is taxed. C corporations are taxed twice, once on the corporate level and again on the personal level. S corporations are only taxed on the personal level.
Structureing you business is key. Finding out as much as you can and getting advice is extremely helpful. This is setting the foundation of your company. For advice or hlep starting your business visit www.precisioncorpsvcs.com.
Precision Corporate Services is a leading tax and accounting firm providing tax services in all 50 states. Our firm specializes in entity formation, tax planning, business recordkeeping, tax auditing and preparation. We also specialize in working with home based business owners, real estate investors, stock and forex investors establish their accounting, asset protection, and entity formations. If you need a tax consultant to ensure IRS compliance, give us a call at Precision Corporate Services 888-656-1293.
Tags: business advice, how to structure a business, new business advice, start a business
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