louboutin Choosing the Optimal Business Structure

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Choosing the Optimal Business StructureArticle Summary: Choosing a legal form of business that meets your needs isn't always as straightforward as it looks. Here are some of the questions entrepreneurs will want to ask to make sure the legal entity they choose is right for them!
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At some stage in planning a business, small business owners will wonder how to protect their personal assets from any business liability. Even if they do not have many personal assets, the worry of being sued in the case of a business failure often detracts from [url=http://www.boyntonbusiness.com/hollisterpascher/]hollister pas cher[/url] running the business profitably.
One of the simplest ways to protect yourself is to form a separate business entity. That way, the entity (not you, personally) takes the "hit" from any lawsuit that might occur in the course of your business. That's [url=http://www.mxitcms.com/abercrombie/]abercrombie[/url] also why they are called "limited liability entities," because they limit your personal liability. Limited liability entities come in many forms including the C-corporation, S-corporation, limited liability company, limited partnership, professional corporation (or, in some states, professional association), limited liability partnership, and professional limited liability company. Like [url=http://www.villazuki.it]woolrich sito ufficiale[/url] the dessert tray [url=http://www.rtnagel.com/louboutinpascher.php]louboutin[/url] at a buffet, all will meet a particular need, but are slightly different in their form and composition, and some aren't right for everyone.
The S-Corp, named from Subchapter "S" of the Internal Revenue Code, is [url=http://www.diecastlinks.co.uk]hollister uk[/url] popular among small business owners, as it has advantageous tax treatments. The [url=http://www.lotogame.fr/hollisterfrance.php]hollister pas cher[/url] limited liability company is also preferred. How do you choose? Let's take a look at the important factors.
1. What is the business ownership structure? Are you running this company alone? Are you [url=http://www.thehygienerevolution.com/hollister.php]www.thehygienerevolution.com/hollister.php[/url] seeking capital from foreign investors who live overseas? How many shareholders are there going to be now or later? These are the questions you need to address. Your answers will determine what corporate structure you can have. Foreign investors, who are not US permanent [url=http://shuzi.0635jia.com/toupiao/forum.php?mod=viewthread&tid=178627]hollister france soldes Approach a Dog Bite Lawyer for Dog Bite Injury Claims -[/url] residents, cannot own a stake in an S-Corp. If you are planning to have more than 100 shareholders, you cannot use an S-Corp either. A limited liability company does not have such restrictions although it may need a minimum of two shareholders in certain states. Further, only licensed professionals can own a professional association, so starting a tax consulting professional limited liability company while none of you are qualified tax accountants will not pass muster.
2. Here, the important issue is whether you require any flexibility in distributing profits. If there is more one owner, and you are putting in the sweat equity and the other is the financial investor, questions arise as to how profits will be shared, and management control split. If you need flexibility in profit sharing, a limited liability company is best. The percentage of ownership or management control is not directly tied to the profit distribution. If you have a two person LLC, you can structure it such that you control 75% of the limited liability company but choose to receive only one quarter of the profits (for example, where the other owner is a substantial financial investor). This kind of flexibility is [url=http://www.allcinema.net/bbs/dvd/bbs.cgi?res=3007%3C/a%3E]abercrombie milano How to Sav[/url] not available in an S-Corp as there is only one shareholder class and your share of the firm represents your share of the profits.
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3. Many small business owners pick the S-Corp because, under US tax law, it passes tax advantages through to the owner. The limited liability company (LLC) gets the same treatment. What does this mean? Very simply, any [url=http://www.jeremyparendt.com/Barbour-Paris.php]barbour france paris[/url] profits [url=http://www.fayatindia.com/giuseppe-zanotti.html]giuseppe zanotti[/url] or losses earned by your business are "passed through" to you and you pay personal income taxes for these profits. The S-Corp and the LLC differ markedly from the C-Corp, which is subject to double taxation. Be mindful of state and local laws when you are making your choices. Some states do not allow a complete pass through and you have to pay state and local taxes. A limited [url=http://www.davidhabchy.com]barbour outlet[/url] liability company gets the same taxation treatment as a partnership. Profits pass through entirely to your personal income tax. Ask your accountant to run through different [url=http://cgi.ebay.co.uk/ws/eBayISAPI.dll?ViewItem&item=220783463366]hollister france The Top Ten [/url] tax scenarios before finalizing your decision. You might find pretty marked differences from one type of business structure to another.
4. How much does the business structure cost? When you start a company, you need to file in the state of incorporation and pay a fee to the Secretary of State. However, the costs of maintaining a company can vary greatly from one structure to another. An S-Corp has more document and accounting requirements necessitating accounting fees, the appointment of company officials, [url=http://www.sandvikfw.net/shopuk.php]hollister outlet sale[/url] and records of shareholder's meetings. An LLC has fewer regulatory requirements and is generally cheaper to maintain. Costs can vary greatly from state to state. In New York, for example, forming a LLC is markedly more [url=http://www.tagverts.com/barbour.php]barbour online shop[/url] expensive than the S-Corp.
Do your due diligence at the start to pick the business structure for you and your shareholders. It is too difficult and costly to change it later. For more advice, consult with an attorney and an accountant who can best explain the various organization types and find the best match for you.
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