...Legal Forms of Business Mike Robertson LAW531 May 7, 2012 Julie Benes Legal Forms of Business The well-informed businessperson understands choosing the correct business form is important. The type of business form determines what type of business organized, how money flows in and out of the business, how the business and owners are taxed, and the levels of risk to owners. There are several types of business forms. These types are sole proprietorship, partnership, Limited Liability Partnership (LLP), Limited Liability Company (LLC), S Corporation, franchise, and corporation. The businessperson needs to have an understanding of which business form is justified for their business startup. The beginning businessperson looks at the sole proprietorship a majority of times because of its simplicity (Anthony, 2011). A sole proprietorship is the simplest form of business organization. The owner of the business, the sole proprietor, is the business. There is no separate legal entity. Sole proprietorships are the most common form of business organization in the United States (Cheeseman, 2010). One example of a business that becomes a sole proprietorship is an independent contractor. The future business owner completes work for a business, but they are not an employee of these companies, they are considered self-employed and therefore a sole proprietor. Most person call this “moonlighting.” For example, if an electrical contractor with a full-time job also does home electrical...
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...Running head: SMALL BUSINESS IDEA PAPER 1 Small Business Idea Paper Napoleon Melton, Jr. ACC/561 September 5, 2011 James Sullivan SMALL BUSINESS IDEA PAPER 2 Small Business Idea Paper Establishing a small business requires the cultivation of a business idea to a business plan that successfully outlines its unique product or service, the rationale for choosing the business organization in particular for the unique product or service, and the financial statements & implications associated with the formation of the business organization. In my small business idea paper, I will discuss my small business’s unique product or service and the rationale for my small business’s business organization formation. Small Business Unique Product or Service Spartanburg, South Carolina needs a diverse establishment in the downtown area that can cater to families, high school students, college students, young professionals, and adults as well as drive growth in the downtown area. Why? The Spartanburg area is more conducive for families and older adults than high school students, college students, and young professionals. High school students should have a place that they can hang out and have fun in. There are numerous bars for the college and the young professional crowd but are basically the same in terms of what entertainment they offer (predominately rock and acoustic acts). The downtown area has undergone renovations in the past couple of years, adding establishments...
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...Introduction This research paper will analysis and discuss the question of whether the owner of a small business corporation is better off taking a salary or drawing a dividend. The salary vs. dividend question is common among small business corporation owners. Unfortunately, there is no one straight forward answer. There are two types of share holder owners who are eligible to extract funds from a corporation, shareholders that actively work within the corporation and shareholders that are not active within the corporation. The shareholder owner that works within the corporation is given the option of drawing a salary or dividend. The shareholder that own shares but does not actively work in corporation can draw dividends only. This paper will focus on the active owners of a small business corporation. The analysis will compare the methods and the impact on owners as well as the corporation using each approach. The mix method will also be analyzed and discussed. Basic tax concepts are based on the theory of integration. BDO defines Integration in The Tax Factor, they say that” A tax system is said to be integrated if the same amount of overall tax is paid when the income is earned indirectly through a corporation or directly by an individual.” (BDO Dunwoody, 2009, p.1) According to this theory there should be no difference to the individual regardless of the method chosen. But we know that in order for there to be integration the rates have to be perfectly...
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...Limited Liability Corporation and Partnership Jacob Sanchez FIN-419 December 22, 2014 Michele Huss Limited Liability Corporation and Partnership Introduction Many people attempt to start businesses annually and need a little guidance on what their best choices are for forming the blueprint of their future endeavors. Limited Liability Corporations and Partnerships are a couple choices that can be chosen by some entrepreneurs. They have some things in common, and also have distinct differences. This paper will discuss how each type of business entity is formed, the tax benefits, some advantages and disadvantages. Lastly, these things will be evaluated to determine under what circumstances one should be chosen over the other. Limited Liability Corporation A Limited Liability Corporation, from now on an LLC, is a less complex formation of a corporation. It is formed by filling an articles of organization with the states Secretary of State office. This article will include the business name, the members, and in some states an operating agreement. (U.S. Small Business Administration, n.d.) In an LLC with more than one member an operating agreement is ideal, for structure and regulation. In most instances it will provide a roadmap of rights, arrangements, and profit sharing and loss. (U.S. Small Business Administration, n.d.) Taxation is an important aspect of forming a business, an LLC has many choices for taxation. An LLC can opt to file as a corporation, in which case...
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...world. People tend to choose a type of business off of what they feel or who they are working with. These forms are what guide someone into being successful or not. These forms are the most traditional ways of our economy. Throughout this paper I will be expressing each major form of business with their advantages and disadvantages. A sole proprietorship is defined as a structure of business organization that is simple to set up and allows you to have control over the business, which is ideal for small owner-operated businesses (Kimmel, Weygandt, & Keiso, 2009, p.4 ). The advantages are a sole proprietor has all the strength and decision-making power towards the company, everything can take place at the verdict of the sole proprietor owner, there are no corporate taxes, and to start a company legally is cheap to name a few. The disadvantage of a sole proprietor business is what can change the mind of a few when it comes to starting one. They are liable for all debts towards the company. Partnership is used a lot through many businesses. A partnership is formed between two or more people to invest and run a business smoothly. Advantages to name a few are Partnerships are relatively easy to establish, cost-effective as each partner specializes in certain aspects of their business, and may benefit from the combination of complementary skills of two or more people as in more knowledge, skills and contacts. The disadvantages are business partners are jointly and individually...
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...owners receive from the business). This system applies to the business S-corporation-called the "C-corporation" (C-corp) for reasons we'll see shortly-and the system of taxing first the corporation and then its owners is called the "corporate double tax." "Pass through" taxation. The entity (called a "flow-through" entity) is not taxed but its owners are each taxed (more or less) on their proportionate shares of the entity's income. The leading forms of pass through entity (further explained below) are: Partnerships, of various types. "S-corporations" (S-corps), as distinguished from C-corps. Limited liability companies (LLCs). A sole proprietorship such as John Doe Plumbing or Marcus Welby, M.D. is also considered a pass through entity even though no "organization" may be involved. The first major consideration (in this case, a tax consideration) in choosing the form of doing business is whether to choose an entity (such as a C-corp) that has two levels of tax on income or a pass through entity that has only one level (directly on the owners). Losses are directly deductible by pass through owners while C-corp losses are deducted only against profits (past or future) and don't pass through to owners. The major business consideration (as opposed to tax consideration) in choosing the form of business is limitation of liability, that is, to protect your assets from the claims of business creditors. State law grants limitation of liability to corporations (C and S-corps), LLCs, and...
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...Legal Forms of Business There are many forms of businesses, from the small business to the corporate business that are found all over the world. Each has its own unique properties, as well as some areas that are similar to all. In this paper, I will give scenarios of the following legal forms of business: sole proprietorship, limited liability partnership, Limited Liability Company, S corporation, franchise and corporate form. This paper will also discuss the justification as to why this business form is preferred. Sole Proprietorship. Suzie owns a shop that does body wraps that helps individuals have slimmer waists and thighs. People are wrapped like mummies and the elastic wraps are saturated in a mineral solution to help assist in breaking down fat. She owns a small shop in a strip mall downtown. A Sole Proprietorship is a business that is owned by one person, and is commonly known as a small business. It is preferred by individuals who want to start their own business because they can make all the decisions regarding payroll, hiring and firing of employees ("Doing Business as a Sole Proprietor,") Business owners of this type file their own taxes. The owner can also sell the business without the approval from others, since they own the business outright. Personal liability is also a factor when opening a business as a sole proprietor. If for example, a customer gets burned by the wraps that are used and the customer sues Suzie, she will have to hire her own attorney...
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...* 產品組合 * 公司方向主要分為三大類： 1. Small Business Services →Has provided products and services to nearly 4.6 million small business customers 2. Direct Checks →Has provided products and services to more than six million consumers 3. Financial Services →Provide products and services to 5600 financial institution clients * 產品及服務分為下列： 1. Checks： →The majority of the revenue in Financial Services and Direct Checks →40.7% of Small Business Services segment’s revenue 2. Marketing solutions and other services： →主要在Small business Services上 →offers services designed to fulfill the sales and marketing needs of small businesses →包含 * web design / hosting and other web services / * Search engine optimization * Marketing services..email/ mobile/ social media/self-service marketing solutions * Digital printing services * Logo design →Small Business Services offers products such as promotional products, postcards, brochures, retail packaging supplies, apparel, greeting cards and business cards, as well as service offerings, including fraud protection and security, and payroll services. →Financial Services offers various customer acquisition programs, marketing communications services, rewards and loyalty programs, fraud protection and security services, financial institution profitability and risk management services, and a suite of financial technology solutions that integrates receivables, accelerates deposits and payments, and eliminates...
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...Limited Liability Corporation and Partnership Paper University of Phoenix FIN/419 November 26, 2012 Every business has a basic idea of the entity in which to establish. Capitalization and protection is the main focus to establish the business with a question of which type of entity should a business use to move forward. Businesses have a host of factors when making this decision, the most common forms of these entities are, partnership, corporation, sole proprietorship, and S corporation. A Limited Liability Company (LLC) is a business structure allowed by the different state statutes. The following will list two of these entities and the business entity which I would choose. Limited Liability Corporation Limited Liability Corporation has a unique quality of being structured like a regular corporation, and having the attributes of a partnership. In a Limited liability corporation the owners are protected from personal liabilities, which are similar to a corporation, but have the tax advantages of the partnership. This means the creditors of the business may not pursue any of the personal assets of members of the LLC to recover any business debts. Also if a member of the LLC has any personal debt, the creditors may not attempt to recover from the corporation. LLC owners, called "members," can manage their businesses or hire professional managers. In addition, LLCs enjoy a lot of flexibility. For instance, they can have as many members...
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...reported as income. The reasons why are that the $25,000 should have been classified as an expense (client advance) on the balance sheet at the time your received it two years ago. It would not have been reported as a deductible expense following the matching principle. In the current year when the $25,000 is reimbursed, the revenue minus the expense equal to zero. However, if you expensed it in the year it was paid, the $25,000 would be reported as income on this year’s income tax. c. Determination regarding reducing the taxable amount of income for both (a) and (b) above? You can make use of an LLC reporting as an S Corporation where wages that are paid to the shareholder may be less than the $300,000. The regular income tax rates will apply regardless, but this legal ploy can save some social security taxes which amount to an additional 15.3% (S-Corporations vs. LLC: Income Tax Savings Benefits, 2012). You can reduce the taxable amount of income by fully funding a variety of retirement plans, such as IRAs, SEP-IRAs, profit sharing. Take advantage of Section 179 (IRS, 2012), you can pay as many current expenses as possible....
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...considered both confidential and proprietary and may not be copied or disclosed to any third party, without the prior written consent of the SMB Group. The content of this proposal supersedes that of any previous proposal. This proposal is valid for thirty (30) days from the proposal date above. SMB Group, Inc. ( www.smb-gr.com ) | 17 Lancaster Rd. Northborough, MA 01532 | (508)410-3562 (P) October 24, 2012 Vishrut Parikh Director, Product Marketing NetSuite 2955 Campus Drive, Suite 100 San Mateo, CA 94403-2511 Dear Vishrut, Thank you for the opportunity to submit a proposal for a whitepaper about the TCO of Cloud/SaaS Delivered Integrated Business Application Suite vs. On-premise Solutions for SMB and Mid-Market Enterprises. This paper will highlight the total cost of ownership of NetSuite’s integrated cloud business application suite vs. comparable on-premise based ERP applications. We realize that you have many choices when selecting a research and consulting partner. The SMB Group is committed to providing real value and unsurpassed satisfaction in both our working relationship and in the services we provide to you. We hope this proposal meets your expectations. We will be happy to modify it as necessary to best meet your requirements. Please do not hesitate to contact us if you have any questions or comments. We look forward to working with you. Sincerely, Sanjeev Aggarwal, Founder and Partner SMB Group 17 Lancaster Rd., Northborough, MA 01532 Sanjeev Aggarwal, sanjeev...
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...S Corporation vs. C Corporation: AComparison Category: Incorporating Your Business When starting a business or changing your business structure, one of the most common options small business owners evaluate is whether to form an S corporation (S corp) or C corporation (C corp). These are the two most common ways to incorporate online, and the choice really depends on your business goals. S corporation vs. C corporation: The similarities The C corporation is the standard corporation, while the S corporation has elected a special tax status with the IRS. It gets its name because it is defined in Subchapter S of the Internal Revenue Code. To elect S corporation status when forming a corporation, Form 2553 must be filed with the IRS and all S corporation guidelines met. But C corporations and S corporations share many qualities: * Limited liability protection. Both offer limited liability protection, so shareholders (owners) are typically not personally responsible for business debts and liabilities. * Separate entities. Both the S corp and C corp are separate legal entities created by a state filing. * Filing documents. Formation documents must be filed with the state. These documents, typically called the Articles of Incorporation or Certificate of Incorporation, are the same for both C and S corporations. * Structure. Both have shareholders, directors and officers. Shareholders are the owners of the company and elect the board of directors, who in turn...
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...Subscribe to the Houston Chronicle | Shopping | Classifieds | Obits | Place an Ad | La Voz Register | Sign In Submit Chron.com Local Directory Home Local US & World Sports Business Entertainment Lifestyle Jobs Cars Real Estate Find&Save in Houston Small Businessby Demand Media501C3s|Advantages of Organizational Structure|Business Models|Business Structures|Charitable Organizations|Flat Organizational Structure|For Profit Businesses|Franchise a Business|More » Small Business > Business Models & Organizational Structure Business Models & Organizational Structure Definition of a Managing Partner of an LLC Definition of a Managing Partner of an LLC If you want to start a business yet limit your liability for business debts, a good choice would be to form a limited liability company. An LLC functions as an entity separate from its owners. ... Featured Picks How to Buy an Existing Franchise How to Buy an Existing Franchise Entrepreneurs choose to buy an existing franchise for the advantages it offers over starting a new business. An existing franchise has name branding, a customer base and a proven strategy for earning ... How to Build a Stakeholder Base for Nonprofits How to Build a Stakeholder Base for Nonprofits A nonprofit organization relies heavily on the relationships it develops with the people and groups in its community. As you try to build a successful nonprofit, you must identify which elements in ... What Is an LLC Annual Report? What...
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...BUSINESS STRUCTURES 1 Husniyah McNeill FIN/571 Professor Timothy Dreyer July 9, 2015 BUSINESS STRUCTURES 2 Business Structures A business entity is an entity that is comprised of a group of people organized for profitable or charitable purposes. Business entities include organizations such as corporations, partnerships, charities, trusts, and other forms of organizations. Business entities are subject to state income tax depending on the laws of the state or states where they conduct business (taxes.about.com). There are three basic types of business structures: Sole Proprietorship, Partnerships, and Corporations (University of Phoenix, Films on Demand, 2011). Depending on the type of business structure one chooses to operate under, will determine how a potential business owner will operate in the business sector. Sole Partnership According to the film on demand video, Sole Proprietorship is considered to be the most common and simplest form of business. Many small businesses operating in the United States are sole proprietorships. An individual proprietor owns and manages the business and is responsible for all business transactions associated with the business (allbusiness.com). Some advantages...
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...RANULFO ALEJADO ACC/537 Financial Accounting Basic Accounting Concepts and Business Structures Executive Summary Most businesses nowadays either sole proprietorship, partnership or corporation should prepare financial statements in accordance with the Generally Accepted Accounting Principles (GAAP). Financial statements are the major source of financial information that would help management, creditors, and investors in their decision making. Financial reporting is one of the responsibilities of the company in communicating financial information, which guides in investment and credit decisions, assessing cash flow prospects, and about company’s resources, and claims to its resources. Accrual and cash basis of accounting are the methods employed in recording financial transactions, which affect the credibility of its financial information. Generally Accepted Accounting Principles Generally Accepted Accounting Principle (GAAP) is a helpful guide in financial reporting. For the past half a century, less than 50% of the GAAP issued are still effective today. These were reviewed and revised in accordance to the investors, and creditors information needs (Fisher, 1998). GAAP are set of standards and procedures that have substantial authoritative support. The organizations responsible in its development are the Securities and Exchange Commission (SEC), American Institute of Certified Public Accountants (AICPA), Financial Accounting Standards Board (FASB) and Government...
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