When referring to corporate filings, even a minor error can be the reason for failure in meeting specific filing requirements. Some common mistakes in the industry are name issues, misstatements or omissions. Every company type has key advantages and disadvantages. Here are some things to think about if you are deciding whether to form an LLC incorporate as an S corporation, or C corporation, or to file a DBA.
If you are starting a business, it’s very important to protect your benefits. First of all, you need to create a business entity for your company such as a corporation. Benefit corporation is an example. If you want to make a positive impact on the environment and society without forming a non-profit corporation, then a b-corporation is your best choice. B-corporations also strive to contribute to the public. B-corporations presume return on investments, unlike non-profits. It’s a new type of business, where directors balance the public interest, the interest of shareholders and other stakeholders.
A C Corporation is a business entity which profits are taxed separately from it’s owners. The company is managed by a board of directors, which is elected by the owners. But they have limited liability and are not responsible for their debts.
Other benefits of C Corporation:
DBA name is a fictitious business name entirely different from your personal name, partner’s name or the officially registered LLC or corporation name. The legal name must match the name of the person or entity that owns the business. Then, you can rename it and register it as a DBA name.
A limited partnership has at least one general partner and one limited partner. The general partner has the same role as a general partnership: controlling the company’s day-to-day operations and also being personally liable for business debts.
LLC is a legal structure by which the members of the company cannot be held personally liable for the company’s debts or liabilities. While each state has some differences to forming an Limited Liability Company, they all have similar general principles:
A Limited Liability Partnership is basically a general partnership but with the addition of giving the partners at least some limited personal liability. Some states provide a limitation of personal responsibility that is similar to a corporation.
Advantages of LLP:
A Nonprofit corporation is a special type of corporation which must meet specific tax-exempt purposes. Furthermore, to qualify for Nonprofit status, your corporation must be formed to benefit: the public, a specific group of individuals, or the membership of the Nonprofit.
Nonprofits include religious organizations, charitable organizations, political organizations, credit unions and membership clubs.
Professional corporations and professional limited liability companies (PLLC) are corporations and limited liability companies which organized for the purpose of providing professional services. Usually, professions where the state requires a license to provide services, require the formation of a professional corporations or PLLC.
An S Corporation is a special type of corporation which is done through IRS TAX ELECTION. Also, it is a corporation with the Sub chapter S designation from the IRS, which makes the S corp different from a traditional corporation (C corp). The difference is that profits and losses can pass through to your personal tax return. Some S Corporation Advantages:
The sole proprietorship is the simplest business form under which, one can operate a business. Also, the sole proprietorship is not a legal entity. It simply refers to a person who owns the business and is personally responsible for its debts. The sole proprietorship is a popular business form because of its simplicity, ease of setup, and nominal cost. Therefore, you need only register your name, secure local licenses, and the sole proprietor is ready for business.
The advantages of a Sole Proprietorship:
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