To Be Or Not To Be…What Business Entity Is For Me

Posted by Tahneesha on Oct 19th, 2009 | 2471 commenthttp://www.avirtualblessing.com/to-be-or-not-to-be%e2%80%a6what-business-entity-is-for-me/To+Be+Or+Not+To+Be%E2%80%A6What+Business+Entity+Is+For+Me2009-10-19+17%3A22%3A54Tahneesha

I am continuing the ABCs of small business series explaining key points that may be helpful in your business planning and start- up phases. This week’s letter is E for (business) Entity. Selecting the correct entity can be a little confusing so it is best to consult an attorney with any questions; however, I am going to provide you with a quick guide to jump start your research. In selecting the right entity for your business, you must consider all the taxation, liability and recordkeeping involved. In addition to federal taxes, you will have to pay any applicable state and local taxes so exercise your due diligence.

According to the IRS the most common forms of businesses are listed below:

• Sole Proprietorship: It is an unincorporated business that is fairly easy to form. The owner is completely responsible for all financial debts or obligations.
• Partnership: It a relationship between two or more partners sharing the profits and losses of the business.
• Corporation: It is a more complex entity with additional regulations and tax requirements than the aforementioned entities. A corporation is a separate legal entity; therefore, no personal liability is generally involved.
• Limited Liability Company (LLC): This newest business entity is fairly popular because of the combination features of the corporation and partnership. The LLC owner, referred to as a member, generally have limited personal liability for the debts and still have flexibility in management.

What entity did you select? Did you consult an attorney or find the information you needed online?

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247One Responsehttp://www.avirtualblessing.com/to-be-or-not-to-be%e2%80%a6what-business-entity-is-for-me/To+Be+Or+Not+To+Be%E2%80%A6What+Business+Entity+Is+For+Me2009-10-19+17%3A22%3A54Tahneesha

1. Banking Accounts: It’s Not Personal- It’s Business | A Virtual Blessing says:

   November 2, 2009 at 12:59 pm

   [...] items required by banks differ depending on state and business entity.  It is best to check with the bank before you attempt to open a business [...]

   Reply

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