Pointers for Entity Formation in US
Most business owners today have considered the process of establishing an appropriate legal entity for their businesses. Business today refers to the continuity and there is a starting point for continual processes. This point gets started with the incorporation. If you are an American citizen or residing in the US and are aiming for a business entity formation, then you can get categorized under the following types:
* Sole Proprietorships
* Partnership
* Limited Liability Company
* Corporation
For advice and professional guidance on business entity formation in US there are leading tax planning service providers that you can get in touch with. The four kinds of entity formation are discussed below:
* Sole Proprietorship
This is also known as a sole trader or a proprietorship and is owned and operated by an individual. There is zero legal difference between the business and owner and can be established at an affordable cost. It is easy to to dissolve and generally involves no tax planning.
* Partnerships
This too can be established at a reasonable price. Partnership business consists of two or more people or any business entity sharing the profits and loss that are incurred equally. Each partner involved here has joint responsibilities to the partnerships. Simultaneously, any partner might be held accountable for paying off the total debts of partnership irrespective of his participation in capital contribution, profit or losses.
* Limited Liability Companies (LLCs)
LLC is a highly flexible entity formation type and can be used for several business types. The members here can but does not need to have limited liability. They are free to choose whether to be taxed either as partners or as corporations.
* Corporations
Corporation’s are slightly intricate as compared to the other business kinds. A new legal entity is established by forming a corporation that is separate from its owners. Owing to the state law, a corporation can be owned by a single person or can have one officer or director.
This apart tax planning service providers’ in the US offer services like:
* Registered Agency Service
* Application of EIN
* Maintenance of minute books and drafting of resolutions
* Business Licenses & permits
* Bylaws and Operating Agreements
* Certificates of Good standing
* Corporate & Compliance kits
* Registering a Business name
* Foreign Incorporations for operations in multiple states
* Filing of Annual/Franchise tax
* Testimonials
A thorough market analysis indicates that most business functions as partnerships or as a sole proprietorship and need not leverage other advantages that are accessible. These advantages might comprise the crucial components for instance enhanced tax treatment, restricting personal liability or adding a professional touch to the business by adding an INC or LLC.
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