Countless decisions go into forming a new business, whether you are purchasing an existing one under a new company or starting from scratch. From picking a legal entity to planning for the future, all of these early decisions could set the tone for long-term profitability. Our seasoned business law attorneys can guide you during this decision-making process.
Filling out the necessary documents to form a business is easy. A mistake during the formation of a business could have a lasting impact for many years to come. With the help of our Kernersville business formation lawyers at Apple Payne Law, you can set the stage for success with your new venture.
One of the most important decisions a new business will make is the legal structure that it takes. Each of the different types of business entities has its own drawbacks and benefits. A competent Apple Payne Law business formation attorney serving Kernersville can help select the best business entity for the specific goals of the new company.
A limited liability company—or LLC—also enjoys liability protection for its members but does not face the taxation issues that corporations must deal with. LLCs are limited in size, however, and while they are the preferred structure, they are not the best fit for all circumstances.
A partnership is an entity formed by two or more people that generally split the operation, management, profits, and losses of the business. It is one of the simplest structures for new businesses. While a partnership structure is flexible and simple to create, it leaves owners personally liable for its debts. A creditor could sue each of the partners directly to resolve a debt. Additionally, there can be tax issues that arise with a partnership and these should be explored carefully before choosing a partnership structure rather than an LLC or Corporation.
Corporations offer important protections that are not available to partnerships. With a corporation, the shareholders are protected from personal liability. This structure is also a viable option for companies with many owners, but corporations have some tax-related drawbacks. Corporate shareholders may be taxed twice on business income, once one the corporate level and again as an individual unless proper case is taken to setup the corporation as s-corp in accordance with IRS Regulations.
Developing the structure of a new business involves more than selecting the right type of entity. There are also important decisions to be made for taxation purposes. The right business structure could take advantage of an array of tax benefits, while the wrong setup could lead to unnecessary tax burdens.
One of the ways a qualified attorney at Apple Payne Law can serve a new Kernersville company is by helping them coordinate their setup of the business (and any growth/modifications that need to be made) with their CPA and financial advisors.
Whether you are starting a new business or buying an existing business, it is imperative that you take the steps needed to avoid tax liabilities or other future conflicts. These steps include selecting your entity type, planning for future tax issues, and reaching agreements with employees, vendors, and contractors.
This process is made easier by talking to experienced legal counsel at the beginning. Reach out today to learn how our Kernersville business formation lawyers at Apple Payne Law might be able to help.