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It is usually said that one of the primary steps in starting a business is to select the right entity structure. There is no denying the fact that the online world can mislead you with information from unverified sources. Selection of the wrong entity in commencing with a business can cost you thousands in taxes and loss of assets. This is where we can help you effectively. We would make you take all the right decisions and prepare the requisite documents to establish various types of entities like corporations, LLCs, partnerships, etc. With our guaranteed incorporation services, we can help you prepare the documents efficiently.
A Limited Liability Company or an LLC is that type of business model which exhibits the properties of both the sole-proprietorship and corporation. Note that an LLC is eligible for the taxation feature of a sole proprietorship or partnership. At the same time an LLC business model limits the liability of the owners.
Note that an LLC is not a separate entity. In other words, the company doesn’t pay taxes and reports its losses. This is usually executed by the founders as they have to report the business losses or profits on tax returns. Always remember that just like corporations, members of the LLC are secured from the private liabilities
For Individual Establishment- File Form- 1040 with Pricing C
As the name suggests, an individual establishment is a business owned by a single person. This single individual is responsible for the entire business operations and is the sole recipient of the organization’s profits. When compared to other legal structures, the individual establishment organizations require less paperwork. Moreover, they are exposed to a fewer business restrictions when compared to others. It is also a popular business model because of its simplicity and easy nature. As an individual establishment, you have to secure local licenses to conduct business operations.
Partnerships- File Form 1065
A partnership refers to the bond between two or more individuals who wish to continue a trade or a business. It is important to note that a partnership doesn’t have to pay taxes on its profits. However, it has to publicize its operating profits and losses via the Form-1065. Also, the partnership business has to send the K-1 form to the owners or the partners through whom they can state their financial losses and gains. With the help of these forms, the IRS is aware about the profit and loss allocated to each partner.
Corporation- File Form-1120
To be frank, a corporation is a separate entity from the shareholders. Moreover, the corporations offer limited liability protection to the directors and shareholders. Note that the corporations are separate taxpayers for the purposes of federal taxes. Moreover, a corporation files its own federal income tax return and that’s why it pays its own income taxes.
