Posts Tagged ‘LLC’

Steps for Helping Entrepreneurs Become Bullet Proof

February 28th, 2010

Words can’t describe how important it is that business owners separate themselves from their business. If you don’t understand why you should never co-mingle your personal and business activities, please continue to read, do some deep research or get sued by a business creditor and see how far his attorney will go to take everything you own personally. It’s not a fun route to travel on. Let’s do it right the first time and start to learn ways of separating yourself from your growing enterprise.

Here are a few things you can do. Get some business cards with a logo. Start a website and direct your customers there. Get a phone number for your business so you don’t have customers calling your cell phone at all hours of the night.

If you would like to just do business without actually filing any paperwork you can, technically. You would become a sole proprietorship. If there are more than one of you doing business together, you can be a partnership. If you actually want your business to become a legal separate entity then you would need to do a little leg work. If you just want to start selling something and leave yourself open for lawsuits then a sole prop is probably okay.

If you want to truly separate yourself from your business by forming an LLC or a Corporation, you have to actually do some work to gain that status of complete separation. Your state will require documents to be completed and filed with them to establish an LLC or Corporation. You will also need to deal with the IRS and get an EIN issued to your business.

If you elect to run your business as a partnership or sole prop then you are fully responsible for all business obligations including commitments made to employees, customers and banks. That’s right, you will be responsible for the business’ debt if creditors show up at your door.

The most important reason for choosing to form a limited liability company or a corporation is to give you, as the business owner, some liability protection for dumb (and often uncontrollable) things that happen within or as a result of your business. Because there are so many different strategies and types of LLCs and Corps, I would highly recommend consulting with a professional before pulling the trigger on the formation. In my opinion, complete separation is Business 101 and shouldn’t be overlooked or taken too lightly.

Jared writes articles about offshore company incorporation and teaches people what to know about set up llc


Comments Off »

Posted in Law

Tags:

Know Your Options Before Your Form An LLC

February 21st, 2010

When forming an entity, it’s always a good idea to think the process through before you begin. Entity formation can be as complicated as you make it or as easy as 1,2,3. In this article, I want to highlight a few of the most popular entity structures that are being used by most business owners. Enjoy your reading!

When you talk with you accountant, legal adviser or entity former make sure you understand what you are asking them to do. If you say that you want a corporation setup then that’s probably what they will do. If you say that you want an entity setup, then it’s a broader question and they will dig deeper to find out which type of entity structure you need.

Corporations give business owners protection again legal actions that might come against their business. It protects them personally from business lawsuits. (as long as the corp. is setup properly). In addition to liability protection to the owners, it also has a host of tax advantages that are often missed by entrepreneurs who choose to operate as a sole proprietor.

Limited Liability Companies are often referred to as LLC’s. They offer similar advantages as the corporation such as limited liability (hence the name) and tax advantages for properly structured LLC’s.

If you do nothing but get a business license, you are essentially a sole proprietor. Sole proprietorship don’t have to apply for a nation employer identification number and most of the time can just use their personal social security number as their recognizable ID. When it comes to taxes, the return for a sole prop business is schedule C of the 1040. This is found on your personal tax returns. It’s easy to start a business and it you don’t have the money to file another type of entity, just do this.

Both Corps and LLCs offer similar advantages when trying to raise money from outside capital sources. It’s hard for an investor to take a piece of equity in a sole prop. It’s impossible because it’s just you. Having a separate entity allows for investors to come in and invest in exchange for equity.

Jeremy tries to teach people that if they want to Form LLC Free information can be found here. You can also learn how to how to incorporate yourself once you have that business started.

categories: entity,corporation,LLC,legal,strategy,finance


Comments Off »

Posted in Law

Tags:

LLC Filing Helps Small Businesses Stay Legal

November 26th, 2009

Limited liability companies (LLC) are great for medium and small companies alike. Forming an LLC is quite easy for any business who would like to start off, since it does not require much paperwork to worry about.

Having the personal protection of assets like that offered to corporations against business debts is truly great. As long as you make sure that your LLC complies with all the requirements, there are absolutely no worries for you of losing personal assets in case you are sued.

This feature is the best edge and advantage that an LLC can offer. It provides only limited liability for owners of the business or what can be referred to as members, as from the name itself. In forming an LLC, its members will be able to operate separately from the company, and will not be held personally liable for the company’s debts and other liabilities.

Unless the member made a personal guarantee to himself. This means that if the company goes bankrupt and they owed money to its suppliers, the suppliers cannot sue the any of members on the personal level.

Another advantage of forming an LLC is it will allow you to register and protect your business name. As for a single proprietor, having this benefit is not an option at all. Aside from m this, forming an LLC will also allow you to have unlimited members to your business and this provides great flexibility in case you need to expand your business in the future. Double taxation is also avoided when you form an LLC since the profits and losses of the business passes directly onto the owners – a great advantage LLC offers over a corporation.

The best thing is that owner of LLC don’t have to be U.S citizens or residents. There are also a few requirements when forming an LLC. Just be sure to check your local government and state for what it will require for LLC formation. There are cities that will require you a license to operate but this isn’t a big cost and it is only a one-time affair.

As an overview on how LLC formation is done, there are only a few steps that you have to take such as preparing or choosing a name for your business, forming a structure for management, creating Articles of Organization and dealing with legal and tax documentations.

If you have a clear business plan and want to have your business to have a good start, you can to form an LLC. It offers great flexibility and sensibility in the long run. You can also consult LLC formation services if you don’t want to worry about state and federal forms.

Ronny Jacobs is a topical expert about how to form an llc online and incorporating.


Comments Off »

Posted in Law

Tags: