Starting a New Business

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Need Help Starting Your New Business?


You've come to the right place. If you need more information about forming or running your small business before you incorporate, you  can rely on us to help you get started.


Take advantage of one of our free start-up consultations to learn more about the topics that interest  you most.


  • The differences between a corporation, an S-corporation and an LLC.
  • The state(s) in which most people incorporate or form an LLC.
  • How the incorporation process works.

 

Choose the Right Business Structure


From  the beginning, it's critical to select the appropriate corporate  structure for your business, which will have legal and tax implications.  The structure you choose can also ensure the success of  future  decisions, such as raising capital or exiting the business.


Most  startups should probably operate as either an LLC or an S-Corporation,  The benefit being that because starting with one of those structures and  converting to a C-Corporation later is much easier than starting as a  C-Corp and trying to convert to an LLC or S-Corp. To determine which  structure is best for your business, let's outline four considerations:


  • Liability limitations:  For C-Corps, S-Corps and LLCs, the owners' personal liability is  generally limited to the amounts invested and loaned. There is unlimited  liability for general partners.
  • Startup losses:  If your company is an S-Corp or an LLC, also known as "pass-through"  entities (because tax liabilities and benefits "pass through" to the  owners' personal tax return), you can usually write off startup costs as  losses on your personal tax return. In a C-Corp, startup costs  producing tax losses can only be utilized at the business level and  offer no future benefit if the new company has future tax profits.
  • Double taxation: Generally, double taxation of earnings is avoided for pass-through entities, but not for C-Corporations.
  • Capital-raising plans: If  you plan to take your business public or raise funds through private  equity, these plans may require that the company not be a pass-through  structure.

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