Tax Time
A Comprehensive Income Tax and Financial Management Service

Business Start-Up

At Tax Time, we have a passion for helping start up your business entity.  Whether it is a profit or non-profit entity; Sole Proprietorship, Partnership, Corporation or LLCs, we have the experience and know how to file the proper documents to get your business established.  We have helped many clients file applications for recognition of exemption, corporate charters, articles of incorporation, business license, sales and use tax, bylaws and well as application for employer identification numbers.  We can also assist with strategic planning, business planning and setting up your accounting systems. 

Please give us a call for a personal free consultation appointment to discuss your business needs.




Below is a simple chart to explain the considerations of forming an LLC vs a corporation.

 

LLC vs C Corporation vs S Corporation

 

Entities Characteristics

LLC Limited Liability Company

C Corporation

S Corporation

Ownership Rules

Unlimited number of members allowed

Unlimited number of shareholders; no limit on stock classes

Up to 100 shareholders; only one class of stock allowed

Personal Liability of the Owners

Generally no personal liability of the members

Generally no personal liability of the shareholders

Generally no personal liability of the shareholders

Tax Treatment

The entity is not taxed (unless chosen to be taxed); profits and losses are passed through to the members

Corporation taxed on its earnings at a corporate level and shareholders are taxed on any distributed dividends

With the filing of IRS Form 2553, a C Corporation becomes a S Corporation, where the profits and losses are passed through to the shareholders

Key Documents Needed for Formation

Articles of Organization / Certificate of Formation; Operating Agreement

Articles of Incorporation; Bylaws; Organizational Board Resolutions; Stock Certificates; Stock Ledger

Articles of Incorporation; Bylaws; Organizational Board Resolutions; Stock Certificates; Stock Ledger; IRS & State S Corporation election

Management of the Business

The Operating Agreement sets forth how the business is to be managed; a Member (owner) or Manager can be designated to manage the business

Board of Directors has overall management responsibility; Officers have day-to-day responsibility

Board of Directors has overall management responsibility; Officers have day-to-day responsibility

Capital Contributions

The members typically contribute money or services to the LLC and receive an interest in profits and losses

Shareholders typically purchase stock in the corporation, either common or preferred

Shareholders typically purchase stock in the corporation, but only one class of stock is allowed

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