Tags |
|
|
Links |
|
|
Article Check - Differences Between LLCs and S-Corps
The future of your business may become may depend on 6 little growth secrets that many businesses have used in the past though not in a matter that creates rapid growth. So how do you create quicker revenue or profit growth with your business?The days of just helping your customers with solutions to their problems is becoming a redundant saying, it is almost a given. What if you could do something else that they would not expect? What if you could show them "The FUTURE of their business". How can you do that you say? Well there are 6 little steps that can assist you in doing this.Why are these steps important, bottom
5. Distribution of Profits and Losses: It is flexible since an LLC allows you to decide what share of the LLC profits and losses each owner will receive.
C. Formalities
1. Very little formalities required. Operating agreement is recommended, annual meetings not required.
2. A reporting fee of $25 and a statement of information are required 90 days after formation and then every two years.
D. Other Characteristics
1. Licensed professional in California must form a Professional Corporation instead.
2. Owners are called “members”
3. Members may be individuals or separate legal entity such as a corporation.
4. Member’s investment receives a percentage ownership interest in return.
Percentage ownership determines how profit and losses are split up.
© 2006 Michael N. Cohen, Esq. This article is not intended as a substitute for legal advice. The specific facts that apply to your matter may
Everywhere you look today, you see them. The logos are plastered all over the entryways into most business shops you see on the roads, you seem the at the bottom of every order form page online or in the paper, and even the olympics and the NFL!Visa and Mastercard logos are everywhere you want, or don't want them to be!With the country today spending so much money on credit, with the "buy now, pay later" mentality, accepting credit cards will truly increase your business simply by accepting these forms of payments.Debit cards are standard becoming the way younger adults pay. Cash is becoming also as obsolete
I. S-Corporation
A. Liability
1. Shareholders granted personal protection from debts and liabilities of business (like c-corp and LLC)
B. Taxation
1. Pass through: Profits and losses pass through the corp and reported to the individual tax return of shareholder (same as partnership and LLC)
2. Self-Employment Tax Break: Profits of the S-Corp which pass through to the shareholders are not subject to self-employment tax (Social Security and Medicare which is approximately 15%). Rather, self-employment is only taxed on the portion classified as a "reasonable salary". LLCs and sole-proprietorships must pay self-employment tax on all income. The ability to minimize self-employment tax is deemed to be one of the greatest benefits of a s-corporation.
3. Corporate Losses: losses in the corporation can be deducted from the individual tax returns of the shareholder thereby allowing them to offset other sources of income such as their W-2 income.
4. Franchise Tax: Franchise Tax is waived your first year. LLC on the other hand, must pay franchise tax its first year. S-Corp must pay the CA Franchise Tax board either a 1.5% tax on net CA income or $800, whichever is greater.
5. Distribution of Profits and Losses: No special allocation of profit and losses for shareholders. Corporate profits and losses must be split up proportionately to the percentage of shares owned by each shareholder. LLC’s on the otherhand allow for flexibility as to how they split their profits and losses.
C. Formalities
1. Must file an S-Corporation annual income tax return each year (IRS Form 1120S)
2. Must file annual report with Secretary of State, and a reporting fee of $25 and a statement of information are required 90 days after formation.
3. Must maintain corporate formalities such as: Drafting Bylaws, Minutes, Annual Meetings, issuance of stock, to keep a paper a trail of financial dealings between the corporation and its shareholders, and to avoid “piercing of the corporate veil.”
D. Other Characteristics
1. No more than 100 shareholders
2. Shareholders must be US citizens or have US residency status
3. Shareholders must be individuals (not corporations or partnerships)
4. Only one class of stock (but different voting rights permitted, and same rights to participate in dividends and sale of assets)
5. Owners are called “shareholders”
II. LLC
A. Liability: shareholders granted personal protection from debts and liabilities of business (like s and c-corp)
B. Taxation
1. Pass through: Profits and losses pass through the LLC and reported to the individual tax return of shareholder (same as partnership and Corps)
2. Self-Employment Tax: LLC members must pay self-employment tax on all income from the LLC.
3. LLC Losses: losses in the LLC can be deducted from the individual tax returns of the member thereby allowing them to offset other sources of income such as their W-2 income.
4. Franchise Tax: Must pay first year minimum annual tax of $800, and is due 75 days after formation and every year thereafter. Annual franchise tax is greater if total reported income is greater than $250,000. See http://www.ftb.ca.gov/forms/06_forms/06_3522.pdf.
5. Distribution of Profits and Losses: It is flexible since an LLC allows you to decide what share of the LLC profits and losses each owner will receive.
C. Formalities
1. Very little formalities required. Operating agreement is recommended, annual meetings not required.
2. A reporting fee of $25 and a statement of information are required 90 days after formation and then every two years.
D. Other Characteristics
1. Licensed professional in California must form a Professional Corporation instead.
2. Owners are called “members”
3. Members may be individuals or separate legal entity such as a corporation.
4. Member’s investment receives a percentage ownership interest in return.
Percentage ownership determines how profit and losses are split up.
© 2006 Michael N. Cohen, Esq. This article is not intended as a substitute for legal advice. The specific facts that apply to your matter may
A biometric time clock is a complex device requiring expert handling. It has many settings that a layman may fail to understand. Biometric time clocks are very important for all businesses these days. These timekeepers are designed to assist organizations in keeping track of employee hours for payroll purposes. The technique uses fingerprints or biometric hand recognition to identify the employee. A biometric time clock requires a specified set of tools and equipments for installation.Biometric time clock manuals are a must during the initial handling of this equipment. One who reads these guides can easily set up, handle,
3. Corporate Losses: losses in the corporation can be deducted from the individual tax returns of the shareholder thereby allowing them to offset other sources of income such as their W-2 income.
4. Franchise Tax: Franchise Tax is waived your first year. LLC on the other hand, must pay franchise tax its first year. S-Corp must pay the CA Franchise Tax board either a 1.5% tax on net CA income or $800, whichever is greater.
5. Distribution of Profits and Losses: No special allocation of profit and losses for shareholders. Corporate profits and losses must be split up proportionately to the percentage of shares owned by each shareholder. LLC’s on the otherhand allow for flexibility as to how they split their profits and losses.
C. Formalities
1. Must file an S-Corporation annual income tax return each year (IRS Form 1120S)
2. Must file annual report with Secretary of State, and a reporting fee of $25 and a statement of information are required 90 days after formation.
3. Must maintain corporate formalities such as: Drafting Bylaws, Minutes, Annual Meetings, issuance of stock, to keep a paper a trail of financial dealings between the corporation and its shareholders, and to avoid “piercing of the corporate veil.”
D. Other Characteristics
1. No more than 100 shareholders
2. Shareholders must be US citizens or have US residency status
3. Shareholders must be individuals (not corporations or partnerships)
4. Only one class of stock (but different voting rights permitted, and same rights to participate in dividends and sale of assets)
5. Owners are called “shareholders”
II. LLC
A. Liability: shareholders granted personal protection from debts and liabilities of business (like s and c-corp)
B. Taxation
1. Pass through: Profits and losses pass through the LLC and reported to the individual tax return of shareholder (same as partnership and Corps)
2. Self-Employment Tax: LLC members must pay self-employment tax on all income from the LLC.
3. LLC Losses: losses in the LLC can be deducted from the individual tax returns of the member thereby allowing them to offset other sources of income such as their W-2 income.
4. Franchise Tax: Must pay first year minimum annual tax of $800, and is due 75 days after formation and every year thereafter. Annual franchise tax is greater if total reported income is greater than $250,000. See http://www.ftb.ca.gov/forms/06_forms/06_3522.pdf.
5. Distribution of Profits and Losses: It is flexible since an LLC allows you to decide what share of the LLC profits and losses each owner will receive.
C. Formalities
1. Very little formalities required. Operating agreement is recommended, annual meetings not required.
2. A reporting fee of $25 and a statement of information are required 90 days after formation and then every two years.
D. Other Characteristics
1. Licensed professional in California must form a Professional Corporation instead.
2. Owners are called “members”
3. Members may be individuals or separate legal entity such as a corporation.
4. Member’s investment receives a percentage ownership interest in return.
Percentage ownership determines how profit and losses are split up.
© 2006 Michael N. Cohen, Esq. This article is not intended as a substitute for legal advice. The specific facts that apply to your matter may
Are you a small to medium sized business owner? If so, are all of your duties and tasks performed by your own employees, under your own roof? If so, you may want to consider outsourcing a number of your business services. This doesn’t necessarily mean that you have to eliminate a portion of your staff, but it does mean that you can give them additional, more important tasks to focus on.One of the many services that you may want to consider outsourcing to another individual or company is your business mail. If you choose to do this, you will likely be seeking a business mail service. A business mail service specializes
C. Formalities
1. Must file an S-Corporation annual income tax return each year (IRS Form 1120S)
2. Must file annual report with Secretary of State, and a reporting fee of $25 and a statement of information are required 90 days after formation.
3. Must maintain corporate formalities such as: Drafting Bylaws, Minutes, Annual Meetings, issuance of stock, to keep a paper a trail of financial dealings between the corporation and its shareholders, and to avoid “piercing of the corporate veil.”
D. Other Characteristics
1. No more than 100 shareholders
2. Shareholders must be US citizens or have US residency status
3. Shareholders must be individuals (not corporations or partnerships)
4. Only one class of stock (but different voting rights permitted, and same rights to participate in dividends and sale of assets)
5. Owners are called “shareholders”
II. LLC
A. Liability: shareholders granted personal protection from debts and liabilities of business (like s and c-corp)
B. Taxation
1. Pass through: Profits and losses pass through the LLC and reported to the individual tax return of shareholder (same as partnership and Corps)
2. Self-Employment Tax: LLC members must pay self-employment tax on all income from the LLC.
3. LLC Losses: losses in the LLC can be deducted from the individual tax returns of the member thereby allowing them to offset other sources of income such as their W-2 income.
4. Franchise Tax: Must pay first year minimum annual tax of $800, and is due 75 days after formation and every year thereafter. Annual franchise tax is greater if total reported income is greater than $250,000. See http://www.ftb.ca.gov/forms/06_forms/06_3522.pdf.
5. Distribution of Profits and Losses: It is flexible since an LLC allows you to decide what share of the LLC profits and losses each owner will receive.
C. Formalities
1. Very little formalities required. Operating agreement is recommended, annual meetings not required.
2. A reporting fee of $25 and a statement of information are required 90 days after formation and then every two years.
D. Other Characteristics
1. Licensed professional in California must form a Professional Corporation instead.
2. Owners are called “members”
3. Members may be individuals or separate legal entity such as a corporation.
4. Member’s investment receives a percentage ownership interest in return.
Percentage ownership determines how profit and losses are split up.
© 2006 Michael N. Cohen, Esq. This article is not intended as a substitute for legal advice. The specific facts that apply to your matter may
A business plan is your most important tool when going after financing -- private and government -- says James Byrne, Director of the Small Business Consumer Centre.Byrne offers these tips to make your business plan stand out from the crowd.1. The process is as important as the plan itself. Do it yourself, and you'll come away from the experience with a more in-depth, more organized and more crystal-clear vision of your business. If the investor sees that you've invested the time, energy and unified effort to develop your own business plan, you're already past the first hurdle. When you're done, you might conside
5. Owners are called “shareholders”
II. LLC
A. Liability: shareholders granted personal protection from debts and liabilities of business (like s and c-corp)
B. Taxation
1. Pass through: Profits and losses pass through the LLC and reported to the individual tax return of shareholder (same as partnership and Corps)
2. Self-Employment Tax: LLC members must pay self-employment tax on all income from the LLC.
3. LLC Losses: losses in the LLC can be deducted from the individual tax returns of the member thereby allowing them to offset other sources of income such as their W-2 income.
4. Franchise Tax: Must pay first year minimum annual tax of $800, and is due 75 days after formation and every year thereafter. Annual franchise tax is greater if total reported income is greater than $250,000. See http://www.ftb.ca.gov/forms/06_forms/06_3522.pdf.
5. Distribution of Profits and Losses: It is flexible since an LLC allows you to decide what share of the LLC profits and losses each owner will receive.
C. Formalities
1. Very little formalities required. Operating agreement is recommended, annual meetings not required.
2. A reporting fee of $25 and a statement of information are required 90 days after formation and then every two years.
D. Other Characteristics
1. Licensed professional in California must form a Professional Corporation instead.
2. Owners are called “members”
3. Members may be individuals or separate legal entity such as a corporation.
4. Member’s investment receives a percentage ownership interest in return.
Percentage ownership determines how profit and losses are split up.
© 2006 Michael N. Cohen, Esq. This article is not intended as a substitute for legal advice. The specific facts that apply to your matter may
We might be in the electronic gaming era, but it’s more like a fun game of Monopoly this business for pleasure of sport franchise ownership. The stakes are high, spending free, and visible worries few.Despite the escalating fees for entry into the game, personal franchise ownership hasn’t been replaced by corporations. Of 121 big league professional sports franchises, only 15 have found their way into corporate hands. Most owners claim to be losing money which would explain takeover shyness of shareholder controlled companies. It’s nicer to think sole owners don’t want to sell because sports ownership is too much fun. A nic
5. Distribution of Profits and Losses: It is flexible since an LLC allows you to decide what share of the LLC profits and losses each owner will receive.
C. Formalities
1. Very little formalities required. Operating agreement is recommended, annual meetings not required.
2. A reporting fee of $25 and a statement of information are required 90 days after formation and then every two years.
D. Other Characteristics
1. Licensed professional in California must form a Professional Corporation instead.
2. Owners are called “members”
3. Members may be individuals or separate legal entity such as a corporation.
4. Member’s investment receives a percentage ownership interest in return.
Percentage ownership determines how profit and losses are split up.
© 2006 Michael N. Cohen, Esq. This article is not intended as a substitute for legal advice. The specific facts that apply to your matter may make the outcome different than would be anticipated by you. You should consult with an attorney familiar with the issues and the laws.
HTTP = HTML link (for blogs, profiles,phorums):
<a href="http://www.caseupon.com/article/3523/caseupon-Differences-Between-LLCs-and-SCorps.html">Differences Between LLCs and S-Corps</a>
BB link (for phorums):
[url=http://www.caseupon.com/article/3523/caseupon-Differences-Between-LLCs-and-SCorps.html]Differences Between LLCs and S-Corps[/url]
Related Articles:
Are You Dramatically Different?
Business Owner's Essentials - The 5 Biggest Challenges for Today's Business Owner
Annual Report Themes – Ideas for Non-profit Annual Reports
Bookmark it:
|