Business Entity Choice - Tax Services
Choosing the right entity name for your
business or practice can make all the difference in the world
when it comes to managing your finances or preparing your
all too important tax returns. Our professionals can help
you determine whether an LLC or S-Corp tag is appropriate
for your business.
Mullin and Associates, CPAS, PC. will ask the right questions
and examine your finances in detail to determine which entity
is most suited to your needs.
Limited Liability
Company (LLC) When permitted by state
law a LLC is generally the most convenient and flexible format.
The LLC avoids many of the tax problems and the maintenance
expenses associated with corporations. The law effectively
insulates the owners of the company from any liability produced
by the business. Personal assets are not subject to the risks
of a business operated within the LLC.
In some circumstances, physicians and some
other licensed professionals cannot shield themselves from
liability with either an LLC or a corporation. In order
to protect the family home and savings, an alternative
route is needed. If you can't limit your personal exposure
to claims, use a strategy such as a Family Limited Partnership
(FLP), an LLC, or a trust, which will protect the assets
themselves.
Inc. - Incorporated. A professional practice that cannot
be conducted as an LLC should be incorporated. Although the
corporation does not offer protection from malpractice claims,
it can insulate you from many other types of business risks.
When you use a corporation, you are not responsible for corporate
obligations unless you have given your personal guarantee.
Also, you will be shielded from most types of claims from
employees, suppliers, and landlords.
If you have other partners in your professional practice,
you can limit your liability for claims arising from their
negligence by incorporating your practice.
S-Corporation Since a corporation is a taxpaying
entity, you will have to plan for eliminating a potential
double tax on corporate earnings. This can be accomplished
by using an S Corporation or by zeroing out corporate income
through salaries to officers. To ensure that the corporation
will be respected for legal and tax purposes, the corporate
formalities of minutes, bylaws, and stock certificates must
be observed. All of your dealings with third parties should
be conducted in the corporate name, and a separate corporate
bank account must be used.
Remember,
every patient or customer represents a potential liability—threatening whatever
savings your business has accumulated. Mullin & Associates, CPAS, PC.
can provide you with the help you need selecting the right
business entity. Please phone our office at (248) 620-5660 or Contct
Us Online to schedule a consultation or appointment.
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