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What
business structures are available for your
business? |
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BACK
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How
to Establish Business Credit?
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The best structure from building
business credit is one that will:
Separate you from your business
Has its own tax identification number
Separates the debts of the business from
that of the owners/officers
The business structures that will do this
are the following:
S Corporation
C Corporation
Limited Liability Company (LLC)
This is not to say that building business
credit cannot be accomplished with a sole
proprietorship or partnership. Universal can
assist in building any credit profile, but
it is highly recommended to structure your
business properly following the business
credit program.
BACK
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Benefits
of a Corporation |
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Limit
personal liability of officers and owner |
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Protection of personal assets from the
business |
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Protection of corporate assets from the
owners and officers |
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Build a separate business and credit
profile |
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Easier to raise capital |
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Easier to solicit investors |
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Lower tax liability |
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Corporate image |
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Lower risk of IRS audit
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BACK |
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When
is the best time to incorporate?
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The best time to incorporate is when
your business:
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Has over $25,000 per year in sales |
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Is a high-liability business |
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Needs to take advantage of the many tax
benefits of a corporation |
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Needs to utilize the many retirement plans
for officers/owners
(The above criteria is only meant as a
guideline)
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BACK |
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When to use an S
corporation? |
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When the owners live in a state with no
personal state income tax |
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Have one or two individuals who own the
company (up to 35) |
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Have sales less then $250,000
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BACK |
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When to use a C
corporation ? |
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When the
owners live outside the country |
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When the owners live in a state with a
state income tax |
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When several individuals are involved in
the ownership |
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When other entities are involved in the
ownership |
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Have sales greater than $60,000
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BACK |
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When to use a Limited Liability Company, LLC
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BACK
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QUESTIONS AND ANSWERS