TVC Seminar - CEO Scott Letourneau Speaks at TVC Seminar on "Types of Business Organizations".
April 25, 2006 - Las Vegas , Nevada , CEO Scott Letourneau of Nevada Corporate Planners, Inc. spoke to entrepreneurs regarding the different types of business organizations.
One person is owner/manager, assets owned by owner, All profits and losses to the owner, Owner personally liable, No regulatory filings to establish the entity, Single tax return, with owners federal/state return, tax paid by owner on personal return, Easy to set up=easy to lose all your assets, Higher rate by the IRS audit.
Two or more owners, assets owned by partnership, Each partner equal in management decisions, Each partner liable jointly and severely , No regulatory filings to establish the partnership, Two tax returns, partnership and personal, tax paid by individual partners on personal return (Schedule E).
Two or more owners, assets owned by partnership, At least one general partner and one or more limited partners, Management in the hands of the general partner, Profits shared in relation to investment or agreement, General partner has full liability, limited partner is generally shielded (Set up separate entity as the GP, if the LP is an operating business), A regulatory filing is required to establish partnership, Two tax returns, partnership (1065) and personal, tax paid by individual partners on personal return
One or more owners (shareholders), Management by a board of directors elected by Shareholders, officers elected by the board, Profits share by dividends, Dividends are NOT deductible to the corporation, Shareholders not personally liable (unless guaranteed), A regulatory filing is required to establish corporation, A tax return is required at the corporate level (1120), the corporation pays the taxes , Double taxation a concern.
One or more owners (shareholders-up to 100), Management by a board of directors elected by Shareholders, officers elected by the board, Shareholders not personally liable (unless guaranteed), A regulatory filing is required to establish corporation, An election is made not to be taxed as a corporation (2553), taxes are paid by the shareholders in proportion to their ownership share of income or gain regardless of any cash distribution (such as dividends), May help avoid SE taxes, Shareholder restrictions
Alternate between a partnership and a corporation, One or more owners,
Federal Default Rules- 1997
One member=disregarded entity, Two members=taxed as a partnership, File 8832 to make an election to file as a corporation. File form 2553 to be taxed as an S corporation, End result: Four different methods of taxation. Make sure you have the correct operating agreement!
Why LLC taxed as an S corporation over an S corporation? (Charging order protection), Management structures vary (Managed by managers or managed by member, Which is best?), Are formalities required, Shareholders generally not personally liable (unless guaranteed)
NCP, unlike many of our competitors, refuses to offer anything but the most conscientiously focused and individualized service available. You'll understand every aspect and implication of your entity formation, every step of the way, so you can move forward with confidence.
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