Today’s blog will deal with partnerships. This week we will be focusing on general partnerships, but next week is going to discuss limited partnerships. We will discuss what a general partnership is, how it works, and who would benefit most from filing their business as a general partnership. A general partnership is a business arrangement between two or more individuals where the parties agree to share all assets, profits, and liabilities of a jointly-owned business structure. The individuals are referred to as “general partners” and each party is subject to unlimited liability, meaning that personal assets may be liable to the partnership’s obligations. A general partnership is often not f

Today’s blog will deal with trade names. A trade name is also commonly referred to as “DBA’s (doing business as)” or “fictitious name” We will discuss what they are, how they work, and who would benefit most from filing a trade name at the state level. A trade name is extremely similar to a sole proprietorship. In fact, they are basically the same thing except for one major difference. As a sole proprietor, you are working under your own name. For example, Pam is an avid painter and she sells her under her own name, Pam Beasley (she hasn’t met Jim yet). However with a trade name, Pam could sell her paintings under the assumed business name “Pam’s Paintings”. One of the major benefits of an i

Over the next few weeks, we are going to switch topics to focus on specific business entities at the state level. Please note that this is different than entities according to the IRS as previously discussed. The next few topics will deal with entities according to a respective state, most of the time these are entities registered with a Secretary of State’s office. Today’s blog will deal with sole proprietorships. We will discuss what they are, how they work, and who would benefit most from filing as a sole proprietor at the state level. Anyone who doing business under their own name and working for themselves is already a sole proprietor. The only thing that really needs to be accomplished

Our final blog in this series will focus on Limited Liability Companies, also known as LLCs. We’ll discuss what an LLC is, the federal tax rate for an LLC, and who benefits the most from filing as an LLC. For starters, an LLC is a business structure allowed by state statute. However, they are recognized as an entity by the IRS and they are pretty versatile in how they can be taxed. The owners of an LLC are called Members. Generally, the LLC is initially categorized either as a sole practitioner or a partnership by the IRS, depending on whether one or more individuals are involved. However, an LLC can elect to either be taxed as an s-corp or c-corp. The LLC provides liability protection to in

As promised in our last blog, today we will focus on s-corporations. We’ll discuss what an s-corporation is, the federal tax rate for an s-corporation, and who benefits the most from filing as a s-corporation. An s-corporation, sometimes called an s-corp, is a special type of corporation that's designed to avoid the double taxation drawback of regular c-corps. S-corps allow profits, and some losses, to be passed through directly to owners' personal income without ever being subject to corporate tax rates. Not all states tax s-corps equally, but most recognize them the same way the federal government does and tax the shareholders accordingly. Some states tax s-corps on profits above a specifi

For the next installment of our series on business entities according to the IRS, today we will focus on c-corporations (s-corporations will be the topic of the next blog). We’ll discuss what a c-corporation is, the federal tax rate for a c-corporation, and who benefits the most from filing as a c-corporation. A c-corporation, sometimes known as a c-corp, is a legal entity that is completely separate from its owners. Corporations can make a profit, pay taxes, and be held liable for their actions as a corporation. Corporations provide the most protection from personal liability to its owners, but they often require higher filing fees, extensive record keeping, and more detailed reporting. In

Over the next couple of weeks, this blog will focus on business entities that are recognized by the IRS. Today, we will focus on partnerships. We’ll discuss what a partnership is, what it is taxed at federally, and who benefits the most from filing as a partnership. A partnership is the relationship existing between two or more persons who join to carry on a trade or business. Each person contributes money, property, labor or skill, and expects to share in the profits and losses of the business. A partnership must file an annual information return to report the income, deductions, gains, losses, etc., from its operations, but it does not pay income tax. Instead, it "passes through" any profi

Over the next couple of weeks, this blog will focus on business entities that are recognized by the IRS. Today, we will focus on a sole proprietorship. We’ll discuss what it is, what the tax rate is, and who benefits the most from filing as a sole proprietorship. A sole proprietor is someone who owns an unincorporated business by himself or herself. You may be a sole proprietor without even knowing it. For example, if you are a freelance worker, you are technically a sole proprietor. If you are operating under a name that is different from your own, then it would be wise to file what’s known as a DBA (“doing business as”) with your respective Secretary of State. Because you and your business

Although mortality and emergency situation are uncomfortable to think about, proper planning can make sure that your interests are taken care of by the people you trust. The following descriptions are brief but explain the use of each type of Power of Attorney. A limited power of attorney is usually assigned for a specific purpose and time period. It's often used when you can't handle certain affairs due to other commitments or short-term illness. A general power of attorney is much more comprehensive and gives your agent broad powers to act on your behalf, including managing all your financial transactions, signing documents, settling claims, operating your small business and any other fin