How can you help with my business?
We can help you set up and form your business. Sell an existing business. Transfer your business to another generation. Protect you and your business from lawsuits and liability. Assist you in buying or selling parts or pieces of your business. Draft agreements with contractors or consultants, and leases or rental agreements for real property. Finally, we can review contracts that affect your business.
I have an idea for a business I’d like to start, but I’m not sure what I need to do to get it off the ground?
We can help with that. Call today to set up an appointment for a New Business Consultation. Bring all the paperwork and documents that you have relating to your new venture. We will help get you organized and started on your way.
What are the different ways I can set up my business?
There are four main ways to form your new business.
- Sole Proprietorship: This is the easiest and least expensive business entity to set up. But, a sole proprietor has no protection from lawsuits or creditor claims. This means your personal assets can be used to satisfy a business debt. Income and expenses are reported to the IRS on a Schedule C.
- Partnership: Involves more than one individual as the owner of the company. Each partner is responsible for the actions of their other partners. And again, personal assets are not protected from business debts. All partners must file a Partnership Information return with the IRS each year.
- Limited Liability Company: A Limited Liability Company requires the filing of paperwork with the State of Kansas. The LLC is responsible for the paying of business debts, which protects your personal assets. An LLC can have a single member, or many members with equal or varying percentages or ownership. Depending on how your LLC is formed will affect how you file your return with the IRS.
- Corporation: Forming a corporation is the most formal way to set up your business. Like an LLC, certain documents must be filed with the State of Kansas. There are two types of corporations, S and C. In a C corporation profits and losses are at the corporate level. However, corporations are then taxed on their earnings AND shareholders are taxed when they receive their dividends. On the other hand, in a S corporation profits and losses flow directly through the business to the owners. There are other requirements that both types of corporations must meet; including annual meetings, record keeping obligations and corporate tax returns.
What are other issues I should be aware of before starting a new business?
There are many things that are important to consider when starting a new business or buying an existing one. Among them are the various tax responsibilities you may face. These include sales tax, payroll tax, business and personal income taxes, property tax, and more.
Another issue to consider is your exposure and liability from potential lawsuits or creditors’ claims. These risks can be managed by carefully structuring business and working with a good insurance agent.
There are also three main categories of bookkeeping that you must maintain:
1. A business must be able to use their books to quickly and accurately figure their state and federal income tax, along with any sales or payroll tax throughout the year.
2. The businesses must keep track of its income, expenses, and cash flow to ensure that monthly bills and obligations can be met.
3. The final category is similar to Number 2 above, but is much more detailed and varied depending on the business’ activities and long term goals. Cash flow, income and expenses are basic numbers a business needs to be aware of so they can determine how they are doing at that moment. More detailed records can help a business owner see where they are going, and maybe point out where they should be going instead. Breaking down the types, timing, volume, size, and frequency of sales, new vs. returning customers, referral sources, and more will help you develop and plan for the next stage of your business.
Keeping up to date and accurate records both of finances and governance are important in ensuring the future success of your business.
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