Disclaimer
RS Circular 230 Notice: To ensure compliance with requirements imposed by the IRS, we inform you that any federal tax advice contained in this communication (including any attachments) is not intended or written to be used, for the purpose of (I) avoiding penalties under the Internal Revenue Code or (II) promoting, marketing or recommending to another party any transaction or matter addressed herein.
There are different approaches you can take that are fully dependent on your current situation. A limited liability limited partnership approach provides a personal liability protection utilized by a single limited partner or the general partners as well, without needing to establish multiple entities. Our family limited partnership may be the right choice for you if your partnership consists only of family members. But also there’s our series LLC, which could be perfect for you if you own multiple businesses or multiple real properties.
Regardless of your business’ necessities, tolerance of risk, or goals, Nevada is know to be one of the best states in America for business due to the many advantages, such as the listed wide selection of the different types of business entities.
Business Structures
Business structures have a significant impact on various aspects of a company, including liability, management, taxation, and capital raising. Limited Liability Companies (LLCs) provide liability protection for members while allowing for simplicity and flexibility in management. C-Corporations (C-Corps) offer limited liability for shareholders but are subject to double taxation, making them more suitable for larger, publicly traded companies. S-Corporations (S-Corps) pass income, deductions, and credits through to shareholders to avoid double taxation while still providing liability protection. Partnerships involve two or more owners who operate a business together and have their business income taxed at individual tax rates. Series LLCs allow for multiple cells within a single company, each with its own liability protection and tax planning options. Ultimately, the choice of structure depends on the specific needs and goals of a business.
Limited Liability Company
LLCs (Limited Liability Companies) are a type of business structure that combines the liability protection of a corporation with the simplicity and flexibility of a partnership. Members of an LLC are not personally responsible for business debts or obligations, meaning their personal assets are protected.
LLCs are often preferred by small business owners and startups as they are easier to manage and have fewer formalities compared to corporations. In terms of taxes, LLCs have the option to be taxed as a sole proprietorship, partnership, or corporation. This flexibility in taxation makes LLCs a popular choice for small businesses.
C Corporation
C-Corps, or C Corporations, are the most common type of corporation. They are separate legal entities from their owners, meaning shareholders have limited liability and are not personally responsible for the company’s debts or obligations.
C-Corps are taxed as separate entities and any profits are taxed at the corporate level before being distributed to shareholders as dividends. This double taxation can make C-Corps less attractive for small businesses, but they are often preferred by larger, publicly traded companies because they offer a wider range of options for raising capital.
S Corporations
S-Corps, or S Corporations, are a type of corporation that has elected to pass corporate income, deductions, and credits through to their shareholders for federal tax purposes. This allows the company to avoid double taxation on the corporate income.
S-Corps have the same limited liability protection as C-Corps, but they are subject to more restrictions, such as having no more than 100 shareholders and only allowing certain types of shareholders. In terms of taxes, S-Corps are only taxed once on their income at the shareholder level, which can provide a tax savings compared to C-Corps.
Partnerships
Partnerships are a type of business structure where two or more people own and operate a business together. In a general partnership, each partner is personally liable for the business debts and obligations. In a limited partnership, there are both general and limited partners, with the latter having limited liability.
Partnerships are often preferred by small businesses because they are relatively simple to set up and have fewer formalities compared to corporations. In terms of taxes, partnerships are pass-through entities, meaning that the business income is passed through to the individual partners and taxed at their individual tax rates.
Series LLCs
Series LLCs are a type of LLC that allows a single company to create separate series or cells within the company that have their own liability protection. This means that each series can have its own assets, income, and debts separate from the others, and the liability of each series is limited to its assets. planning.
Series LLCs are often used in real estate investment, where each property can be managed as its own separate series. In terms of taxes, each series of a Series LLC can be taxed as a separate entity, or the entire Series LLC can be taxed as a single entity, providing flexibility in tax
