Growing Your Business

Corporation? Sub-S? Partnership? Limited Liability? Which is Right for You?

by
Sonu Shukla
on
4/15/2015
Corporation? Sub-S? Partnership? Limited Liability? Which is Right for You?

When you are establishing a new business, one of the most important decisions that you need to make is which type of structure to choose for your business. Though in most cases the decision is based on considerations that have nothing to do with tax liability, that does not mean that you don't have to think about that aspect when making your decision. The choice you make at the outset will have an impact on many of your future decisions, so it's important to educate yourself completely on each of your options and carefully consider what's going to be best for you.

The different types of entities that you can choose from are corporation, Sub-S corporation, partnership and limited liability. Sole proprietorship is also an option for those who have no co-owners or partners. The chart here shows what the different tax ramifications are for each of the entity types:

How business entities are taxed:

  To The Business To The Owner (s)
Limited Liability Company Depends on Structure Depends on Structure
Sole Proprietorship NO YES
Partnership NO YES
Corporation YES Dividends
S-Corporation NO (2) YES

(2) Exceptions Apply

The decision about what kind of business entity your business should be classified as is important, and making the wrong decision can result in unnecessary expense. Make sure that you have all the information that you need to make an educated decision that you'll be happy with for years, and if you have questions, don't hesitate to contact Orlando Accountant Sonu Shukla, CPA for more information.

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Sonu Shukla

Sonu Shukla

Sonu Shukla is a CPA, accountant, and tax preparer based in Orlando, FL. Sonu Shukla can assist you with your tax preparation and planning needs. Sonu is more than just another accountant in Orlando, Florida; he is a small business owner himself. It is a position in life that grants him the perspective and insight to emphasize with his clients, bringing them the best service possible. A Certified Public Accountant and a Certified Financial Planner, Sonu possesses the skills, education and experience to demonstrate unerring business acumen and passionately planned financial strategies. Being proactive is key for Sonu, tailoring highly efficient tax plans for his small business clients, all in a one on one environment where he and the client can bounce ideas around until every detail is worked out.

SONU SHUKLA, CPA, P.A.
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Florida

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