Frequently Asked Questions
What is a corporation?
A corporation, and a Limited Liability Company (LLC), is referred to as a legal entity. Formally recognized by the state in which the business is incorporated, incorporated companies and LLC’s can buy and sell property, bring lawsuits, enter into legally binding contracts, and be taxed.
Why is incorporation important?
It is vitally important to incorporate your business because, corporations and LLC's have a legally recognized existence all their own, separate from that of their owners. As a result, corporate owners and LLC managers are not held personally responsible for company debts and obligations. In addition to limited liability protection, corporations and LLC's receive tax benefits that vary by structure type.
What is involved with the incorporation process?
The process starts with choosing the business structure best suited to your business goals; selecting corporate directors, or members/managers when forming an LLC; choosing a registered agent to process legal documents on your company’s behalf; and preparing and filing formation papers with the state in which you wish to incorporate or form your LLC.
What is an LLC?
A Limited Liability Company (LLC) combines the flexibility of a partnership with the credibility and asset protection of a corporation. The operating agreement spells out rules for managing the business and allocating profits and losses. By default, an LLC’s income and losses pass-through to the owners and are taxed at their tax rate.
What is an S Corp?
An S corporation formed as a corporation under state law. This protects each owner’s personal assets from business debts. However, the corporation makes an IRS election to pass its income and losses through to the owners who report (and pay tax on) these items on their individual returns.
What is the difference between LLC and S Corp?
Although both are pass-through structures, an S Corporation must allocate each owner’s percentage of the income and loss based on ownership percentage. In an LLC, the operating agreement controls this allocation. However, unlike LLC’s, S corporations can pay the owners a salary which can lower overall taxes for the owners.
Is LAUNCH Consulting a law firm or CPA?
No, LAUNCH Business Consulting, Inc. is NOT a law firm or a CPA. We recommend you seek the advice of legal counsel and a CPA prior to getting started in business. We cannot advise you as to any legal matters or IRS matters. However, we can assist in the start up of your business compliance documentation and submit all necessary paperwork on your behalf as your representative/agent.
A corporation, and a Limited Liability Company (LLC), is referred to as a legal entity. Formally recognized by the state in which the business is incorporated, incorporated companies and LLC’s can buy and sell property, bring lawsuits, enter into legally binding contracts, and be taxed.
Why is incorporation important?
It is vitally important to incorporate your business because, corporations and LLC's have a legally recognized existence all their own, separate from that of their owners. As a result, corporate owners and LLC managers are not held personally responsible for company debts and obligations. In addition to limited liability protection, corporations and LLC's receive tax benefits that vary by structure type.
What is involved with the incorporation process?
The process starts with choosing the business structure best suited to your business goals; selecting corporate directors, or members/managers when forming an LLC; choosing a registered agent to process legal documents on your company’s behalf; and preparing and filing formation papers with the state in which you wish to incorporate or form your LLC.
What is an LLC?
A Limited Liability Company (LLC) combines the flexibility of a partnership with the credibility and asset protection of a corporation. The operating agreement spells out rules for managing the business and allocating profits and losses. By default, an LLC’s income and losses pass-through to the owners and are taxed at their tax rate.
What is an S Corp?
An S corporation formed as a corporation under state law. This protects each owner’s personal assets from business debts. However, the corporation makes an IRS election to pass its income and losses through to the owners who report (and pay tax on) these items on their individual returns.
What is the difference between LLC and S Corp?
Although both are pass-through structures, an S Corporation must allocate each owner’s percentage of the income and loss based on ownership percentage. In an LLC, the operating agreement controls this allocation. However, unlike LLC’s, S corporations can pay the owners a salary which can lower overall taxes for the owners.
Is LAUNCH Consulting a law firm or CPA?
No, LAUNCH Business Consulting, Inc. is NOT a law firm or a CPA. We recommend you seek the advice of legal counsel and a CPA prior to getting started in business. We cannot advise you as to any legal matters or IRS matters. However, we can assist in the start up of your business compliance documentation and submit all necessary paperwork on your behalf as your representative/agent.