Pennsylvania 2290 Heavy Highway Use Tax

One of the first arrangements you must make as a new entrepreneur is figuring out what kind of business structure you will file as. Because you will most likely be operating under the same structure for the rest of the life of the business, knowing which type to file could be a tough decision. There are a wide range of various state filings available for businesses nowadays. Make sure that you choose the file the correct one as it can make a huge difference for the financial future of both you and your business. To make your task less troublesome, below you will learn the major benefits of each type of state business filing.

If you do not assign your business with any other type of structure then it will be considered a sole proprietorship by the state. The main advantages of sole proprietorships are they are convenient to setup, have few filing requirements, and your business income is taxed together with your personal income. However, this construction is not a separate legal entity from you as an individual, so you will be personally liable for any debts your business acquires.

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A partnership is where you and at least another individual are joint owners in the enterprise. Among the most significant things to be aware of is that you will be specifically liable for the actions of your partners and employees. Some of the benefits of creating a partnership include the ability to enlist resources and knowledge with someone else. As an example, you might know tips on how to run a trucking company, but your partner might know the way to access capital.

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Corporations have a number of substantial benefits over partnerships. The most important of these is limited liability. What limited liability means is that the corporation is a completely separate legal entity from you as an individual. If for example, the business took out a loan in order to pay for a new rig and was not capable to meet the payments, your lender could not pursue you in person for the payment owed. Sub chapter S corporations are a relatively new form of business structure that has proved to be popular with many small business owners. A sub chapter S corporation is treated the same as a standard corporation in terms of limited liability. However, for tax purposes, you are treated similarly as a partnership. This helps to stay clear of the problem of double taxation which accompanies standard corporations.

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Limited liability companies are the most flexible form of business structures available. While limited liability companies do share several of the same features, as corporations they stand out. Like a corporation, they offer limited liability protection. Having said that a limited liability company can incorporate a single owner, whereby case they are taxed as though they were a sole proprietorship. You can also have multiple owners for your limited liability company. Just one of the other benefits is that they are generally less complicated to setup than corporations and have fewer regulatory criteria. In a limited liability partnership you are protected from the actions of these other parties. Additionally the business will be structured under the guidelines of normal partnership. This is generally a better choice than a standard partnership unless the business you are administering is very small and has no debt.

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