Tennessee Heavy Highway Use Tax

Among the first selections you must make as a new entrepreneur is figuring out what kind of business system you will file as. Because you will possibly be operating under the same structure for the rest of the life of the business, understanding which type to file may be a difficult decision. There are a wide range of varied state filings available for businesses nowadays. Be 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 much easier, below you will learn the major benefits of each variety of state business filing.

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

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A partnership is where you and a minimum of one other individual are joint owners in the establishment. Among the most essential things to be aware of is that you will be specifically liable for the actions of your partners and employees. A few of the benefits of starting a partnership include the ability to enlist resources and knowledge with another person. As an example, you might know the best ways to run a trucking company, but your partner might know the way to access capital.

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Corporations have a number of notable 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 secured a loan in order to buy a new rig and was unfit to meet the payments, your lender could not pursue you personally for the payment owed. Sub chapter S corporations are a reasonably new form of business structure that has proved as being popular with many small business owners. A sub chapter S corporation is treated the same as a normal corporation in regards to 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 are distinct. Like a corporation, they offer limited liability protection. That being said a limited liability company can contain a single owner, in which case they are taxed as if they were a sole proprietorship. You can also have multiple owners for your limited liability company. Among 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. Simultaneously the business will be structured under the rules of normal partnership. This is generally a better choice than a standard partnership unless the business you are managing is very small and has no debt.

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