Alabama Corporate Filings

One of the first selections you must make as a new entrepreneur is determining what variety of business structure you will file as. Because you will likely be operating under the same structure for the rest of the existence of the business, determining which type to file might be a tough decision. There are a wide range of assorted state filings available for businesses nowadays. Be sure that you choose the file the appropriate 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 uncover the major benefits of each form of state business filing.

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

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A partnership is where you and a minimum of another individual are joint owners in the enterprise. Among the most important 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 arranging a partnership include the ability to join resources and knowledge with another person. As an example, you might know tips on how to run a trucking company, but your partner might know how to access capital.

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Corporations have a lot of considerable benefits over partnerships. The most important of these is limited liability. What limited liability means is that the corporation is a completely independent legal entity from you as an individual. If as an example, the business took out a loan in order to purchase a new rig and was unable to meet the payments, your lender could not pursue you directly for the payment owed. Sub chapter S corporations are a relatively 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 typical 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 occurs with standard corporations.

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Limited liability companies are extremely flexible form of business structures available. While limited liability companies do share a few of the same features, as corporations they are distinct. Like a corporation, they offer limited liability protection. Having said that a limited liability company can incorporate a single owner, in which case they are taxed as though they were a sole proprietorship. You can also have multiple owners for your limited liability company. One of the other benefits is that they are generally easier to setup than corporations and have fewer regulatory requirements. In a limited liability partnership you are sheltered from the actions of these other parties. Additionally the business will be structured under the standards 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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