Nebraska IRS Form 2290

Among the first choices you must make as a new company is deciding what kind of business framework you will file as. Because you will likely be operating under the same structure for the rest of the existence of the business, knowing which type to file might be a difficult decision. There are a wide range of different state filings available for businesses nowadays. Ensure 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 easier, below you will learn the major benefits of each variety of state business filing.

If you do not mark your business with any other form 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 alongside your personal income. However, this structure is not a separate legal entity from you as an individual, consequently you will be personally liable for any debts your business acquires.

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A partnership is where you and at least one other individual are joint owners in the establishment. One of the most essential things to be familiar with is that you will be directly liable for the actions of your partners and employees. Several of the benefits of creating a partnership include the ability to join resources and knowledge with another person. For example, you might know the way to run a trucking company, but your partner might know how to access capital.

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Corporations have a lot of substantial benefits over partnerships. One of the most important of these is limited liability. What limited liability means is that the corporation is a completely distinct legal entity from you as an individual. If for example, the business obtained a loan in order to buy a new rig and was unfit 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 regular corporation in regards to limited liability. However, for tax purposes, you are treated in the same way as a partnership. This helps to avoid the problem of double taxation which occurs with 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. On the other hand a limited liability company can consist of a single owner, whereby case they are taxed as if they were a sole proprietorship. You can even have multiple owners for your limited liability company. 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 sheltered from the actions of these other parties. At the same time the business will be structured under the regulations of normal partnership. This is generally a better choice than a standard partnership unless the business you are operating is very small and has no debt.

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