Rhode Island Fuel Tax Report

One of the first decisions you must make as a new business owner is figuring out what type of business framework you will file as. Because you will likely be operating under the same structure for the rest of the journey of the business, determining which type to file can be a challenging decision. There are a wide range of assorted state filings available for businesses these days. Be sure that you choose the file the ideal one as it can make a huge difference for the financial future of both you and your business. To make your task simpler, below you will find out the major benefits of each variety of state business filing.

If you do not appoint your business with any other kind of structure then it will be considered a sole proprietorship by the state. The main perks 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 construction is not a separate legal entity from you as an individual, and so 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 company. Among the most vital 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 arranging a partnership include the ability to enlist resources and knowledge with someone else. For instance, you might know how to run a trucking company, but your partner might know how to access capital.

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Corporations have a number of significant benefits over partnerships. 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 as an example, the business obtained a loan in order to pay for a new rig and was not capable to meet the payments, your lender could not pursue you personally for the payment owed. Sub chapter S corporations are a pretty 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 in the same way as a partnership. This helps to avoid the problem of double taxation which accompanies standard corporations.

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Limited liability companies are one of the most flexible form of business structures available. While limited liability companies do share a number 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 consist of a single owner, in which case they are taxed as if they were a sole proprietorship. You can additionally have multiple owners for your limited liability company. One of the other benefits is that they are generally much simpler to setup than corporations and have fewer regulatory conditions. In a limited liability partnership you are protected from the actions of these other parties. At the same time 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 operating is very small and has no debt.

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