Washington Fuel Tax Report

Among the first arrangements you must make as a new business owner is determining what type of business structure you will file as. Because you will possibly be operating under the same structure for the rest of the life of the business, finding out which type to file might be a challenging decision. There are a wide range of different state filings available for businesses nowadays. Ensure that you choose the file the right one as it can make a huge difference for the financial future of both you and your business. To make your task less complicated, below you will uncover the major benefits of each form of state business filing.

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

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A partnership is where you and at least another individual are joint owners in the business. Among the most essential things to be familiar with is that you will be personally liable for the actions of your partners and employees. Several of the benefits of setting up a partnership include the ability to enlist resources and knowledge with someone else. For instance, you might know the way to run a trucking company, but your partner might know the best way to access capital.

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Corporations have a lot 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 for instance, the business obtained a loan in order to pay for 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 standard corporation in terms of limited liability. However, for tax purposes, you are treated similarly as a partnership. This helps to prevent 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 a couple of the same features, as corporations they are distinct. Like a corporation, they offer limited liability protection. However a limited liability company can consist of a single owner, whereby case they are taxed as though they were a sole proprietorship. You can additionally have multiple owners for your limited liability company. Just one of the other benefits is that they are generally much easier 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 guidelines 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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