BUSINESS FORMATION
BUSINESS FORMATION
Putting Your Best Interests First
Are you an entrepreneur who’s ready to take the next step? Or maybe you already own a business as a sole proprietorship, and you’re itching to protect your personal assets and grow your company. Forming a business entity is the best way to protect your business operations and manage your business structure while maintaining profits. But with so many entities to choose from (and lots of paperwork to go through), forming a business entity on your own can be challenging. Consulting a team of business formation lawyers is the best way to protect yourself and your business as you expand.
At Legacy Law Partners, PLLC, our team of Connecticut business lawyers has years of experience representing business clients. We can help you choose from the various business entities available to pick the right one for you. We will also ensure that all your paperwork is filed correctly and that your business taxes are in order to avoid discrepancies with the Internal Revenue Service. If you want assistance with business formation, call (203) 446-4725 today for a free initial consultation.
What Goes Into a Good Business Plan?
Before creating your business, it’s essential to choose the right type of business entity. There are many entities to choose from, and some entities may be more valuable to you than others. Our team of business formation lawyers can assist you if you need help choosing the one that’s right for you.
The main types of business entities include:
Limited Liability Company
A limited liability company, or LLC, is one of the most common business entities you can choose. In limited liability companies, business members and owners are not personally liable for the business’s debts. When the LLC is created, members will contribute something of value, like cash, services, or property. This value then becomes their share of the business. Shareholders will receive a portion of the profits.
It is essential to create an operating agreement for an LLC with the help of a team of business formation lawyers. These agreements detail the business ownership, buy-sell agreements, profit distribution, dissolution, tax obligations, and more. Incorrect operating agreements can be detrimental to the business and business members.
C Corporation
C corporations are taxable entities that pay taxes at the corporate level. Typically, corporate income is distributed to owners as dividends, which is considered personal income. This means that corporate income is taxed twice: once at the corporate level and once again at the personal level. All corporations have limited liability protection, so business owners are typically not responsible for the debts or liabilities of the business.
S Corporation
S corporations are pass-through taxation entities, which some business owners prefer due to the tax break. No income tax is filed at a corporate level; instead, the profits and the losses are passed through to the business and reported as personal tax returns. All taxes are paid at the individual level by the business owners. S corporations also have limited liability protection.
How Do You Register With the Connecticut Department of Revenue?
New business owners must register their businesses with the Connecticut Department of Revenue Services (DRS). Registration ensures that your business pays sales taxes or withholds for state income taxes. Registering with the DRS is as simple as filing a few forms, but there are many steps you must take beforehand to gather the necessary documents and prepare.
To register your business, take the following steps:
Register With the Connecticut Department of Revenue?
Because these steps are all so essential, consulting with a team of business formation lawyers is the best way to create a business or take over an existing one. With legal counsel from our team, you can rest assured that all your paperwork is correct and that you have taken the necessary steps to register and pay taxes correctly. To get help with your business formation, contact our office today.
- Research the licenses and registration you need to secure, including business permits and county zoning permits
- Apply for an Employer Identification Number (EIN) with the IRS to pay wages, submit deductions, and withhold deductions
- Search up your proposed business name with the Connecticut Secretary of State to ensure it’s available
- File the necessary paperwork to register a business entity
- Obtain a Tax Clearance Certificate if you are purchasing an existing business
What Does a Business Formation Lawyer Do?
There are many areas that a business lawyer can assist with. For many clients, we help them iron out all the small details that they might miss. Business formations require many documents, licenses, and registrations – without them, your business could be underwater before it even begins.
A business formation lawyer on our team can help you with the following:
- Determining how operations will be funded
- Determining how owners will operate the business
- Drafting operating agreements for owners and shareholders
- Resolving internal differences between partners
- Creating procedures for ownership succession in the case of retirement or death
- Providing general counsel for any other legal issues
