You are now being logged in using your Facebook credentials
Allstate Gospel Superfest Battle of the Bands New Talent Search to Return in August!

Allstate Gospel Superfest Battle of the Bands New Talent Search to Return in August!

Producers of the Allstate Gospel Superfest

The Allstate Gospel Superfest Battle of the Bands New Talent Search to Return in August!- Jacksonville, Memphis & Washington, DC Chosen to Host the 2014 Competitions -(BLACK PR WIRE) – Cincinnati, OH – Producers of the Allstate Gospel Superfest will conduct its sixth annual new talent initiative in three major U.S. cities this coming…

Read More...
Dorothy Buckhanan Wilson Installed as International President of Alpha Kappa Alpha Sorority, Incorporated

Dorothy Buckhanan Wilson Installed as International President of Alpha Kappa Alpha Sorority, Incorporated

Charlotte, NC (BlackPR.com)

Dorothy Buckhanan Wilson of Milwaukee, Wisconsin, a business executive, was installed as the 2014-2018 International President of Alpha Kappa Alpha Sorority, Incorporated (AKA)

Read More...
Nielsen Expands Communications Leadership Team with Key Media Relations Hire

Nielsen Expands Communications Leadership Team with Key Media Relations Hire

New York (BlackPR.com)

New York (BlackPR.com) -- Nielsen today announced that Andrew McCaskill has joined Nielsen as Senior Vice President, Corporate Communications. He will report to Chief Communications Officer Laura Nelson.

Read More...
Voter Suppression: It’s Mobilization Time

Voter Suppression: It’s Mobilization Time

Written by Peter Grear

With this article we will start detailing the ingredients of a revisable action plan that needs comments and revisions as we move toward the Tuesday, November 4, 2014 General Election.  

Read More...
Las Vegas Comedian James Bean's Candid Account Of His Struggle With Suicide

Las Vegas Comedian James Bean's Candid Account Of His Struggle With Suicide

WHEN THE HUMOR IS GONE

James Bean has shown insight and understanding of the darkest moments of many people’s lives as well as ideas on how one could begin to create a life worth living even out of the depths of despair.” -– Rhonda Duncombe, LMFT, LADC

Read More...
Voter Suppression: NC Black Republican Advisory Board

Voter Suppression: NC Black Republican Advisory Board

Written by Peter Grear

Educate, Organize and Mobilize: I confess that I’m amazed. The Republican National Committee and the Republican Party of North Carolina announced last week that they have launched theNorth Carolina Black Advisory Board (BRAB) 

Read More...
Tips for Managing Stress in Your Life

Tips for Managing Stress in Your Life

Written by State Point

Stress is not only unpleasant; it can be overwhelming, ultimately preventing you from solving the problems that caused the stress in the first place. But getting focused can help you feel happier and be more successful professionally, financially and in your relationships, say experts.

Read More...
Voter Suppression: Defeating it requires two massive efforts

Voter Suppression: Defeating it requires two massive efforts

Written by Peter Grear

For black voters, Benjamin Jealous expressed what I believe to be the critical message for black voters when he said that the best way to overcome massive voter suppression is through a massive wave of voter registration.  Thankfully, the NAACP is putting this theory into action through the Youth Organizing…

Read More...
Black Women are Taking Care of Business

Black Women are Taking Care of Business

Written by Freddie Allen

Instead of breaking the glass ceiling, Black women have increasingly started making their own. According to the Center for American Progress, an independent, nonpartisan progressive institute, Black women are the fastest-growing group of entrepreneurs in the country.

Read More...
Voter Suppression: Is it partisan?

Voter Suppression: Is it partisan?

Written by Peter Grear

Educate, Organize and Mobilize: I’ve been doing commentaries on our Campaign to Defeat Voter Suppression since November, 2013.  Because the right to vote is fundamental to our democracy, I’ve tried to promote a non-partisan theory of voter enfranchisement. 

Read More...
Why vote? ALEC and the Doctrine of Exclusion

Why vote? ALEC and the Doctrine of Exclusion

By Peter Grear

Educate, Organize and Mobilize: Frequently, in going forward it is imperative to examine your history.  In 1638 the Maryland Colony issued a public edict encouraging the separation of the races that became the public policy of America. 

Read More...
Download Greater Diversity News Digital PDF Edition for FREE

Download Greater Diversity News Digital PDF Edition for FREE

FREE Full PDF Edition includes stories not featured on the website

The FREE Full PDF Edition includes stories not featured on the website. No paper, no hasel, read on your laptop or mobile devices. 

Read More...
Frontpage Slideshow | Copyright © 2006-2011 JoomlaWorks Ltd.

Home Page

Choosing the Right Business Entity: Does Everyone Need to Incorporate?

Written by Renee Hykel, Esq. of LegalZoom.com on 07 January 2013.

Question #1: Do you need to protect your personal assets from the liabilities of the company? If you’re debating whether to form a legal entity or to be a sole proprietorship, one issue to consider is whether or not you need to protect your personal assets. The biggest benefit of formal entity formation is that the individual(s) owners of the corporation are shielded from the liabilities and debts of the entity. For some businesses, however, the cost of formation, including tax consequences, may outweigh the benefits, especially if the business can be thoroughly insured.

Professionals such as lawyers, doctors and veterinarians may opt not to form a legal entity, because professional liability insurance will cover the most likely type of action against the business. But it won’t cover everything. For example, a slip and fall on the office premises, or an alleged employment discrimination suit would generally not be covered by professional liability insurance, but additional coverage is often available for these and other kinds of risks.  

For small businesses, the protection from personal liability—especially for those without significant assets—may not be necessary. When you consider that sole proprietors can offset their personal income, including interest and dividends from all sources, against their business losses, a sole proprietorship can look attractive. Compare a thoroughly insured group of accountants with 5 employees to a restaurant with 50 employees and hundreds of patrons per day. The additional risks posed by a larger business would likely justify the small cost of incorporating to shield the owner(s) from liability.

Question #2: Should you choose a C corporation, S corporation or limited liability company?

If you decide you do want to shield yourself from the liabilities of the company, the question then becomes, should you choose a C corporation, S corporation or limited liability company (LLC)? A C corp. is a corporation that requires by-laws, a board of directors and the exercise of corporate formalities (board meetings, shareholder meetings). Most distinctively, however, it is subject to double taxation. That means C corps. are taxed at the entity level, and then when dividends are paid out, the shareholders are taxed at the individual level (hence the phrase “double taxation”). C corps. are typically only advisable under certain circumstances, such as if the answer to question #3 is “yes.”

By comparison, S corps. have many of the same restrictions as C corps., but they are not subject to double taxation. Instead, they offer pass-through taxation, which is advantageous for small businesses because the taxes incurred are frequently less than in a double tax situation.

LLC owners may elect either double or pass-through taxation. In addition, LLCs may require certain corporate formalities (this may include documenting company decisions and meeting minutes), as well as some additional business costs. It’s important to note, all three entities offer liability protection.

Question #3: Will the business seek venture capital funding?

If you plan to seek venture capital funding for your new business, most investors like to see a C corp.—and not just any C corp., but a Delaware C corp. Delaware corporate law is highly developed and predictable as Delaware’s Chancery Court is devoted solely to corporate law. High-tech companies often see themselves as candidates for venture capital, so if you have one of these companies, it is advisable to be realistic with yourself about the timeline for seeking this kind of funding. If you don’t see the company in a position to ask for venture capital until year three, you may want to form an S corp. or an LLC (both of which allow pass-through taxation, rather than double taxation), because the taxes and lack of flexibility in governance of a C corp. can be burdensome and costly during the early stages of the company. Fortunately, it is relatively easy and straightforward to convert from one business entity to another in most states when you’re ready.

Question #4: Do you want flexibility in the management and payment structures of the business?

If the answer is “yes,” and you want to also be shielded from personal liability, then you should probably form an LLC, which allows for such flexibility. By contrast, an S corp. requires shareholders to elect a board of directors, who make decisions about the company. While the formalities of an S corp. may be beneficial to save on Social Security taxes, Medicare taxes, payroll and unemployment taxes, it is advisable to speak with a professional and thoroughly crunch the numbers to determine if the tax savings would ultimately increase your bottom line.

When deciding which entity to select for your business, the decision depends on the unique circumstances of the founders of the business and the type of business to be formed. If you have additional questions you can consult a professional before making a final decision.

If you’d like to speak to an attorney about your options, you can do so through the LegalZoom Business Legal Plan. Your first 30 days are free with the purchase of an LLC, Inc. or DBA. •

GDN Link Exchange