It’s easy to imagine working with an accounting firm once you have your small Nashville business up and running. But the truth is, you might need to start consulting an accountant – and particularly, a tax guru – even when your startup is still in the conceptualization phase.
Understanding how your business can be taxed is just as essential as strategizing on how your product or service will turn a profit. Here are three questions you can review with an accountant to help you determine your company’s relationship with taxes and gain an edge for your business.
How will you structure your business?
The type of business you establish, legally speaking, determines the kinds of taxes you will file. For startups, the common forms of business entities are:
Sole Proprietorship
Partnership (general or limited)
C Corporation
S Corporation
Limited Liability Company (LLC)
Sole proprietorships and partnerships are the simplest for small startups, but they come with inherent risks. For example, as sole proprietor, you could end up mixing personal and business funds to support your fledgling company. Alternatively, you and your partners might encounter issues about the distribution of roles and profits. Both scenarios could make tax-time a messy period, which is why it’s essential to clarify the responsibilities attached to each business type.
Read more from this blog: http://bit.ly/2ins2IW
Sole Proprietorship
Partnership (general or limited)
C Corporation
S Corporation
Limited Liability Company (LLC)
Sole proprietorships and partnerships are the simplest for small startups, but they come with inherent risks. For example, as sole proprietor, you could end up mixing personal and business funds to support your fledgling company. Alternatively, you and your partners might encounter issues about the distribution of roles and profits. Both scenarios could make tax-time a messy period, which is why it’s essential to clarify the responsibilities attached to each business type.
Read more from this blog: http://bit.ly/2ins2IW
