If you just beginning to form a new business, undoubtedly, you will have done your research and have learned about the process for starting a new business and the steps that you should follow to establish your business and in what specific order those steps need to be followed. Before you can even establish your business, you must choose a business structure so that you can run your business, register it and pay taxes. Many businesses start out as either a sole proprietorship or a partnership. Larger companies often form corporations.
You have the option of more than one business structure from which to choose. Each business structure has different tax implications, personal liability and requirements for registration. Additionally, it is also a very good idea to consult an attorney with expertise in this particular type of law. That will be especially helpful if the business that you are setting up is complex, such as a limited liability company, or LLC. If you are setting up an LLC, your business will need to be incorporated with the state of New Jersey.
How does an LLC work?
An LLC is basically a combination of a partnership and a corporation. If you own an LLC, you are not responsible for the business’s debt. Hence the name, limited liability company. You have limited liability in the business. Also, an LLC does not have to file separate taxes, which would be the case in a corporation. In an LLC, each member declares their profits on their own (personal) tax return.
An LLC is a smart choice for your business if the business that you wish to start is fairly simple and straightforward. If you are anticipating that your business will own property, an LLC is a good idea so that you don’t end up paying taxes twice. That is usually more of an issue if your business is a corporation.
Valuable advice from a New Jersey business attorney
When you are just starting a new business, the experience of a business attorney may make your experience much easier than it would have been if you had tried to set up everything on your own. A business attorney can help protect you and your business and they can also be instrumental in getting your business started in the most effective way possible so that you will hopefully enjoy a great deal of success for many years to come.