Favorable Business Structures for Web Entrepreneurs In The US

You started an online business which may be an e-commerce website or a blog(or any thing like this) and now you want to register or incorporate your business. If you ask why you need to incorporate then please read my previous article about that. Well its probably a great thing if you want to register in the US because it has been a great business friendly country since a long time. In fact almost every magazine considers the US as one of the top 10 destinations while ranking almost any other country. So what are the stuff that one faces and how it helps, lets have a look.

Doing business in USA is simple. You can go ahead with either of below :

• Sole Proprietorship
• Partnership(LP/General/LLP/LLLP)
• Corporation(S Corp or C Corp)
• LLC(Limited Liability Company)

Of the above, the one that is best suited with liability protection and is considered as a separate legal entity include corporation and Limited Liability company. Both of the entities are some how like this :

Corporation

A corporation is the simplest and the oldest way of doing business in a protected way(be it in The US or the whole world). A regular corporation is a C Corporation which has the following features :

• Separate Legal entity than its owners
• Formed by individual which can also be other corporations(if not humans) or organizations
• Double taxation(both at corporate and individual level)
• Investment is really easy, and can attract investors from all over the world
• Most states allow the corporation to have its office anywhere in the country(provided you have a?registered?office in the state)

Unlike the above the S Corporation is a regular corporation which has a special status by IRS. Its called the S status and has to be mentioned when the corporation is being incorporated. In that the benefits as which may be seen are :

• Separate Legal entity
• Single Pass through taxation(only the individual(s) who own the corp. is taxed not the corp)
• Investments are fairly easy
• All the owners have to be Americans or US Permanent residents
• Maximum number of shareholders can be 100.

Form a Corporation Online?

Also some other restriction as well as advantages apply. The only thing this business is best suited for new business as its not as complicated as a C Corporation and lots of money is not lost in taxes, provided the business owners are not a lot and all of them are based in the USA or are Americans.

LLC( Limited Liability Company)

This is probably the simplest form of legal structure under which any one can do business in a?fairly?protected way. The advantages are :

• Legal entity separate from that of its owners
• Can be taxed as a partnership or sole proprietorship(pass through taxation) or as a C corporation.
• Can have unlimited amount of members.
• Members can appoint?mangers?to run the business or can do it themselves.
• Members can be citizens/residents of any country.
• Really less paperwork as compared with corporations(only annual report filling is required)

Probably one of the best structures for all business that is owned by Solopreneurs or 5-10 member business. Even people doing business in any part of the world can form an LLC online and maintain it as well.?Hardly?the cost would range $200-$300 annually for the?maintenance?depending on the requirements of the LLC.

View the Requirements and Form your LLC

Doing Business As or DBA(Sole?Proprietorship/Partnerships)

Both of the above business are the most used form of business throughout the world. In fact almost every country has this form of business the most(except for offshore tax havens, maybe). Registering as a sole proprietoship is literally easy and infact can be done in a few days.

You can also form your sole proprietorship online starting from just $110. This would be just a one time fee and you won?t be able to pay anything else annually except for if you require a license that is required by your state laws. This is one of the forms that would provide you with:

• Separate Business Name
• Have a bank account in the business name
• No annual requirements
• Branding

But you won?t get?liability?protection, that means if by any chance you are unable to pay your?business?debts or are sued, then you as a person is in legal trouble instead of your business because in legal terms you and your business are considered to be the same and are not different.

Form A DBA Now

Also note that you can always start as a sole?proprietor?or as a partnership firm initially when there are no chances of being sued or as such. Subsequently as your business grows you may consider incorporating or forming an LLC(when you have money to handle the costs). also know that if you have already formed an LLC or corporation you can still go ahead and register a DBA for your LLC/corp if you want to do business with an additional name.

Source: http://www.axetue.com/2012/11/01/business-structures-usa-web-business/?utm_source=rss&utm_medium=rss&utm_campaign=business-structures-usa-web-business

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