Formations & Entity Selection Services

New startup businesses must make a critical decision right from the beginning: What type of entity will they choose? This decision will affect many different aspects of the business, including how taxes are paid and how much tax is ultimately due.

O’Brien and Panchuk will work closely with you to help determine the right entity selection for your business. Depending on your specific situation, this may be a sole proprietorship, partnership, S corporation, C corporation, Limited Liability Company (or LLC) or Limited Liability Partnership (LLP).

Incorporating your business as either a C corporation or S corporation limits your personal liability for any debts, obligations or losses sustained by the business. There may also be more flexibility in deducting some expenses and savings in self-employment taxes for corporations. However, in some instances, C corporations may be faced with double-taxation, which can offset some of the other tax benefits offered by incorporation.

For many self-employed individuals and professional services firms, a sole proprietorship may be the best entity choice due to its simplicity. A business tax return (Schedule C) is simply filed along with a personal tax return. Partnerships are similar to sole proprietorships but used when there is more than one owner.

Meanwhile, LLCs and LLPs offer some of the benefits of both corporations and partnerships. For example, owners are shielded from personal liability for business debts, obligations and losses, while profits and losses flow through to shareholders, which avoids the potential double taxation of C corporations.

Whether yours is a new startup business or an existing company, O’Brien and Panchuk will help you choose the most beneficial entity form. Our considerations include not just the lowest possible tax liability, but the greatest overall benefit for you from a financial, tax, liability and simplicity standpoint.