By forming your own business, you may be able to lower your taxable income. Plus, you gain the flexibility to decide exactly how you want to file your tax return. In addition to being taxed as an S Corp., a Limited Liability Company (LLC) can choose to file as a sole proprietor or partnership to continue claiming your earnings as an individual or you can petition to file as a corporation for even more options.
There are several additional benefits to forming a business and lowering how much you pay in taxes is just the beginning. Properly utilizing a business entity can also help provide personal liability and asset protection. This added layer of protection is why it’s called a Limited Liability Company.
Find out more about how forming a small business can help you save.
Incorporation is the legal process of turning a business into a “legal person” that’s separate from you. An incorporated business can own property, pay taxes, and sign contracts under its own name.
Your registered agent is your business’s official point of contact, and you need one in every state where your company is formed or registered.
We’ll cover all the steps and even tell you about more things you’ll need to do after your LLC filing in Tennessee.
Your LLC won’t officially exist until the state accepts your Articles of Organization. You’ll need the filed document to open LLC bank accounts, apply for business licenses, and sign contracts.
While this guide gives you useful information about paying yourself from an LLC, it is recommended that you consult with a CPA or an accountant so your LLC is set up with the best tax classification to meet your needs and maintain compliance with IRS regulations.
Running a corporation, no matter how small, requires ongoing documentation. Without a comprehensive record book, it’s harder to find and follow your corporate rules and meet reporting requirements.
