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Growing Your Business

Owning and operating a successful business is an amazingly rewarding experience. However, to stay in business long-term, you need to continuously grow your client base. To do so, you should always strive to provide exceptional customer service to your clientele. You can accomplish this task by training your salespeople well. You should also search for effective ways to advertise your business’s product or service offerings. Some wonderful places to advertise your goods or services include newspapers, magazines, your website, and the social media outlets you engage in. On this blog, I hope you will discover smart tips to help you succeed in business.

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Growing Your Business

Why You Should Consider an LLC for Your Business Registration

by Claude Medina

If you've made the decision that it's time to legally register your business, you may still be trying to decide between making your business an LLC or a C-corporation. The good news is that you do have the choice of either one, but the bad news is that it can be tough to decide which one is right for you. Thankfully, there is some basic information that can help you decide if an LLC is the best option for your situation. Here are a couple of things you should think about.

Tax Benefits

Registering your business as an LLC has some tax benefits for you. The tax liability of an LLC rests solely at the member level, which means you don't pay taxes from the business and from your own income. This simple tax status can save you substantially over time because, with a corporation, the corporation pays taxes on recorded revenue and you also pay personal income taxes on the salary you draw from the corporation. This double-tax situation can add up quickly, making an LLC advantageous from a tax standpoint.

In addition to the single-tax benefit, there's another tax benefit to registering your business as an LLC. When you register as an LLC, any losses that the business records can be distributed among the members, allowing you to claim your share of that loss on your personal income taxes, potentially reducing your tax liability.

Asset Benefits

There are also benefits to an LLC when it comes to managing assets. First, an LLC can pass a fully appreciated asset to one of its members without incurring a tax liability for either the business or the owner. Similarly, LLCs can also accept asset donations without generating any kind of tax liability for the receipt. 

Additionally, for those who may hope to sell their business later, registering as an LLC is in your best interest. Those buying an LLC receive a step-up benefit in terms of asset accounting. That means that they can recognize a higher value of the assets based on the current market value as compared to the value you had on your books. 

These are some of the benefits of registering your business as an LLC instead of as a C-corporation. If you're not sure where to begin with the registration, talk with a local LLC formation service for help. They can guide you through the paperwork and the process, ensuring that your LLC is ready to go.

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