Embarking on a journey to establish a business, restructure an existing company, or enter into joint ventures demands a strong foundation of legal guidance and advice. Hudson, Reed & Christiansen, PLLC offers comprehensive assistance to clients aspiring to achieve their entrepreneurial and professional goals. With a deep commitment to empowering business owners, Hudson, Reed & Christiansen, PLLC provides unparalleled insights into choosing the correct entity, managing liability, and navigating complex tax landscapes.
Choosing the Right Entity: Impact on Liability and Taxes
One of the crucial decisions an entrepreneur or established owner must make is choosing the legal structure to start or expand their business. This choice significantly influences matters of liability, taxation, and overall management. Hudson, Reed & Christiansen, PLLC understands the intricacies of these decisions and works closely with clients to ensure they opt for the entity that best aligns with their goals and circumstances.
Additionally, navigating law regarding incorporating in Tennessee requires a thorough understanding of the state’s legal landscape, regulations, and procedures. Hudson, Reed & Christiansen, PLLC’s team of adept legal professionals not only assists clients in choosing the appropriate business entity but also ensures compliance with Tennessee’s specific requirements for each type of incorporation. From selecting a suitable entity structure to managing liability and tax implications, Hudson, Reed & Christiansen’s experience instills the confidence to embark on your business journey in Tennessee.
Sole Proprietorships
Hudson, Reed & Christiansen, PLLC recognizes that sole proprietorships are the simplest and most common form of business structure. In a sole proprietorship, the primary entity number is the social security number of the sole person. They are often ideal for single owners seeking complete control over their venture. Generally, a benefit of a sole proprietorship is that the sole proprietorship does not pay corporate income taxes. However, this structure exposes the owner’s personal assets to potential liabilities. For this reason, it is important to work with a trusted partner to protect you.
Limited Liability Companies (LLCs)
LLCs offer a balance between ease and liability protection. Hudson, Reed & Christiansen, PLLC assists clients in setting up LLCs, shielding personal assets from business debts and liabilities while maintaining a flexible management structure. An LLC can be a single-member LLC, which is formed by one individual or entity through a special written agreement, or a multi-member LLC, which is formed by one or more individuals or entities through a special written agreement.
A professional limited liability company (PLLC) is formed under a state professional limited liability company and is a company that performs professional services.
Partnerships
If you are a current business owner desiring to bring on a partner, or an entrepreneur wanting to establish an initial partnership, Hudson, Reed & Christiansen, PLLC provides helpful guidance. A partnership is an entity composed of two (2) or more people. Whether it’s a general partnership, where all partners share responsibilities and liabilities, or a limited partnership, where liability exposure differs for general and limited partners, you will be supported in the creation and establishment of the partnership that fits your business model.
Limited Liability Partnerships (LLPs)
LLPs are often favored by professionals like lawyers and accountants. These structures combine the liability protection of corporations with the flexibility of partnerships. An LLP is an entity composed of one or more general partners and one or more limited partners. The general partners manage and control the business while having full personal responsibility of all business debts and liabilities. The limited partners have no personal responsibility for business debts or liabilities past the amount of their investment interest. A limited partner cannot control or manage daily operations. Hudson, Reed & Christiansen, PLLC ensures clients understand the nuances of LLPs and their implications.
Corporations (Corp)
Corporations are chartered legal entities with more complex business structures. A corporation has its own rights, privileges, and liabilities. While corporations can grant tax or other financial benefits, there are other considerations such as increased licensing fees or limited personal control. Corporations may be formed for profit or nonprofit purposes. Corporations chartered in Tennessee are Tennessee domestic corporations. Corporations chartered in other states are foreign corporations.
S-Corporations
S-Corps are a form of corporation that allows for pass-through taxation, meaning profits and losses are reported on individual tax returns. Hudson, Reed & Christiansen, PLLC aids entrepreneurs in meeting the requirements for S-Corp status, balancing liability protection with tax efficiency.
C-Corporations
C-Corps are a form of corporation that offers separate legal and tax entities, shielding owners’ personal assets. Hudson, Reed & Christiansen, PLLC helps clients navigate the complexities of forming and managing C-Corps, ensuring compliance with regulations.
Next Steps for Incorporating in Tennessee
Hudson, Reed & Christiansen stands as a steadfast partner, guiding aspiring entrepreneurs and current business owners through the intricate maze of business formation and structure. With an unparalleled commitment to client success, Hudson, Reed & Christiansen, PLLC offers tailored insights into sole proprietorships, LLCs, partnerships, LLPs, S-Corps, and C-Corps. By understanding the implications of each entity on liability and taxation, Hudson, Reed & Christiansen, PLLC equips clients with the tools they need to make informed decisions that set them on a path to business triumph.