Business start-up labyrinth causing you trouble? You are not alone. Many who have a small business start-up are confused when trying to pick the right entity, or frustrated when trying to fill out the formation documents or know what they need to do to keep up the formalities needed to run and protect a business. These are not items that can be ignored. Not putting the correct business foundation in place could be very costly to you in the future.
Putting the correct business start-up foundation in place can save you time and money. I see it all the time. If someone takes the time to choose the business structure carefully, in the end it saves them in management headaches and taxes. The truth is that a small business really is one of the best tax deductions you can have. To get the most out of your tax deduction possibilities, it is important to have the correct structure in place and keep up with your formalities.
Save Money in Your Business Start-up
I was visiting with an ex-IRS agent and he told me how a business start-up can be structured to help decrease the chances of a tax audit. I have been audited a couple of times and it has taken one or two weeks and used up valuable employee time and resources. I can tell you for a fact that saving a tax audit can be a big deal. In my LLC Wizard Course there is a business formation chart that helps you make the right choice.
Once the correct entity is in place, as an owner of a small business start-up, you should be certain to take advantage of all the tax deductions you can. These deductions are given to small business because the government wants to encourage small business start-ups. I have talked to folks who believe it is best to avoid taking deductions so they can avoid IRS scrutiny. Unfortunately it doesn’t work that way. The IRS has formulas and they use those to determine if your business is taking too much money. They know approximately what you should deduct.
The take home message is that you should honestly take your business start-up deductions, and legitimate business expense deductions, but keep all of the receipts and records and be prepared to defend them. Take the time to develop a good filing system so you can get to the receipts when you need them.
Create a Firm Business Start-Up Foundation
More than 50% of small business start-ups fail within the first five years of formation. If the foundation for your business start-up has not been correctly structured and maintained, you could find yourself personally liable for all your business debts. But if you understand what you need and you have taken the time to do it right, you can be protected. The correct legal foundation could make all the difference in your liability protection.
Labyrinths, like a maze, are designed to challenge their patrons. Your business start-up will be a challenge, but it doesn’t need to trap you. If you have a business start-up, ask yourself these questions. Do I have the proper asset protection in place to protect my business and myself? Also ask, can I take advantage of the tax deductions that will save my business and me a bundle of money? It is possible to structure your business start-up so you can take advantage of these benefits. The LLC Wizard Course answers all these questions and more.
Copyright Lee Phillips