The Launch Blog: Expert Advice from the CorpNet Team

Incorporating a Business 101

As a business owner, the day will come when you inevitably will have to address the legal aspects of your business – and the sooner the better. And, fortunately, the process can be relatively painless and hassle-free. I talk to countless small business owners and freelancers who consider themselves too small to worry about incorporation. After all, you don't have mazes of cubicles…you may not even have any employees. However, incorporation can still be a smart idea even for the self-employed graphic designer or wedding planner and in this post we discuss the benefits of incorporating your small business.

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What Is a Pass-Through Entity?

A pass-through entity refers to a business that does not pay income tax of its own. Its income, losses, credits, and deductions “pass-through” to each business owner’s personal tax return, where its profits are taxed according to each owner’s individual income tax rate. Sole proprietorships, general partnerships, limited partnerships, limited liability partnerships, limited liability companies, and S Corporations are all pass-through entities. Corporations, and limited liability companies that elect to be taxed as a corporation, are not pass-through entities.

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What Business Owners Need to Know About Filing Taxes in 2024

2024 has arrived, which means businesses across the United States need to start thinking about filing taxes for 2023. It’s time to determine deadlines and research any legislative and tax code changes that may affect you and your company. For guidance in preparing your 2023 tax return, I encourage you to talk with a professional tax expert. In the meantime, here’s a quick overview of what business owners should consider when filing their taxes in 2024. Sole Proprietorship Taxes Sole Proprietorships are unincorporated businesses with no distinction between the business owner and the...

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How to Avoid Double Taxation as an LLC or S Corporation

There are a whole host of reasons to incorporate as a C Corporation. For example, the C Corporation is the preferred structure if you intend on seeking VC funding or taking the company public. However, forming a C Corporation involves more paperwork, legal fine print, and potential double taxation. In today's article, we'll review how you can utilize an S Corporation or LLC to avoid double taxation. S Corporation Considerations The biggest differences between forming a Limited Liability Company (LLC) and incorporating as an S Corporation arise when you start to look at the more complex...

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How the Corporate Transparency Act Affects Your Company

Per the recently passed Corporate Transparency Act (CTA), owners of smaller Limited Liability Companies (LLCs) and corporations will soon have another compliance requirement to adhere to this year. LLCs and corporations with fewer than 20 employees must report information about their owners and company applicants to the federal government. What is the Corporate Transparency Act? The Corporate Transparency Act (CTA) is federal legislation created by the U.S. Department of the Treasury’s Financial Crimes Enforcement Network (FinCEN) and passed by Congress as part of the Anti-Money...

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Does Your Business Need a DBA?

Do you need a DBA for your business? It is a common question for evolving and growing businesses. Let's explore what a DBA is, what benefits it offers, and discuss some situations when you might need to file a DBA. What is a DBA? A DBA is a fictitious business name, trade name, or assumed business name. This DBA, which is short for Doing Business As, is a filing that lets the public know you’re the true owner of your business. In the United States, a DBA lets the public know who the real owner of a business is. The DBA is also called a fictitious business name or assumed business name. It...

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How Many Members Can an LLC Have?

Besides personal liability protection, flexibility is among the top reasons entrepreneurs choose the Limited Liability Company (LLC) business structure for their companies. An LLC can have an unlimited number of owners, called “members” (with few restrictions on who can be a member); an LLC can override its default tax treatment and opt for an S Corporation or C Corporation tax election (if it meets the IRS’s qualification criteria); and an LLC can be managed by the LLC’s members or one or more designated managers. These qualities make operating as a Limited Liability Company attractive...

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Can You File Your Own LLC?

Many entrepreneurs who want to form a Limited Liability Company (LLC) think they must hire a lawyer to handle the paperwork. They’re mistaken! While it’s helpful to consult an attorney about which business entity type is right for your business and get answers to other legal questions, you’re not required to have an attorney file your LLC’s Articles of Organization with the state. In fact, you may complete and submit your LLC registration paperwork on your own — or work with an online business filing company like CorpNet. Before I get into the filing requirements for LLCs, let’s revisit...

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Professional Corporation vs. Professional LLC

A professional corporation and a professional LLC are business entities that licensed professionals may wish, or be required, to form. Generally, professions that form professional LLCs or professional corporations include: Attorneys and law firms Accountants and CPAs Physicians Engineers Architects Psychologists Chiropractors Dentists Veterinarians Social workers Real estate agents In this article, I'll explain some of the characteristics of the professional LLC (PLLC) and professional corporation (PC) business structures, show how they are similar, and show how they differ from each...

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Which LLC Is Right for Me?

Just as there are flavors of ice cream, different varieties of the LLC business structure exist, too. The ideal option for a company may depend on a business's industry, type of commercial activities, number of owners, and even an owners' professional credentials. On the CorpNet website, we offer a tool to help entrepreneurs zero in on the right business entity for them. In this article, I'll describe some general scenarios and the limited liability company structure versions that might be most appealing in those situations. Keep in mind that choosing a business entity type requires...

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The Top Reasons Startup Businesses Fail

No one starts a business to see it fail. Seeds of ideas slowly germinate into full-blown business plans bursting forth with sparkle and optimism. This business is your dream and you’ve given it your heart and soul.  You know it won’t fail. I’m sorry to say that many startups do fail, and they fail for various reasons. Financial Issues Cash is the lifeblood of a new business. Without it, you can’t afford to pay your employees, purchase inventory and materials, or adequately market your business. You can’t even cover your overhead expenses like rent and utilities. The reasons for cash...

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What is a Business Statement of Purpose for an LLC or Corporation?

When starting a Limited Liability Company or C Corporation, businesses in most states must provide a written statement of business purpose in their formation documents (Articles of Incorporation or Articles of Organization). The business purpose statement describes why, and for what legal purpose, will the business exist. This is not the same as a company's mission or vision statement, which businesses often leverage when seeking financing, attracting customers, and rallying employee morale. In most states’ Articles of Incorporation and Articles of Organization, the purpose statement is a...

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How to Calculate Profit Margins

Passion, energy, and enthusiasm are essential entrepreneurial traits for launching a business — and so is an understanding of financial performance. To sustain and grow an LLC or Corporation, a business owner must keep an eye on its profitability. Calculating profit margin reigns as one of the most telling ways to assess a company's financial standing. What Is Profit Margin? Profit margin measures your company’s profitability after deducting expenses from its revenue. It’s expressed as a percentage — indicating the ratio of profit to revenue. For example, if your business has a 30% profit...

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The Best CPA Marketing Channels for Growing Your Firm

Whether your accounting business is just starting out, or whether you’re a seasoned veteran, marketing your business is a must. It’s crucial in good economic times and in bad. In fact, during an economic downturn, choosing the right CPA marketing channels for your business matters more than ever. Smart marketing can give you the edge you need to succeed—if you know where to spend your time and money! Listed below are five CPA marketing channels sure to help grow your accounting business. 1. Direct Mail Along with huge accounting staff, huge accounting firms have huge budgets. How can you...

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A Mid-Year Business Checklist to Get You Back on Track

Tax season is over (for most of us). So, what’s next for business owners and professional advisors with business clients? With so much disruption and distraction this year, you may have fallen behind keeping up with compliance for business licenses, permits, and identification numbers. Here’s a mid-year business checklist to get you back on track. Federal Tax ID Getting a Federal Tax ID number (or an Employer Identification Number—EIN) is optional if you’re a Sole Proprietorship, but if your business acts as a C Corporation, Limited Liability Company, or a Partnership, you and your...

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16 Considerations When Choosing a Business Filings and Compliance Provider

Entrepreneurs cannot succeed in business completely on their own. Successful business owners will leverage their talent, expertise, and skills, while also being quick to delegate tasks and responsibilities to others with the knowledge and proficiencies they lack. For example, not very many business owners know all the ins and outs involved in preparing and submitting the paperwork involved in setting up a business entity and keeping it compliant. Rather than trudge through the process and hope for the best, it's wise for business owners to enlist the help of a business filings and...

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How to Protect a Business Name

As an entrepreneur, my business name is my greatest asset.  I have invested countless hours promoting my business.  I have untold articles hoping people respond favorably when they hear the word "CorpNet." I have traveled across the United States, away from my husband and children, promoting my business name and its products and services.  Thus, preventing others from using or "stealing" my brand name is of utmost importance to me.  And, the quest to protect a business name should be important to you. Registering a Business Name Offers No Protection After speaking with several other...

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Seven Tips for Optimizing LinkedIn for Accountants

With more than 849 million users, LinkedIn is a powerhouse of social media. While it doesn't command the 2.9 billion users of Facebook, it is the top location for connecting at a business-to-business level. The social network has established a solid niche for itself by focusing on workforce needs such as finding new business, searching for jobs, and building professional relationships. Plus, if you know the secrets to using it successfully, LinkedIn could be a major revenue generator for your accounting business. Here are seven tips for getting started with optimizing LinkedIn for...

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Increasing Client Satisfaction in Accounting Firms

What if you could increase customer satisfaction, while also increasing your revenue and profits? What if you could accomplish both objectives without changing your existing workload or staff? In a recent webinar, we walked through the benefits moving towards a more proactive mode with clients by helping them manage the burden of incorporation, LLC filings, registered agent services, and annual compliance management. We also explored CorpNet’s partner program and showed how CPAs, accountants, and bookkeepers can easily add these services to their existing advisory offering. At the end of...

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CorpNet Listed on Inc.’s Power Partner Awards for 2023

CorpNet is proud to announce that it has made Inc.’s Power Partner list for 2023. CorpNet is one of 389 companies to make the list. The Inc Power Partner award recognizes B2B companies that provide exemplary products and services for their partners. The award focuses on actual client interviews that discuss criteria such as the value of services and the nominee's service quality in comparison to its competitors. For CorpNet, this award acknowledges the exemptional business filing and compliance services provided to partner companies like Soulence Tax & Wealth Advisors, K&K...

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How to Start a Consulting Business

If you have a high level of proficiency, expertise, and experience in a field, you may have thought about how to start a consulting business. Starting a consulting business can be a wonderful career option for individuals who want to leverage their knowledge and skills while enjoying the flexibility and autonomy of self-employment. Even if you don't presently have experience doing the type of work you're interested in, you may be able to achieve your dream with hard work, education, training, and attention to complying with the professional and legal requirements. In today's post, we'll...

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When you’re starting a small business that has more than one owner, you and your partner(s) may have concerns about your personal liability risks. If this is the case, it would be wise to compare LLP vs. LLC business structures. Limited liability partnerships (LLP) and limited liability companies (LLC) combine some aspects of general partnerships and corporations. As a hybrid business entity type, they each provide a level of liability peace of mind for their owners while preserving some of the simplicity of operating as a general partnership. Although they have some things in common,...

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Maintain Business Compliance to End the Year in Good Standing

As we move into the fall and winter months it's time to begin thinking of year-end compliance responsibilities and business activities. We'd like to help you prepare for the year-end and we want to help you get all your legal ducks in a row. To assist in these efforts, we’ve put together a year-end compliance checklist to set you on the right path. And to make the entire year-end compliance process as easy as possible, we've also created an annual compliance checklist you can download in a PDF (see below). File Your Annual Corporate Documentation Most states require registered C...

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How Much Do Small Business Owners Really Make?

We all dream of having our own business, being the boss, and controlling our own destiny. I can assure you the dream is indeed possible. But will that dream, and future success be enough? How much do small business owners really make per year? And will it be enough to support them, their families, and their ideal lifestyle? There are multiple factors affecting an entrepreneur’s annual income. Some are within the owner’s control while others are not. Today, we will discuss how much a small business owner can expect to make per year. Experience and Expertise To me, the number one component...

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How to Manage Payroll for Restaurants

Maintaining an exceptional staff reigns as one of the essential ingredients for a successful restaurant. With hiring that staff, comes payroll responsibilities and complying with all related federal, state, and local employment and tax laws. Payroll for restaurants is complex. It entails calculating work hours, wages, salaries, benefits, and wage garnishments; withholding and paying employment-related taxes; reporting and remitting withholdings to the appropriate agencies; and dealing with the nuances of handling tipped employees’ compensation and tax withholdings. The percentage of...

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Incorporate Before Year End to Avoid Issues at the Secretary of State

Think you’re the only business owner who wants to incorporate or form an LLC before the end of the year with your Secretary of State? Think again. Registering a business at the end of a calendar year can take longer than any other time of the year. Because everyone waits until the end of the year to change their business structure for the New Year, there's a lot of competition. What might normally take just a few weeks to get approved can take a lot longer. Waiting until December to register your business with the Secretary of State could mean that your application gets backed up into...

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