Corporate Law

Choosing the right form of entity for your business is among the most difficult decisions for entrepreneurs. The initial selection process is one that should be done with care after sound legal advice. Business owners who wish to incorporate as a traditional C corporation (C corp) must consider whether they wish to have corporate earnings taxed at the entity level first, and then again after earnings are distributed to individual shareholders on their individual tax returns. C corps must file lengthy corporate tax returns every year. In an LLC or PLLC, entity earnings are not taxed until they are distributed to the individual members or owners based upon their percentage of ownership in the entity. Although this simplifies an entity’s tax filing, the entity must issue tax statements to each member annually reflecting a member’s share of income and expenses from the entity. These statements may add an additional tax reporting burden for members of LLC’s and PLLC’s.  The federal government now requires newly formed entities to file a compliance statement under the Corporate Transparency Act.