BUSINESS
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How to land a bank loan
It's tougher to get business loans in this lender's market, but these tips
can improve your chances
The size of the loan. Smaller institutions tend to have capital
constraints (either self-imposed or dictated by regulators) that restrict
the size of loans they make.
Larger institutions sometimes have a per-transaction minimum, which
allows them to focus their managerial resources on fewer loans while
still lending in significant volume.
The industry within which the borrower is engaged. Banks will rarely
lend to a entrepreneurs in an industry with which they have little
experience.
The geographic location of the business and borrower. Lenders within
the federal banking system receive Community Reinvestment Act
credits lending within their geographical charter area and debits for
lending outside it. The challenge of dealing with varied collection laws
and other local regulations makes many regional banks unwilling to
lend outside certain areas.
When you call a potential lender, Bartmann recommends identifying
yourself and running through all three parameters in your first phone
call to the institution. The script he uses is:
"Hi, my name is John Doe and I am interested in borrowing $ (amount)
for (type of business), located in (geographic area). Would your
institution have an interest in visiting with me about that?"
"In a matter of a few minutes, you have found out whether this
institution is even capable of making the kind and type of loan you
desire," he says. "If the answer is no, you have saved lots of time and
can quickly pick up the phone and call the next one on your list. If they
say yes, then set an appointment to go pitch the deal - now with a
higher expectation of the likelihood of success."
Look at the credit score (also known as the CRA rating) of the bank as
well, recommends Leili McKinley of Haiku, Hawaii, business
consultancy Soaring Phoenix. She recommends that business owners
use Web sites such as iBank.com and TheStreet.com (TSCM) to make
comparisons between banks.
Once you have done your due diligence, make sure your business plan
is in top shape
It's tougher to get business loans in this lender's market, but these tips
can improve your chances
The size of the loan. Smaller institutions tend to have capital
constraints (either self-imposed or dictated by regulators) that restrict
the size of loans they make.
Larger institutions sometimes have a per-transaction minimum, which
allows them to focus their managerial resources on fewer loans while
still lending in significant volume.
The industry within which the borrower is engaged. Banks will rarely
lend to a entrepreneurs in an industry with which they have little
experience.
The geographic location of the business and borrower. Lenders within
the federal banking system receive Community Reinvestment Act
credits lending within their geographical charter area and debits for
lending outside it. The challenge of dealing with varied collection laws
and other local regulations makes many regional banks unwilling to
lend outside certain areas.
When you call a potential lender, Bartmann recommends identifying
yourself and running through all three parameters in your first phone
call to the institution. The script he uses is:
"Hi, my name is John Doe and I am interested in borrowing $ (amount)
for (type of business), located in (geographic area). Would your
institution have an interest in visiting with me about that?"
"In a matter of a few minutes, you have found out whether this
institution is even capable of making the kind and type of loan you
desire," he says. "If the answer is no, you have saved lots of time and
can quickly pick up the phone and call the next one on your list. If they
say yes, then set an appointment to go pitch the deal - now with a
higher expectation of the likelihood of success."
Look at the credit score (also known as the CRA rating) of the bank as
well, recommends Leili McKinley of Haiku, Hawaii, business
consultancy Soaring Phoenix. She recommends that business owners
use Web sites such as iBank.com and TheStreet.com (TSCM) to make
comparisons between banks.
Once you have done your due diligence, make sure your business plan
is in top shape
| Business structures 101 ---KNOWLEDGEFINANCIAL.COM -- BUY AND SALE HOMES, CONDOS, TOWN- HOMES, COMMERCIAL PROPERTIES AT KNOWLEDGEFINANCIAL.COM LLP, LLC, S-corp and C-corp: It's not just alphabet soup! A breakdown of what you need to know, in layman's terms. Fortune Small Business) -- What exactly is an LLP? What's the difference between an LLC and a corporation? What about S-corps and C-corps? Sorting through the legal jargon and tax codes defining these business structures can be daunting for entrepreneurs - but picking the right structure for your company brings vital tax benefits and legal flexibility. LLC or corporation? There's virtually no reason why a small business should file as a corporation, unless the owners plan to take the business public in the near future, says Carter Bishop, a professor at Suffolk University Law School who helped draft the uniform LLC and LLP laws for several states. Instead, filing as an LLC, or limited liability company, is usually the best choice. The major differences between an LLC and a corporation include decision-making flexibility and the type of taxation the business faces, says Mark Patton, an attorney with Lewis and Roca in Tucson, Ariz. A corporation has to have a board of directors to make decisions according to a formal process. The "board" could technically be one person, but it still needs to exist. An LLC, on the other hand, can set up an operating agreement at the time the business is created, and make decisions more informally. Common provisions in operating agreements include: • Who can make decisions on behalf of the LLC? Will all owners manage the company, or will there be one primary manager? • What are the owners' responsibilities to contribute money to the company? • When and how will the company income be shared? • What procedure is required to transfer membership interests in the company? The second major difference is that an LLC benefits from "pass-through taxation." Pass-through taxation means the company pays no tax on its profits: It's like the company doesn't even exist for federal tax purposes, Bishop says. In fact, if the LLC is a sole proprietorship, the company does not have to file any tax returns. LLCs with more than one member must file a federal tax return, although the LLC itself is not subject to a tax. Earnings pass through to the owners, who then report the income on their own tax returns and pay the tax on their income. A corporation, on the other hand, must pay federal taxes as an entity; its shareholders are then taxed on any dividends or distributions they receive from the company, in effect allowing some of the company's profits to be taxed twice. There is an exception to this rule, however, for companies that file under subchapter S of the Internal Revenue Code. Such companies are commonly referred to as "S-corp" entities. S-corp or C-corp? ----KNOWLEDGEFINANCIAL.COM -- BUY AND SALE HOMES, CONDOS, TOWN- HOMES, COMMERCIAL PROPERTIES AT KNOWLEDGEFINANCIAL.COM The terms "S-corp" and "C-corp" are merely shorthand references for a company's tax status - they're not distinct business entities. The major tax difference between the two is that an S-corp receives pass-through tax treatment similar to a partnership or LLC, whereas a C-corp (taxed under subchapter C) is required to pay tax on its income as a business entity. An S-corp's pass-through tax treatment does not come without some limits, however. An S- corp can have only 100 shareholders, each of whom must be an individual. (Certain types of trusts are also eligible.) Other businesses can't be an S-corp shareholder. "For tax purposes, a small-business owner will probably want to choose either an LLC or an S-corp to obtain pass through tax treatment and to avoid the double taxation of a C-corp," Patton says. The shareholders of a corporation can obtain subchapter S treatment by filing Form 2553 with the IRS within 75 days of starting operations. If this form is not filed, the corporation is taxed under subchapter C by default. So then, what's the difference between an LLC and S-corp? The members of an LLC can agree to share a company's income and absorb its losses disproportionately, whereas S-corp shareholders must share in the company's income in direct proportion to the number of shares they hold. Even if an S-corp is small and private, it's still subject to corporate formalities. The company will need to hold an annual meeting and file formal reports to its shareholders documenting its decision-making processes on significant corporate matters. An LLC does not need such documentation. "Between an LLC and an S-corp," Patton says, "the LLC is again the more flexible of the two and can accommodate most business arrangements." He recommends, however, that small-business owners consult their advisors to determine whether there are additional tax benefits of an S-corp in their specific situation that might justify incurring the structure's limitations. Okay, now what about partnerships? In addition to an LLC or a corporation, there are two types of partnerships a small business may want to consider: A general partnership and a limited partnership. The first requirement of any partnership is obvious: there must be more than one owner, or "partners" (hence the name). If you're a sole proprietor, opt for an LLC instead. Partnerships, Bishop says, are typically formed by professionals such as lawyers, architects, accountants and doctors. In some states, such firms are precluded from operating as LLCs; in others, where general partnerships and longstanding law firms predated LLC laws, many organizations opt to retain their existing status. ----KNOWLEDGEFINANCIAL.COM -- BUY AND SALE HOMES, CONDOS, TOWN- HOMES, COMMERCIAL PROPERTIES AT KNOWLEDGEFINANCIAL.COM |
KNOWLEDGEFINANCIAL.COM
BUSINESS INFO, BUSINESS Structure Questions And Answers. HOW TO BUY A GOOD BUSINESS? WHAT ARE: LLP, LLC, S-corp
and C-corp? How TO ESTABLISH A NEW BUSINESS? HOW TO NEGOTIATE YOUR WAY TO A GREAT BUSINESS DEAL?
and C-corp? How TO ESTABLISH A NEW BUSINESS? HOW TO NEGOTIATE YOUR WAY TO A GREAT BUSINESS DEAL?
SMALL BUSINESS CLICK HERE TO CONTINUE! Buying a Franchise a Consumer Guide:
Investments and Business Opportunities / Franchise & Business Opportunities for all. The Benefits and Responsibilities of Franchise
Ownership. ----KNOWLEDGEFINANCIAL.COM -- BUY AND SALE HOMES, CONDOS, TOWN-HOMES, COMMERCIAL PROPERTIES AT KNOWLEDGEFINANCIAL.COM
Investments and Business Opportunities / Franchise & Business Opportunities for all. The Benefits and Responsibilities of Franchise
Ownership. ----KNOWLEDGEFINANCIAL.COM -- BUY AND SALE HOMES, CONDOS, TOWN-HOMES, COMMERCIAL PROPERTIES AT KNOWLEDGEFINANCIAL.COM
11 Great things to do with your money in financial crisis, in difficult
economic time
Trust Account: Definition of a Trust; Land Trust, Living Trust,
Revocable Trust, Land Contract. It is one of the oldest and best
defined relationships known in the law
How to protect yourself and a business against malicious law-suits?
Will & Living trust
What is a will and what is living trust? How does a living trust avoid
probate?
{Investment} The Ultimate Retirement Guide for Everyone; Retire Rich,
Retire Early
How can I protect my assets? {Business 101 --- Corp., S - Corp., LLC,
General Partnership, Limited partnership, Trust Account, Will and
Living-Trust
economic time
Trust Account: Definition of a Trust; Land Trust, Living Trust,
Revocable Trust, Land Contract. It is one of the oldest and best
defined relationships known in the law
How to protect yourself and a business against malicious law-suits?
Will & Living trust
What is a will and what is living trust? How does a living trust avoid
probate?
{Investment} The Ultimate Retirement Guide for Everyone; Retire Rich,
Retire Early
How can I protect my assets? {Business 101 --- Corp., S - Corp., LLC,
General Partnership, Limited partnership, Trust Account, Will and
Living-Trust
General partnership and LLPs
In a general partnership, all owners have equal rights to manage the
company, regardless of their ownership shares in the company. On the
downside, they can also all be equally liable for any mishaps the
company runs into, like debt or lawsuits. This is where an LLP, or
limited liability partnership, comes into play.
An LLP is merely a certificate a general partnership can obtain to
create a liability shield protecting the individual partners, ANTONY
says. Take, for example, a law firm that has offices in New York and
Los Angeles. If a partner in Los Angeles commits malpractice, the
partner in New York will not be considered individually liable. Without
an LLP certificate, however, the New York partner would not be
protected.
Limited partnership and LLLP
A limited partnership structure varies from a general partnership in that
not all partners are entitled to participate in managing the business.
The general partner or partners actively manage the business, while
the limited partners (usually passive investors) do not participate in the
day-to-day operations. This type of business structure usually suits
real-estate investments.
When it comes to liability in a limited partnership, responsibility follows
the management chain: in most actions, the limited partner is not
liable, but the general partner is.
In many states, however, a limited partnership can obtain an LLLP
certificate, for a limited liability limited partnership. This certificate,
says, works in the same manner as the LLP certificate by protecting
the general partners with a liability shield.
An entrepreneur's best choice
In the end, an LLC business structure is the best bet for most small
businesses. It's the structure that gives the owners the greatest
flexibility. Plus, it automatically includes a liability shield protecting all
owners.
For more information on your options, check out the Internal Revenue
Service's guide to business structures
KNOWLEDGEFINANCIAL.COM -- BUY AND SALE HOMES, CONDOS,
TOWN-HOMES, COMMERCIAL PROPERTIES AT KNOWLEDGEFINANCIAL.COM
In a general partnership, all owners have equal rights to manage the
company, regardless of their ownership shares in the company. On the
downside, they can also all be equally liable for any mishaps the
company runs into, like debt or lawsuits. This is where an LLP, or
limited liability partnership, comes into play.
An LLP is merely a certificate a general partnership can obtain to
create a liability shield protecting the individual partners, ANTONY
says. Take, for example, a law firm that has offices in New York and
Los Angeles. If a partner in Los Angeles commits malpractice, the
partner in New York will not be considered individually liable. Without
an LLP certificate, however, the New York partner would not be
protected.
Limited partnership and LLLP
A limited partnership structure varies from a general partnership in that
not all partners are entitled to participate in managing the business.
The general partner or partners actively manage the business, while
the limited partners (usually passive investors) do not participate in the
day-to-day operations. This type of business structure usually suits
real-estate investments.
When it comes to liability in a limited partnership, responsibility follows
the management chain: in most actions, the limited partner is not
liable, but the general partner is.
In many states, however, a limited partnership can obtain an LLLP
certificate, for a limited liability limited partnership. This certificate,
says, works in the same manner as the LLP certificate by protecting
the general partners with a liability shield.
An entrepreneur's best choice
In the end, an LLC business structure is the best bet for most small
businesses. It's the structure that gives the owners the greatest
flexibility. Plus, it automatically includes a liability shield protecting all
owners.
For more information on your options, check out the Internal Revenue
Service's guide to business structures
KNOWLEDGEFINANCIAL.COM -- BUY AND SALE HOMES, CONDOS,
TOWN-HOMES, COMMERCIAL PROPERTIES AT KNOWLEDGEFINANCIAL.COM
| The Ultimate Retirement Guide for Everyone; Retire Rich, Retire Early. Long-term care insurance? Is a long-term care insurance policy really provides money to help cover the costs of living if you are no longer able to take care of yourself.? SOCIAL SECURITY RETIREMENT GUIDE. HOW DOES SOCIAL SECURITY WORK? What is the importance and benefits of life insurance in real life, and at retirement age? Pension Plans / IRA / INDIVIDUAL RETIREMENT ACCOUNT. What is an IRA? And what does it matter? What is Annuity Insurance Investment, Annuity & Pension Insurance? Are Annuities Planning today for a secure tomorrow? |
SMALL BUSINESS
CLICK HERE TO
CONTINUE! Buying a
Franchise a Consumer
Guide:
Investments and
Business Opportunities /
Franchise & Business
Opportunities for all. The
Benefits and
Responsibilities of
Franchise Ownership
CLICK HERE TO
CONTINUE! Buying a
Franchise a Consumer
Guide:
Investments and
Business Opportunities /
Franchise & Business
Opportunities for all. The
Benefits and
Responsibilities of
Franchise Ownership
SMALL BUSINESS CLICK HERE TO CONTINUE! Buying a Franchise a Consumer Guide:
Investments and Business Opportunities / Franchise & Business Opportunities for all. The Benefits and
Responsibilities of Franchise Ownership
Investments and Business Opportunities / Franchise & Business Opportunities for all. The Benefits and
Responsibilities of Franchise Ownership
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| HOW TO BUY A BUSINESS? THE BEST GIFT YOU CAN EVER PROVIDE FOR YOURSELF: IS BUYING, CREATING, OWNING A BUSINESS IN YOUR OWN. METHODS, TECHNIQUES, AND STRATEGIES. TO ESTABLISH A SOLID BUSINESS. HOW TO BUY A FRANCHISE? Buying a Franchise a Consumer Guide: Investments and Business Opportunities / Franchise & Business Opportunities for all. The Benefits and Responsibilities of Franchise Ownership .How to Register Your Business with the Secretary of State.?. State Business Entity Registration.. State Licenses and Permits . Steps to Registering a Business. FINANCIAL KNOWLEDGE: Investments, and Insurance knowledge to help you start your own business. Be your own boss, make extra money, secure your financial future, obtain financial freedom. LEARN MORE.. |
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The Best Investment You Will Ever Make -----KNOWLEDGEFINANCIAL.COM
When buying a business, you can and should expect to make at least 25%–33% return on your cash
investment. Plus, you will have the opportunity to produce a steady personal cash flow, and you’ll be
building value that will pay you handsomely when the day arrives to sell the business.
Many people wrongly believe that acquiring a business is a risky investment. Personally, I think that
putting your fate in someone else’s hands has a heck of a lot more risk to it. While there is some
inherent risk buying a business, much, if not all, can be eliminated simply by doing your research
beforehand on any business you consider purchasing.
Take the time to properly assess your strengths and weaknesses. Take an honest inventory of
yourself. Your goal is to buy the right business
Determine Your Investment Level
Determine with absolute certainty how much of your own cash you are prepared to invest. Forget any
relatives who may have promised that they’ll "back you". When the time comes to lay down the money,
chances are they won’t be around.
Don’t bother looking at businesses that are unaffordable. Over 90% of small business purchases
involve seller financing. Generally, this is 40%-50% of the purchase price. If you have $150,000 to
invest, don’t look at businesses that will sell for $500,000. It’s OK to dream, but be realistic.
KNOWLEDGEFINANCIAL.COM -- BUY AND SALE HOMES, CONDOS, TOWN-HOMES, COMMERCIAL PROPERTIES
AT KNOWLEDGEFINANCIAL.COM
When buying a business, you can and should expect to make at least 25%–33% return on your cash
investment. Plus, you will have the opportunity to produce a steady personal cash flow, and you’ll be
building value that will pay you handsomely when the day arrives to sell the business.
Many people wrongly believe that acquiring a business is a risky investment. Personally, I think that
putting your fate in someone else’s hands has a heck of a lot more risk to it. While there is some
inherent risk buying a business, much, if not all, can be eliminated simply by doing your research
beforehand on any business you consider purchasing.
Take the time to properly assess your strengths and weaknesses. Take an honest inventory of
yourself. Your goal is to buy the right business
Determine Your Investment Level
Determine with absolute certainty how much of your own cash you are prepared to invest. Forget any
relatives who may have promised that they’ll "back you". When the time comes to lay down the money,
chances are they won’t be around.
Don’t bother looking at businesses that are unaffordable. Over 90% of small business purchases
involve seller financing. Generally, this is 40%-50% of the purchase price. If you have $150,000 to
invest, don’t look at businesses that will sell for $500,000. It’s OK to dream, but be realistic.
KNOWLEDGEFINANCIAL.COM -- BUY AND SALE HOMES, CONDOS, TOWN-HOMES, COMMERCIAL PROPERTIES
AT KNOWLEDGEFINANCIAL.COM
Your Six Steps To Success
1-Commit to a deadline for buying a business (not just “looking” for one).
2-Set aside time every day to work on this project.
3-Organize your finances.
4-Work on determining what type of business will thrive from your strengths and not suffer
from your weaknesses.
5-Seek professional advice from a qualified accountant and attorney.
Unless you have a wealth of experience buying businesses, then educate yourself about this
6-process. Learn as much as you can. When it comes to investing in your future, you can never
know too much! ---------KNOWLEDGEFINANCIAL.COM -- BUY AND SALE HOMES, CONDOS, TOWN-HOMES,
COMMERCIAL PROPERTIES AT KNOWLEDGEFINANCIAL.COM
Structuring The Offer – and Remember, It’s YOUR Offer!
The offer will, in most cases, begin the ball rolling on a potential acquisition. At times, this is the
most effective way to gain insight into the guts of the business. You may also be dismayed to
learn that you may in fact have to make an offer without all of the data that you would like to
have. As an example, you may only gain access to the true financials after an accepted offer
has been put forth.
1-Commit to a deadline for buying a business (not just “looking” for one).
2-Set aside time every day to work on this project.
3-Organize your finances.
4-Work on determining what type of business will thrive from your strengths and not suffer
from your weaknesses.
5-Seek professional advice from a qualified accountant and attorney.
Unless you have a wealth of experience buying businesses, then educate yourself about this
6-process. Learn as much as you can. When it comes to investing in your future, you can never
know too much! ---------KNOWLEDGEFINANCIAL.COM -- BUY AND SALE HOMES, CONDOS, TOWN-HOMES,
COMMERCIAL PROPERTIES AT KNOWLEDGEFINANCIAL.COM
Structuring The Offer – and Remember, It’s YOUR Offer!
The offer will, in most cases, begin the ball rolling on a potential acquisition. At times, this is the
most effective way to gain insight into the guts of the business. You may also be dismayed to
learn that you may in fact have to make an offer without all of the data that you would like to
have. As an example, you may only gain access to the true financials after an accepted offer
has been put forth.
KNOWLEDGEFINANCIAL.COM
The world's richest man, Warren Buffett, says it best. "I will tell you how to become rich. Close
the doors. Be fearful when others are greedy. Be greedy when others are fearful." In today's
real estate market, naive investors are fearful. Choose to be greedy. Choose to be rich.
KNOWLEDGEFINANCIAL.COM
While others run from the chaos, savvy investors are doing what they do best. They're "bargain
hunting". They realize that there's a record number of troubled homeowners who need to sell
fast to avoid foreclosure. And they know that these homeowners are often willing to sell at big
discounts. KNOWLEDGEFINANCIAL.COM
The world's richest man, Warren Buffett, says it best. "I will tell you how to become rich. Close
the doors. Be fearful when others are greedy. Be greedy when others are fearful." In today's
real estate market, naive investors are fearful. Choose to be greedy. Choose to be rich.
KNOWLEDGEFINANCIAL.COM
While others run from the chaos, savvy investors are doing what they do best. They're "bargain
hunting". They realize that there's a record number of troubled homeowners who need to sell
fast to avoid foreclosure. And they know that these homeowners are often willing to sell at big
discounts. KNOWLEDGEFINANCIAL.COM
Learn How to Save Money With a business well structured with an LLC
KNOWLEDGEFINANCIAL.COM
1-Protect your assets and reduce your tax bill!
2-FREE Webinar December 10, 8 p.m. EST
3-If you are serious about investing in real estate or starting a new venture, you need to know
4-about the many advantages of incorporating your business. For many investors and small
business owners, the benefits of forming a limited liability corporation (LLC) are significant. By
forming an LLC business you can:
5-Protect your personal assets through liability protection
6-Deduct many business expenses such as tuition for educational programs
7-Enjoy certain tax advantages
8-Establish credibility with clients, partners and investors
9-Reduce the risk of personal identity theft
KNOWLEDGEFINANCIAL.COM
Why do you need an LLC business?
As an investor or entrepreneur, it is important to think about incorporation before you begin
your new venture, especially in today's legal environment in which frivolous lawsuits have spun
out of control. If you operate a business as a sole proprietorship, you are personally
responsible for any business debts or lawsuits against your business. As a sole proprietor,
almost everything you own can be at risk including your home and your personal bank account!
KNOWLEDGEFINANCIAL.COM
1-Protect your assets and reduce your tax bill!
2-FREE Webinar December 10, 8 p.m. EST
3-If you are serious about investing in real estate or starting a new venture, you need to know
4-about the many advantages of incorporating your business. For many investors and small
business owners, the benefits of forming a limited liability corporation (LLC) are significant. By
forming an LLC business you can:
5-Protect your personal assets through liability protection
6-Deduct many business expenses such as tuition for educational programs
7-Enjoy certain tax advantages
8-Establish credibility with clients, partners and investors
9-Reduce the risk of personal identity theft
KNOWLEDGEFINANCIAL.COM
Why do you need an LLC business?
As an investor or entrepreneur, it is important to think about incorporation before you begin
your new venture, especially in today's legal environment in which frivolous lawsuits have spun
out of control. If you operate a business as a sole proprietorship, you are personally
responsible for any business debts or lawsuits against your business. As a sole proprietor,
almost everything you own can be at risk including your home and your personal bank account!
HOW TO BUY A GOOD BUSINESS -----KNOWLEDGEFINANCIAL.COM
You can easily convince yourself that right now is not the time to buy a business. I don’t
blame you one bit for thinking it may be best to wait.
Or, perhaps you are thinking that you should just go about this cautiously, and if the right
opportunity comes up, you will consider it. While caution is always the right approach,
nobody has ever been successful sitting on the sidelines.
Don’t get me wrong, today’s market is something you have to be concerned about.
Unfortunately, many business buyers, and especially first-timers, are going to end up
buying bad businesses.
But, if you know how to find the good ones, you can put together an incredible deal today
because the market is upside-down and primed for a knowledgeable buyer to steal a
great business. -----KNOWLEDGEFINANCIAL.COM -- BUY AND SALE HOMES, CONDOS, TOWN-
HOMES, COMMERCIAL PROPERTIES AT KNOWLEDGEFINANCIAL.COM
THE BEST GIFT YOU CAN EVER PROVIDE FOR YOURSELF:
IS BUYING, OWNING A BUSINESS IN YOUR OWN.
It’s amazing how we see an immediate increase in our business right after the
December holidays and the day after every long weekend. The former may be many
“New Year’s Resolutioners” as I call them, and the latter is because most people dread
the thought of
You can easily convince yourself that right now is not the time to buy a business. I don’t
blame you one bit for thinking it may be best to wait.
Or, perhaps you are thinking that you should just go about this cautiously, and if the right
opportunity comes up, you will consider it. While caution is always the right approach,
nobody has ever been successful sitting on the sidelines.
Don’t get me wrong, today’s market is something you have to be concerned about.
Unfortunately, many business buyers, and especially first-timers, are going to end up
buying bad businesses.
But, if you know how to find the good ones, you can put together an incredible deal today
because the market is upside-down and primed for a knowledgeable buyer to steal a
great business. -----KNOWLEDGEFINANCIAL.COM -- BUY AND SALE HOMES, CONDOS, TOWN-
HOMES, COMMERCIAL PROPERTIES AT KNOWLEDGEFINANCIAL.COM
THE BEST GIFT YOU CAN EVER PROVIDE FOR YOURSELF:
IS BUYING, OWNING A BUSINESS IN YOUR OWN.
It’s amazing how we see an immediate increase in our business right after the
December holidays and the day after every long weekend. The former may be many
“New Year’s Resolutioners” as I call them, and the latter is because most people dread
the thought of
CERTAINLY YOU NEED: Real Estate Broker, Mortgage Broker,
Business Broker--- Do You Need One? Yes you do!
CALL Mr. ANTONY AT: 786-709-6577 -- SOUTH FLORIDA
--- LICENSED REALTOR, LICENSED MORTGAGE
BROKER.
I am a firm believer in using one, or all of these guys to help you throughout the
process. And so their role from an advice point of view may be very important
sometimes limited however, a good broker can, and will:
Provide you with access to a vast database of businesses for sale
walk you through the valuation process
Provide you with Real Estate and Financing information. And also with comparable
business valuations, and
keep the deal moving along when obstacles are encountered
The Broker will make sure all pertinent documents are assembled for the closing.
KNOWLEDGEFINANCIAL.COM -- BUY AND SALE HOMES, CONDOS, TOWN-HOMES, COMMERCIAL
PROPERTIES AT KNOWLEDGEFINANCIAL.COM
Business Broker--- Do You Need One? Yes you do!
CALL Mr. ANTONY AT: 786-709-6577 -- SOUTH FLORIDA
--- LICENSED REALTOR, LICENSED MORTGAGE
BROKER.
I am a firm believer in using one, or all of these guys to help you throughout the
process. And so their role from an advice point of view may be very important
sometimes limited however, a good broker can, and will:
Provide you with access to a vast database of businesses for sale
walk you through the valuation process
Provide you with Real Estate and Financing information. And also with comparable
business valuations, and
keep the deal moving along when obstacles are encountered
The Broker will make sure all pertinent documents are assembled for the closing.
KNOWLEDGEFINANCIAL.COM -- BUY AND SALE HOMES, CONDOS, TOWN-HOMES, COMMERCIAL
PROPERTIES AT KNOWLEDGEFINANCIAL.COM
NEGOTIATE YOUR WAY TO A GREAT BUSINESS DEAL
When it comes to buying a business for sale, the most exciting and anxious moments can
be experienced when the time arrives for you to enter into negotiations and make an offer.
This part of the process completely handcuffs some individuals. There’s really no need for
this to happen. Just like every other aspect to the buying process, your preparation will
determine your level of success.
Keep in mind that this should be an enjoyable and educational part of buying a business.
There is much to be learned during this phase. You must also realize that negotiations will
evolve, and so if you approach it with an open-minded strategy instead of a “take it or leave
it” philosophy, you will ultimately perform much better and produce a stronger deal.
KNOWLEDGEFINANCIAL.COM -- BUY AND SALE HOMES, CONDOS, TOWN-HOMES, COMMERCIAL
PROPERTIES AT KNOWLEDGEFINANCIAL.COM
When it comes to buying a business for sale, the most exciting and anxious moments can
be experienced when the time arrives for you to enter into negotiations and make an offer.
This part of the process completely handcuffs some individuals. There’s really no need for
this to happen. Just like every other aspect to the buying process, your preparation will
determine your level of success.
Keep in mind that this should be an enjoyable and educational part of buying a business.
There is much to be learned during this phase. You must also realize that negotiations will
evolve, and so if you approach it with an open-minded strategy instead of a “take it or leave
it” philosophy, you will ultimately perform much better and produce a stronger deal.
KNOWLEDGEFINANCIAL.COM -- BUY AND SALE HOMES, CONDOS, TOWN-HOMES, COMMERCIAL
PROPERTIES AT KNOWLEDGEFINANCIAL.COM
| FREE INTERNET ADVERTISEMENT FOR COMMERCIAL REAL ESTATE FOR SALE FREE AD. LEARN MORE! FSBO --- FREE ONLINE SERVICE TO SELL YOUR FOR SALE BY OWNER PROPERTY. CLICK HERE Your FOR SALE Advertisement could be seen by thousands of viewers HOMEOWNERS IN FORECLOSURE: SALE YOUR FORECLOSURE PROPERTY NOW. CLICK HERE SAVE YOUR EQUITY, SAVE YOUR CREDIT RATING WE'LL EMAIL YOUR FOR SALE PROPERTY TO OVER HUNDREDS OF PROSPECTIVE BUYERS AND INVESTORS FOR FREE! |
A step by step guide to gaining control of your financial life.
Setting priorities
Here's help for the first -- and often the hardest -- step in
achieving your financial goals: deciding which goals to pursue.
LESSON 2
Making a budget, saving money
How to bring your spending under control, so that you get the
most out of every dollar.
LESSON 3
Basics of banking and saving
Here's how to get the best banking services at the best price,
either online or off.
LESSON 4
Basics of investing
An introduction to making money in stocks, bonds and mutual
funds REIT'S, real estate.
LESSON 5
Investing in stocks
The market can be a great place to turn savings into wealth -- or
to lose your shirt. Here are some fundamentals of investing
wisely.
LESSON 6
Investing in mutual funds
It's a mutual-fund jungle out there. Here's how to create a simple
portfolio that works.
LESSON 7
Investing in bonds
Bonds can provide a steady and reasonably secure income,
while adding ballast to your portfolio--but only if you really
understand what you're buying.
LESSON 8
Buying a home
Owning your home is part of the American Dream, but if you’re not
prepared, buying it can be a nightmare. Here are some
fundamentals for buyers and sellers.
LESSON 9
Controlling debt
You've got to know when to hold debt--and when to fold it. This
lesson shows you how to accomplish your financial goals by
making debt work for you.
LESSON 10
Home Selling
WAYS TO SELL A PROPERTY FAST AND EASY FOR THE TOP
PRICE!
Selling a home is a big decision and requires a lot of work. From
getting the house ready to reviewing the escrow papers, our
helpful guide will walk you through the process of selling your
home.
LESSON 11
INSURANCE
Health Insurance, Life Insurance, Home Insurance, Car Insurance
Great things to know about insurance
Buying a car, Auto loans. Great things to know:
Buying a car is like no other shopping experience. The choices
seem to be endless. This lesson helps you sort through your
options.
FINANCIAL FREEDOM: A SMARTEST WAY TO PREPARE A
BETTER FUTURE. YOUR PATH TO WEALTH STARTS RIGHT NOW.
It's a fact: today, anyone can become a millionaire
– In the history of the world, there has never been
a better time to create wealth than right here, right
now in real estate.
Setting priorities
Here's help for the first -- and often the hardest -- step in
achieving your financial goals: deciding which goals to pursue.
LESSON 2
Making a budget, saving money
How to bring your spending under control, so that you get the
most out of every dollar.
LESSON 3
Basics of banking and saving
Here's how to get the best banking services at the best price,
either online or off.
LESSON 4
Basics of investing
An introduction to making money in stocks, bonds and mutual
funds REIT'S, real estate.
LESSON 5
Investing in stocks
The market can be a great place to turn savings into wealth -- or
to lose your shirt. Here are some fundamentals of investing
wisely.
LESSON 6
Investing in mutual funds
It's a mutual-fund jungle out there. Here's how to create a simple
portfolio that works.
LESSON 7
Investing in bonds
Bonds can provide a steady and reasonably secure income,
while adding ballast to your portfolio--but only if you really
understand what you're buying.
LESSON 8
Buying a home
Owning your home is part of the American Dream, but if you’re not
prepared, buying it can be a nightmare. Here are some
fundamentals for buyers and sellers.
LESSON 9
Controlling debt
You've got to know when to hold debt--and when to fold it. This
lesson shows you how to accomplish your financial goals by
making debt work for you.
LESSON 10
Home Selling
WAYS TO SELL A PROPERTY FAST AND EASY FOR THE TOP
PRICE!
Selling a home is a big decision and requires a lot of work. From
getting the house ready to reviewing the escrow papers, our
helpful guide will walk you through the process of selling your
home.
LESSON 11
INSURANCE
Health Insurance, Life Insurance, Home Insurance, Car Insurance
Great things to know about insurance
Buying a car, Auto loans. Great things to know:
Buying a car is like no other shopping experience. The choices
seem to be endless. This lesson helps you sort through your
options.
FINANCIAL FREEDOM: A SMARTEST WAY TO PREPARE A
BETTER FUTURE. YOUR PATH TO WEALTH STARTS RIGHT NOW.
It's a fact: today, anyone can become a millionaire
– In the history of the world, there has never been
a better time to create wealth than right here, right
now in real estate.
Common Limited Liability Company (LLC)
Questions
Getting Started With Questions and
Answers..
KNOWLEDGEFINANCIAL.COM -- BUY AND SALE HOMES,
CONDOS, TOWN-HOMES, COMMERCIAL PROPERTIES AT
KNOWLEDGEFINANCIAL.COM
PART- 1
1-How long does it take to get a LLC entity set up in Florida?
2-How do I begin the process of incorporating my business?
3-How do I go about naming the LLC?
4-What Else Do I Need And Why?
5-What is a business license or occupational license and where do I
get one?
6-What is a fictitious name or DBA (Doing Business As) and why
would I need one?
7-What is a Registered Agent and is one needed?
8-What is an EIN and why do I need one?
9-What are certificates of ownership and why would I need them for
my LLC?
8-What is a Certificate of Status and why would I need one?
9-How do I get a resale certificate or a Florida Tax ID number from the
Florida Department of Revenue?
--------------------------------------------------------------------------------
How long does it take to get an LLC entity set up in Florida?
Depending how quickly the state processes the filings, it will take
between two and five business days to set up your LLC entity.
KNOWLEDGEFINANCIAL.COM -- BUY AND SALE HOMES, CONDOS,
TOWN-HOMES, COMMERCIAL PROPERTIES AT
KNOWLEDGEFINANCIAL.COM
How do I begin the process of incorporating my business?
Articles of Organization must be filed with the State of Florida,
together with the required fees.
How do I go about naming the LLC?
The name of your LLC must comply with requirements of the Florida
Department of State. Florida Incorporation Service will perform a
preliminary name check for you at no additional charge.
The name of your LLC must comply with requirements of the Florida
Department of State. We will perform a preliminary name check for
you at no additional charge as you form your company to help make
sure you meet the following requirements.
As a minimum, keep these points in mind as you select a company
name:
KNOWLEDGEFINANCIAL.COM -- BUY AND SALE HOMES, CONDOS,
TOWN-HOMES, COMMERCIAL PROPERTIES AT
KNOWLEDGEFINANCIAL.COM
The name cannot be the same as another corporation or LLC on file
with the State of Florida.
The name should not be confusingly similar to that of an existing
corporation or LLC, i.e., the name should be distinguishable.
Adding "The", "and". "&", or any punctuation or pluralization,
will not make it unique according to the state. Adding "of Florida" or a
name of a city is also rejected by the State.
Using works like Services, Group, Management, Enterprise,
Associates, International, Property, Properties, Holdings, Marketing,
Investments and the like are well used put you at risk for reject.
May not contain language implying that the Florida Corporation
is connected with a government agency or that the corporation is
chartered under United States law.
You can look up your company name to see if it is available at
the Florida Department of State website.
For an LLC, please select a designator for the last part of the name
(use either "LLC" or "Limited Liability Company") to identify your
company as an LLC.
The name you select may not contain language implying that your
company is connected with a government agency or that it is
chartered under United States law.
Important Liability Issue for LLCs:
You should make a point of using the correct name of your company,
including the "LLC" or "Limited Liability Company" designation at the
end of the name, as you conduct your business. Once you form your
LLC, keep in mind that omission of the designation in the use of the
name shall render any person who knowingly participates in the
omission, or knowingly acquiesces in the omission, liable for any
indebtedness, damage, or liability caused by the omission (Florida
Statutes, Chapter 608.406).
You can look up your company name to see if it is available at the
Florida Department of State website.
KNOWLEDGEFINANCIAL.COM -- BUY AND SALE HOMES, CONDOS,
TOWN-HOMES, COMMERCIAL PROPERTIES AT
KNOWLEDGEFINANCIAL.COM
What is a business license or occupational license and where do I
get one?
A business or occupational license is issued yearly by the county
government. Most but not all counties in Florida require that you
register your new business with them.
The costs depends on the county, the type of business and your
company's impact on the county itself.
Please contact your local county once you have all your corporation
documents to find out where you will need to go to get this license.
What is a fictitious name or DBA (Doing Business As) and
why would I need one?
A fictitious name or DBA (Doing Business As) or Trade Name is a
name you can register with the Florida Department of State so that
you may transact business as another name besides your company
name.
You do not need to file for a fictitious name if you will be conducting
business with your company name. You will only need to file for a
fictitious name if you will be conducting business as a DIFFERENT
name then your LLC name
For example, you can have a company name ABC, LLC then register a
fictitious name Ray's Pizza and then do business as Ray's Pizza in
advertising, letterhead, internet names and the like. So the company
name remains the same and you will be able to transact business
with this fictitious name.
There are no holds on a fictitious name as it is a "nickname" or trade
name of the company. So other companies can have the same
fictitious name.
What is a Registered Agent and is one needed?
Florida requires that an individual, or service company, be
responsible for receiving important legal and tax documents.
This service is provided by an "agent" of the LLC who is "registered"
within Florida, thus the term "Registered Agent."
The registered agent for the LLC must have a valid street address
within Florida and be available during normal business hours to
receive documents. The services performed by a registered agent
may include:
Receiving and forwarding legal documents;
Receiving and forwarding franchise tax and annual report forms; and,
Accepting and forwarding service of process.
A Registered Agent must be an adult, residing within Florida and
provide a physical address, (no P.O. boxes).
Florida Incorporation Service offers the Registered Agent Service as
an additional item, à la carte, if you would like someone other than
yourself to be your Registered Agent.
KNOWLEDGEFINANCIAL.COM -- BUY AND SALE HOMES, CONDOS,
TOWN-HOMES, COMMERCIAL PROPERTIES AT
KNOWLEDGEFINANCIAL.COM
What is an EIN and why do I need one?
An Employer Identification Number (EIN), also known as a federal tax
identification number, is a nine-digit number that the IRS assigns to
business entities.
This number is used to identify a business entity and to identify
taxpayers that are required to file various business tax returns.
A business will need to apply for a new EIN if the business is sold or
is otherwise transferred.
You will need an EIN if you have employees in your new business.
Banks may require an EIN to open an account for most LLC.
What are certificates of ownership and why would I need
them for my LLC?
A Certificate of ownership is a printed document used to indicate the
percentage ownership in the LLC.
Please note: If you are applying for Workman's Compensation
Exemption, you will need to supply a certificate of ownership to them
with your application of exemption.
Florida Incorporation Service offers these in our a la carte as an
additional item. There are 10 custom-printed certificates which may
be issued at the discretion of the LLC members.
KNOWLEDGEFINANCIAL.COM -- BUY AND SALE HOMES, CONDOS,
TOWN-HOMES, COMMERCIAL PROPERTIES AT
KNOWLEDGEFINANCIAL.COM
What is a certificate of status and why would I need one?
A Certificate of Status is issued by the Florida Department of State to
show that your company is active and has paid the initial filing fees
or annual report after the first year.
Some banks and governmental agencies require this certificate as
verification that the company is an active Florida company.
If you choose this certificate as part of your package, it is issued
electronically by the Florida Department of State and will be emailed
to you with your articles.
How do I get a resale certificate or a Florida Tax ID number from the
Florida Department of Revenue?
Please visit the Florida Department of Revenue website or call them
at 1-800-352-3671.
KNOWLEDGEFINANCIAL.COM -- BUY AND
SALE HOMES, CONDOS, TOWN-HOMES,
COMMERCIAL PROPERTIES AT
KNOWLEDGEFINANCIAL.COM
Questions
Getting Started With Questions and
Answers..
KNOWLEDGEFINANCIAL.COM -- BUY AND SALE HOMES,
CONDOS, TOWN-HOMES, COMMERCIAL PROPERTIES AT
KNOWLEDGEFINANCIAL.COM
PART- 1
1-How long does it take to get a LLC entity set up in Florida?
2-How do I begin the process of incorporating my business?
3-How do I go about naming the LLC?
4-What Else Do I Need And Why?
5-What is a business license or occupational license and where do I
get one?
6-What is a fictitious name or DBA (Doing Business As) and why
would I need one?
7-What is a Registered Agent and is one needed?
8-What is an EIN and why do I need one?
9-What are certificates of ownership and why would I need them for
my LLC?
8-What is a Certificate of Status and why would I need one?
9-How do I get a resale certificate or a Florida Tax ID number from the
Florida Department of Revenue?
--------------------------------------------------------------------------------
How long does it take to get an LLC entity set up in Florida?
Depending how quickly the state processes the filings, it will take
between two and five business days to set up your LLC entity.
KNOWLEDGEFINANCIAL.COM -- BUY AND SALE HOMES, CONDOS,
TOWN-HOMES, COMMERCIAL PROPERTIES AT
KNOWLEDGEFINANCIAL.COM
How do I begin the process of incorporating my business?
Articles of Organization must be filed with the State of Florida,
together with the required fees.
How do I go about naming the LLC?
The name of your LLC must comply with requirements of the Florida
Department of State. Florida Incorporation Service will perform a
preliminary name check for you at no additional charge.
The name of your LLC must comply with requirements of the Florida
Department of State. We will perform a preliminary name check for
you at no additional charge as you form your company to help make
sure you meet the following requirements.
As a minimum, keep these points in mind as you select a company
name:
KNOWLEDGEFINANCIAL.COM -- BUY AND SALE HOMES, CONDOS,
TOWN-HOMES, COMMERCIAL PROPERTIES AT
KNOWLEDGEFINANCIAL.COM
The name cannot be the same as another corporation or LLC on file
with the State of Florida.
The name should not be confusingly similar to that of an existing
corporation or LLC, i.e., the name should be distinguishable.
Adding "The", "and". "&", or any punctuation or pluralization,
will not make it unique according to the state. Adding "of Florida" or a
name of a city is also rejected by the State.
Using works like Services, Group, Management, Enterprise,
Associates, International, Property, Properties, Holdings, Marketing,
Investments and the like are well used put you at risk for reject.
May not contain language implying that the Florida Corporation
is connected with a government agency or that the corporation is
chartered under United States law.
You can look up your company name to see if it is available at
the Florida Department of State website.
For an LLC, please select a designator for the last part of the name
(use either "LLC" or "Limited Liability Company") to identify your
company as an LLC.
The name you select may not contain language implying that your
company is connected with a government agency or that it is
chartered under United States law.
Important Liability Issue for LLCs:
You should make a point of using the correct name of your company,
including the "LLC" or "Limited Liability Company" designation at the
end of the name, as you conduct your business. Once you form your
LLC, keep in mind that omission of the designation in the use of the
name shall render any person who knowingly participates in the
omission, or knowingly acquiesces in the omission, liable for any
indebtedness, damage, or liability caused by the omission (Florida
Statutes, Chapter 608.406).
You can look up your company name to see if it is available at the
Florida Department of State website.
KNOWLEDGEFINANCIAL.COM -- BUY AND SALE HOMES, CONDOS,
TOWN-HOMES, COMMERCIAL PROPERTIES AT
KNOWLEDGEFINANCIAL.COM
What is a business license or occupational license and where do I
get one?
A business or occupational license is issued yearly by the county
government. Most but not all counties in Florida require that you
register your new business with them.
The costs depends on the county, the type of business and your
company's impact on the county itself.
Please contact your local county once you have all your corporation
documents to find out where you will need to go to get this license.
What is a fictitious name or DBA (Doing Business As) and
why would I need one?
A fictitious name or DBA (Doing Business As) or Trade Name is a
name you can register with the Florida Department of State so that
you may transact business as another name besides your company
name.
You do not need to file for a fictitious name if you will be conducting
business with your company name. You will only need to file for a
fictitious name if you will be conducting business as a DIFFERENT
name then your LLC name
For example, you can have a company name ABC, LLC then register a
fictitious name Ray's Pizza and then do business as Ray's Pizza in
advertising, letterhead, internet names and the like. So the company
name remains the same and you will be able to transact business
with this fictitious name.
There are no holds on a fictitious name as it is a "nickname" or trade
name of the company. So other companies can have the same
fictitious name.
What is a Registered Agent and is one needed?
Florida requires that an individual, or service company, be
responsible for receiving important legal and tax documents.
This service is provided by an "agent" of the LLC who is "registered"
within Florida, thus the term "Registered Agent."
The registered agent for the LLC must have a valid street address
within Florida and be available during normal business hours to
receive documents. The services performed by a registered agent
may include:
Receiving and forwarding legal documents;
Receiving and forwarding franchise tax and annual report forms; and,
Accepting and forwarding service of process.
A Registered Agent must be an adult, residing within Florida and
provide a physical address, (no P.O. boxes).
Florida Incorporation Service offers the Registered Agent Service as
an additional item, à la carte, if you would like someone other than
yourself to be your Registered Agent.
KNOWLEDGEFINANCIAL.COM -- BUY AND SALE HOMES, CONDOS,
TOWN-HOMES, COMMERCIAL PROPERTIES AT
KNOWLEDGEFINANCIAL.COM
What is an EIN and why do I need one?
An Employer Identification Number (EIN), also known as a federal tax
identification number, is a nine-digit number that the IRS assigns to
business entities.
This number is used to identify a business entity and to identify
taxpayers that are required to file various business tax returns.
A business will need to apply for a new EIN if the business is sold or
is otherwise transferred.
You will need an EIN if you have employees in your new business.
Banks may require an EIN to open an account for most LLC.
What are certificates of ownership and why would I need
them for my LLC?
A Certificate of ownership is a printed document used to indicate the
percentage ownership in the LLC.
Please note: If you are applying for Workman's Compensation
Exemption, you will need to supply a certificate of ownership to them
with your application of exemption.
Florida Incorporation Service offers these in our a la carte as an
additional item. There are 10 custom-printed certificates which may
be issued at the discretion of the LLC members.
KNOWLEDGEFINANCIAL.COM -- BUY AND SALE HOMES, CONDOS,
TOWN-HOMES, COMMERCIAL PROPERTIES AT
KNOWLEDGEFINANCIAL.COM
What is a certificate of status and why would I need one?
A Certificate of Status is issued by the Florida Department of State to
show that your company is active and has paid the initial filing fees
or annual report after the first year.
Some banks and governmental agencies require this certificate as
verification that the company is an active Florida company.
If you choose this certificate as part of your package, it is issued
electronically by the Florida Department of State and will be emailed
to you with your articles.
How do I get a resale certificate or a Florida Tax ID number from the
Florida Department of Revenue?
Please visit the Florida Department of Revenue website or call them
at 1-800-352-3671.
KNOWLEDGEFINANCIAL.COM -- BUY AND
SALE HOMES, CONDOS, TOWN-HOMES,
COMMERCIAL PROPERTIES AT
KNOWLEDGEFINANCIAL.COM
PART- 2 ---- KNOWLEDGEFINANCIAL.COM -- BUY AND SALE HOMES, CONDOS,
TOWN-HOMES, COMMERCIAL PROPERTIES AT KNOWLEDGEFINANCIAL.COM
1-LLC Structure Questions And Answers
2-What is a Limited Liability Company (LLC)?
3-What are some of the benefits/advantages and disadvantages of forming an
LLC?
4-What is the difference between a Member Manager and an External Manager?
5-Where can I find definitions for commonly associated LLC terms?
6-Things To Know About LLC's
7-What is an Operating Agreement?
8-What are articles of organization?
9-How is an LLC classified for Federal tax purposes?
10-How is an LLC classified for Florida state tax purposes?
11-Do I need an attorney or CPA to form an LLC?
12-What are the business activities I can choose for my LLC?
13-What are the different types of employees?
14-What is the difference between a principal address and a mailing address for
an LLC?
15-Can I change the principal and mailing address of my corporation after I have
filed?
1- What is a Limited Liability Company (LLC)?
In the early 1980s Florida became the second state to authorize the formation of
limited liability companies ("LLCs"). Now more than 100,000 LLCs are formed in
Florida annually.
One or more persons may form an LLC. A single-member LLC is allowed in
Florida.
KNOWLEDGEFINANCIAL.COM -- BUY AND SALE HOMES, CONDOS, TOWN-
HOMES, COMMERCIAL PROPERTIES AT KNOWLEDGEFINANCIAL.COM
What are some of the benefits/advantages and disadvantages of
forming an LLC?
The primary reason for forming a limited liability company is to limit the liability of
the owners.
Interests in LLCs, in addition, are protected from the claims of creditors of their
members.
Organizational changes related to the LLC can generally be made in the operating
agreement alone (without amending the articles of organization).
Managers and managing members are also protected from personal liability
regarding claims pertaining to the exercise of their management authority except
for more egregious conduct (criminal or reckless acts, deriving improper
personal benefits, voting for unlawful distributions, etc.).
Changes to Florida's corporate income tax laws in the 1990s effectively
eliminated the corporate tax for LLCs.
Generally, an LLC with multiple members is treated for Florida income tax
purposes as a partnership (nontaxable entities that act as conduits for
transferring income and loss directly to the individual partners) and a single-
member LLC is "disregarded" as a separate entity for tax purpose, the same way
it is disregarded for federal tax purposes. Thus, most LLCs are not subject to
Florida's corporate income tax.
LLCs are similar to S corporations for federal tax purposes and do not pay tax
themselves, but pass their income through to their shareholders.
Selected benefits over a corporation:
Flexibility: One of the benefits of an LLC over a corporation is the great latitude
provided in the drafting of the operating agreement and the flexibility that is
possible on such issues as members' contribution obligations, member and
management voting powers, profit and loss allocations, governance structure,
members' distribution rights, etc. Amendments may be made to the operating
agreement as needed.
KNOWLEDGEFINANCIAL.COM -- BUY AND SALE HOMES, CONDOS, TOWN-
HOMES, COMMERCIAL PROPERTIES AT KNOWLEDGEFINANCIAL.COM
A corporation requires that specific formalities be completed on a regular basis,
including annual meetings of shareholders and directors each year, meeting
minutes which are kept with the corporation's records, etc. It is a good business
practice to document major decisions regardless of the structure of your
business; however these formalities are not required for LLCs.
The interest a member owns in an LLC can be protected from creditors while the
stock a person has in a corporation may be seized and sold by creditors.
LLCs can make special allocations of profits and losses among members; S
corporations cannot. S corporations have one class of ownership with profits and
losses allocated according to the percentage of ownership.
LLC Disadvantages
The main disadvantage of the LLC as compared with an S corporation has to do
with the tax treatment for profits that are taken out of the business. If yours is a
smaller company, you may want to consider the LLC carefully as the
disadvantage primarily affects smaller companies. KNOWLEDGEFINANCIAL.COM
Here's the situation: With an S corporation, profits taken out of the business (other
than salary) are not subject to social security and Medicare taxes (which together
amount to 15.3% in 2004)*.
Consider this: In larger companies, where company owners take out salaries of
$85,000 or more, plus profits, this situation would not have much of an impact;
however, in smaller companies where the owners take out more modest salaries
(and then take profits out of the business when available), all the profit taken out
of the LLC would be subject to social security and Medicare taxes, where in the S
corporation it would not. The result: For a small business where the owner paid
themselves a $35,000 salary and took and additional $40,000 in profit out of the
business, the extra taxes on the $40,000 would be over $6,000.
* The maximum amount subject to the social security portion for tax years
beginning in 2004 has increased to $87,900. All net earnings of at least $400 are
subject to the Medicare portion.
Additional LLC Information
A limited liability company may be organized for any lawful purpose, and remains
subject to statutes and regulations of the laws of the State of Florida for regulating
and controlling its business.
Unless its articles of organization or operating agreement provide otherwise,
each limited liability company organized and existing under Florida law shall
have the same powers as an individual to do all things necessary to carry out its
business and affairs, including, without limitation, the power to:
Sue and be sued, and defend, in its name.
Purchase, receive, lease, or otherwise acquire, own, hold, improve, use, and
otherwise deal with real or personal property, or any legal or equitable interest in
property, wherever located.
Sell, convey, mortgage, grant a security interest in, lease, exchange, and
otherwise encumber or dispose of all or any part of its property.
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Purchase, receive, subscribe for, or otherwise acquire, own, hold, vote, use,
sell, mortgage, lend, grant a security interest in, or otherwise dispose of and deal
in and with, shares or other interests in or obligations of any other entity.
Make contracts or guarantees, or incur liabilities; borrow money; issue its notes,
bonds, or other obligations, which may be convertible into or include the option to
purchase other securities of the limited liability company; or make contracts of
guaranty and suretyship which are necessary or convenient to the conduct,
promotion, or attainment of the business of a corporation the majority of the
outstanding stock of which is owned, directly or indirectly, by the contracting
limited liability company; a corporation which owns, directly or indirectly, a
majority of the outstanding membership interests of the contracting limited liability
company; or a corporation the majority of the outstanding stock of which is
owned, directly or indirectly, by a corporation which owns, directly or indirectly,
the majority of the outstanding membership interests of the contracting limited
liability company, which contracts of guaranty and suretyship shall be deemed to
be necessary or convenient to the conduct, promotion, or attainment of the
business of the contracting limited liability company; or make other contracts of
guaranty and suretyship which are necessary or convenient to the conduct,
promotion, or attainment of the business of the contracting limited liability
company.
Lend money, invest or reinvest its funds, and receive and hold real or personal
property as security for repayment.
Conduct its business, locate offices, and exercise the powers granted by this
chapter within or without this state.
Select managers or managing members and appoint officers, directors,
employees, and agents of the limited liability company, define their duties, fix their
compensation, and lend them money and credit.
Make donations for the public welfare or for charitable, scientific, or educational
purposes.
Pay pensions and establish pension plans, pension trusts, profit-sharing plans,
bonus plans, option plans, and benefit or incentive plans for any or all of its
current or former managers, members, officers, agents, and employees.
Be a promoter, incorporator, shareholder, partner, member, associate, or
manager of any corporation, partnership, joint venture, trust, or other entity.
Make payments or donations or do any other act not inconsistent with law that
furthers the business of the limited liability company.
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What is the difference between a Member Manager and an External
Manager?
An LLC can be run by Members or External Managers.
What is a member?
A member is an owner of the company. An LLC can be run by a member (owner)
or several members (owners) of the company. Thus, where a member or several
members run the company, the people who own the company also run the
company. Most Limited Liability Companies are member managed in this way.
What does it mean to have external managers?
If not managed by its members, you will choose to hire an outside person to run
the company who does NOT own a part of the company. This would be termed an
"External Manager." You may have one external manager or several external
managers.
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Additional Definitions
Authorized Representative - One or more persons acting to form a limited liability
company by executing and filing the articles of organization , as authorized by a
member of such limited liability company. The authorized representative may, but
is not required to be, a member of the limited liability company that is being
formed. Capital Account - The agreed value of the initial contributions, increased
by the agreed value of subsequent contributions to capital, if any, and reduced by
distributions of capital, unless otherwise provided in the articles of organization
or the operating agreement.
Contribution - Any cash, property, or services rendered or a promissory note or
other obligation to contribute cash or property or to perform services, which a
person contributes to the limited liability company as a member.
Distribution - A direct or indirect transfer of money or other property or incurrence
of indebtedness by a limited liability company to or for the benefit of its members
in respect of their economic interests.
Foreign limited Liability Company - A limited liability company formed under the
laws of any state other than Florida or under the laws of any foreign country or
other foreign jurisdiction.
Majority-in-interest of the members means, unless otherwise provided in the
articles of organization or operating agreement, members owning more than 50
percent of the then-current percentage or other interest in the profits of the limited
liability company.
Manager - A person who is appointed or elected to manage a manager-managed
company and, unless otherwise provided in the articles of organization or
operating agreement, a manager may be, but need not be, a member of the limited
liability company.
Manager-managed company means a limited liability company that is designated
to be managed by one or more managers.
Managing member means a member appointed or elected as a managing member
of a member-managed company.
Management agreement - If the LLC will be managed by a subset of its members
or by someone who is not a member, there should be a management agreement in
place which spells out the rights and duties of both the members and managers.
Member - Any person who has been admitted to a limited liability company as a
member and has an economic interest in a limited liability company which may,
but need not, be represented by a capital account or, in the case of a foreign
limited liability company, has been admitted to a limited liability company as a
member in accordance with the laws of the state or foreign country or other
foreign jurisdiction under which the foreign limited liability company is organized.
The member need not reside in Florida. See also Management of a Limited
Liability Company.
Membership interest, member's interest, or interest means a member's share of
the profits and the losses of the limited liability company, the right to receive
distributions of the limited liability company's assets, voting rights, management
rights, or any other rights under this chapter or the articles of organization or
operating agreement.
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What is an Operating Agreement and why would I need one for my LLC?
An operating agreement can contain a writing setting out:
The amount of cash and a description and statement of the agreed value of any
other property or services contributed by each member and which each member
has agreed to contribute.
The times at which or events on the happening of which any additional
contributions agreed to be made by each member are to be made.
Any events upon the happening of which the limited liability company is to be
dissolved and its affairs wound up.
It may also contain:
Members and managers name and responsibilities as well as ownership
percentages and signatures.
Profits, losses, distribution of monies, management, banking resolutions, taxes
and other legal agreements regarding internal conflicts as well as general
provisions.
We offer as part of our a la carte service a SAMPLE Operating Agreement. For
complete requirements, please obtain a copy of your state's Limited Liability
Company legislation. There you will be able to determine the guidelines for your
Operating Agreement.
Additional information regarding Limited Liability Company requirements can be
located in Florida Statutes, Chapter 608: Limited Liability Companies.
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What are Articles of Organization?
(1) In order to form a limited liability company, articles of organization of a limited
liability company must be executed and filed with the Department of State by one
or more members or authorized representatives of the limited liability company.
The articles of organization shall set forth the following and additional information
as required:
(a) The name of the limited liability company.
(b) The mailing address and the street address of the principal office of the limited
liability company.
(c) The name and street address of its initial registered agent for service of
process in the state.
(2) The articles of organization are executed by at least one member or the
authorized representative of a member.
Note: Articles of organization are filed quickly and efficiently using our online
system. Since filings are completed with the Division of Corporations
electronically, this cuts the processing time required to form your LLC.
Back to top
How is an LLC classified for Federal tax purposes?
For Federal tax purposes, an LLC business entity must file as either a corporation,
partnership or sole proprietorship.
Federal tax laws will automatically classify and tax certain LLC business entities
as corporations. These entities are:
A business entity formed under a Federal or State statute or under a statute of a
federally recognized Indian tribe if the statute describes or refers to the entity as
incorporated or as a corporation, body corporate, or body politic.
An Association under Regulations section 301.7701-3.
A business entity formed under a Federal or State statute if the statute describes
or refers to the entity as a joint stock association.
A state chartered business entity conducting banking activities if any of its
deposits are insured by the FDIC.
A business entity wholly owned by a state of political subdivision thereof, or a
business entity wholly owned by a foreign government or other entity described in
Regulations section 1.892.2-T.
A business entity taxable as a corporation under a provision of the code other
than section 7701.(a)(3).
Certain foreign entities (see Form 8832 instructions).
An Insurance Company.
If your LLC is not in one of the above categories:
An LLC that is not automatically classified as a corporation can file Form 8832 to
elect their business entity classification. A business with at least 2 members can
choose to be classified as an association taxable as a corporation or a
partnership , and a business entity with a single member can choose to be
classified as either an association taxable as a corporation or disregarded as an
entity separate from its owner, a “disregarded entity”. The Form 8832 is also filed
to change the LLC’s classification.
What is the effect of Not Electing and Entity Classification, the Default Rules?
If an LLC does not File Form 8832, it will be classified, for Federal tax purposes
under the default rules. The default rules provide that if the LLC has at least two
members and is not required to be classified as a corporation, it will
automatically default as a partnership, and be required to file a partnership return.
An LLC that has only a single member and is not required to be classified as a
corporation will automatically default to the classification of disregarded entity.
The disregarded entity files as a sole proprietorship and completes the
appropriate schedules as part of the single owners Form 1040.
Note: The above is a summary of tax information from the IRS website and does
not present complete information. Please consult an appropriate tax professional
if you need clarification or contact the IRS directly for more detail.
Here is the web link to the IRS website for more information on different tax
situations.
http://www.irs.gov/businesses/small/article/0,,id=98359,00.html
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How is an LLC classified for Florida state tax purposes?
A limited liability company that is classified as a corporation for Florida and
federal tax purposes is subject to the Florida Income Tax Code and must file a
Florida corporate income tax return.
A limited liability company that is classified as a partnership for Florida and
federal tax purposes is required to file Form F-1065 if one or more of its owners is
a corporation. In addition, the corporate owner of a limited liability company that is
classified as a partnership for Florida and federal tax purposes must file a Florida
corporate income tax return.
A single member limited liability company that is disregarded for Florida and
federal tax purposes is not required to file a separate Florida corporate income
tax return. However, the income of the company is not exempt from tax if it is
owned by a corporation, whether directly or indirectly. In this case, the
corporation is required to file Form F-1120 reporting its own income, together with
the income of the single member limited liability company.
Source: Fl Dept Revenue
Do I need an attorney or CPA to form an LLC?
No. An attorney or CPA is not legally required to form an LLC.
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What are the business activities I can choose for my LLC?
These are broad categories that the IRS provides to help you select what type of
company you are creating. If your company does not fall into any of these
categories choose “other” then tell us specifically what you will be doing in the
blank next to “other.”
Accommodation & food services - providing customers with lodging, meal
preparation, snacks, or beverages for immediate consumption.
Construction - erecting buildings or other structures, (e.g., streets, highways,
bridges, tunnels). The term “construction” also includes special trade contractors
(e.g., plumbing, HVAC, electrical, carpentry, concrete, excavation, etc.)
Finance & insurance - in transactions involving the creation, liquidation, or
change of ownership of financial assets and/or facilitating such financial
transactions; underwriting annuities/insurance policies; facilitating such
underwriting by selling insurance policies; or by providing other insurance or
employee-benefit related services.
Health care and social assistance - providing physical, medical, or psychiatric
care using licensed health care professionals or providing social assistance
activities such as youth centers, adoption agencies, individual/family services,
temporary shelters, etc.
Manufacturing - the mechanical, physical, or chemical transformation of
materials, substances, or components into new products. The assembling of
component parts of manufactured products is also considered to be
manufacturing.
Real estate - renting or leasing real estate to others; managing, selling, buying or
renting real estate for others; or providing related real estate services (e.g.,
appraisal services).
Rental and leasing - providing tangible goods such as autos, computers,
consumer goods, or industrial machinery and equipment to customers in return
for a periodic rental or lease payment.
Retail - selling merchandise to the general public from a fixed store; by direct,
mail-order, or electronic sales; or by using vending machines.
Transportation & warehousing - transportation of passengers or cargo;
warehousing or storage of goods; scenic or sight-seeing transportation; or
support activities related to these modes of transportation.
Wholesale-agent/broker - arranging for the purchase or sale of goods owned by
others or purchasing goods on a commission basis for goods traded in the
wholesale market, usually between businesses.
Wholesale-other - selling goods in the wholesale market generally to other
businesses for resale on their own account.
Other - activity not described above. Describe the applicant's principal business
activity in the space provided.
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What are the different types of employees?
Other
Applies to most employees. Most new companies will designate their employees
in the "Other" category.
Household employees
Employee who performs household services, such as a maid, babysitter,
gardener, or cook, in your home are not subject to social security and Medicare
taxes if you pay that employee cash wages of less than $1,400.
Agricultural Employees
In general, you are an employer of farm workers if your employees:
Raise or harvest agricultural or horticultural products on your farm,
Work in connection with the operation, management, conservation, improvement,
or maintenance of your farm and its tools and equipment,
Handle, process, or package any agricultural or horticultural commodity if you
produced over half of the commodity (for a group of up to 20 unincorporated
operators, all of the commodity),
Or do work for you related to cotton ginning, turpentine, or gum resin products.
What is the difference between a principal address and a mailing address for an
LLC?
The principal address is the physical location in Florida where the company
conducts business. Florida Department of State Division of Corporations
mandates that this be a physical Florida address. A P.O. Box number cannot be
used for this address.
The Mailing address for an LLC can be a P.O. Box and does not have to be in
Florida. What the Florida Department of State does require of this address is that
this be a current and good address where you can be reached at any time.
Can I change the principal and mailing address of my corporation after I have
filed?
Yes, you can update both of these addresses by emailing the Florida Department
of State – Division of Corporations at corpaddresschange@dos.state.fl.us.
The principal address will still have to be a physical Florida address.
You can also update the officer and director after your initial filing
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1-LLC Structure Questions And Answers
2-What is a Limited Liability Company (LLC)?
3-What are some of the benefits/advantages and disadvantages of forming an
LLC?
4-What is the difference between a Member Manager and an External Manager?
5-Where can I find definitions for commonly associated LLC terms?
6-Things To Know About LLC's
7-What is an Operating Agreement?
8-What are articles of organization?
9-How is an LLC classified for Federal tax purposes?
10-How is an LLC classified for Florida state tax purposes?
11-Do I need an attorney or CPA to form an LLC?
12-What are the business activities I can choose for my LLC?
13-What are the different types of employees?
14-What is the difference between a principal address and a mailing address for
an LLC?
15-Can I change the principal and mailing address of my corporation after I have
filed?
1- What is a Limited Liability Company (LLC)?
In the early 1980s Florida became the second state to authorize the formation of
limited liability companies ("LLCs"). Now more than 100,000 LLCs are formed in
Florida annually.
One or more persons may form an LLC. A single-member LLC is allowed in
Florida.
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What are some of the benefits/advantages and disadvantages of
forming an LLC?
The primary reason for forming a limited liability company is to limit the liability of
the owners.
Interests in LLCs, in addition, are protected from the claims of creditors of their
members.
Organizational changes related to the LLC can generally be made in the operating
agreement alone (without amending the articles of organization).
Managers and managing members are also protected from personal liability
regarding claims pertaining to the exercise of their management authority except
for more egregious conduct (criminal or reckless acts, deriving improper
personal benefits, voting for unlawful distributions, etc.).
Changes to Florida's corporate income tax laws in the 1990s effectively
eliminated the corporate tax for LLCs.
Generally, an LLC with multiple members is treated for Florida income tax
purposes as a partnership (nontaxable entities that act as conduits for
transferring income and loss directly to the individual partners) and a single-
member LLC is "disregarded" as a separate entity for tax purpose, the same way
it is disregarded for federal tax purposes. Thus, most LLCs are not subject to
Florida's corporate income tax.
LLCs are similar to S corporations for federal tax purposes and do not pay tax
themselves, but pass their income through to their shareholders.
Selected benefits over a corporation:
Flexibility: One of the benefits of an LLC over a corporation is the great latitude
provided in the drafting of the operating agreement and the flexibility that is
possible on such issues as members' contribution obligations, member and
management voting powers, profit and loss allocations, governance structure,
members' distribution rights, etc. Amendments may be made to the operating
agreement as needed.
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A corporation requires that specific formalities be completed on a regular basis,
including annual meetings of shareholders and directors each year, meeting
minutes which are kept with the corporation's records, etc. It is a good business
practice to document major decisions regardless of the structure of your
business; however these formalities are not required for LLCs.
The interest a member owns in an LLC can be protected from creditors while the
stock a person has in a corporation may be seized and sold by creditors.
LLCs can make special allocations of profits and losses among members; S
corporations cannot. S corporations have one class of ownership with profits and
losses allocated according to the percentage of ownership.
LLC Disadvantages
The main disadvantage of the LLC as compared with an S corporation has to do
with the tax treatment for profits that are taken out of the business. If yours is a
smaller company, you may want to consider the LLC carefully as the
disadvantage primarily affects smaller companies. KNOWLEDGEFINANCIAL.COM
Here's the situation: With an S corporation, profits taken out of the business (other
than salary) are not subject to social security and Medicare taxes (which together
amount to 15.3% in 2004)*.
Consider this: In larger companies, where company owners take out salaries of
$85,000 or more, plus profits, this situation would not have much of an impact;
however, in smaller companies where the owners take out more modest salaries
(and then take profits out of the business when available), all the profit taken out
of the LLC would be subject to social security and Medicare taxes, where in the S
corporation it would not. The result: For a small business where the owner paid
themselves a $35,000 salary and took and additional $40,000 in profit out of the
business, the extra taxes on the $40,000 would be over $6,000.
* The maximum amount subject to the social security portion for tax years
beginning in 2004 has increased to $87,900. All net earnings of at least $400 are
subject to the Medicare portion.
Additional LLC Information
A limited liability company may be organized for any lawful purpose, and remains
subject to statutes and regulations of the laws of the State of Florida for regulating
and controlling its business.
Unless its articles of organization or operating agreement provide otherwise,
each limited liability company organized and existing under Florida law shall
have the same powers as an individual to do all things necessary to carry out its
business and affairs, including, without limitation, the power to:
Sue and be sued, and defend, in its name.
Purchase, receive, lease, or otherwise acquire, own, hold, improve, use, and
otherwise deal with real or personal property, or any legal or equitable interest in
property, wherever located.
Sell, convey, mortgage, grant a security interest in, lease, exchange, and
otherwise encumber or dispose of all or any part of its property.
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Purchase, receive, subscribe for, or otherwise acquire, own, hold, vote, use,
sell, mortgage, lend, grant a security interest in, or otherwise dispose of and deal
in and with, shares or other interests in or obligations of any other entity.
Make contracts or guarantees, or incur liabilities; borrow money; issue its notes,
bonds, or other obligations, which may be convertible into or include the option to
purchase other securities of the limited liability company; or make contracts of
guaranty and suretyship which are necessary or convenient to the conduct,
promotion, or attainment of the business of a corporation the majority of the
outstanding stock of which is owned, directly or indirectly, by the contracting
limited liability company; a corporation which owns, directly or indirectly, a
majority of the outstanding membership interests of the contracting limited liability
company; or a corporation the majority of the outstanding stock of which is
owned, directly or indirectly, by a corporation which owns, directly or indirectly,
the majority of the outstanding membership interests of the contracting limited
liability company, which contracts of guaranty and suretyship shall be deemed to
be necessary or convenient to the conduct, promotion, or attainment of the
business of the contracting limited liability company; or make other contracts of
guaranty and suretyship which are necessary or convenient to the conduct,
promotion, or attainment of the business of the contracting limited liability
company.
Lend money, invest or reinvest its funds, and receive and hold real or personal
property as security for repayment.
Conduct its business, locate offices, and exercise the powers granted by this
chapter within or without this state.
Select managers or managing members and appoint officers, directors,
employees, and agents of the limited liability company, define their duties, fix their
compensation, and lend them money and credit.
Make donations for the public welfare or for charitable, scientific, or educational
purposes.
Pay pensions and establish pension plans, pension trusts, profit-sharing plans,
bonus plans, option plans, and benefit or incentive plans for any or all of its
current or former managers, members, officers, agents, and employees.
Be a promoter, incorporator, shareholder, partner, member, associate, or
manager of any corporation, partnership, joint venture, trust, or other entity.
Make payments or donations or do any other act not inconsistent with law that
furthers the business of the limited liability company.
Back to top
What is the difference between a Member Manager and an External
Manager?
An LLC can be run by Members or External Managers.
What is a member?
A member is an owner of the company. An LLC can be run by a member (owner)
or several members (owners) of the company. Thus, where a member or several
members run the company, the people who own the company also run the
company. Most Limited Liability Companies are member managed in this way.
What does it mean to have external managers?
If not managed by its members, you will choose to hire an outside person to run
the company who does NOT own a part of the company. This would be termed an
"External Manager." You may have one external manager or several external
managers.
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Additional Definitions
Authorized Representative - One or more persons acting to form a limited liability
company by executing and filing the articles of organization , as authorized by a
member of such limited liability company. The authorized representative may, but
is not required to be, a member of the limited liability company that is being
formed. Capital Account - The agreed value of the initial contributions, increased
by the agreed value of subsequent contributions to capital, if any, and reduced by
distributions of capital, unless otherwise provided in the articles of organization
or the operating agreement.
Contribution - Any cash, property, or services rendered or a promissory note or
other obligation to contribute cash or property or to perform services, which a
person contributes to the limited liability company as a member.
Distribution - A direct or indirect transfer of money or other property or incurrence
of indebtedness by a limited liability company to or for the benefit of its members
in respect of their economic interests.
Foreign limited Liability Company - A limited liability company formed under the
laws of any state other than Florida or under the laws of any foreign country or
other foreign jurisdiction.
Majority-in-interest of the members means, unless otherwise provided in the
articles of organization or operating agreement, members owning more than 50
percent of the then-current percentage or other interest in the profits of the limited
liability company.
Manager - A person who is appointed or elected to manage a manager-managed
company and, unless otherwise provided in the articles of organization or
operating agreement, a manager may be, but need not be, a member of the limited
liability company.
Manager-managed company means a limited liability company that is designated
to be managed by one or more managers.
Managing member means a member appointed or elected as a managing member
of a member-managed company.
Management agreement - If the LLC will be managed by a subset of its members
or by someone who is not a member, there should be a management agreement in
place which spells out the rights and duties of both the members and managers.
Member - Any person who has been admitted to a limited liability company as a
member and has an economic interest in a limited liability company which may,
but need not, be represented by a capital account or, in the case of a foreign
limited liability company, has been admitted to a limited liability company as a
member in accordance with the laws of the state or foreign country or other
foreign jurisdiction under which the foreign limited liability company is organized.
The member need not reside in Florida. See also Management of a Limited
Liability Company.
Membership interest, member's interest, or interest means a member's share of
the profits and the losses of the limited liability company, the right to receive
distributions of the limited liability company's assets, voting rights, management
rights, or any other rights under this chapter or the articles of organization or
operating agreement.
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What is an Operating Agreement and why would I need one for my LLC?
An operating agreement can contain a writing setting out:
The amount of cash and a description and statement of the agreed value of any
other property or services contributed by each member and which each member
has agreed to contribute.
The times at which or events on the happening of which any additional
contributions agreed to be made by each member are to be made.
Any events upon the happening of which the limited liability company is to be
dissolved and its affairs wound up.
It may also contain:
Members and managers name and responsibilities as well as ownership
percentages and signatures.
Profits, losses, distribution of monies, management, banking resolutions, taxes
and other legal agreements regarding internal conflicts as well as general
provisions.
We offer as part of our a la carte service a SAMPLE Operating Agreement. For
complete requirements, please obtain a copy of your state's Limited Liability
Company legislation. There you will be able to determine the guidelines for your
Operating Agreement.
Additional information regarding Limited Liability Company requirements can be
located in Florida Statutes, Chapter 608: Limited Liability Companies.
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What are Articles of Organization?
(1) In order to form a limited liability company, articles of organization of a limited
liability company must be executed and filed with the Department of State by one
or more members or authorized representatives of the limited liability company.
The articles of organization shall set forth the following and additional information
as required:
(a) The name of the limited liability company.
(b) The mailing address and the street address of the principal office of the limited
liability company.
(c) The name and street address of its initial registered agent for service of
process in the state.
(2) The articles of organization are executed by at least one member or the
authorized representative of a member.
Note: Articles of organization are filed quickly and efficiently using our online
system. Since filings are completed with the Division of Corporations
electronically, this cuts the processing time required to form your LLC.
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How is an LLC classified for Federal tax purposes?
For Federal tax purposes, an LLC business entity must file as either a corporation,
partnership or sole proprietorship.
Federal tax laws will automatically classify and tax certain LLC business entities
as corporations. These entities are:
A business entity formed under a Federal or State statute or under a statute of a
federally recognized Indian tribe if the statute describes or refers to the entity as
incorporated or as a corporation, body corporate, or body politic.
An Association under Regulations section 301.7701-3.
A business entity formed under a Federal or State statute if the statute describes
or refers to the entity as a joint stock association.
A state chartered business entity conducting banking activities if any of its
deposits are insured by the FDIC.
A business entity wholly owned by a state of political subdivision thereof, or a
business entity wholly owned by a foreign government or other entity described in
Regulations section 1.892.2-T.
A business entity taxable as a corporation under a provision of the code other
than section 7701.(a)(3).
Certain foreign entities (see Form 8832 instructions).
An Insurance Company.
If your LLC is not in one of the above categories:
An LLC that is not automatically classified as a corporation can file Form 8832 to
elect their business entity classification. A business with at least 2 members can
choose to be classified as an association taxable as a corporation or a
partnership , and a business entity with a single member can choose to be
classified as either an association taxable as a corporation or disregarded as an
entity separate from its owner, a “disregarded entity”. The Form 8832 is also filed
to change the LLC’s classification.
What is the effect of Not Electing and Entity Classification, the Default Rules?
If an LLC does not File Form 8832, it will be classified, for Federal tax purposes
under the default rules. The default rules provide that if the LLC has at least two
members and is not required to be classified as a corporation, it will
automatically default as a partnership, and be required to file a partnership return.
An LLC that has only a single member and is not required to be classified as a
corporation will automatically default to the classification of disregarded entity.
The disregarded entity files as a sole proprietorship and completes the
appropriate schedules as part of the single owners Form 1040.
Note: The above is a summary of tax information from the IRS website and does
not present complete information. Please consult an appropriate tax professional
if you need clarification or contact the IRS directly for more detail.
Here is the web link to the IRS website for more information on different tax
situations.
http://www.irs.gov/businesses/small/article/0,,id=98359,00.html
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How is an LLC classified for Florida state tax purposes?
A limited liability company that is classified as a corporation for Florida and
federal tax purposes is subject to the Florida Income Tax Code and must file a
Florida corporate income tax return.
A limited liability company that is classified as a partnership for Florida and
federal tax purposes is required to file Form F-1065 if one or more of its owners is
a corporation. In addition, the corporate owner of a limited liability company that is
classified as a partnership for Florida and federal tax purposes must file a Florida
corporate income tax return.
A single member limited liability company that is disregarded for Florida and
federal tax purposes is not required to file a separate Florida corporate income
tax return. However, the income of the company is not exempt from tax if it is
owned by a corporation, whether directly or indirectly. In this case, the
corporation is required to file Form F-1120 reporting its own income, together with
the income of the single member limited liability company.
Source: Fl Dept Revenue
Do I need an attorney or CPA to form an LLC?
No. An attorney or CPA is not legally required to form an LLC.
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What are the business activities I can choose for my LLC?
These are broad categories that the IRS provides to help you select what type of
company you are creating. If your company does not fall into any of these
categories choose “other” then tell us specifically what you will be doing in the
blank next to “other.”
Accommodation & food services - providing customers with lodging, meal
preparation, snacks, or beverages for immediate consumption.
Construction - erecting buildings or other structures, (e.g., streets, highways,
bridges, tunnels). The term “construction” also includes special trade contractors
(e.g., plumbing, HVAC, electrical, carpentry, concrete, excavation, etc.)
Finance & insurance - in transactions involving the creation, liquidation, or
change of ownership of financial assets and/or facilitating such financial
transactions; underwriting annuities/insurance policies; facilitating such
underwriting by selling insurance policies; or by providing other insurance or
employee-benefit related services.
Health care and social assistance - providing physical, medical, or psychiatric
care using licensed health care professionals or providing social assistance
activities such as youth centers, adoption agencies, individual/family services,
temporary shelters, etc.
Manufacturing - the mechanical, physical, or chemical transformation of
materials, substances, or components into new products. The assembling of
component parts of manufactured products is also considered to be
manufacturing.
Real estate - renting or leasing real estate to others; managing, selling, buying or
renting real estate for others; or providing related real estate services (e.g.,
appraisal services).
Rental and leasing - providing tangible goods such as autos, computers,
consumer goods, or industrial machinery and equipment to customers in return
for a periodic rental or lease payment.
Retail - selling merchandise to the general public from a fixed store; by direct,
mail-order, or electronic sales; or by using vending machines.
Transportation & warehousing - transportation of passengers or cargo;
warehousing or storage of goods; scenic or sight-seeing transportation; or
support activities related to these modes of transportation.
Wholesale-agent/broker - arranging for the purchase or sale of goods owned by
others or purchasing goods on a commission basis for goods traded in the
wholesale market, usually between businesses.
Wholesale-other - selling goods in the wholesale market generally to other
businesses for resale on their own account.
Other - activity not described above. Describe the applicant's principal business
activity in the space provided.
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What are the different types of employees?
Other
Applies to most employees. Most new companies will designate their employees
in the "Other" category.
Household employees
Employee who performs household services, such as a maid, babysitter,
gardener, or cook, in your home are not subject to social security and Medicare
taxes if you pay that employee cash wages of less than $1,400.
Agricultural Employees
In general, you are an employer of farm workers if your employees:
Raise or harvest agricultural or horticultural products on your farm,
Work in connection with the operation, management, conservation, improvement,
or maintenance of your farm and its tools and equipment,
Handle, process, or package any agricultural or horticultural commodity if you
produced over half of the commodity (for a group of up to 20 unincorporated
operators, all of the commodity),
Or do work for you related to cotton ginning, turpentine, or gum resin products.
What is the difference between a principal address and a mailing address for an
LLC?
The principal address is the physical location in Florida where the company
conducts business. Florida Department of State Division of Corporations
mandates that this be a physical Florida address. A P.O. Box number cannot be
used for this address.
The Mailing address for an LLC can be a P.O. Box and does not have to be in
Florida. What the Florida Department of State does require of this address is that
this be a current and good address where you can be reached at any time.
Can I change the principal and mailing address of my corporation after I have
filed?
Yes, you can update both of these addresses by emailing the Florida Department
of State – Division of Corporations at corpaddresschange@dos.state.fl.us.
The principal address will still have to be a physical Florida address.
You can also update the officer and director after your initial filing
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