How to Expand My Business: Deciding on a Business Structure | Business Opportunity Dallas, TX
One only has to look around a little longer and harder to find the perfect business opportunity Dallas, TX. There are many things that can cause a business’s downfall: Low sales, late payments, suppliers quitting, not enough supplies or low cash flow, etc. Often people invest their life savings in creating a business but do not have the man power to run it. On paper, it might look good but in the real world, it requires hard work and dedication.
The question is, why let your business fall that far when you have several opportunities in front of you. Granted, being a sole proprietor is all well and good but when it comes to finances and dealing with the day to day business operations, the work load can get to you and that’s when things will start to fall down. The right business opportunity Dallas, TX lies in your business’s structure. The entire business industry has succeeded by bringing investors into the fold for its growth. Goals can be achieved faster, and work can be delegated to people who you know are right for the job. However, it is necessary that you analyze a business structure from all angles so that you are sure you are entering a business opportunity Dallas, TX with eyes open.
Following are some business structures that will help you understand how a business works under different leaderships:
Partnership
Partnership is one of the most common business structures, which most people go for when they are trying to expand their business. It opens several doors for the sole proprietor and can prove to be a very powerful business opportunity Dallas, TX. In partnership, each member of the business contributes his/her labor, money, skill and property. The losses and profits are shared equally. Since each partner has a say in every decision, an agreement should be signed that outlines how profits will be divided, a new partner will be bought into the fold or how disputes will be resolved.
Although it is not necessary to sign any kind of agreement for a partnership but it is highly recommended to do so to avoid any miscommunication or future problems. A partnership offers two different arrangements, which makes this business opportunity Dallas, TX all the more appealing. Following are those opportunities explained briefly:
- Joint Venture: A partnership for a limited time that benefits both the business and partners in terms of growth and profits
- Limited Partnership: Is a good business opportunity Dallas, TX for investors aiming for short-term projects. However, they have limited input in the decisions and the extent of their partnership is based on the investment percentage. Plus, limited partnership holds them accountable for limited liability, putting you in a dangerous position in case of a loss.
C-Corporation
A corporation is a legal entity, quite different from any other business structure, which is owned by shareholders. Meaning: The business itself is legally liable for any debts that it incurs. The shareholders are merely there to overlook the day to day operations and voice in their opinion on important decisions. A corporation is more suited for a business that has multiple employees and runs large operations.
Since this business structure has complex legal and tax requirements, and costly administration fees, this business opportunity Dallas, TX is more suited for companies that are well-established. In this kind of business, you have a lot of leeway to keep the business going through initial public offering, which is one of the most beneficial ways for attracting investment capital.
Limited Liability Corporation (LLC)
An LLC is a hybrid business opportunity Dallas, TX that offers the operational flexibility and tax benefits of a partnership and limited liability benefits of a corporation. An LLC mostly contains two or more partners who share the profits and losses of a business. However, the taxes on these are according to what the business earns and not what each member is receiving. Since LLC members are considered self-employed, they have to report everything on their federal tax returns. Along with paying self-employment taxes, they have to make contributions towards social security and Medicare.
Cooperative
A cooperative is owned by multiple people and works on the principal of members using its services. This business opportunity Dallas, TX offers you the benefit of paying less tax. The profits are distributed amongst the members and they are taxed on just their corporate level rather than individual.
The cooperative is run by a member who is elected as the board of directors, while other members have their voting power that controls the decisions. However, one of the drawbacks of the cooperative is that the decision-making process is based on voting rather than the number of shares a particular member holds. It’s possible that a member might invest somewhere else or not invest at all because he is not using the cooperative’s services.
S-Corporation
This business opportunity Dallas, TX is an offering from the IRS allowing corporations a reprieve from double taxation, by turning it into an S Corp. The reason why this is considered a separate business structure from C Corp is because the losses and profits are passed through an individuals’ tax return. Meaning: The business is safe no matter what position it is in, whereas the other shareholders are taxed. However, in order for the IRS to approve this transition, the owner must pay the shareholders fair market value. If they fail to meet this requirement, their corporate earnings will be marked as wages and they will have to pay a self-employment tax.
If you are ready to invest in a business opportunity then you will find Kirksey Business Brokers at your service, right here in Texas. The company is dedicated to helping people start their own business by finding them an opportunity where they can either sell their business or buy an existing one. They also provide business loans from a network of 40 lenders. For further details about their services, call at 817-637-1508.