From the IRS to local tax agencies, Texas business owners can’t forget about the tax man when starting a business. Launching a new company can be an exhausting, frightening and adventuresome time, especially for new entrepreneurs. It’s easy to overlook what seem like tiny details, but those details can come back to haunt your balance sheets or tax returns.
One of the first things you should consider for your startup is the business structure. You can choose from structures such as limited liability corporation or partnership, family limited partnership, traditional or limited partnership, sole proprietorship, S-corporation or C-corporation. Each structure comes with its own benefits and advantages, and not every structure is right for every business or owner.
By working with someone experienced in business formations, you can avoid common problems in the first few years of business, such as surprising tax liabilities or risks that you didn’t plan for. Understanding legal options before launching your company also lets you protect yourself, your employees, your ideas and your business as much as possible.
Some things to consider when launching a business in addition to structure include determining how you will contract with business partners, vendors and customers. You’ll also want to understand how your personal assets may be at risk if the business goes into debt or experiences a tax-related problem, particularly given the power of the IRS to levy personal accounts in some situations. The right business structure could mitigate that danger, helping to protect assets such as your personal home, retirement accounts and checking and savings accounts. Launching a new business is good for you and good for the Texas economy, but the most positive results come when you take time to do it right.