Make Well-Informed Business Decisions With Our Attorneys

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Byzantine world of tax

Understanding the Byzantine world of tax law and utilizing that highly specialized knowledge to a client's best advantage is absolutely essential to effective tax planning. However, the reality is that tax planning is the area that new businesses overlook the most when starting out. Indigo Legal Solutions can help you plan your transactions in order to maximize tax benefits and avoid unforeseen tax disasters. Whether you are implementing a new business venture, guiding a business through the start-up phase, managing business developments throughout the life of the business, or directing the sale or dissolution of a business or its assets, we can identify and plan for the associated tax consequences related to that activity at the stage you are in to best meet your needs and the goals of your team.

We work with individuals and organizations who are subject to tax laws around the world, including domestic and foreign entities, C corporations and S corporations, partnerships and limited liability companies, professional associations and sole proprietorships, trustees and executors, consolidated groups, disregarded entities, and tax-exempt organizations. Whether your transaction is related to your business or simply involves a personal investment, we can help you structure the transaction in order to achieve the best results under federal, state, local, and international tax laws.

Tax Planning Services Include:

  • Corporate, Partnership, and Joint Venture Planning, Including Choice of Entity
  • Accounting Method Issues, Including Inventory Methods and Capitalization Issues
  • Real Estate Development Activities, Including Insolvency and Workout Arrangements
  • Tax-Exempt Organizations
  • Nontaxable Exchanges and Capital Gains/Losses
  • Consolidated Returns
  • Depreciation and Amortization Policies
  • Advising on the Application of FIN 48 to Domestic and International Tax Issues

Business Structures

How you structure your company has enormous effects on taxation, personal liability, funding, and profits. Choosing the right business structure is essential to your overall business strategy and success, and should be based on your business strengths, goals, and desired liability protection. The following is a nonexclusive list of the most common business structures.

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Sole Proprietorships

Sole proprietorships are automatically formed if you choose not to register as any type of business with your Secretary of State but engage in business activities. Because there is no formal business structure or state registration to protect you from liability, you may be held personally liable for the debts and obligations incurred by the business.

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Corporations

Corporations offer the highest level of protection to their shareholders from personal liability. However, the corporation is required to pay taxes on its profits in addition to the taxes paid by the recipient shareholders or employees when they receive a distribution from the corporation, resulting in double taxation of the same income. Corporations also have the most formalities, record-keeping, and reporting obligations.

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Limited Liability Companies

Limited liability companies (LLCs) will generally limit your personal liability on the company's debts and obligations. There is only one level of tax with LLCs, as the business profits and losses are “passed through” from the LLC to the company’s members via Schedule K-1. However, the life of an LLC is usually dependent upon its members and transferring membership interests can sometimes be problematic without the proper agreements in place.

Partnerships

Like a sole proprietorship, general partnerships may be formed automatically when two or more people do business with the intent of making a profit. There need not be an official partnership agreement in place, nor an official registration with the Secretary of State, for a general partnership to be established; however, the liability protections offered to limited partnerships require both.

The liability protections offered by limited partnerships vary greatly with the type of partnership created. Generally, each partner must contribute to the partnership (cash, property, or sweat equity), and the profits and losses of the partnership are distributed in accordance with the partnership’s capital contributions. The profits and losses of the partnership are “passed through” to its partners via Schedule K-1.

Formation Requirements

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Annual Filings & Record Keeping

Business Structure FAQ