Nexus Planning Group, LLC

The first step in business entity planning is to understand the pros and cons of each type. The following overviews will aid you in deciding what is the proper and most advantageous business structure for you and your business.

Sole Proprietorship: A sole proprietorship is the simplest and most common form of business organization. If you are running your own business and have not incorporated (regardless of whether or not you have a business license or have filed for a fictitious business name/dba) you are by default a sole proprietor. By definition, this type of business entity has a single owner - you. Operating as a sole proprietor is like gambling because you are betting that you will not incur business liability...a bad bet. Furthermore you are giving up the ability to take advantage of a significant array of potential tax benefits available to corporations. We do not recommend that any business should be conducted as a sole prioprietor.

Advantages: Easy and inexpensive to set up in terms of legal, accounting and startup fees. There are few legal restrictions and requirements, though you do need to adhere to local, state and federal guidelines. You have full control of your business decisions and all of your business profits are yours.Taxes are paid at your individual rate.

Disadvantages: No liability protection. "You are the business and the business is you" and so you have full, unlimited liability for all business activities. You are pesonally responsible for business debts and liabilities, including lawsuits against your business. Any liabilities extend to not only your business assets but also all of your personal assets since there is no distinction between them. Business income is taxed at personal income tax rates which is often much higher at certain levels than corporate tax rates. You must pay additional self-employment taxes. The availability of additional benefits is very limited. Certain business expenses are only partially tax deductible.

General Partnerships: A general partnership is as simple to set up as a sole proprietorship. The only difference is that it has at least two participants or partners. When two or more people get together and start a new business without setting up a specific business entity, by default they are general partners.

Still have questions? Please contact us anytime! We look forward to hearing from you.

Disclaimer: Nexus Planning Group, LLC (a Nevada LLC) is a business service company that provides services which allow you to form your own business entity. Nexus Planning Group uses the information provided to us by you, on our order forms, to complete the information on the required state business entity forms and assists you in the filing of such forms. Nexus Planning Group is not a law or accounting firm and neither Nexus Planning Group nor any of its officers, directors, agents or employees provide (1) legal services or advice or (2) financial services or financial planning or tax advice. The nature, extent and scope of our business formation services is limited solely to assisting you in the preparation of the required state forms which allow you to form a business entity of your choice under applicable state law.

Further, no representations or warranties, express or implied are given regarding the business, legal, tax or other consequences, of whatever nature, resulting from the use of our services or forms. And Nexus Planning Group, together with all of its officers, directors, advisors, agents, representatives and employees, specifically and unconditionally disclaims and and all warranty beyond the limited refund warranty stated above, whether express or implied, including the implied warranties of merchantability and fitness for purpose. under no circumstances will Nexus Planning Group, its officers, directors, agents, representatives and/or employees be liable or responsible for any damage(s) of whatsoever nature or extent, direct or consequential, past, present or future, known or yet-undetermined, or any delay or inconvenience resulting or caused, or alleged to be resulting or caused by or from the use of our services.