Starting a small business is exciting but is not without risk. Accordingly, personal liability protection should be your first priority.
There is little doubt that business ownership is one of the best ways to acquire wealth and financial freedom. Plus, you hopefully are involved in an area where you have strong interests. Just be smart by protecting your personal assets along the way.
The best legal entity for small business protection is known as the limited liability company in Texas. This is a creature of state laws and Texas offers a solid set of LLC laws aimed at providing small business owners with some major benefits when operating a business.
FORMING AN LLC IN TEXAS RESULT IN OWNER ASSET PROTECTION
If you choose to operate as a sole proprietor without the benefit of an asset protection vehicle like an LLC in Texas, you are risking everything you now and in the future will own. This is because by not separating out your business, you are your business. Basically, you are personally and completely liable for all liability that may arise in your business.
Businesses by definition need to take on some risk in order to be profitable and sustainable. Any time your business activity involves another party, there gives rise to a potential for disputes, accidents, and lawsuits down the road.
When you have a separate entity such as the limited liability company in Texas as the operator, there arises a layer of protection between business activity and your personal assets. The great thing is that the Texas Limited Liability Company Act makes this protection very clear and it outlines what is required to properly forming an LLC in Texas.
Texas LLC formations increase every year in Austin because of the many benefits afforded to small business by these legal entities. In addition to risk management, there are other advantages.
TEXAS LIMITED LIABILITY COMPANY PROVIDES EASY AND FLEXIBLE GOVERNANCE
Another reason business owners shy away from legal entities is their fear of subjecting themselves to complex legal requirements. Texas lawmakers wanted to reduce any unnecessary burden and so took care of this in the LLC laws.
A Texas LLC is only required to have a simple governance structure with minimal rules. After forming an LLC in Texas, there are no required meetings or the need for centralized management.
However, if a particular business situation requires that there be a more formal management structure or additional rules for operations, the Texas Limited Liability Company Act allows for those to be implemented for an LLC. In other words, this entity gives owners and managers a lot of flexibility to determine the right structure and processes for their business.
ADDITIONAL ADVANTAGES OF FORMING AN LLC IN TEXAS
Statistics show that the public is becoming more paranoid as a result of the many fly by night and fraudulent companies that purport to be businesses. These scams exist because there are no real requirements for a sole proprietorship. When you make the decision to use an official legal entity such as the Texas limited liability company, customers will view your company as more credible and trustworthy.
And, the LLC offers the most choice when it comes to federal taxation. The business will automatically qualify for a single layer of taxation which can save a heap of taxes compared to the double taxation of C corporation. On the other hand, if your accountant concludes that for your business, a corporate tax structure would be better, the Texas limited liability company can elect to be taxed under the corporate structures.
In summary, forming an LLC in Texas provides the required protection but also offers other benefits that will make your business more successful.
There is little doubt that business ownership is one of the best ways to acquire wealth and financial freedom. Plus, you hopefully are involved in an area where you have strong interests. Just be smart by protecting your personal assets along the way.
The best legal entity for small business protection is known as the limited liability company in Texas. This is a creature of state laws and Texas offers a solid set of LLC laws aimed at providing small business owners with some major benefits when operating a business.
FORMING AN LLC IN TEXAS RESULT IN OWNER ASSET PROTECTION
If you choose to operate as a sole proprietor without the benefit of an asset protection vehicle like an LLC in Texas, you are risking everything you now and in the future will own. This is because by not separating out your business, you are your business. Basically, you are personally and completely liable for all liability that may arise in your business.
Businesses by definition need to take on some risk in order to be profitable and sustainable. Any time your business activity involves another party, there gives rise to a potential for disputes, accidents, and lawsuits down the road.
When you have a separate entity such as the limited liability company in Texas as the operator, there arises a layer of protection between business activity and your personal assets. The great thing is that the Texas Limited Liability Company Act makes this protection very clear and it outlines what is required to properly forming an LLC in Texas.
Texas LLC formations increase every year in Austin because of the many benefits afforded to small business by these legal entities. In addition to risk management, there are other advantages.
TEXAS LIMITED LIABILITY COMPANY PROVIDES EASY AND FLEXIBLE GOVERNANCE
Another reason business owners shy away from legal entities is their fear of subjecting themselves to complex legal requirements. Texas lawmakers wanted to reduce any unnecessary burden and so took care of this in the LLC laws.
A Texas LLC is only required to have a simple governance structure with minimal rules. After forming an LLC in Texas, there are no required meetings or the need for centralized management.
However, if a particular business situation requires that there be a more formal management structure or additional rules for operations, the Texas Limited Liability Company Act allows for those to be implemented for an LLC. In other words, this entity gives owners and managers a lot of flexibility to determine the right structure and processes for their business.
ADDITIONAL ADVANTAGES OF FORMING AN LLC IN TEXAS
Statistics show that the public is becoming more paranoid as a result of the many fly by night and fraudulent companies that purport to be businesses. These scams exist because there are no real requirements for a sole proprietorship. When you make the decision to use an official legal entity such as the Texas limited liability company, customers will view your company as more credible and trustworthy.
And, the LLC offers the most choice when it comes to federal taxation. The business will automatically qualify for a single layer of taxation which can save a heap of taxes compared to the double taxation of C corporation. On the other hand, if your accountant concludes that for your business, a corporate tax structure would be better, the Texas limited liability company can elect to be taxed under the corporate structures.
In summary, forming an LLC in Texas provides the required protection but also offers other benefits that will make your business more successful.
About the Author:
For a Free Texas LLC Report Explaining the Benefits of Forming an LLC in Texas or a Free Texas LLC Name Search, Click Here Now: http://www.TexasBusinessFormation.com
No comments:
Post a Comment