Tag: Partnerships
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Legal Structures for Contractors
There are four different core legal structures a contractoror may select. Each has its own restrictions, advantages and distinct issues requiring knowledge to ensure the best selection.
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Tenancy in Partnership
Tenancy in partnership is an important principle in understanding an individual partner’s ownership right as it relates to the partnership and the law of partnership. Does he own the assets jointly or as tenants in common?
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Business Barriers
No business is instantaneously successful. There are multiple obstacles referred to as business barriers all owners and managers have to overcome. There are three primary groups of barriers for every business out there.
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Bookkeeping – Charitable Giving (Lesson 64)
Many small business owners are actively involved in the community and thus donate time and money to their favorite cause. In almost every case the owner believes the donation is a business deduction. It is NOT a business deduction for tax purposes except under the C-Corporation status; however, the business is still writing the check.
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Bookkeeping – Tracking Income Taxes (Lesson 58)
It is important for the bookkeeper to track income taxes for the business and the owners. Tracking includes apprising management of current status and pending obligations.
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Double Taxation – Not an Issue in Small Business
In the world of big business corporate earnings are taxed twice under the Internal Revenue Code. The first layer of taxation occurs with the traditional corporate income tax. The second tier of taxation happens when dividends are issued to shareholders. The shareholder pays an income tax at their personal rate.
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Joint Venture
The average person may not realize this, but the most notable joint venture in existence today is the National Football League. It figuratively owns every Sunday in the fall of each year. It is an association of 32 clubs agreeing to compete with each other, i.e. engage in athletic entertainment. Each venturer is its own…
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Forms of Business Ownership
When an entrepreneur starts out on his/her long journey of building a legacy with his business; he/she almost immediately focuses on the legal status of his business. Thoughts include: ‘Should I become a limited liability company or an S-Corporation?’; ‘What if I take on partners?’; ‘How do I get more capital without giving up control?’
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Aggregate and Entity Theories of Partnership
A partnership is defined as an association of two or more persons to carry on as co-owners a business for profit. The premise is built around the notion that the combined power of the partners exceeds the sum of the value the partners could generate independently.
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Economic Substance Principle
The taxpayer must prove that the underlying economic transaction was not concocted to avoid or reduce tax liability. In the Gregory Vs. Helvering case, the Supreme Court actually uses the word ‘sham’.