May 4, 2026

TAX TALK 4 U Business Entities LLC, Corp S-Corp what is right for my business.

TAX TALK 4 U Business Entities LLC, Corp S-Corp what is right for my business.
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Season 4

TAX TALK 4 U Business Entities LLC, Corp S-Corp what is right for my business. What business entity is right for your business, taxes on business and how they affect your personal taxes. Tax savings isnt just writing off expenses your business structure can save you thousands in taxes. How to choose the right business structure for tax savings.

Tax Talk 4 U is broadcast live Mondays at 10AM ET and Music on W4CY Radio (www.w4cy.com) part of Talk 4 Radio (www.talk4radio.com) on the Talk 4 Media Network (www.talk4media.com). Tax Talk 4 U is viewed on Talk 4 TV (www.talk4tv.com).

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WEBVTT

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The topics and opinions express in the following show are

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solely those of the hosts and their guests and not

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those of W FOURCY Radio. It's employees are affiliates. We

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make no recommendations or endorsements for radio show programs, services,

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or products mentioned on air or on our web. No

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liability explicitor implies shall be extended to W FOURCY Radio

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or its employees are affiliates. Any questions or comments should

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be directed to those show hosts. Thank you for choosing

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W FOURCY Radio.

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Barry G.

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Fouler EA brings you tax talk for you right here

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on W four CY Radio and talk for TV. As

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an enrolled agent and a national leader in tax resolution

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as well as Trucker bookkeeping and tax planning. With over

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thirty years of experience, Barry will break down taxes, bookkeeping,

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tax planning, and tax relief for individuals and businesses just

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like you.

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So let's have some tax talk for you with your hosts.

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Barry G.

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Foul Order, Hey, good morning and man, glad you're here.

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Mondays are sometimes a little bit hectic, but it's a

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great day to be in the doing the show. Here.

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Text talk for you, which you know we do cover

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trucking owner operators and stuff like that, but we also

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cover all business types. So when we are talking about

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any kind of business, you know, a lot of it

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applies to other businesses as well. Like last week we

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talked about repairs and maintenance to trucks, but business equipment,

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so it applies across the board to different business you know. Today,

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you know, we got a lot of questions. We were

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doing a program with Asked the Experts, and we've had

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a lot of people asking us about setting up or

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what they should do when they're going into business for themselves.

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So maybe your first time going into business, you know,

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you you trying to make a decision. You know, what

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am I going to do? Entity? What should I be

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so a proprietorship? Should I be an ll C? Should

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I be a C CORP? Should I be a pass corp?

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You know, it gets confusing and sometimes it gets expensive

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depending on you know who you're talking to to try

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to set up your business. Who when you're dealing in business,

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who's going to give you the advice that you want

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or need for your business? And uh, you know, when

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you've when you've got that, you know you've got to

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uh really consider you know who you who you're using,

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and then back it down to you know what am

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I going to do in business? So you know, when

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you're choosing a business entity, it depends on your liability,

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your tax and your growth. I mean, that's really what

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it comes down to. You know what kind of liability

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you have going into the business you're entering. Now if

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you're the only one in the business and the only

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one doing anything, if you have liability and you do

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something wrong, you're getting sued whether you have an entity

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or not. Now, I'm not an attorney and never wanted

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to be an attorney and don't charge legal fees. So

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when we talk about liability, this is in generality and

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this is coming from attorney friends that I do have

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that have given us advice and told us, hey, look,

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this is what happens when you are in business as

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a single soul proprietor do all yourself entity out there.

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You know. We talk about sometimes in trucking and people ask, well,

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I'm I want an LLC for liability protection. Well, if

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you're driving the truck and you have to get into

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an accident, you're the one that's going to be held responsible.

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So you want to make sure that you know whatever

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you do that you know you're they're looking at what

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kind of protections, what is that entity going to offer?

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And in my opinion, an LLC is generally the best

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for small business. It does offer that personal liability protection

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again unless you make the mistake, and then is flexible

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and it can be a pass through company for taxation,

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so it gives you the flexibility out there as you

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grow and then making decisions how you're going to use

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that entity. So proprietorships, you know, they're the easiest to start.

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You go down and get a little DBA at your

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local tax office, or you just run underneath your name

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and get your ten ninety nine and you file schedule CE.

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So no protections, no liability protection, nothing else out there.

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You know sometimes when I ask somebody and they say, hey,

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I want to be an LLC for liability protection, and said,

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what do you have? What do you own? Nothing? There's

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nothing really to protect yet. Now if the business grows,

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hey you do want to do that LLC. Now you

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could choose to be a corporation, so widgets inc. Widgets Incorporated,

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whatever the name of the company may be that you

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so choose There are one type of corporation and it's

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a C corp. When you set it up. Now, C

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corps will offer you protection even as a sole proprietor

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or so owner out there you're working for the business.

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You have to get a W two and then you

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file your own corporate tax return, and a corporation pays

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its own tax. Now you can elect to be an

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escort and those are suited for those with net in

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come fifty thousand dollars or above. Now, both LLCs and

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C corps can make the election for escorp, which then

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allow you to have passed through income. But again you've

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got to have W two's. So we're going to talk

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about some common options in each of these entities and

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where this will actually go with for you when you're

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operating your business. So, we got a lot of questions

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coming in. You know, we'll get to those questions and

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we'll answer them in future segments. Out here, we want

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to kind of lay out all the information about these

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corporations and then we can come back and address particular

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questions that you would have for the different types of entities. Now,

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you know that LLC these are very popular for small

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business because the tech protects your personal assets, home savings

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from business debts and potentially lawsuits. You can actually go

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to your own Secretary of State's office and through their

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website and apply for YOURLLC. You don't need an attorney

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to do it. You prefer to have an attorney to

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get all the paperwork done that's right for your entity.

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But you can actually go to the Secretary of State's

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office and just pay the filing fees and you don't

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need anybody else. But if you do want help with that,

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you know there are companies out there, websites out there

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that can help you set up your entity and provides

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you basic LLC paperwork and so then you have your entity,

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you have your operating agreement, articles of incorporation, the whole

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works is right there. If you're using outside source, whether

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it's an attorney, there's one of the online services you know,

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or you can do it yourself. You can actually look

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up on the web, you know, operating agreements for an LLC. Now,

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when you file through let's say Texas SOS Direct, which

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is Secretary of State's office, or you go to Mississippi's

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Secretary of State's office or Indiana, whatever state you're in,

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you will actually file the articles at corporation, which you're

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going to want to make sure you have a copy

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of you so you know that becomes your choice out there.

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Now do you have to do it in your state? Well,

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if you're operating in your state, if you go out

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to let's say Nevada or New Hampshire and you file

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for a corporation, but you're going to operate let's say

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in the state of Indiana or Illinois or Florida, whatever

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state it is, you are going to be considered a

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foreign corporation within the state, and you have to register

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within your state as well. I suggest you talk to

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your attorney and make that decision. Now, if you don't

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want to be known or ownership or whatever in the business,

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well then you know, hey, probably the matter or someplace

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is a great place to register your company. I've seen

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some other places and states that have advertised online that

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you can incorporate here even though you don't live here.

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So and generally you've got to have a registered agent

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in that state of where you have your corporation, So

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you've got to be aware of that as well. Your

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sole proprietorships man, like I said, they're the easiest. They're

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the cheapest default choice for one owner. There's no state

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finally requirement, but again you're personally liable for all that's

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now I'm going to tell you when you first get started,

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I don't care what entity you have as a choice.

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Most places that are owing you money are going to

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put it in your company name and guess what, you

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get to sign a personal letter of guarantee as well,

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so you still end up being liable for those debts.

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But where these entities can come in and help you

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as on the tax side as well as the liability side.

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Now your CEA corporation, your corporation. Sometimes it can be

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very very tricky and very very difficult, and if you

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don't do it right, you will be stuck as a

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C corp. Now we're going to explain that after we

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take a quick break on what you need to do

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if you file for a corporation.

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We'll do that right after we have only scratched the

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surface of today's show. Please stand by as Barry Chief

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Fowler will be right back with tax talk for you.

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If you owe the.

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IRS or are going through an IRS audit, don't go

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at it alone. Call taxation Solutions, Tax relief at eight

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eight eight.

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Nine three zero one zero one six.

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We are your solution for IRS, debts, audits, back taxes, garnishments,

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leans and levees. Whether you're an individual or business, you

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need a solution and a strong aggressive tax resolution. Don't

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let the IRS walk all over you. Stop the IRS

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now call eight eight eight nine three zero one zero

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one six or go to Taxationsolutions dot net now for

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a free no obligation consultation. Let's get back to tax

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stock for you with more tax stock once again.

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Here's your host, Barry G. Feller.

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All right, so we're talking about how to set up

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or what it's you should choose for your business. And

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you know we always recommend, hey, you should be talking

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to your tax advisor. You should be talking to your

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attorney and making a decision together jointly on what's right

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for you and your business. You know, we can cover

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the tax strategies behind this, We can kind of cover

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you know, the different entities that are there. But again,

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you know, talk to your tax advisor, find out what's

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exactly better for you tax wise for your business and

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what you're planning. You know, it's not just today, but

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it's looking out to the future and what the future

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holds for your business or what are you planning for

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your business? So you know, you go to the Secretary

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of State's office and you decide you want to be corporation,

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and you want to be you know, widgets Inc. And

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you know, you decide, hey, this is the name. So

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you get the name and you find for your Sorry

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about that, I thought I turned that maybe off. But

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sometimes you forget. Sometimes you forget when you get into church,

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even though they remind you so for good here at

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the show. Hopefully that never happens to anybody, right, But

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you get incorporated and then you have to get your

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EI in number and as a C corp or as

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a corporation, when you get your employer identification number, it's

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going to tell you you're automatically a C corp. Okay. Now,

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SE corps are good if you're considering and going to

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be in a high growth startup and you're intending to

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raise institutional capital or possibly go public. That SEA corporation

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provides the strongest liability protection. But it does have double taxation.

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Now what's double taxation. Well, the company pays a tax

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and then they distribute in distributions to the owners of

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the business the net income or portion retained earnings to

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the owners, and that gets taxed as well on the

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personal side. So you already pay tax at the corporate level,

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and then you turn around and make a distribution, just

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like ex On Mobile or one of the major companies

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out there that do dividends. You do a distribution of

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a dividend and you get taxed as well, so you

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have that double taxation out there. But again, if you

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are a high growth startup intending to raise capital or

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go public, you want to be the sequel. Now, once

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you're a se corp because you established your corporation widget

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think you file for your employer identification number. It came

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back and told you you go to file eleven twenty

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which makes you a C corp, or you have to

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file the twenty five fifty three to unlect escorp status.

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An escorp status is a designation to pass income through

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the personal returns, avoiding self employment tax on a portion

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of earnings. But you have to have reasonable wages for

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a working business. You can't skip that step. But you

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can also elect escorts status as an LLC, So there

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is the option of an LLC being a pass through

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company as well. Now, you know, I know, we're getting

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to get confused and we get into the weeds. There's

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too many options. You know, what is the right option

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for you? You know, what I tell you is is

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a lot of times you can start. Unless you are

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actually going for high growth institutional capital and you want

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to go public, then you can simply default to an

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LLC and then the LLC gives you options as you go.

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You could be considered a single member LLC for the

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first year, file Schedule C on your personal return. Depending

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on your net income, might be the right way to go. Well,

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you can make the election right off to be an escort,

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or maybe you're married and or you have other people

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that are members of the organization. Now you can be

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a multi member LLC and you file a partnership return,

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which again passes income from the company to you, and

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it's tax on you the owner's level, not double tax. Again,

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somebody working in a partnership, working in a multi member

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LLC or an LLC recognized as an escorp, you've got

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to have some kind of reasonable wages. Escorp is through payroll.

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A multi member LLC tax as a partnership is done

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through what we call guaranteed payments. A lot of information,

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a lot of things going on, so I'm going to

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try to answer. We got a lot of questions coming

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in the first question we got here this morning. While

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are all companies publicly traded? No, not all companies are

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publicly traded. Your LLC that you go out there and

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get that is your You don't trade stock or partnership

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interests in your LLC or your corporation unless you choose

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make the choice to go public. And then, man, you've

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got to have a team of attorneys and CPAs and

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stuff on your side that's going to walk you through

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registering your company to become publicly traded. That's a possibility

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out there. You know, that's a choice. And looking at

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where you're going to go go growth wise and what

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you have out there to offer to people may make

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the biggest difference in the whole white world on what

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you're going to do with the business. Pam asked, do

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companies move from LLC to corporations and what are the

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changes to pay? But you're an LLC, you're a limited

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liability company. You're not moving from an LLC ton incorporated business.

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You already are incorporated just with the limited liability company. Now,

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what you do make the choice is whether you want

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to be an es corp or sometimes we advise people

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that you know, hey, husband and wife can both be

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members and now you've got a multi member organization and

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file a partnership returns. So what the changes do become

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as your business grows is an election of how the

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business is going to be taxed. So when you first

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start up your LLC and you're a single member, you're

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going to be taxed on Schedule C, which means, hey,

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your net income is taxed one hundred percent for Social

287
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Security and Medicare, self employment taxes fifteen point three percent

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across the board. You know, not a major issue. If

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you make maybe ten thousand dollars or twenty thousand dollars,

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you know you're talking about, you know, fifteen hundred two,

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you know, three thousand dollars in self deployment taxes that

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you're going to pay. Well, at that point, it doesn't

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really make sense to move to a score or a

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multi member LLC. You know, your bottom line income is

295
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going to stay the same, your taxes, yes, would potentially decrease,

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But then you've got to have reasonable pay for yourself

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if you're working in the business, And so mitigating factor

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out there is what the cost is going to be

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to get your tax return down. And if the cost

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to do your tax return doesn't save you enough money,

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and why do something? So you've got to really consider,

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you know, what is my net income, what is my

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reasonable wage for working in the business, and take all

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those factors into account before you jump from one to

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the other. Now, if you're going to jump from an LLC,

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you know, whether it's an ES corporate partnership and you

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want them go public, then yes, you're gonna have to

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change your business structure to go from widgets LLC to

309
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widgets ink and so yeah, you would have to make

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some changes out there. And then of course you're changing

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your tax status to a C corp as well when

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you do that. So you're going to have to jump

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through the hoops to do that. But your attorneys are

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going to walk you through that so that you know, hey,

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you're going to find ways of making it work for

316
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your business and your entity as your as you're going

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man a lot of information, a lot of great questions

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we got going on here, you know, as we move

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through this you know, one of the goals of using

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a business is to you know, avoid taxation, so fashion

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and sometimes choosing you know that LLC, thees Core sole proprietorships,

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you know those entities are going to avoid double taxation.

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You know, to where the company is being taxed and

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you get taxed on your dividends. But you know you

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have to watch how those entities are being treated so

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that you know, not only are you avoiding double taxation,

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but now you're avoiding self employment tax potentially or reducing

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the amount of self employment taxes you're going to have

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as well. So you know there's strategy, strategic decisions to

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be made, not just for liability protection, but for tax

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purposes as well. Hey, we've got some more questions from

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Victor and Cameron and we're going to address those right

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after the squad.

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We have only scratched the surface of today show. Please

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00:22:01.400 --> 00:22:04.920
stand by as Barry Chief Fowler will be right back with.

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Tax talk for you.

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338
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339
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340
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341
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342
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343
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345
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346
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347
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tax Tools dot com now and let the.

348
00:22:48.519 --> 00:22:50.240
Experts keep you trucking.

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00:22:53.319 --> 00:22:56.200
Let's get back to tax stock for you with more

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tax stock once again.

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Here's your host, Harry chi Fallo.

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Hey, welcome back. You know, I like this question. We

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you know, get talking about business entities and what entities

354
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should be choosing. Victor asked, in my opinion, how important

355
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is a company name? Sometimes company names are very important.

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It identifies what you do in business. It identifies the

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type of business that you're in. Uh. Sometimes it uses

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a family name and it's going to continue to grow,

359
00:23:35.599 --> 00:23:39.599
you know, if you're in ranching. Sometimes it's the family

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name in ranching that's out there, or you know, using

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some kind of abbreviation about it. But a lot of

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times it's like, you know, the Six's Ranch or Dutton Ranch,

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Yellowstone Ranch. You know, those things kind of made a

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name for him, but it was in you know, ranch,

365
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so everybody understood what that was. You know. Other times

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it's it's just around you know, the name of the

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family or something of interest, and then you make it

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stand out. So you know, when Ford came out with

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with cars, you know, he used his last name for

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the business, but he grew the business around it and

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making it a household name and everybody understands, you know, hey,

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Henry Ford, and he made bards, you know, in the cars.

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So you know, you can grow it around that. So

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it really depends on you. But a lot of times

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00:24:45.200 --> 00:24:48.160
it's what you're doing marketing wise, it's going to make

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00:24:48.319 --> 00:24:53.000
that name for that business stand out. So there are

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certain industries where you can use something that will identify

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what you do. Other times you can take a name

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00:25:00.119 --> 00:25:03.720
like FORDA and build it into you know, something that's

380
00:25:04.400 --> 00:25:08.279
mammoth out there, into a large, you know, c corporation

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that lasts, you know, forever and ever, passes from generation

382
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and generation and has multiple hundreds thousands. I don't know

383
00:25:17.559 --> 00:25:21.680
how many people own Ford stock, but you know, you

384
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can see that it's kind of up to you and

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how you're going to build it and grow from there.

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So Cameron asks, do you need to file in the

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00:25:33.319 --> 00:25:37.359
state of where your business is running in? So most

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00:25:37.400 --> 00:25:41.720
states do require you to do some kind of filing

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00:25:41.880 --> 00:25:47.079
within your state, So I know, like in Texas and

390
00:25:47.559 --> 00:25:52.279
Florida and I believe Louisiana. If you've formed your corporation

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00:25:52.400 --> 00:25:55.359
in a different state, you've got to register in state

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00:25:55.480 --> 00:26:01.000
you're operating in, as well as a foreign corporation. So yes,

393
00:26:01.119 --> 00:26:04.279
you end up having to register within the state that

394
00:26:04.319 --> 00:26:07.559
you're going to operate in, even if you formed in

395
00:26:07.759 --> 00:26:12.039
let's say Devada, someplace out there, you know, and I

396
00:26:12.079 --> 00:26:17.079
know there's Delaware, and you know, a lot of corporations

397
00:26:17.119 --> 00:26:20.119
are filing other places, and especially if you're going to

398
00:26:20.119 --> 00:26:23.759
be a c corp. You know, maybe it doesn't really matter.

399
00:26:24.039 --> 00:26:27.079
You know where you're at and where you form it.

400
00:26:28.200 --> 00:26:31.960
Sometimes they'll give you better way of doing things, and

401
00:26:32.039 --> 00:26:34.720
sometimes it's talking to your corporate attorney to make sure

402
00:26:34.720 --> 00:26:39.400
that you're going to choose things right. Cameron also asked

403
00:26:39.400 --> 00:26:41.880
do you have to file different taxes with the IRS

404
00:26:41.920 --> 00:26:45.960
to run in different states or just one federal tax return?

405
00:26:46.319 --> 00:26:51.359
So your corporation, once you form it, you take your

406
00:26:51.440 --> 00:26:54.240
Articles of the corporation and you file a form called

407
00:26:54.480 --> 00:26:59.160
SS four with the IRS. SS four gives you one

408
00:26:59.640 --> 00:27:04.839
Singer Employer Identification number with the federal government. To file

409
00:27:04.880 --> 00:27:09.319
your taxes, you file one corporate tax return with the

410
00:27:09.359 --> 00:27:12.759
federal government. Now, depending on what state you live in

411
00:27:13.240 --> 00:27:16.279
or the different states you're running in, you may have

412
00:27:16.359 --> 00:27:19.599
to file a corporate tax return at the same time

413
00:27:19.680 --> 00:27:23.200
you file your federal from for each in every state

414
00:27:23.400 --> 00:27:27.799
you're operating in. So if you are a conglomerate running

415
00:27:27.920 --> 00:27:32.440
across all the different states and you have a nexus

416
00:27:32.920 --> 00:27:36.480
place of business in that state, then you're going to

417
00:27:36.480 --> 00:27:40.160
be required to file a tax return in that state

418
00:27:40.839 --> 00:27:44.200
or the business the entity does in that state. So

419
00:27:44.440 --> 00:27:49.200
you've got to have good bookkeeping not only for the

420
00:27:49.279 --> 00:27:52.039
total entity, but you want to make sure you can

421
00:27:52.079 --> 00:27:55.319
break down what business you did in each state you're

422
00:27:55.400 --> 00:27:58.680
operating in, because you're going to have to file those

423
00:27:58.759 --> 00:28:03.200
tax returns in the states. Now, you know, depending on

424
00:28:03.279 --> 00:28:05.960
the state, will depend on the taxes that you will

425
00:28:06.000 --> 00:28:08.920
pay there, but you want to make sure that you're

426
00:28:09.160 --> 00:28:14.640
getting everything broken down income and expenses by state. Now,

427
00:28:14.680 --> 00:28:17.960
I tell people, we really want you to be tracking

428
00:28:18.319 --> 00:28:22.640
by location. So if you have multiple locations states. So

429
00:28:22.720 --> 00:28:26.920
let's say you're in Louisiana and you've got a location

430
00:28:27.400 --> 00:28:32.160
in Baton Rouge. Maybe you've got one in Shreveport. Maybe

431
00:28:32.200 --> 00:28:35.440
you've got one down in New Orleans or out in.

432
00:28:37.000 --> 00:28:37.319
Hammon.

433
00:28:37.759 --> 00:28:41.079
So each one of those locations that you have, you

434
00:28:41.119 --> 00:28:44.480
want to make sure that you have your income by location.

435
00:28:45.079 --> 00:28:48.799
An expense is broken out by location. Now you may

436
00:28:48.839 --> 00:28:52.599
even be able to allocate some overhead between all those

437
00:28:52.640 --> 00:29:00.279
locations from the corporation itself running general administrative expenses to

438
00:29:00.400 --> 00:29:03.240
oversee that. So you know, you want to really break

439
00:29:03.279 --> 00:29:05.240
it down so you know, and part of the reason

440
00:29:05.279 --> 00:29:08.279
you also want to do that is because you want

441
00:29:08.319 --> 00:29:11.519
to know how each locations doing. If you're failing in

442
00:29:11.599 --> 00:29:16.079
New Orleans and it's just bleeding you dry, maybe you

443
00:29:16.119 --> 00:29:19.440
want to close that location and concentrate on Treeport or

444
00:29:19.519 --> 00:29:23.440
Hammond that is being a huge profit center for you.

445
00:29:23.440 --> 00:29:25.960
You don't want that, you know, one location to be

446
00:29:26.000 --> 00:29:31.480
a drain just because it's underperforming. So you might want to,

447
00:29:31.720 --> 00:29:34.759
you know, reconsider where you're where you're operating at and

448
00:29:35.000 --> 00:29:37.359
you know, move from one city and maybe move it

449
00:29:37.400 --> 00:29:40.599
to a different city or do something different. Maybe your

450
00:29:40.640 --> 00:29:42.640
marketing is failing in that area, and you want to

451
00:29:42.680 --> 00:29:45.559
be able to identify what the problems are to be

452
00:29:45.640 --> 00:29:51.880
able to operate, you know, successfully in each location that's

453
00:29:51.920 --> 00:29:56.160
out there. James asked, does an LLC need a board

454
00:29:56.160 --> 00:30:00.880
of directors or a consultant team? No, not necessarily. Now,

455
00:30:00.920 --> 00:30:04.200
if you are, you know, operating with you know, multi

456
00:30:04.279 --> 00:30:06.519
members and stuff, yeah, you might want to put a

457
00:30:06.559 --> 00:30:10.359
team together. That would be your board of directors. But

458
00:30:10.640 --> 00:30:13.640
most of the time, you know, you are the owner,

459
00:30:13.720 --> 00:30:18.599
you're the managing member. You don't need to have that

460
00:30:18.759 --> 00:30:21.359
full board of directors out there. You can appoint yourself

461
00:30:21.400 --> 00:30:25.799
as president, secretary. You don't need anybody else. If you're married,

462
00:30:25.839 --> 00:30:28.359
it could be your wife sitting in one of those positions.

463
00:30:28.759 --> 00:30:31.000
And then you can have board of directors meeting somewhere

464
00:30:31.839 --> 00:30:35.119
with your wife for significant other and uh, you know

465
00:30:35.200 --> 00:30:37.759
right off that trip as long as it's business and

466
00:30:38.759 --> 00:30:41.880
so it gives you an advantages out there as well.

467
00:30:43.160 --> 00:30:46.680
Gene asked, what does one need to develop an LLC?

468
00:30:47.440 --> 00:30:50.599
A company name and the filing fee with your state.

469
00:30:51.039 --> 00:30:53.960
So if you go to your Secretary of State's office

470
00:30:54.000 --> 00:30:57.079
find out what their filing fee is, that's really all

471
00:30:57.359 --> 00:31:00.519
you really need. At that point, you can go in

472
00:31:00.680 --> 00:31:04.119
and file as long as you have your company name

473
00:31:04.519 --> 00:31:07.279
and nobody else is using it. And generally what I

474
00:31:07.319 --> 00:31:10.119
tell people is to try to come up with three

475
00:31:10.200 --> 00:31:13.400
or four. Do some research, look at the entities on

476
00:31:14.440 --> 00:31:18.440
the Secretary of State's office, do some background search. If

477
00:31:18.440 --> 00:31:20.960
you're looking to become a C corp and you're looking

478
00:31:21.000 --> 00:31:24.519
to become public, you go look at patents and trademarks

479
00:31:24.519 --> 00:31:26.839
and stuff and see what company names you're out there

480
00:31:26.880 --> 00:31:31.079
as well nationwide, so that you know you have the

481
00:31:31.160 --> 00:31:34.680
right structure in place, you know, for your business, but

482
00:31:34.759 --> 00:31:38.319
you also have the right company name to you know,

483
00:31:38.599 --> 00:31:41.519
ensure a you don't have to change it later and

484
00:31:41.720 --> 00:31:44.720
you can continue to have success. And you don't want

485
00:31:44.720 --> 00:31:47.480
to copy somebody else's name because you don't want trademark

486
00:31:47.599 --> 00:31:51.680
infringements or anything else on you out there, So the

487
00:31:51.759 --> 00:31:55.960
company name becomes important. Kevin asks, what is the difference

488
00:31:55.960 --> 00:31:59.839
between public and private companies and how do you know

489
00:32:00.119 --> 00:32:03.000
what your company should be? Well, Kevin, you know this

490
00:32:03.039 --> 00:32:08.160
is kind of a personal choice difference between private and public.

491
00:32:08.599 --> 00:32:12.680
Private is something you own, or maybe your family or

492
00:32:12.720 --> 00:32:15.559
maybe you and a couple of partners decide to go

493
00:32:15.640 --> 00:32:19.519
into business together. That's not public. Public's when you're going

494
00:32:19.599 --> 00:32:24.160
out and trying to get investor money into your business,

495
00:32:24.799 --> 00:32:29.599
which requires a whole bunch of individuals or other investors

496
00:32:29.680 --> 00:32:34.000
out there to buy stock of your business. Now are

497
00:32:34.039 --> 00:32:36.599
going to become a public entity, and you've got a

498
00:32:36.640 --> 00:32:39.160
file with the SEC and you're going to need a

499
00:32:39.200 --> 00:32:42.440
team of attorneys. So if you are looking to do

500
00:32:42.480 --> 00:32:44.720
something like that, get an attorney, find out what he's

501
00:32:44.720 --> 00:32:47.480
going to charge you, and make sure that you're covering

502
00:32:47.519 --> 00:32:51.559
your costs by getting these investors in having attorney working

503
00:32:51.759 --> 00:32:55.279
for you. And how do you know? You know, it

504
00:32:55.319 --> 00:32:58.759
depends on your plans. You know. This is where consultants

505
00:32:58.799 --> 00:33:02.000
come in and sit down and talk to you. Is

506
00:33:02.039 --> 00:33:05.640
if you're going into a business that's going to be

507
00:33:06.240 --> 00:33:11.319
very intensive expense wise to get going and get started up,

508
00:33:11.400 --> 00:33:14.400
and you're going to be pulling investors in, but it

509
00:33:14.440 --> 00:33:18.680
has a huge upside. You know. Now you're maybe looking

510
00:33:18.720 --> 00:33:22.200
at that C corp level because you're going to be

511
00:33:23.000 --> 00:33:27.759
trying to get the public involved in your business. So

512
00:33:27.920 --> 00:33:33.279
let's say you're creating AI software and you need to

513
00:33:33.319 --> 00:33:37.400
bring in investors and you have these grandiose plans for

514
00:33:37.519 --> 00:33:42.200
the future that this is going to help you greatly succeed.

515
00:33:42.319 --> 00:33:45.680
And you need to be a public company because you

516
00:33:45.799 --> 00:33:50.319
see the potential out there being millions, billions, quadrillions of

517
00:33:50.400 --> 00:33:55.519
dollars coming in and you can entice people by potential

518
00:33:55.839 --> 00:34:00.720
future profits. You're not guaranteeing anybody profits. You're just showing potential,

519
00:34:01.160 --> 00:34:05.200
you know, future process profits out there, and you know

520
00:34:05.319 --> 00:34:11.199
C corps will provide investor accessibility and stuff, so you

521
00:34:11.239 --> 00:34:13.760
can go from there. If you're going to be an escort,

522
00:34:13.920 --> 00:34:17.760
you're actually limited on the number and type of shareholders

523
00:34:17.800 --> 00:34:23.119
you have. Lcs and partnerships may also face challenges in

524
00:34:23.480 --> 00:34:27.440
raising capital as well, so C corps are getting generally

525
00:34:27.599 --> 00:34:31.920
used for that. Hey, we've got several more questions. We're

526
00:34:31.920 --> 00:34:34.719
going to keep addressing those questions and questions that we

527
00:34:34.800 --> 00:34:38.320
got from asked the experts that came in that Steve

528
00:34:38.400 --> 00:34:42.000
O would ask the experts forward it over to me. Hey,

529
00:34:42.320 --> 00:34:45.599
real quick, you know if you're in I R S trouble,

530
00:34:45.639 --> 00:34:49.440
you owe the I R S money. UH give taxation

531
00:34:49.599 --> 00:34:54.199
solutions call That was important of a name. Taxation solutions,

532
00:34:54.280 --> 00:34:58.119
tax relief, getting you tax relief to save you from

533
00:34:58.199 --> 00:35:02.360
the I R S and so that's a great name

534
00:35:02.480 --> 00:35:08.320
for tax solutions, getting taxation solutions out to you to

535
00:35:08.440 --> 00:35:10.880
save you from the irs. Give him a call it

536
00:35:10.960 --> 00:35:14.840
a eight nine three zero one zero one six eight

537
00:35:14.960 --> 00:35:17.519
nine three zero one zero one six and don't forget

538
00:35:17.559 --> 00:35:19.679
to mention that you heard it here at Tax Talk

539
00:35:19.800 --> 00:35:21.599
for You. And we're gonna take a short break and

540
00:35:21.599 --> 00:35:22.880
we'll be right back after this.

541
00:35:23.960 --> 00:35:27.599
We have only scratched the surface of today's show. Please

542
00:35:27.639 --> 00:35:31.159
stand by as Barry Chief Fowler will be right back with.

543
00:35:31.360 --> 00:35:33.159
Tax Talk for you.

544
00:35:35.159 --> 00:35:38.480
As an owner operator, you already spend too much time

545
00:35:38.519 --> 00:35:39.559
away from your family.

546
00:35:40.119 --> 00:35:42.159
Stop spending time doing paperwork.

547
00:35:42.639 --> 00:35:46.159
Go to Trucker tax tools dot com a solution filled

548
00:35:46.199 --> 00:35:50.360
specifically for truckers. Trucker tax tools dot Com makes your

549
00:35:50.440 --> 00:35:56.559
life run smoothly. Let's get back to tax Stock for

550
00:35:56.679 --> 00:35:59.480
you with more tax stock once again.

551
00:36:00.079 --> 00:36:04.719
Here's your host, Harry G. Fallum.

552
00:36:04.840 --> 00:36:07.320
Hey, welcome back. And you know I'm throwing the producers

553
00:36:07.320 --> 00:36:09.480
off by continuing talking when we're supposed to go to

554
00:36:09.480 --> 00:36:11.679
a break. And hey, at least they didn't never run me.

555
00:36:12.800 --> 00:36:14.320
You know, we have a little bit of fun here

556
00:36:14.400 --> 00:36:17.960
and on the show and trying to help you, you know,

557
00:36:18.000 --> 00:36:20.760
with your taxes. You know, today was a great show

558
00:36:20.840 --> 00:36:24.920
about business entities. I can tell you the questions have

559
00:36:25.000 --> 00:36:30.039
been incredible and it really helps us be able to

560
00:36:30.079 --> 00:36:32.880
better help you. So you know, if you've got questions

561
00:36:32.920 --> 00:36:35.199
during any of these shows, you know, hey, we always

562
00:36:35.239 --> 00:36:39.199
love asking. Harry asked what's the difference between LLC and

563
00:36:39.280 --> 00:36:43.199
partnership and taxes and credits? So if you choose to

564
00:36:43.199 --> 00:36:47.519
be a general partnership, you know, just you and the

565
00:36:47.559 --> 00:36:51.440
guy next door become partners starting say a lawn business

566
00:36:51.519 --> 00:36:54.440
or something out there, you're going to file a partnership return.

567
00:36:54.559 --> 00:36:58.679
You have no liability protection whatsoever. So if you have

568
00:36:58.880 --> 00:37:01.400
long maintenance guys out there and they do something wrong,

569
00:37:02.800 --> 00:37:06.039
you know you you as a partner, and the other

570
00:37:06.079 --> 00:37:10.159
guy can both be sued personally. You have that LLC

571
00:37:10.360 --> 00:37:14.840
out there, it should limit your liabilities out there. Now.

572
00:37:15.159 --> 00:37:20.039
In tax wise, they're not going to be much because

573
00:37:20.079 --> 00:37:23.280
if there's two members, you're a multi member LLC taxed

574
00:37:23.320 --> 00:37:27.320
as a partnership or you are a partnership taxed as

575
00:37:27.320 --> 00:37:30.199
a partnership. So you're going to file that partnership return

576
00:37:30.480 --> 00:37:35.119
either way regardless. But if you're going into business as

577
00:37:35.159 --> 00:37:38.280
a partnership, I would still suggest you go in as

578
00:37:38.320 --> 00:37:43.199
an LLC, and therefore it's a multi member partnership out

579
00:37:43.199 --> 00:37:47.360
there and gets taxed as a partnership, so that works

580
00:37:47.400 --> 00:37:52.159
for you as well. Lyle asked, does a private LLC

581
00:37:52.400 --> 00:37:55.519
have private stock you're considered to be a member, you're

582
00:37:55.519 --> 00:38:00.719
not necessarily issuing stocks or stock certificates. Same thing when

583
00:38:00.719 --> 00:38:05.079
you do a corporation. You are supposed to issue stocks

584
00:38:05.199 --> 00:38:09.119
and stock certificates, but it's just you holding the stock

585
00:38:09.360 --> 00:38:13.760
or you and your partner out there doing that. So

586
00:38:13.920 --> 00:38:17.239
you want to make sure that a you know, you

587
00:38:17.320 --> 00:38:20.800
follow the rules that you have for your business, get

588
00:38:20.800 --> 00:38:25.079
that operating agreement. I always tell people if you're going

589
00:38:25.119 --> 00:38:27.559
to form a corporation, make sure you get with an

590
00:38:27.559 --> 00:38:30.880
attorney to do it. But you can also do it

591
00:38:30.920 --> 00:38:32.519
on your own. Just kinda have to do a little

592
00:38:32.519 --> 00:38:35.079
bit of research. You know what else you need in

593
00:38:35.119 --> 00:38:38.159
your corporate book, and there's some places that also sell

594
00:38:38.239 --> 00:38:40.280
corporate books for you, so you can actually do it

595
00:38:40.360 --> 00:38:44.719
your own. James asked if an LC will be in

596
00:38:44.760 --> 00:38:47.599
a trust. Does a trust have a tax ID number

597
00:38:47.719 --> 00:38:50.880
or does every entity in the trust have its own

598
00:38:51.119 --> 00:38:55.360
tax ID number? So depending on your trust, your trust

599
00:38:55.440 --> 00:38:59.440
may or may not have its own tax ID number.

600
00:39:00.119 --> 00:39:04.079
A living trust, it may be solely under your social

601
00:39:04.079 --> 00:39:11.559
Security number until that trust becomes active after you pass away,

602
00:39:11.679 --> 00:39:14.480
then it will go out and either pass into a

603
00:39:14.480 --> 00:39:16.800
new trust, depending on the rules that are set up

604
00:39:17.199 --> 00:39:20.360
and everything. So depending on what you've got. If you

605
00:39:20.440 --> 00:39:25.599
have an irrevocable trust, then that trust will have its

606
00:39:25.599 --> 00:39:29.440
own tax ID number and have ownership in your LLC.

607
00:39:30.280 --> 00:39:34.360
And depending on how the membership of the LLC is,

608
00:39:34.960 --> 00:39:37.599
so maybe your member and the trust is a member,

609
00:39:38.079 --> 00:39:41.800
then therefore each would receive a K one and then

610
00:39:41.840 --> 00:39:44.840
the trust would file its own tax return and you

611
00:39:44.920 --> 00:39:48.039
would file your tax return. There are a lot of

612
00:39:48.119 --> 00:39:52.480
variables in trusts and how the trust is set up.

613
00:39:52.960 --> 00:39:58.920
If it's a trust that is irrevocable, then it's going

614
00:39:59.000 --> 00:40:03.599
to file its own return. If it's a revocable trust,

615
00:40:03.719 --> 00:40:07.559
then it may default to your solid Security number or

616
00:40:07.599 --> 00:40:13.000
a default you know, to you as the owner that's

617
00:40:13.000 --> 00:40:15.039
out there. So you know, we would have to look

618
00:40:15.039 --> 00:40:18.800
at the trust documents to determine exactly everything that needed

619
00:40:18.800 --> 00:40:23.039
to go in to the trust. But if your trust

620
00:40:23.119 --> 00:40:26.480
is owning multiple entities, each entity would still have its

621
00:40:26.480 --> 00:40:32.840
own Social employer identification Helmer James follow that up with

622
00:40:33.000 --> 00:40:36.239
would you form the trust first or the company? I

623
00:40:36.239 --> 00:40:40.719
would be forming the trust first. However, maybe many people

624
00:40:40.760 --> 00:40:44.280
have companies that are already running and they want to

625
00:40:44.760 --> 00:40:49.440
roll those entities to the trust. You work with your

626
00:40:49.480 --> 00:40:54.360
trust attorney to make sure that they're doing everything correctly

627
00:40:54.840 --> 00:40:59.760
so that you're getting the right benefit. Had a message

628
00:40:59.800 --> 00:41:02.679
to ask the experts candas has to do LLC's file

629
00:41:02.760 --> 00:41:06.639
as at s corporations. They can, they don't at the

630
00:41:06.639 --> 00:41:09.599
beginning unless you make that election through Form twenty five

631
00:41:09.719 --> 00:41:12.599
fifty three. And there are reasons to do it, and

632
00:41:12.639 --> 00:41:15.800
there are reasons not to do it. That's something that

633
00:41:15.840 --> 00:41:18.320
we can address maybe in one of the next shows

634
00:41:18.719 --> 00:41:23.000
the benefits and reasons to do an escort those reasons

635
00:41:23.039 --> 00:41:27.639
not to do. Score Owen ask are there differences in

636
00:41:27.760 --> 00:41:30.239
the type of companies to start and what would be

637
00:41:30.239 --> 00:41:33.639
best for a solo venture? I always say, hey, if

638
00:41:33.679 --> 00:41:36.119
you're doing a solo venture and you're not planning on

639
00:41:36.159 --> 00:41:40.280
going in public forman LLC, it's inexpensive at the state

640
00:41:40.400 --> 00:41:43.480
level to be able to do it. Most states aren't

641
00:41:43.559 --> 00:41:46.519
charging an armor and lay only the attorney's actually filing

642
00:41:46.519 --> 00:41:49.119
the paperwork due. But if it's something you can go

643
00:41:49.159 --> 00:41:52.000
to the Secretary of State's office and file, then it's

644
00:41:52.039 --> 00:41:53.880
a good way to do it. You may need more

645
00:41:53.920 --> 00:41:57.159
paperwork later, which you can do as you're making And

646
00:41:57.400 --> 00:41:59.880
Parker had asked if you're running a side hustle, should

647
00:41:59.920 --> 00:42:02.360
you have a business, and what type of taxes would

648
00:42:02.360 --> 00:42:05.960
you file a side hustle. Don't necessarily have to unless

649
00:42:05.960 --> 00:42:10.440
you're seeing future growth. And if you're seeing a future

650
00:42:10.599 --> 00:42:13.800
growth that's going to be exponential, then you want that

651
00:42:14.239 --> 00:42:18.719
LLC and it's going to file initially as a sole

652
00:42:18.760 --> 00:42:23.800
proprietorship on Schedule C. And if the taxes are minimal,

653
00:42:23.840 --> 00:42:27.400
if you're not making much making much income, but if

654
00:42:27.440 --> 00:42:30.760
you grow the business, then you can elect to be

655
00:42:30.920 --> 00:42:36.880
that escort down the road. Kirk X asked what is

656
00:42:36.920 --> 00:42:40.480
the difference between filing on your own taxes versus business. Hey,

657
00:42:40.480 --> 00:42:44.199
we always put this in the most elegant language, and

658
00:42:44.280 --> 00:42:48.239
that is it takes the tax, takes the tax trash

659
00:42:48.280 --> 00:42:50.599
off your personal return and puts it on a business.

660
00:42:50.599 --> 00:42:54.199
So if you get audited personally, all they're looking at

661
00:42:54.280 --> 00:42:56.679
is the k one coming from business. They're not looking

662
00:42:56.719 --> 00:43:00.320
at all the trash in the business itself. They're not

663
00:43:00.400 --> 00:43:05.079
looking at your financial reports and everything for business. They're

664
00:43:05.079 --> 00:43:08.519
not getting into your business income and expenses. All they're

665
00:43:08.559 --> 00:43:11.480
seeing is a K one coming over. Now, if you

666
00:43:11.599 --> 00:43:15.280
com mingle things, meaning you're not running a separate bank

667
00:43:15.360 --> 00:43:19.599
account for business and just business, then you know, Hey,

668
00:43:20.079 --> 00:43:23.880
everything's fair game when the IRS audits you, everything's fair

669
00:43:23.960 --> 00:43:27.000
game if you get sued. Don't com mingle set up

670
00:43:27.000 --> 00:43:30.119
a separate account for the business and run only business

671
00:43:30.159 --> 00:43:34.280
through the business. Can has also asked would have been

672
00:43:34.280 --> 00:43:37.639
better to have company as an LLC or a corporate

673
00:43:37.679 --> 00:43:41.000
as a startup? Again, we you know, as we've talked about,

674
00:43:41.039 --> 00:43:44.079
it just really depends on where you see the business going.

675
00:43:44.119 --> 00:43:46.400
Are you going trying to go public and bring in

676
00:43:46.800 --> 00:43:50.719
a whole bunch of investors in the business. That is

677
00:43:50.920 --> 00:43:56.119
where the choice becomes for you. And one last quick

678
00:43:56.239 --> 00:43:59.719
answer here, Sally, do you file LLC in personal taxes

679
00:44:00.119 --> 00:44:02.360
when you first set up that LLC? If you're the

680
00:44:02.360 --> 00:44:06.400
only member, you file on your personal return as a schedule.

681
00:44:06.559 --> 00:44:09.679
See if you make a choice to be a multi

682
00:44:09.719 --> 00:44:12.000
member or an es corp, then you file the escort

683
00:44:12.360 --> 00:44:15.360
turn and the K one comes to your personal Hey,

684
00:44:15.400 --> 00:44:19.360
time flies when we're having fun. We're down to the

685
00:44:19.440 --> 00:44:22.559
last minutes here man, thank you for the questions today.

686
00:44:23.000 --> 00:44:26.039
We always appreciate it. Make sure you're here Mondays at

687
00:44:26.039 --> 00:44:28.760
ten am Eastern time, right here on tax Talk for

688
00:44:28.880 --> 00:44:32.079
you on W four CY Radio. Hey, follow us over

689
00:44:32.159 --> 00:44:36.320
on Facebook or go to tax Talk number four letter

690
00:44:36.440 --> 00:44:39.559
you dot com and follow us there. But be whatever

691
00:44:39.599 --> 00:44:42.920
you do, be here every Monday ten am Eastern time.

692
00:44:43.360 --> 00:44:47.480
We're here to talk about your taxes, your business. Hey,

693
00:44:47.719 --> 00:44:50.320
today it was great. We talked about starting your own

694
00:44:50.360 --> 00:44:54.199
business and answering people's questions. Be here every Monday, ask

695
00:44:54.239 --> 00:44:56.920
those questions. Let's get the answers out. Let's help you

696
00:44:57.639 --> 00:45:01.880
save money on taxes. Last thing you or I or

697
00:45:01.920 --> 00:45:04.960
anybody wants to do is pay warrant. Hey have a

698
00:45:05.039 --> 00:45:08.119
God blessed Gloris week. We'll see you back here Monday

699
00:45:08.320 --> 00:45:11.480
at ten am Eastern time with W four c R

700
00:45:12.199 --> 00:45:15.000
W four Cy Radio. Have a great week.

701
00:45:16.519 --> 00:45:19.679
Are you an individual or business that wants to understand

702
00:45:19.760 --> 00:45:23.119
taxes and how they affect you. Are you looking for

703
00:45:23.159 --> 00:45:28.599
specific tax advice for self employed business owners and truckers.

704
00:45:29.159 --> 00:45:33.199
Are you behind on taxes and your bookkeeping? Are you

705
00:45:33.320 --> 00:45:36.280
dealing with the irs and ready to have some relief.

706
00:45:37.119 --> 00:45:40.960
Then you need Tax Talk for You, hosted by tax

707
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and trucker expert Barry G.

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Fowler EA.

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Tune in ten am Eastern Time every Monday right here

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on W four CY Radio and Talk for TV. Don't

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forget to check this and past episodes at tax TALKFORU

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dot com. See you next week at W four cy

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dot com.