The document discusses IRS collection procedures for different types of business entities that owe payroll tax debt. It explains that sole proprietors and general partners are generally personally liable for a business's unpaid payroll taxes. Corporations provide liability protection unless assets are comingled or officers willfully fail to pay taxes. LLC members have liability protection except for unpaid payroll taxes. The document also discusses trust fund recovery penalties under Code Section 6672 and potential resolution options for taxpayers with payroll tax debt.
This document provides an overview of various non-corporate business entities under Indian law, including sole proprietorships, Hindu Undivided Families (HUFs), partnerships, cooperative societies, non-profit companies, and non-governmental organizations. It describes the key features of each type of entity such as ownership structure, liability, registration requirements, taxation treatment, and formation process. The document also discusses the merits and limitations of sole proprietorships and partnerships.
CTKnowledgeShare: CT Corporation is dedicated to educating our customers on the most current and essential topics for corporate legal and compliance professionals.
The document discusses factors to consider when choosing an entity for a business, including tax treatment, liability issues, and regulatory requirements. It then provides details on forming limited liability companies (LLCs), C corporations, S corporations, and considerations for each such as management, taxation, capitalization, issuing stock, and IRS regulations. Key steps for formation like name availability checks, filing articles and applications are outlined for each entity type.
The Intersection of Bankruptcy and... Tax Law (Series: Bankruptcy Intersectio...Financial Poise
The issues created by the intersection of bankruptcy law and tax law are complex and marked by the tension between the fundamental goal of the federal bankruptcy laws is to give debtors a financial "fresh start" from burdensome debts and the applicable federal income tax laws. As a result, certain tax liabilities are not dischargeable in bankruptcy. Moreover, a debtor generally continues to be subject to applicable federal income tax laws and must timely file federal income tax returns and pay federal income tax.
To listen to this webinar on-demand, go to: https://www.financialpoise.com/financial-poise-webinars/intersection-of-bankruptcy-and-tax-law-2020/
The document discusses the US "check-the-box" system of classifying foreign entities and issues that have arisen. It allows companies to choose whether foreign entities are treated as corporations or partnerships for tax purposes. This has led companies to create hybrid entities that take advantage of inconsistent tax treatment between countries to reduce taxes. Reforms have been proposed but not enacted to address problems like profit shifting through interest deductions on loans between related disregarded entities. The system has increased tax planning complexity rather than simplifying taxation as originally intended.
This document outlines qualifications and requirements for corporate boards of directors and officers according to the Corporation Code of the Philippines. It discusses the following key points:
1. Board members must own stock, be Philippine residents, and not have criminal convictions. Certain industries like banks require citizen directors.
2. Officers are elected annually and must include a president, treasurer, and secretary. The president and secretary cannot be the same person.
3. Directors have responsibilities to act diligently, obediently, and loyally. They cannot receive secret profits and are disqualified from voting on personal interests. Contracts between corporations with interlocking directors are permitted if certain conditions are met.
4. Powers of corporations
This document provides an overview of various non-corporate business entities under Indian law, including sole proprietorships, Hindu Undivided Families (HUFs), partnerships, cooperative societies, non-profit companies, and non-governmental organizations. It describes the key features of each type of entity such as ownership structure, liability, registration requirements, taxation treatment, and formation process. The document also discusses the merits and limitations of sole proprietorships and partnerships.
CTKnowledgeShare: CT Corporation is dedicated to educating our customers on the most current and essential topics for corporate legal and compliance professionals.
The document discusses factors to consider when choosing an entity for a business, including tax treatment, liability issues, and regulatory requirements. It then provides details on forming limited liability companies (LLCs), C corporations, S corporations, and considerations for each such as management, taxation, capitalization, issuing stock, and IRS regulations. Key steps for formation like name availability checks, filing articles and applications are outlined for each entity type.
The Intersection of Bankruptcy and... Tax Law (Series: Bankruptcy Intersectio...Financial Poise
The issues created by the intersection of bankruptcy law and tax law are complex and marked by the tension between the fundamental goal of the federal bankruptcy laws is to give debtors a financial "fresh start" from burdensome debts and the applicable federal income tax laws. As a result, certain tax liabilities are not dischargeable in bankruptcy. Moreover, a debtor generally continues to be subject to applicable federal income tax laws and must timely file federal income tax returns and pay federal income tax.
To listen to this webinar on-demand, go to: https://www.financialpoise.com/financial-poise-webinars/intersection-of-bankruptcy-and-tax-law-2020/
The document discusses the US "check-the-box" system of classifying foreign entities and issues that have arisen. It allows companies to choose whether foreign entities are treated as corporations or partnerships for tax purposes. This has led companies to create hybrid entities that take advantage of inconsistent tax treatment between countries to reduce taxes. Reforms have been proposed but not enacted to address problems like profit shifting through interest deductions on loans between related disregarded entities. The system has increased tax planning complexity rather than simplifying taxation as originally intended.
This document outlines qualifications and requirements for corporate boards of directors and officers according to the Corporation Code of the Philippines. It discusses the following key points:
1. Board members must own stock, be Philippine residents, and not have criminal convictions. Certain industries like banks require citizen directors.
2. Officers are elected annually and must include a president, treasurer, and secretary. The president and secretary cannot be the same person.
3. Directors have responsibilities to act diligently, obediently, and loyally. They cannot receive secret profits and are disqualified from voting on personal interests. Contracts between corporations with interlocking directors are permitted if certain conditions are met.
4. Powers of corporations
This document summarizes key concepts in corporate law. It discusses how corporations are classified as stock or non-stock. It also covers the separate legal personality of corporations, corporate tort liability, piercing the corporate veil, determining corporate nationality, and the retroactive effect of amending corporate documents. Additionally, it addresses topics such as share classifications, redeemable shares, treasury shares, and the rules regarding non-voting shares.
The document discusses the key characteristics and tax advantages of an S corporation. An S corporation is a business structure that allows business income and losses to pass through to shareholders for taxation under individual tax rates, avoiding double taxation. It provides liability protection like a C corporation but taxes profits like a partnership. Key benefits include lower overall taxes, ability to remove profits tax-free as distributions, and flexibility to manage employment taxes through executive salaries.
Corporate meetings, whether of directors, shareholders, or members, can be regular or special. Meetings allow for a majority to make binding decisions for the corporation, provided proper notice was given and the meeting was properly called and conducted. Key elements of meetings include quorum requirements, voting procedures such as by proxy, and rules for joint ownership of shares. Stock certificates must be issued following certain requirements and signed by corporate officers, and transfers recorded by the corporation in order to be valid against the company. Consideration for shares cannot be less than par or issued value, and can include assets, labor, or previous debt as well as cash.
Multi member-llc-operating-agreement-downloadGeorges Krinker
This document outlines an operating agreement for a limited liability company (LLC). It establishes four members of the LLC and allocates ownership units equally among them. The agreement specifies the LLC will be member-managed and decisions will be made by majority vote. It also covers responsibilities of members, capital contributions, distributions, admission of new members, transfer of ownership units, withdrawal of members, and dissolution of the LLC.
The document defines directors and boards of directors, and outlines their appointment, qualifications, duties, powers, and liabilities according to company law. Key points include: Directors are appointed by the articles of association to manage company affairs; the board must have at least 3 directors for public companies and 2 for other companies; directors can be appointed through various modes including by shareholders, boards, and government; directors have certain qualifications and duties of care, and are subject to disqualification; boards exercise power derived from articles of association and companies acts.
The document discusses the legal issues surrounding corporate liquidation. It provides an overview of the different reasons a company may enter liquidation, either voluntarily through shareholder or director resolution, or involuntarily through a court order obtained by creditors. It also outlines the roles and responsibilities of directors, shareholders, secured and unsecured creditors during the liquidation process. Key points covered include tests for insolvency, director liability for insolvent trading, and the order of creditor payment during liquidation. The document is relevant as it analyzes the legal implications of the liquidation of Best Dressed Homes Ltd.
Sebi (lodr) regulations obligations on listing of id rs & securitised de...DVSResearchFoundatio
Key Takeaways:
Equitable treatment to IDR holders
Terms / Structure of IDRs
Information to stock exchange / investors
Terms of Securitised Debt Instruments
The document discusses various tax and accounting issues for small businesses and contractors. It addresses questions about paying dividends versus salary, transferring shares to spouses, properly declaring dividends and maintaining appropriate documentation, tax implications of overdrawn directors' accounts, and HMRC's increased focus on businesses maintaining proper records in light of new penalty regimes for inaccuracies.
This document outlines regulations for close corporations and special corporations under Philippine law. For close corporations, it specifies requirements like ownership and transfer restrictions, and rules around shareholder agreements. It describes deadlock situations and allows shareholders to compel share buybacks or dissolution. For educational corporations, it specifies incorporation requirements and rules around boards of trustees. It also defines religious corporations as either corporations sole (led by a presiding elder) or religious societies, and sets rules for incorporating as a corporation sole.
When a business owner decides to sell the company, there are different scenarios to consider ensuring the sale benefits the seller as much as possible. It’s imperative that the owner should understand the tax implications and how they relate to the company’s corporate structure. When starting a business or changing your business structure, one of the most common options business owners evaluate is whether to form an S corporation or C corporation. These are the two most common ways to incorporate, and the choice really depends on your business goals.
There are many people creating new entities in order to protect their assets and liability. This small presentation of running an S-Corporation has been provided to offer some "Basic" understanding of certain requirements that are often overlooked when choosing the S-Corporation entity type.
This document provides information on company law concepts and the Companies Act. It discusses:
1. Key concepts like corporate personality, corporate democracy, and corporate status.
2. The differences between a company limited by shares and an association.
3. Circumstances where the veil of incorporation may be lifted, holding members or officers personally liable.
4. Functions of the Registrar of Companies and requirements for a company's register of members.
5. Conditions for altering a company's Articles of Association and how an alteration may breach existing contracts.
6. Definitions of ordinary shares, deferred shares, and preferred shares.
What mechanisms do the IRS, EDD, or BOE have to pierce the veil of limited liability and hold individual(s) personally liable for trust taxes? The presentation provides an overview for personal liability issues for payroll taxes, sales taxes, and other excise taxes.
Peru in numbers
International Treaties
Foreign Trade
Corporate considerations
External Audit Requirements
Tax system
Transfer pricing
Labor legislation
TGS Sarrio & Asociados
This document outlines the legal rules for foreign corporations doing business in the Philippines according to Title XV of the Corporation Code. It defines a foreign corporation and establishes the requirements for obtaining a license to transact business, including submitting documents to the SEC. The document also describes the rights and obligations of licensed foreign corporations, the process for mergers or withdrawals, and penalties for non-compliance.
Milly and Doug are considering starting a dot-com business and need to choose between a C corporation or general partnership structure. They expect $200,000 in annual pre-tax earnings. As single filers with a 28% tax rate, an S corporation or LLC would minimize total taxes of $56,000, leaving $144,000 after-tax cash flow compared to $82,062 for a C corporation. The LLC offers additional flexibility over an S corporation.
The document provides information on key aspects of partnership law in India according to the Partnership Act 1932. It defines a partnership as the relation between persons who have agreed to share the profits of a business carried on by all or any of them acting for all. It outlines the essentials of a partnership including association of two or more persons, agreement, business, sharing of profits, and mutual agency. It also discusses the rights, duties, and liabilities of partners, as well as provisions related to incoming and outgoing partners. Finally, it provides a brief overview of limited liability partnerships established under the LLP Act 2008.
The document defines a company and its key features. It states that a company is a legal entity formed under the Companies Act and registered with the Registrar of Companies. It then lists the key features of a company such as separate legal entity, limited liability, perpetual succession, transferability of shares, and more. The document also discusses the different types of companies based on incorporation, liability, ownership, control and number of members. It provides details on statutory companies, registered companies, limited companies, unlimited companies and more.
Course Description
If you own or manage a business that uses independent contractors, you need to know when you can or cannot treat a worker as an independent contractor. This presentation answers some of the common questions about worker classification.
INTRODUCTION
Misclassification of employees as independent contractors is now a common phrase uttered by state and federal legislators and regulators. State task forces have been formed to crack down on businesses that do not pay unemployment insurance and workers’ compensation premiums or withhold taxes for workers whom the state believes are employees and not independent contractors.
This document discusses employment taxes and the trust fund recovery penalty (TFRP). It begins by explaining trust fund taxes, which are taxes that employers are required to withhold from employee wages, such as income taxes and the employee portion of Social Security and Medicare taxes. These withheld taxes are considered funds held in trust for the government. The TFRP is a penalty that can be assessed against individuals within an employer's organization who are responsible for ensuring these trust fund taxes are paid over to the IRS but willfully fail to do so. The document outlines the key elements the IRS examines to determine if someone is liable for the TFRP, such as if they had sufficient control over the employer's financial decisions. It also discusses
Accounting Basic for Attorney - Accounting for Different Business EntitiesIrma Miller
This document discusses different types of business entities for tax and legal purposes, including sole proprietorships, C-corporations, S-corporations, and partnerships. It provides information on forming each entity type, tax treatment, advantages, and disadvantages. Key points include that C-corporations are subject to double taxation but have unlimited liability protection, while S-corporations pass profits through to shareholders but have restrictions on ownership. Proper formation and tax filings vary by entity structure.
This document summarizes key concepts in corporate law. It discusses how corporations are classified as stock or non-stock. It also covers the separate legal personality of corporations, corporate tort liability, piercing the corporate veil, determining corporate nationality, and the retroactive effect of amending corporate documents. Additionally, it addresses topics such as share classifications, redeemable shares, treasury shares, and the rules regarding non-voting shares.
The document discusses the key characteristics and tax advantages of an S corporation. An S corporation is a business structure that allows business income and losses to pass through to shareholders for taxation under individual tax rates, avoiding double taxation. It provides liability protection like a C corporation but taxes profits like a partnership. Key benefits include lower overall taxes, ability to remove profits tax-free as distributions, and flexibility to manage employment taxes through executive salaries.
Corporate meetings, whether of directors, shareholders, or members, can be regular or special. Meetings allow for a majority to make binding decisions for the corporation, provided proper notice was given and the meeting was properly called and conducted. Key elements of meetings include quorum requirements, voting procedures such as by proxy, and rules for joint ownership of shares. Stock certificates must be issued following certain requirements and signed by corporate officers, and transfers recorded by the corporation in order to be valid against the company. Consideration for shares cannot be less than par or issued value, and can include assets, labor, or previous debt as well as cash.
Multi member-llc-operating-agreement-downloadGeorges Krinker
This document outlines an operating agreement for a limited liability company (LLC). It establishes four members of the LLC and allocates ownership units equally among them. The agreement specifies the LLC will be member-managed and decisions will be made by majority vote. It also covers responsibilities of members, capital contributions, distributions, admission of new members, transfer of ownership units, withdrawal of members, and dissolution of the LLC.
The document defines directors and boards of directors, and outlines their appointment, qualifications, duties, powers, and liabilities according to company law. Key points include: Directors are appointed by the articles of association to manage company affairs; the board must have at least 3 directors for public companies and 2 for other companies; directors can be appointed through various modes including by shareholders, boards, and government; directors have certain qualifications and duties of care, and are subject to disqualification; boards exercise power derived from articles of association and companies acts.
The document discusses the legal issues surrounding corporate liquidation. It provides an overview of the different reasons a company may enter liquidation, either voluntarily through shareholder or director resolution, or involuntarily through a court order obtained by creditors. It also outlines the roles and responsibilities of directors, shareholders, secured and unsecured creditors during the liquidation process. Key points covered include tests for insolvency, director liability for insolvent trading, and the order of creditor payment during liquidation. The document is relevant as it analyzes the legal implications of the liquidation of Best Dressed Homes Ltd.
Sebi (lodr) regulations obligations on listing of id rs & securitised de...DVSResearchFoundatio
Key Takeaways:
Equitable treatment to IDR holders
Terms / Structure of IDRs
Information to stock exchange / investors
Terms of Securitised Debt Instruments
The document discusses various tax and accounting issues for small businesses and contractors. It addresses questions about paying dividends versus salary, transferring shares to spouses, properly declaring dividends and maintaining appropriate documentation, tax implications of overdrawn directors' accounts, and HMRC's increased focus on businesses maintaining proper records in light of new penalty regimes for inaccuracies.
This document outlines regulations for close corporations and special corporations under Philippine law. For close corporations, it specifies requirements like ownership and transfer restrictions, and rules around shareholder agreements. It describes deadlock situations and allows shareholders to compel share buybacks or dissolution. For educational corporations, it specifies incorporation requirements and rules around boards of trustees. It also defines religious corporations as either corporations sole (led by a presiding elder) or religious societies, and sets rules for incorporating as a corporation sole.
When a business owner decides to sell the company, there are different scenarios to consider ensuring the sale benefits the seller as much as possible. It’s imperative that the owner should understand the tax implications and how they relate to the company’s corporate structure. When starting a business or changing your business structure, one of the most common options business owners evaluate is whether to form an S corporation or C corporation. These are the two most common ways to incorporate, and the choice really depends on your business goals.
There are many people creating new entities in order to protect their assets and liability. This small presentation of running an S-Corporation has been provided to offer some "Basic" understanding of certain requirements that are often overlooked when choosing the S-Corporation entity type.
This document provides information on company law concepts and the Companies Act. It discusses:
1. Key concepts like corporate personality, corporate democracy, and corporate status.
2. The differences between a company limited by shares and an association.
3. Circumstances where the veil of incorporation may be lifted, holding members or officers personally liable.
4. Functions of the Registrar of Companies and requirements for a company's register of members.
5. Conditions for altering a company's Articles of Association and how an alteration may breach existing contracts.
6. Definitions of ordinary shares, deferred shares, and preferred shares.
What mechanisms do the IRS, EDD, or BOE have to pierce the veil of limited liability and hold individual(s) personally liable for trust taxes? The presentation provides an overview for personal liability issues for payroll taxes, sales taxes, and other excise taxes.
Peru in numbers
International Treaties
Foreign Trade
Corporate considerations
External Audit Requirements
Tax system
Transfer pricing
Labor legislation
TGS Sarrio & Asociados
This document outlines the legal rules for foreign corporations doing business in the Philippines according to Title XV of the Corporation Code. It defines a foreign corporation and establishes the requirements for obtaining a license to transact business, including submitting documents to the SEC. The document also describes the rights and obligations of licensed foreign corporations, the process for mergers or withdrawals, and penalties for non-compliance.
Milly and Doug are considering starting a dot-com business and need to choose between a C corporation or general partnership structure. They expect $200,000 in annual pre-tax earnings. As single filers with a 28% tax rate, an S corporation or LLC would minimize total taxes of $56,000, leaving $144,000 after-tax cash flow compared to $82,062 for a C corporation. The LLC offers additional flexibility over an S corporation.
The document provides information on key aspects of partnership law in India according to the Partnership Act 1932. It defines a partnership as the relation between persons who have agreed to share the profits of a business carried on by all or any of them acting for all. It outlines the essentials of a partnership including association of two or more persons, agreement, business, sharing of profits, and mutual agency. It also discusses the rights, duties, and liabilities of partners, as well as provisions related to incoming and outgoing partners. Finally, it provides a brief overview of limited liability partnerships established under the LLP Act 2008.
The document defines a company and its key features. It states that a company is a legal entity formed under the Companies Act and registered with the Registrar of Companies. It then lists the key features of a company such as separate legal entity, limited liability, perpetual succession, transferability of shares, and more. The document also discusses the different types of companies based on incorporation, liability, ownership, control and number of members. It provides details on statutory companies, registered companies, limited companies, unlimited companies and more.
Course Description
If you own or manage a business that uses independent contractors, you need to know when you can or cannot treat a worker as an independent contractor. This presentation answers some of the common questions about worker classification.
INTRODUCTION
Misclassification of employees as independent contractors is now a common phrase uttered by state and federal legislators and regulators. State task forces have been formed to crack down on businesses that do not pay unemployment insurance and workers’ compensation premiums or withhold taxes for workers whom the state believes are employees and not independent contractors.
This document discusses employment taxes and the trust fund recovery penalty (TFRP). It begins by explaining trust fund taxes, which are taxes that employers are required to withhold from employee wages, such as income taxes and the employee portion of Social Security and Medicare taxes. These withheld taxes are considered funds held in trust for the government. The TFRP is a penalty that can be assessed against individuals within an employer's organization who are responsible for ensuring these trust fund taxes are paid over to the IRS but willfully fail to do so. The document outlines the key elements the IRS examines to determine if someone is liable for the TFRP, such as if they had sufficient control over the employer's financial decisions. It also discusses
Accounting Basic for Attorney - Accounting for Different Business EntitiesIrma Miller
This document discusses different types of business entities for tax and legal purposes, including sole proprietorships, C-corporations, S-corporations, and partnerships. It provides information on forming each entity type, tax treatment, advantages, and disadvantages. Key points include that C-corporations are subject to double taxation but have unlimited liability protection, while S-corporations pass profits through to shareholders but have restrictions on ownership. Proper formation and tax filings vary by entity structure.
This document summarizes a webinar on business entities and incorporations presented by Deborah Sweeney, CEO of MyCorporation.com. The webinar objectives are to understand different business entity types, their tax implications, and online filing options. Sweeney discusses various entity types including sole proprietorships, partnerships, corporations, LLCs and their characteristics and legal requirements. She compares S-Corporations and LLCs, provides an overview of incorporation processes and tax filings required, and pitches MyCorporation.com as providing an easy, reliable way to form and manage businesses online.
The document discusses different types of business entities including sole proprietorships, C-corporations, S-corporations, partnerships, and limited liability companies. It provides an overview of the legal and tax considerations for each entity type, such as formation requirements, tax treatment, advantages, and disadvantages. The document also includes examples analyzing reasonable compensation and partnership tax issues.
The document summarizes key aspects of legal consequences of incorporation for different business structures. It discusses sole traders, partnerships, unincorporated and incorporated associations, and different types of companies including proprietary and public companies. Some key points covered include limited liability for companies, pre-incorporation contracts, registering a company, and a company's legal personality and ability to be sued.
This document discusses the hazards of unpaid payroll taxes. It begins with an overview of trust fund taxes, which are taxes employers withhold from employee paychecks for income tax and Social Security/Medicare. It notes that failure to remit these taxes can result in penalties against responsible individuals and potential criminal prosecution. It then covers topics like the trust fund recovery penalty assessed against those responsible, definitions of responsible persons and willfulness, appealing penalties, and resolving tax liabilities. It concludes with two case examples of potential trust fund penalty situations.
C-Suite Snacks Webinar Series: Tax Structures to Reduce Cost and Improve Comp...Citrin Cooperman
Sign up for our weekly C-Suite Snacks webinars here: https://www.citrincooperman.com/infocus/c-suite-snacks
Our C-Suite Snacks webinar series provides the middle market with brief, strategic, and tactical business improvement information for 30 minutes every week. Join Citrin Cooperman live every Thursday at noon for snack-sized insights for business executives.
Running a business can be quite difficult, and the process of getting things up and running often overshadows other considerations, such as what type of business tax structure you should operate under. During this session, we covered how to structure your business for optimal tax benefits. Key takeaways included:
- Best tax structure for your business
- New insights on tax structure
- Tips to avoid tax traps based on the type of structure
The verb "to file" can be used with the following nouns: an action, an appeal, an amendment, a brief, charges, an injunction, a motion, a suit. These nouns refer to legal documents or actions that can be officially submitted or registered with a court.
This document discusses different forms of business organization including sole proprietorships, partnerships, and corporations. It focuses on partnerships, explaining that a partnership is formed through a contract and involves two or more people carrying on a business together to make a profit, without being a separate legal entity. The document outlines the rights and responsibilities of partners, including unlimited liability, as well as how partnerships can be created, dissolved, and have their assets distributed. It also discusses limited partnerships and limited liability partnerships as variations that provide some liability protection.
Corporate Formation - Business Law & Order Event SeriesAnnArborSPARK
This presentation was given by Carrie Leahy of Bodman PLC, Russ Brown of R.D. Brown PLC and Jerry Grady of UHY Advisors.
When forming a business one of the first decisions an entrepreneur will make is choice of entity. This session will cover the possible legal structures for your business activities, including the advantages and disadvantages of each type of entity in terms of limited liability, management of the business, employee compensation and tax matters. Learn the basics of Corporate Formation and understand the pros and cons of incorporating in Michigan and Delaware.
Tips for Choosing the Right Business Entitycarbonadmin
This presentation highlights some of the key considerations for startup and small business founders in choosing the right business entity. We hope you find the information useful as you start your business by making sure you have adequate protection and growth potential for your venture.
This document provides information for Kayla Falk's business principles homework assignment that is due on February 14, 2021 and worth 30 points. It includes details on sole proprietorships, general partnerships, limited partnerships, limited liability companies, C corporations, and S corporations. For each business structure, it outlines aspects like control, taxes, liability, registration/fees, advantages, disadvantages, and continuation upon an owner's death. It also asks Kayla to identify which structure she would choose for her mock business and to provide location options in Wisconsin to set up the business.
Espindola Corporate types us ProcolombiaProColombia
There are several types of business entities in the US, each with different characteristics. A corporation has a separate legal existence from its owners and an S corporation passes corporate income through to shareholders. A limited liability company (LLC) is a hybrid structure that provides liability protection like a corporation. When starting a business, an entrepreneur must choose between forming a sole proprietorship, partnership, S corporation, C corporation or LLC, considering factors like taxation, liability, and ownership.
The document discusses different types of business entities and considerations for entity selection including legal liability and tax implications. It outlines sole proprietorships, partnerships, limited liability partnerships, C-corporations, S-corporations, and limited liability companies (LLCs). For each entity, it summarizes costs, complexity, liability protections, and tax treatments to help business owners choose the best structure. The overall goal is to select an entity that shields personal assets from lawsuits while minimizing tax obligations.
A Limited Liability Company (LLC) is a business that is its own legal entity; they can be a single member LLC (a single owner) or a multimember LLC (multiple owners).
An LLC is NOT an INCORPORATED business like a C Corporation or an S-Corp, but it has the benefits without the burdensome and expensive regulations and corporate formalities, making it an ideal way to start a small business or convert an existing business for personal asset protection.
This document discusses trusts, including what a trust is, benefits and disadvantages of trusts, taxation of trusts, and examples. Some key points covered include:
- A trust is a contract where a donor transfers assets to trustees to hold for the benefit of beneficiaries.
- Benefits of trusts include preservation of wealth across generations, protection of people and causes, and reduction of taxes like capital gains tax, estate duty tax, and donations tax.
- Disadvantages include the donor losing control over assets and costs of establishing and maintaining the trust.
- Taxation includes income tax and capital gains tax in the trust at rates of 40% and 20%, and distributions to beneficiaries may be taxed depending on rules.
-
corporate law (CL) Under company act 2013.
What is corporate law? The background of Companies Act 1956. What is the importance of this Act?
Memorandum of association. Doctrine of ultra vires. Articles of association. Doctrine of indoor management.
Entrepreneurs will face a huge number of decisions as they move from concept to commercialization. One of the
first major decisions is what type of legal entity to form in order to move their great ideas forward. Why does it
matter? Because different entities have very different rules regarding limited liability, management and control
flexibility, capital structure, tax efficiency and eligible investors.
Similar to IRS Payroll Tax Collection by Entity Types (20)
Explore the key differences between silicone sponge rubber and foam rubber in this comprehensive presentation. Learn about their unique properties, manufacturing processes, and applications across various industries. Discover how each material performs in terms of temperature resistance, chemical resistance, and cost-effectiveness. Gain insights from real-world case studies and make informed decisions for your projects.
2. IRS Payroll Tax Debt Collection by Entity Type
• Objective:
• 1) Business Entities & Collection
• 2) Internal Revenue Code 6672-who can be
individually assessed for non-payment of payroll taxes.
• 3) Collection Resolution Options
3. Introduction: State Law
• State law is the one who dictates who is shielded from liability and
it is used as a guidance for determining which entity is liable for
taxes incurred by a business.
• State law also defines property and rights to property. The federal
lien to property is dependent on state law.
• State law definition of property is used to determine what
property the federal tax lien attaches to.
4. Business Entity Types
• a. Sole Proprietor
• b. Partnership
• c. Corporation
• d. Limited Liability Companies
• e. Limited Liability Partnership
• f. Non-Profits
5. Sole Proprietorship
• No distinction as to who owns the business. Usually one owner. Although, husband
and wife can own a sole proprietorship.
• Any and all debts of the sole proprietor can be seized and sold by the IRS to collect
unpaid payroll debts of the business.
• For Payroll tax debts all the debt can be collected against any and all assets of the
business and the individual owner (s).
• NOTE: Bankruptcy does not affect payroll tax debt. It survives any discharge.
• Innocent Spouse Claim Potential
6. Partnership
• Created via partnership agreements
• No limit as to the number of partners.
• Partners can be individuals or other entities.
• State law indicates that general partners are responsible for the debts of a general
partnership.
• HOWEVER, the personal debts of the general partners cannot be collected against
the assets of a general partnership.
• Example: Form 1040 Individual Tax Debts cannot be collected against the
partnership business assets.
7. Partnership continued
• IRS can enforce collection against the individual partner (s) ownership interest in a
general partnership for the individual tax liability of the partner.
• Example: Form 1040 Individual Tax Debt can be collected via seizure and sale of
the general partner ownership interest in the general partnership business. Difficult
to sell though at auction.
• Again, when a general partnership owes payroll taxes make sure that the potential
innocent spouse’s property ownership interest is protected from seizure/sale by the
IRS. Especially, in community property states like California.
8. Corporation
• Registered with the Secretary of State and the document specifies the duties
of the Corporate Officers and the right to issue stock.
• Corporation is a legal separate entity and owns property with limited liability
relative to the debts of the owners/stockholders.
• Corporate Assets cannot be enforced upon for the individual debts of the
Officers or stockholders.
• Except, when there are alter-ego/nominee, transferee of property or
comingling of assets between the officers, stockholders and the Corporation.
9. Corporation Cont’d
• Corporate Officers and others maybe exposed individually for non-payment
of payroll taxes if they had financial control of the Corporate assets, were
responsible for paying payroll taxes and willfully failed to pay these taxes.
• More discussion on this issue later under Internal Revenue Code 6672.
• Corporations do not in themselves provide individual protection against
liability when it comes to non-payment of payroll taxes by Corporations.
10. Limited Liability Companies
• An LLC is organized as a distinct legal entity under state law by filing articles of
organization or a similar document with a designated state official.
• An LLC is owned by one or more persons known as members. Members may be
individuals or other legal entities.
• An LLC may own property in its own right and has limitation of liability relative to
the debts of the owner(s).
• Again, IRS cannot enforce collection against members of the LLC for individual
debts of those members. Unless, there is comingling of assets, transferee,
nominee/alter-ego situations.
11. Limited Liability Companies cont’d.
• Limited Liability Companies that elect to be classified as a Corporation are
protected from IRS enforcement actions for debts of the individual members.
• The IRS may levy on the owner's distributive interest in the LLC, levy on the
owner's membership interest in the LLC and sell it, or file suit to foreclose the
federal tax lien against the ownership interest.
• However, payroll tax debts can be collected against all the equity in assets of the
LLC and payroll tax debts can be collected from those who are responsible and who
willfully failed to pay the LLC payroll debts.
12. Limited Liability Company Partnership
• If a company elects to be a limited liability partnership and is taxed as a partnership.
• Under the provisions of Treas. Reg. 301.7701-3, an LLC is classified as a
partnership if it has two or more members or disregarded as an entity separate from
its owner, if it has a single owner.
• State LLC law specifically limits the liability of owners for debts of the LLC.
• Again, not for unpaid payroll tax debts. Members or partners of an LLC
Partnership can be held personally liable for unpaid payroll taxes of the
LLC.
13. Single Member LLC
• Single-member LLCs are generally disregarded as taxable entities, meaning that
the owner is the taxpayer. Think sole proprietor.
• Payroll Tax Debts: For wages paid prior to January 1, 2009, the employment tax
liability of the single-member owner of a disregarded LLC may be reported in the
name of the LLC.
• However, the individual owner of the disregarded LLC is still the liable taxpayer for
any employment tax liability incurred before January 1, 2009, regardless of whether
the LLC's name and EIN were used to report the liability.
14. Single Member LLC cont’d
• For wages paid on or after January 1, 2009, employment taxes will be the
liability of the single-member LLC. In other words, the single-member
LLC is not disregarded for employment tax purposes.
• Depending on the facts and circumstances, a member of an LLC may be
responsible for the trust fund recovery penalty under IRC 6672.
• See IRM 5.1.21, Collecting from Limited Liability Companies, for additional
information.
15. . Limited Liability Partnerships (LLPs)
• Are formed under a state limited liability partnership law.
• Generally, a partner in an LLP is not liable for the debts of the LLP or any
other partner.
• A partner is not liable for the acts or omissions of any other partner, solely
by reason of being a partner.
• Depending on the facts and circumstances, a member of an LLP may be
responsible for the trust fund recovery penalty under IRC 6672. Refer to
IRM 5.17.7.1.1.3, Partners/Members.
16. Non-Profits
• The organization must not be organized or operated for the benefit of private
interests.
• No part of a section 501(c)(3) organization's net earnings be for the, benefit of any
private shareholder or individual. If the organization engages in an excess benefit
transaction with a person having substantial influence over the organization, an
excise tax may be imposed on the person and any organization managers agreeing
to the transaction.
• Furthermore, directors, volunteers, and others who have the responsibility of the
financial affairs of the non-profit maybe investigated and held liable for non-
payment of payroll taxes.
17. Note: Non-Profit Organizations
• Persons serving as volunteers solely in an honorary capacity as directors and
trustees of tax exempt organizations will generally not be considered
responsible persons.
• Unless they participated in the day-to-day or financial operations of
the organization and had actual knowledge of the failure to withhold
or pay over the trust fund taxes.
• This does not apply if it would result in there being no person
responsible for the TFRP. Refer to IRC 6672(e).
18. Internal Revenue Code 6672
• Imposes personal liability in the amount of the unpaid trust fund taxes upon
any person who is required to collect, account for, and pay over such taxes
and who willfully fails to do so.
• IRS has to prove that an entity or individual were responsible and willfully
failed to pay the payroll taxes.
• Potential responsible persons include: Officers, employees, directors,
partners, shareholders, Payroll Service Providers, Payroll Employer
Organization (PEO), Reporting Agents, entities and others.
19. IRC 6672 Establishing Willfullness
Internal Revenue Manual 5.7.3.3.2
• IRS is required to prove intentional, reckless, knowing, awareness, intentional
disregard and or indifferent to the requirements for paying payroll taxes.
• A responsible person’s failure to investigate or correct mismanagement after
being notified that tax withholding taxes are due and not paid satisfies the
willfulness requirement.
• Anyone loaning money to a company specifically to pay payroll tax debts and
the company fails to do so can be held personally liable under IRC 6672.
20. Liability When Funds are Supplied — IRC
§ 3505(b)
• IRC § 3505(b) provides that a lender, surety, or other person who supplies funds to
or for the account of an employer for the specific purpose of paying wages of the
employees of such employer may be personally liable for any unpaid withholding
taxes even though this person does not directly pay the employees’ wages.
• A person within the meaning of Section 3505(b) includes the following: A prime or
general contractor who supplies funds directly to a subcontractor to meet its net
payroll with knowledge of the subcontractor’s inability to pay its withholding taxes.
United States. Algernon Blair, Inc., 441 F.2d 1379 (5th Cir. 1971).
•
21. Liability When Funds are Supplied — IRC
§ 3505(b) Continued.
• A shareholder, including a parent company of a subsidiary, who makes a
capital contribution or a direct loan, or who puts up collateral for a loan
from a third party to a corporation if the loan is to be used by the
corporation to pay net wages. United States v. Intercontinental Industries,
Inc., 635 F.2d 1215 (6th Cir. 1980).
• A bank that honors a customer’s/employer’s overdrafts for payroll checks.
Fidelity Bank, N.A. v. United States, 616 F.2d 1181 (10th Cir. 1980).
22. Potential Appeal of IRC 6672
• Where willfulness and responsibility are not proved by the IRS facts and
evidence in the trust fund recovery penalty file.
• Type of payroll tax assessments can in themselves be unprovable for the IRS
to establish willfulness:
23. Type of Payroll Tax Assessments (Debts)
If Then
The assessment is a Combined Annual Wage Reporting
(CAWR) assessment
It is normally difficult to establish willfulness to the degree
necessary to assert the TFRP (See IRM 5.7.3.3.2(5) for
situations where the TFRP should be pursued).
An employment tax assessment is made under IRC 3509 It requires a determination of intentional disregard of the
requirements to deduct and withhold taxes (See IRM
5.7.3.3.2(6)).
The assessment involves a volunteer director or trustee of
a tax exempt organization
The IRS may need to show the person's "actual knowledge" of
the organization's failure to collect or pay over trust fund taxes,
if the person was serving as a volunteer solely in an honorary
capacity (IRC 6672(e)).
24. Collection Resolution Options:
• There are over twenty-six different processes and procedures that one can
utilize to resolve client tax debt issues.
• Many notices and letters need to be issued by the IRS prior to taking
enforcement actions such as filing liens, issuing levies and seizure and sale of
assets.
• Appeal Rights should be requested timely and according to the type of case
issues being addressed.
• Do not forget innocent spouse claims.
26. Collection Resolution Options
• Post of a Bond
• Payroll Deduction
• Wage Garnishment at 25% maybe less than an installment agreement.
• Bankruptcy
• Close Business and stop pyramiding of payroll taxes. Resolve according to
entity type.
• Lien Discharge, subordination, withdrawal, non-attachment, release.
27. Collection Resolution Options
• Collection Due Process Appeal and potential tax court.
• Tax Court Filing for decision on issues.
• Sell assets of client to pay debts. Ex. Installment Agreement for one year and
balloon payment from sale of assets. Or, withdrawal of bank accounts, 401(k), sell
real or other personal property.
• File suit against the U.S. Government (IRS) for erroneous levy.
• Refund claims
• Credit transfers
28. Collection Resolution Options
• Tax Preparer Fraud Claim with separate request for penalty abatement.
• Identity Theft claim
• File a Congressional Letter with complaints against IRS.
• Form 911 Request for Taxpayer Advocate Assistance
• Request for Appeal accordingly. Look out for appeal rights on all letters and
procedures conducted by IRS Collection.
• Factoring of Accounts Receivable, loans, reverse mortgages, pension loans.
29. Collection Resolution Options
• Think out of the box according to taxpayer assets and ability to pay or not.
• Innocent Spouse, Equitable Relief, Separation of Liability.
• Secure personal loans and designate payment on check to TRUST FUND
ONLY.
30. Conclusion
• There are many ways for IRS Collection to take place. Depending on the
type of entity that is in payroll tax debt will the collection processes and
procedures determine the ability to collect.
• Who is responsible for non-payment will be determined if Automated
Collection System fails to get to assets via levies, liens and other actions.
• Personal liability for unpaid payroll taxes will create personal financial havoc
on those entities or individuals who are confronted with this type of
assessments.
31. Conclusion
• Do read the Internal Revenue Manual Part 5 to go over current processes and
procedures that Collection should follow. Many new Revenue Officers who are
making many mistakes in making sure taxpayer rights are provided for and followed.
• Field Collection Revenue Officers are the ones who you will be confronted with to
negotiate the best resolution option according to client’s entity type, cause of
liability, compliance and cross compliance, determine which resolution options
mentioned will resolve the debt.
• Do not be intimidated by Group Managers or the Revenue Officers. It is there job
to inform you of collection actions to follow if you and client fail to comply with
their requests.
32. Conclusion.
• However, just because they ask for something it does not mean it is in the
best interest of your client.
• Innocent Spouse Claims
• Appeals
• Think outside the box and look into all the other tax resolution options that
can benefit the taxpayer.