It is important to seek advise from professionals before you formally establish your business. There are various types of business structures, accounting processes, tax elections and retirement planning techniques. It is easiest to formulate the business correctly from the beginning.
An attorney knowledgeable about the formation of businesses can assist you deciding the structure of your practice. Each business structure has a different set of legal and tax considerations. Common forms of businesses include:
- sole proprietorship
- S corp
- C corp
- Limited Liability Company (LLC)
An attorney can also assist you in creating various documents such as Articles of Incorporation, Articles of Organization, Buy/Sell agreements and By-Laws some of which will be required by the Secretary of State when you file for the initial business entity. Different forms of businesses also have varying requirements for members, meeting minutes and shareholders. Attorneys can assist you with your IRS tax registration (EIN). This insures that the IRS is taxing your business properly. Many attorneys will offer a one time free consultation.
Certified Public Accountants will shine the light for you about federal tax payments, state taxes, business deductions, W2/1099s and depreciation schedules. Often times accountants also employ bookkeepers in their offices that can offer support with payroll, annual report filings, and bookkeeping matters. It is beneficial to brainstorm what bookkeeping software is best suited for you and start using it immediately. If you establish the correct categories in the bookkeeping software and log accordingly, reconciliation will be easier. Common bookkeeping programs include
- Sage 50
Choose a financial advisor that is familiar with self-employment investment options for retirement. As with most aspects of self-employment, there are federal tax implications with how you chose to invest. Common options for self funded retirement savings include
- Simple IRA
- Deferred Benefit
- Solo 401 (k)
- Traditional or Roth IRA