Business Credit Building Program
Advantages of Having A Business Credit Profile
Just by building a business credit profile you will be able to limit the use of your personal guarantee and build business credit regardless of your personal credit history.
You will have more cash for the business. Convenience in purchasing. Protection of your personal assets from that of the business. Limit your personal liability from the business. No need for personal credit checks. Purchase vehicles with no personal guarantees. Purchase equipment, computers and more with your business credit. Preparing your business for future lending needs
Limited Liability Company (LLC)
The simplest form of business in which a sole owner and his business are not legally distinct entities; the owner is usually liable for business debts.
The best structure for building BUSINESS CREDIT is one that will:
– Separate you from your business.
– Has it’s own tax identification number.
– Separates the debts of the business from that of the owners/officers.
The business structures that will do this are:
– C Corporation
– Limited Liability Company (LLC)
– S CORPORATION
– This is not to say that building BUSINESS CREDIT can not be accomplished with a sole proprietorship or partnership but in the end it will be limited.
Benefits of a corporation The benefits of a S corporation, C corporation or LLC:
When is the best time to incorporate?
The best time to incorporate is when your business
Is a high LIABILITY BUSINESS.Has over $25,000 per year in sales and Wants to take advantage of the many tax benefits of a corporation.Wants to utilize the many retirement plans for officers/owners.When an Entrepreneur wishes to use business instead of PERSONAL CREDIT
When to use a S Corporation :
- When the owners live in a state with no personal state income tax.
- Have one or two individuals who own the company. (Can be as many as 35)
- Have sales less than $250,000.
When to use a C Corporation :
- When the owners live outside the country.
- When the owners live in a state with a state income tax.
- When several individuals are involved in the ownership.
- When other entities are in involved in the ownership.
- Have sales greater than $60,000.
When to use A LIMITED LIABILITY COMPANY - LLC
- Any partnership.
Owning real estate FOR INVESTMENT purposes.
- Have several entities that own the business.
- Looking for complete protection of the owners PERSONAL LIABILITY.