Café Aroma I was able to save $100,000 and finally, I will be able to open my dream business. A coffee shop that I will call, Cafe Aroma. My best friend Myrna and I have always talked about opening a coffee shop together. Myrna did not have the money saved up, but she just won $100,000 in the California lottery. When we went to celebrate her winnings, she asked me if she can partner up and open the coffee shop with me. I personally have enough money to open the coffee shop on my own. Even though, we talked about opening the coffee shop together at one time. Now I’m not so sure if I want Myrna as a partner because she’s unreliable at times, and she doesn’t take things seriously. I need to decide what I should do. The advantages and disadvantages
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The advantages of forming a corporation: If we open the business as a corporation it would be an entirely separate legal entity from Myself and Myrna and shareholders. If you’re trying to raise capital by selling shares in the coffee shop, we’ll need to be incorporated. We would also need to form a corporation if we ever plan to go public. Depending on our corporation structure under which we choose to do business, we can elect to have pass-through taxation to our personal taxes, to avoid double taxation. “A corporation remains a corporation even if the owner leaves, dies, or sells off the company. A business with an Inc. or LLC extension after its name often sounds more credible to outsiders.” (B.L) We might bring more partners, clients, and attention from the community if we choose incorporation. Being incorporated can also help protect your business name in the state in which you do business. (B.L) The disadvantages of forming a corporation. It’s not cheap to incorporate, so I do need Myrna just to get started, I know that we would be paying for such costs as state filing fees, franchise tax, attorney, and other government fees. “As a corporation, we’re required to file Articles of Incorporation, bylaws, corporate minutes, certificates of good standing, and other paperwork on a regular basis.”(B.L) The business losses can only be applied to the business they can’t help you on your personal taxes. So we would have continued to file our own individual
The advantages of forming a corporation: If we open the business as a corporation it would be an entirely separate legal entity from Myself and Myrna and shareholders. If you’re trying to raise capital by selling shares in the coffee shop, we’ll need to be incorporated. We would also need to form a corporation if we ever plan to go public. Depending on our corporation structure under which we choose to do business, we can elect to have pass-through taxation to our personal taxes, to avoid double taxation. “A corporation remains a corporation even if the owner leaves, dies, or sells off the company. A business with an Inc. or LLC extension after its name often sounds more credible to outsiders.” (B.L) We might bring more partners, clients, and attention from the community if we choose incorporation. Being incorporated can also help protect your business name in the state in which you do business. (B.L) The disadvantages of forming a corporation. It’s not cheap to incorporate, so I do need Myrna just to get started, I know that we would be paying for such costs as state filing fees, franchise tax, attorney, and other government fees. “As a corporation, we’re required to file Articles of Incorporation, bylaws, corporate minutes, certificates of good standing, and other paperwork on a regular basis.”(B.L) The business losses can only be applied to the business they can’t help you on your personal taxes. So we would have continued to file our own individual