Memorandum
Memorandum
To: Karl Malone
From: Brittany Walker
Re: Recommendation for Business Organizations
Date: November 3, 2014
Thank you for providing me the details of your business as well as your plans for its future. After reviewing all of this information, I have determined that the best business organization for your business would be a Limited Liability Company. The Limited Liability offer limited liability with the tax benefits of a partnership/sole proprietorship. What this means is that as an owner, you can enjoy limited liability for the debts of the company. That should help to alleviate the fears that you had mentioned with the drivers and subcontractors. Another benefit is that you can choose whether you want to file taxes as a corporation and pay income tax on net income, or continue filing taxes through your personal income tax. Please note that on any future business loans may require you to personally guarantee them. Also, Limited Liability Companies are unable to sell stock, and if you decide at a later time that you are interested in selling stock, you should change the business to a C or S Corporation. Another note to make is that business dealings must be handled at arm’s length to not risk being personally held liable for business debts. Should you choose to go with this type of business organization, you will need to update the name of your business to include LLC at the end. You will also need to file ‘Articles of Organization’ with the Secretary of State. The articles of corporation are a basic outline of the business, and its intentions. Good luck with the future and success of your business.
To: Karl Malone
From: Brittany Walker
Re: Recommendation for Business Organizations
Date: November 3, 2014
Thank you for providing me the details of your business as well as your plans for its future. After reviewing all of this information, I have determined that the best business organization for your business would be a Limited Liability Company. The Limited Liability offer limited liability with the tax benefits of a partnership/sole proprietorship. What this means is that as an owner, you can enjoy limited liability for the debts of the company. That should help to alleviate the fears that you had mentioned with the drivers and subcontractors. Another benefit is that you can choose whether you want to file taxes as a corporation and pay income tax on net income, or continue filing taxes through your personal income tax. Please note that on any future business loans may require you to personally guarantee them. Also, Limited Liability Companies are unable to sell stock, and if you decide at a later time that you are interested in selling stock, you should change the business to a C or S Corporation. Another note to make is that business dealings must be handled at arm’s length to not risk being personally held liable for business debts. Should you choose to go with this type of business organization, you will need to update the name of your business to include LLC at the end. You will also need to file ‘Articles of Organization’ with the Secretary of State. The articles of corporation are a basic outline of the business, and its intentions. Good luck with the future and success of your business.