We assist clients in choosing the appropriate form of business entity (corporation, general or limited partnership, limited liability company,
joint venture or individual proprietorship, or non-profit organization prepare the required
organizational documents, and file them with the Florida Secretary of State.
We analyze and advise you not only the legal issues involved but
also the tax implications and practical considerations involved in the
day-to-day operation of the business.
FLORIDA FOR-PROFIT CORPORATE FORMATION SERVICES
When beginning a new business, or even choosing to continue along the current path your that business is on, you must decide what form of business entity to establish. Your form of business determines what federal and state taxes you and your business will have to pay, the amount of personal liability that will stem from your business activities, and many other important factors.
The most common forms of business are the sole proprietorship, partnership, corporation, partnership, limited liability partnerships, professional associations, C corporations, and S corporations. A Limited Liability Company (LLC) is a relatively new business structure, and is allowed by Florida state statute. The decision about how to structure your business will have long-term implications, so consulting with an attorney who knows the ends and outs of this area of law will help you select the form of ownership that is right for you. Our firm will guide you through the process of starting, or re-structuring your business to make it the best choice for your situation. We help clients make informed decisions regarding the legal and tax consequences that are associated with each corporate structure, while also taking into account the specific goals of each client in terms of the following:
- The client’s vision regarding the size and nature of their business.
- The level of control they wish to have.
- The need for access to cash out of the business for themselves.
- The business' vulnerability to lawsuits.
- Tax implications of the different ownership structures.
- Expected profit (or loss) of the business.
- Whether or not you need to reinvest earnings into the business.
- The level of structure you are willing to deal with.
FORMATION OF FLORIDA NONPROFIT ORGANIZATIONS AND
TAX-EXEMPT 501(c)3 ORGANIZATIONS
We assist clients in both forming Florida Nonprofit Corporations, as well as obtaining federal tax-exempt 501(c)3 status. The federal tax-exempt 501(c)3 application process is time-consuming and can be confusing to someone unfamiliar with the process, but the long-term benefits of obtaining 501(c) 3 status can certainly outweigh the initial complexity.
Tax exemption under Internal Revenue Code section 501(c)(3) provides a number of benefits, including:
- Exemption from Federal income tax;
- Tax-deductible contributions;
- Possible exemption from state income,
- sales, and employment taxes;
- Reduced postal rates;
- Exemption from Federal unemployment tax;
- Increased availability of grants from both the government and private foundations; and Tax-exempt financing
Non-profit status is a state law concept. Non-profit status may make an organization eligible for certain benefits, such as state sales, property, and income tax exemptions. Although most federal tax-exempt organizations are non-profit organizations, organizing as a non-profit organization at the state level does not automatically grant the organization exemption from federal income tax. To qualify as exempt from federal income taxes, an organization must meet requirements set forth in the Internal Revenue Code section 501(c)(3). Organizations that meet the requirements of Internal Revenue Code section 501(c)(3) are exempt from federal income tax as charitable organizations. In addition, contributions made to charitable organizations by individuals and corporations are deductible.
Every exempt charitable organization is classified as either a public charity or a private foundation. Generally, organizations that are classified as public charities are those that (i) are churches, hospitals, qualified medical research organizations affiliated with hospitals, schools, colleges and universities, (ii) have an active program of fund-raising and receive contributions from many sources, including the general public, governmental agencies, corporations, private foundations or other public charities, (iii) receive income from the conduct of activities in furtherance of the organization’s exempt purposes, or (iv) actively function in a supporting relationship to one or more existing public charities.
Private foundations, in contrast, typically have a single major source of funding (usually gifts from one family or corporation rather than funding from many sources) and most have as their primary activity the making of grants to other charitable organizations and to individuals, rather than the direct operation of charitable programs.
