If you own or are thinking of starting a business, there are many things you should consider and be advised about.
What type of business entity will you create? Typical choices include corporations, limited liability companies and partnerships. Deciding whether to be an “S” corporation, a “C” corporation or a not for profit corporation, a limited liability company being treated as a sole proprietor, S corp or partnership, a series limited liability company or a limited partnership depends on the type of business you are conducting, the number of shareholders or members and several estate planning and tax considerations. Failing to plan for the appropriate entity selection can have unintended consequences for your business.
Once you decide what type of entity you are creating for your business, you will need to officially form the entity and make all proper elections and filings with the Secretary of State, IRS, Illinois Department of Revenue and other government agencies, depending on the type of business. Documents such as Operating Agreements, Shareholder Agreements, ByLaws, Shareholder certificates and the like may be necessary to accomplish your goals or be required by law. Proper entity formation or conversion is essential to avoid unintended consequences for your business.
Your designation as a shareholder of a corporation, a member of a limited liability company, or a partner of a limited partnership should be carefully evaluated in regard to your estate planning goals. Does it make sense to hold your business interest in trust? Does it make sense to involve your spouse?
This can be an effective estate planning strategy to transfer shares to a spouse or children during your lifetime to reduce the value of your taxable estate. Careful business evaluation, tax and estate planning goals should be assessed to determine the amount, frequency and class of such gifts.
Semmelman & Semmelman, Ltd.
900 North Shore Drive
Lake Bluff, IL 60044
Semmelman & Wisneski, Ltd. serves clients in Illinois such as Lake Bluff, Lake Forest, Libertyville, Vernon Hills, Highland Park, Mundelein, Gurnee, Grayslake, Wadsworth, Ingleside, Antioch, Wauconda, Lake Zurich and the rest of Lake County.
Regional Nicknames: Lake County, Illinois
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