Most Suitable Entity for Your Home-based Business

Most Suitable Entity for Your Home-based Business

Choosing the Right Legal Entity for Your Home-based Business

Starting a home-based business can be an exciting venture, but it’s important to choose the right legal entity to ensure the success and protection of your business. There are several options to consider, each with its own advantages and disadvantages. In this article, we will explore the most suitable entity for your home-based business.

One of the most common legal entities for a home-based business is the sole proprietorship. This is the simplest and easiest option to set up, requiring no formal registration or paperwork. As a sole proprietor, you have complete control over your business and all its profits.

However, you are also personally liable for any debts or legal issues that may arise. This means that your personal assets could be at risk if your business faces financial difficulties or legal action.

The LLC

If you want to protect your personal assets, you may consider forming a limited liability company (LLC). An LLC provides a level of personal liability protection similar to that of a corporation, while still offering the flexibility and simplicity of a sole proprietorship.

With an LLC, your personal assets are generally shielded from business liabilities. Additionally, an LLC allows for pass-through taxation, meaning that the business’s profits and losses are reported on your personal tax return.

Small business tax pros!

How about a Partnership?

Another option to consider is a partnership, especially if you are starting your home-based business with one or more partners. A partnership is similar to a sole proprietorship, but it involves two or more individuals sharing the responsibilities and profits of the business.

Like a sole proprietorship, a partnership does not require formal registration, but it is recommended to have a partnership agreement in place to outline each partner’s rights and responsibilities. It’s important to note that in a general partnership, each partner is personally liable for the business’s debts and legal obligations.

The C Corp

For those looking for more formal structure and potential growth opportunities, incorporating your home-based business may be the best choice. There are several types of corporations to consider, including C corporations and S corporations.

A C corporation is a separate legal entity from its owners, providing the highest level of personal liability protection. However, C corporations are subject to double taxation, meaning that the corporation’s profits are taxed at the corporate level and then again when distributed to shareholders as dividends.

Or maybe a Sub-chapter S Corp

On the other hand, an S corporation allows for pass-through taxation, similar to an LLC. This means that the corporation’s profits and losses are reported on the shareholders’ personal tax returns, avoiding double taxation. However, S corporations have stricter eligibility requirements, such as a limit on the number of shareholders and restrictions on who can be a shareholder.

Grow your business with cash flow

Get the cash flow. Help your business grow!

Ultimately, the most suitable entity for your home-based business will depend on your specific needs and goals. It’s important to consider factors such as personal liability protection, tax implications, and the potential for growth. Consulting with a legal or tax professional can help you make an informed decision and ensure that you choose the right legal entity for your home-based business.

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Admin’s Observation:

Those of us who are self-employed are often referred to as entrepreneurs, and the businesses we operate are referred to as entrepreneurships. However, while these terms describe business persons and the types of businesses owned and operated by them, entrepreneurship should not be thought of as a legal entity, because it is not. Only those entities acknowledged by the IRS – some of which are mentioned in the above paragraphs – as such, should be thought of as legal entities. Hope this little tidbit was of some value.

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Proven Steps for Building a Subscriber List

Birth of the WMS model

According to Internet Growth Statistics provided on the Internet World Stats website, in December 1995 only 0.4 percent of the world’s population used the Internet; by December 2005 that percentage had risen to 15.7 percent (fueled in part by addition of the World Wide Web, circa 1997); and by June of this year (2017) the number stood at 51.7 percent of the world’s population using the Internet. So it is reasonable to state that there was a growth rate of Internet use which was indeed rapid.

That having been said, it is probably as reasonable to state that the growth rate of online marketing have surged just as rapidly as that of the Internet (Web), except that it did not cover the same period of time; but as more Web-based businesses were created and vied for a share of the eCommerce marketplace, the need to develop new marketing skills and information products became more evident and, as a result, an increased number of marketing strategies were being discovered and developed to cope with the changing face of business in the eCommerce world.

Needless to say, such growth could not have occurred without a demand for the services provided via the Web and the new business type it fostered. However, there was also demand for online marketing tips and strategies which resulted from the astronomical number of new businesses that were created on the Web and continue to be created, leading to the birth of a new Web-based business known as Web Marketing Strategies (WMS). Part of understanding this seb-set of Web Marketing is accepting the nature of business, the market it serves, and its motivating factor which is profit.

Staple of email marketing

So it follows that while there are companies engaged in WMS activities that are all too eager to help your Web-based business build a clientele for a fee, there are also a number of methods you can utilize to promote your website in a more cost effective – and in many cases – free way. One of these methods is Email Marketing (EM), also known as permission marketing, in which Web-based business owners (known as merchants) can actually engage by getting permission from site visitors to send them emails about their company and/or product offers. Those who grant such permission become subscribers to such emails and are considered members of a subscriber list maintained by the merchant.

The staple of email marketing is a subscriber list which, as stated above, requires permission from website visitors, supporters and past customers of a merchant or publisher (website owner) who are willing to subscribe to marketing materials, newsletters, catalogs and other promotional material via email; and the more marketing emails are sent by the merchant or marketer, the more chances s/he has of making sales and perhaps encouraging more future purchases. To do this s/he, the email sender, must build a list consisting of all those who wish to subscribe to the list.

From this list the merchant or email marketer will be able to designate certain members of the subscriber list as target customers for some product types and other members for different product types. This is considered a good list since these different sections of it will have already shown interest in different product offers the merchant has to show and sell. As list members have a preference for what they’ve seen on the merchant’s site, and have decided they want to see more, and maybe even purchase whatever product or service the merchant – through his/her website – offers they will have the opportunity to follow through on that preference.

Strategic patience

In view of the above many people may harbor the opinion that building a subscriber list takes a lot of hard work and a lot of time to build and collect names and addresses; and when approached in the wrong way this could indeed be true. However, if the correct steps are taken, the process takes a bit of patience and a few solid strategies that have been proven to be effective in building subscriber lists. Such a list-building process can be instrumental in a publisher’s ability to open his/her website and business to a whole new world of target marketing.

The central point here is that simply making the effort to build a subscriber list by utilizing strategies that have been proven effective can take your business to a new level which will often result in increased traffic and decent profit, if that’s your objective, and can ultimately do wonders for your business venture. keep in mind that there are many sources and articles which are accessible from the Web to anyone wanting who wish to build a subscriber list, even though they can sometimes be confusing because there are so many sources; and seldom do they all promote the same approach.

And while different groups of marketers, “gurus” and tutorialists have different approaches in building subscriber lists, be assured that there are certain fundamentals that must be adhered to when building your own list; and some of those fundamental steps are outlined in the following paragraphs.

Steps one & two

Step one – requires that you install a good, workable, legible web form on your website which can be located immediately following each of your articles and/or blog posts, or in the side bar of your website. While some may say that immediately placing a web form on a newly created website is too soon ask visitors to subscribe to a list, there is really no best or ideal time to ask a visitor to opt-in to your list. As long as your homepage provide a quick, good (first) impression and a website visitor finds something s/he likes, that might just be enough reason for signing up.

A good web form for opting into a subscriber list is not hard to come by, and asking your website visitor opt-in to your list is really not hard to do. Simply write a simple short statement inviting your visitors to see more and get updated information about the site and what it stands for. Then there should be an area where they could put in their names and e-mail addresses. This web form will automatically save and send you the data entered on the form; and as more people sign in, your list will grow accordingly and proportionately.

Step two – requires your site’s home page (or landing page if other than your home page), as mentioned in the first step, be as impressive as you can make it; and the articles, as well as the description of your website should be clear, well-written and free of any derogatory language or graphics. Depending on what your site is all about, you need to capture your website visitor’s interest while making your content useful and your site easy to navigate. Do not expect everyone to be tech savvy! Invest in having good programming on your site and make your graphics beautiful while making sure to not overload it.

Don’t waste your time making the homepage or landing page overly large megabyte-wise, since there is a strong possibility that all visitors to your website will not have dedicated T1 connections; so the faster your site gets loaded (a consequence of reduced number and size of the graphics placed on it), the better experience your visitors will have. Go for a look that borders between simplicity and sophisticated knowledge.

Steps three & four

Step three – requires that any products or services you offer via your site be of high quality, value and reliability which in turn will have the affect of satisfying any customer who makes a purchase, and can therefore result in very positive responses. Remember that a returning customer is more likely to bring in more business; and a satisfied customer will more likely recommend new customers that do business. Word of mouth and recommendations alone can rake in more and better business than an expensive ad. As your clientele roster grows, so too will your list; and with more members on the list even more people will get to know about what you have new to offer.

Step four – requires that you maintain a clean and private list while never losing the trust your customers who have entrusted to you their email addresses and other private information; and remember this rule if you don’t remember anything else you’ve read thus far: NEVER, NEVER, NEVER engage in unlawful activities by sending SPAM email to anyone! Bad news has a tendency of spreading fast, and such illegal activities will reach your subscriber list members quicker than you can compose a one-line email.

Be assured that many of your subscribers will most likely unsubscribe from your list as a result of such activity, or even accusations of doing so. Keep your reputation untarnished, because a good reputation will drive more traffic and subscribers to your site/business, as well as strengthen the loyalty of current customers.