Business Agreements: Yes, they really should be in writing

When engaging in business transactions with friends, it can be very tempting to try to save the time and money involved with formalizing the arrangement. Everyone knows that lawyers are expensive. You know and trust the person you're dealing with, so why not just trust them to keep their word now? Maybe you’re worried that making a friend sign a written agreement will make them think you don't trust them. Who really wants to talk about how a deal could go wrong when you and your partner are so pumped about your great business idea? I would suggest having this conversation early is much better than skipping it and having the deal go south after you've both invested time and money. Despite your excitement about your new venture, things can, and often do, go wrong and you need a plan in place for that possibility. 

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A Brief Introduction to Federal Taxation of Businesses

It would be impossible to fully explain the intricacies of the various federal business tax regimes in a blog post. I can assure you, nobody wants to read that. However, I will attempt to briefly introduce some keep pieces of the following business tax regimes:

  • Sole Proprietor (Schedule C of an individual return)
  • C Corporation (Subchapter C - Form 1120)
  • S Corporation (Subchapter S - Form 1120s)
  • Partnership (Subchapter K - Form 1065)
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