Knowing where you are going in business is like mapping out a trip. There are three critical questions that must be understood and answered before even going into business.

How do I get in?

What do I do once I’m in?

How do I exit and when?

I can’t overemphasize the above stated questions. A business plan is critical. As a Real Estate Agent in the State of Arizona, we are business brokers. I work with individuals wanting to buy a business and those who want to sell. I’m a product of my own analysis. Has the buyer answered the critical questions, and is the seller truly prepared to exit his business.

A business may be operated under the following formats.

Sole Proprietorship, in which an individual or husband and wife together may operate with virtually no formality. A Schedule C business Income Statement is attached to their 1040 tax return.

Limited Liability Company although not a corporation, may be formed to give its members a limited exposure to liability with an attempt to protect assets.

Sub-Chapter S Corporation is my referred way to organize general business. True limited liability exists, protection of assets with an enjoyment of certain tax benefits not otherwise provided for.

C Corporation is used as a strong measure to organization can provide enhanced benefit planning for its shareholders and employees. The double taxation dilemma is always an issue, and I feel that the owners loose flexibility in this type organization.

“This is the season of the year when we discover that we owe most of our success to Uncle Sam.” The Wall Street Journal