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Starting a New Business

We have noticed that business activities, that is, buying and selling businesses, seem to be on the rise.  This month, we have been engaged to help several clients purchase small businesses.  These range from an auto repair shop to an accounting firm.  I hope that this is a sign of good things for the economy!

With that in mind, sellers are usually interested in selling effective January 1, 2010 in an effort to delay or defer the recognization of tax.  As a result, here’s a little bit of advice that could apply to anyone thinking about starting a business this year – make the formation effective January 1, 2010.  Why? 

Well it may should like I am being cheap, if you form your business this year (and there are only 2 + weeks left in the year), you will need to pay the formation fee with the State of Florida at this time, and come January 1, you will need to pay an Annual Report fee of $150.  But, if you make your formation effective as of the first of the year, then you won’t have to pay the 2010 Annual Report fee. 

Hey, if you really want to spend the money, then may I suggest that you consider making a gift to your favorite charity instead.

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This entry was posted on Thursday, December 17th, 2009 at 9:35 am and is filed under Business Planning. You can follow any responses to this entry through the RSS 2.0 feed. Both comments and pings are currently closed.

One Response to “Starting a New Business”

  1. Should an owner of a S corp who is starting a new business set it up as a separate entity? | Suits & Jackets blog says:
    December 24, 2009 at 4:14 am

    [...] Starting a New Business [...]