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best way to set up a partnership

Discussion in 'Business Operations' started by Smitty58, Dec 4, 2004.

  1. Smitty58

    Smitty58 LawnSite Senior Member
    Posts: 531

    My son and I are going forces in 05. We are looking at ways to set up our new company. If we go LLC do we have to put llc on all ads and business cards etc? Also, anyone that is a partnership have any advice as to how to set things up?
  2. AllStarLawnCare

    AllStarLawnCare LawnSite Member
    Posts: 23

    Kansas says any llc is required to have it any time the business name appears. Best thing to do is talk to your CPA about it, the two major things you're interested in is personal assets shielding (liability) and tax benefits. If you can afford the costs, most people advise setting up as an s-corp because you get the security of a corporation and without the double taxation of a normal corporation (taxes on business income, and then taxes on shareholder income). Best thing to do is talk to a CPA.
  3. mtdman

    mtdman LawnSite Gold Member
    Posts: 3,137

    The best way to set up a partnership? Two words: DO NOT! I've had two partnerships, and both ended bad. I wouldn't recommend that form of business for anyone.
  4. SodKing

    SodKing LawnSite Bronze Member
    Posts: 1,648

    Partnerships are great...just make sure you own 100% and your partner owns less. ;)
  5. dvmcmrhp52

    dvmcmrhp52 LawnSite Platinum Member
    from Pa.
    Posts: 4,205


    Nerves of steel, that's what's required.
  6. tonygreek

    tonygreek LawnSite Gold Member
    Posts: 3,439

    you can workaround the "llc" in your company name issue by either having it in a very small font, or filing a dba. you'd be "smitty & sons, llc" doing business as "smitty & sons".
  7. Kelly's Landscaping

    Kelly's Landscaping LawnSite Platinum Member
    Posts: 4,353

    I have an S corp. its 60/40 with my partner I have total control but I have only had to over ride him a few times we normally see eye to eye on everything. The double tax is for C corps. not S corps. I would never set up a company as either a LLC or a partnership the advantages on the S corp. out weighed my accountant crying because he would have to use a different form. Best advice talk with your partner regularly about where you guys are going and how you want to get there I think the biggest problem a partnership has is opposing dreams. You got to have the same goals or its doomed from the start. If you want to use the profits and buy more equipment and expand and he wants to get a larger paycheck your going to have to work though that or it will cause one hell of a rip in your company. If you get enough of these it will end very badly.
  8. tonygreek

    tonygreek LawnSite Gold Member
    Posts: 3,439

    speaking of kelly's point re: profits vs. working capital. be sure you get the proper advice you need from an accountant, or in-depth research, on how you want the llc to be taxed. you can either choose to have it taxed as a straight pass-through, ala a sole proprietorship or straight partnership, or have it taxed as a corporation. the benefits to the latter is that you can carry over working capital from year to year and only be taxed at the corporate level. if you go the straight pass-through route, any money left in your business account at year end will be taxed at the potentially higher, personal income tax rate.

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