FAQ's

Frequently Asked Questions

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What are Articles of Incorporation?

Articles of incorporation are a set of formal documents filed with a government body (typically the Secretary of State) to legally document the creation of a corporation.

What is a merchant account?

A merchant account is a bank account established by a business to allow the business to accept payments from customers by credit/debit cards.

What is IRS?

The IRS is the revenue service of the United States federal government. The IRS is responsible for collecting taxes and administering the Internal Revenue Code. You are required by the law to file with IRS in order to report your finances.

What is 411 Listing?

Our 411 Listing Setup is designed to help you, or your business, get your phone number listed in 411 phone directory assistance.

What is a DUNS Number and why do you need it?

A DUNS Number, obtained through Dun & Bradstreet, is a unique nine-digit identification number for each physical location of your business. This DUNs number is used to create your business credit file, similar to how your social security number is used to identify your personal credit reports.

What is a PAYDEX Score?

Paydex is a numerical score granted to businesses as a credit score for the promptness of their payments to creditors. The Paydex score is used for commercial organizations in a manner similar to the way the FICO score is used for individuals.

What is Business Experian?

Experian helps you manage your business credit. Your business credit score is essential to the financial health of your business.

What is Business Equifax?

Equifax is a credit reporting agency. Business Equifax provides Business Credit Reports to help you clearly spot immediate and future risk.

What is a Business Entity?

A business entity is an organization created by one or more natural persons to carry on a trade or business. Corporations, limited liability companies, and sole proprietorships are types of common business entities.

Which Entity Is Right For You?

The table below will help you gain a better understanding of the different types of entities. Don't worry if you're not sure which one would be the best fit for you, we've got you covered!

Advantages vs Disadvantages

Sole proprietorship


Advantage(s):

  • No corporate tax payments so it’s easy to fulfill the tax reporting requirements.

Disadvantage(s):

  • The sole proprietor can be held personally liable for the debts and obligations of the business.
     

LLC (Limited Liability Company)


Advantage(s):

  • Owners and shareholders are protected from incurring personal liability.
  • An LLC can choose whether it wants to be taxed as a sole proprietorship, partnership, S corporation, or corporation.


Disadvantage(s):

  • LLCs incur “pass-through” taxation (profits and losses are reported on each owner’s or shareholder’s individual tax return, whether or not the shareholders receive dividends.) 
  • Many states require LLCs to pay a franchise tax or “capital values tax.”
     

S Corporations


Advantage(s):

  • In an S corporation, profits and losses are passed through to shareholders, and taxes are only paid once.
  • Your personal assets are separate from the business’s assets and are therefore protected in case of a loss.


Disadvantage(s):

  • The IRS requires all officers and owners of an S Corporation to make a salary, even if the company is not yet making a profit. This could be problematic for new businesses struggling to make payroll. 
  • If an S Corporation has shareholders, the shareholders will be taxed for any income the company has, even if they did not receive any portion of that income.
     

C Corporation 


Advantage(s):

  • Owners and shareholders are protected from incurring personal liability.
  • Shareholders are taxed only if they receive dividends, unlike an S corporation. 


 Disadvantage(s):

  • Corporations pay a number of state and federal filing fees, and each state also has its own set of regulations. Dealing with these regulations may require the professional expense of an attorney or accountant.
  • One tax at the corporate level on the corporation's net income, and another tax to the shareholders when the profits are distributed.

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