Small Business Owner In Need Of A Business Formation Plan

Business, Lifestyle
Reading Time: 3 minutes

With the introduction of its new Business Entity Formation Program, Legacy Assurance Plan has added another cutting-edge tool to its menu to help consumers meet their estate and financial planning needs in a truly comprehensive way.

Legacy Assurance Plan, an industry leader in estate planning services, is now giving its members the option of including the new Business Entity Formation Program in their membership. With this additional service, members can establish either a limited liability company (LLC) or corporation as part of their Legacy Business Plan membership.

Legacy Assurance Plan recognizes that with the Tax Cuts and Jobs Act boosting new business development and a growing number of baby boomers in need of comprehensive estate and business planning, the new service can benefit a vastly expanding market. Additionally, LLCs, because of their flexibility and the liability and asset protections they afford, are increasingly popular in today’s flourishing small business environment and can fulfill the needs of many of Legacy Assurance Plan’s members.

Despite the advantages of forming an LLC, IRS statistics show that sole proprietorships, which expose the business owner to personal liability, are still outpacing the growth of LLCs, which offer protection from liability and tax advantages that sole proprietorships don’t. What’s more, many individuals have taken risks by creating LLCs with do-it-yourself kits without fully understanding the numerous legal obligations to properly form and maintain a business entity.

The Business Entity Formation Program helps consumers by creating legal walls that separate a consumer’s personal assets from their business affairs. State laws grant many business entities what’s called “legal personhood.” That means that a consumer’s business entity has a completely separate legal identity from the consumer.

“What that means for consumers, in a practical sense, is that they as individuals and their business entities are separate,” according to Tom Alberts, Legacy Assurance Plan staff journalist. “However, if you operate as a sole proprietorship, then you are your business and your business is you. If someone sues you in a personal dispute, they can go after your business’ assets. Similarly, if someone has a legal claim against your business, they can go after your personal wealth. With proper business entity planning and formation, your business entity is legally separated from you, which helps provide valuable asset protection that you need.”

Among the people Legacy Assurance Plan has tailored this program to help are those who have worked hard to build their business yet still operate as sole proprietors. “By utilizing Legacy Assurance Plan’s new program, consumers can keep their family farm, rental business or small service business separate from their personal financial affairs, thereby creating a liability shield,” Alberts said.

The Legacy Business Plan provides numerous services to assist members with both forming and maintaining their business entity. For example, periodic reviews ensure LLC owners are following formalities and adjusting to changes in state law so they keep their business entities viable and maintain a liability shield. The program also provides guidance with documenting annual meetings and reminders to file annual reports. Another included service is business succession planning, which enables the business to transition seamlessly according to the member’s stated wishes.

“Succession planning is vital for owners of small businesses. The period of transition immediately after a sole owner’s death can be one of confusion, causing a business’ operation to sink into disorganization and inefficiency. Too often, it is this period of inefficient transition that causes small businesses to fail. It doesn’t have to be that way. We can help members avoid that fate,” Alberts said.

“What we do is firmly grounded in the belief that everyone should have access to a comprehensive estate and business plan that meets all their needs and goals. Legacy’s Business Entity Formation Program is just the latest of our many innovations designed to make comprehensive planning a reality for our members.”

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