Starting a company can be tough, especially with the amount of legal preparation that is involved. One of the trickiest things required when running a new business is selecting which entity you want your company to be filed under by the Internal Revenue Service (IRS). Another is to send in an application for an Employer Identification Number. Thankfully, IRS EIN can help individuals get their EINs in no time, as well as easily check the status of an EIN online right from the comfort and convenience of their homes.
What Is a Personal Service Corporation?
One type of business entity your company can apply for is called a personal service corporation. This type of business entity is for companies who provide personal services to clients, including law firms, doctors’ and dentists’ offices, and accounting firms.
Personal Service Corporation Perks
There are tons of benefits if you get an EIN for a personal service corporation from IRS EIN. For one thing, a personal service corporation provides your company with a limited liability structure. If you fall under this heading, you’re considered an independent entity by the IRS, which is a separate entity from its owner. You will not be responsible for any or all debts or claims filed against your organization.
There are also tax advantages that come with filing your company as a personal service corporation. You can provide your workers with tax-free healthcare benefits and life insurance.
Here are some of the more specific advantages of filing your business as a personal service corporation:
As with so many business-related decisions, taxes are often one of the key factors to consider. In this case, there are numerous tax advantages available to personal service corporations. For example, they are permitted to offer tax-free healthcare benefits and life insurance to their employees. In addition, the law allows numerous tax deductions for personal service corporations such as for dependent care and disability insurance, as well as for business expenses, including the purchase of equipment and travel costs.
Personal service corporations are also protected by limited liability, which is a huge advantage business-wise. For instance, if you are operating your business as a sole proprietorship and fail to pay bills associated with your business, your assets, such as your car or home, could be seized to rectify the situation. Operating it as a personal service corporation, however, means the government views it as a separate business entity and that no one can come after your personal assets as a result of any unresolved business situation. This also means your personal credit would be safe and you would not have to be concerned about lawsuits against the company affecting you personally.
Another benefit of a personal service corporation is that it can exist forever, that is, in perpetuity. More specifically, once established, you as its owner could decide to retire and reassign ownership or management to the individual of your choice, without affecting the day-to-day operations and responsibilities of that company. Conversely, if you were to run the business as a sole proprietorship or partnership, that company would dissolve the moment you retire from it or when you die.
As always, stopping by www.irs-ein-tax-id.com is your best first bet to find the information you need to get your questions answered. We will assist you in all of your employer identification number needs. We look forward to hearing from you!