HOW TO CHOOSE A BUSINESS ENTITY

Before starting a business, it is vital to carefully choose which form of business entity you want to establish. There are many factors to take into consideration, including the type of business, what your day-to-day operations will involve, the level of personal risk and tax liability, to name a few. Seeking the counsel of an experienced corporate business attorney to advise you on the options that are available to you, help you choose wisely and assist you in setting up your business entity can make the process much easier and ensure that you strike the right balance between the benefits and legal protections different entities offer.

Things to Consider When Choosing a Business Entity

Considering federal, state and local legal and tax considerations when you form a business entity is essential. The type of entity you choose affects –

• your personal liability,
• your capacity to raise capital for your company,
• the amount you will pay in taxes, and
• the type of paperwork you must file to create and maintain your business entity.

You should decide on a business entity before you register your business with the state. A small business legal advisor who is well-versed in the laws and regulations surrounding the formation of business entities in Pennsylvania can provide invaluable guidance that will protect your rights and ensure you choose an entity that meets your unique needs. Once you have chosen a business entity, he or she can help you obtain a federal tax ID number, assist you with registering a business in PA, and file all other required paperwork. Failing to properly register your business can result in serious tax consequences, unintended dissolution and other problems down the road.

There many different factors that should be taken into account before you choose your business entity:

1. The degree of control-How much control do you want to have when it comes to investing, day-to-day operations and other business-related issues? The size, financing needs, complexity of the business and other issues should be taken into account when thinking about the degree of control you want to have over your business.
2. The cost of a business entity-How much will your chosen business entity cost to establish? It’s important to be aware of government fees, regulatory costs and other fiduciary concerns.
3. Your ability to raise capital-How will you raise money for your business? The ways you can raise cash for your business vary depending on the type of entity you choose.
4. Personal liability– Which entity will best help you avoid personal liability? Some forms of ownership provide protection from personal liability for business owners.
5. Federal, state and local taxation-What are the tax advantages and disadvantages of each business entity? The size and type of the business play an important role in this decision. It’s also important to keep business succession plans in mind.
6. Profit division– How will you divide the profits generated by your business? There are several different ways to divide profits that can also have an effect on your ability to raise capital.
7. Business succession planning-How do you plan to continue or pass on your business when you retire or if a sudden illness, injury or death should occur? Do you want to transfer business ownership to a family member or someone else? The type of business entity you choose can have a significant impact on these intentions being carried out according to plan.

Types of Business Entities in Pennsylvania

In Pennsylvania, there are a few types of business entities to choose from, including:

• Sole Proprietorships
• Partnerships
• Corporations
• Limited Liability Companies

Sole Proprietorships

A sole proprietorship is owned by one individual and gives that person total control of his or her business. A sole proprietor is also entitled to all profits from the business. While it does present a few advantages, sole proprietorship is typically unsuitable for a business that needs outside sources of capital for rapid growth.

Complete control of your business and profits can come with a cost. As a sole proprietor, you will be personally liable for all facets of the business, including creditor claims, damages from lawsuits and paying all taxes owed by the business.  If you have substantial personal assets, sole proprietorship is most likely not the best option for your business entity.

Federal taxes due are paid through the owner’s personal income tax return, and are subject to federal self-employment tax, which varies depending on your income.  In Pennsylvania, sole proprietors must pay state income tax and local wage taxes on income from the business as well.

If a sole proprietor wants to sell a business, potential buyers may not want to pay as much as they would for a business entity such as a corporation, particularly when a business has built a good name for itself over time. Having an effective business exit strategy in place at the very beginning can help you decide how you would want to sell your business when it’s time. Family business transition planning can also help you decide how you will handle passing your business assets on to your loved ones in the event of your death.

Partnerships

In Pennsylvania, the profit and losses from a partnership pass directly into the partners’ personal incomes. Depending on the type of partnership, you may be fully personally liable for your business’s debts. Some partnerships offer limited liability, which can protect your assets from certain kinds of debt.

General Partnership (GP)

General partnerships are a fairly simple business entity, but do not offer liability protection. All earnings, losses, and various business expenses are included in a GP partner’s personal income.

Limited Partnership (LP)

Limited partnerships work well for companies that need capital without added executive complications. LPs include limited partners, who invest in the company but do not have any managerial involvement. They are not liable for the company’s debts beyond their capital investment. Just like with general partnerships, they pay taxes on their income on personal returns.

Limited Liability Limited Partnership (LLLP)

Business owners who want to limit their personal liability, raise capital, and retain direct control over their business may create limited liability limited partnerships. LLLPs offer liability protection to limited partners for any business debts outside their investment. General partners enjoy protection from certain types of business debts.

A business contract attorney can help you choose which type of partnership is best for you and create an effective small business partnership agreement to ensure that all of your legal bases are covered.

Corporations

There are a few different types of corporations, but they are all business entities that are separate from their owners. Corporations can make a profit, be taxed, and can be held legally liable. Regular C corporations are typically a good choice for medium- or higher-risk businesses, those that need to raise money, and businesses that plan to “go public” or eventually be sold. Corporations have an advantage when it comes to raising capital because they can raise funds through the sale of stock, which can also be a benefit in attracting employees. When forming a corporation, your business attorney can help you come up with business succession planning strategies that address issues surrounding the sale or transfer of your business.

Corporations pay income tax on their profits. In some cases, profits are taxed twice — first, when the company turns a profit, and again when shareholders claim dividends on their personal tax returns. Corporations offer the strongest protection from personal liability, but the cost to form a corporation is higher than other business entities.

S corporations are designed to avoid this type of double taxation. S corporations allow profit, and some losses, to be passed directly to the owners’ personal income without being subject to corporate tax rates. They must file with the IRS to get S corporation status, which is a different process from registering with the state. Special limits are placed on S corporations and strict filing and operational processes must be followed.

Often called 501(c)(3)s, nonprofit corporations are formed to serve charitable, educational or religious purposes. Because their work benefits the public, nonprofits may receive tax-exempt status. Nonprofits must file with the IRS to get tax exemption and follow stringent rules about what they do with any profits they earn.

Limited Liability Company (LLC)

An LLC lets you take advantage of the benefits of both the corporation and partnership, and protects you from personal liability in most cases.

An LLC allows you to avoid paying corporate taxes, and profits and losses can be passed through your personal income. However, owners of an LLC must pay self-employment tax contributions toward Medicare and Social Security. Medium- or higher-risk businesses, owners with significant personal assets, and those who wish to avoid paying corporate taxes can benefit from choosing an LLC.

The experienced business and contracts attorneys at Carosella & Associates provide legal help for small businesses in Chester County. We offer the exceptional legal counsel and support you need throughout the process of forming a business entity so you can focus on creating a successful, thriving business.

This blog was originally posted at  https://carosella.com/how-to-choose-a-business-entity/

TOP CRIMINAL DEFENSE LAWYERS IN CHESTER COUNTY

From doing time in prison, to time paying costly fines, a felony conviction can have damaging consequences. Having an experienced local criminal lawyers  in your corner is essential to protecting your rights and helping you work toward the best possible outcome in your case.

DUI/DWI

Driving while under the influence of alcohol or drugs can lead to criminal charges that have serious repercussions for you and your family. Depending on the type of charges you are facing, you may incur thousands of dollars in fees, a felony conviction and prison time. The Pennsylvania Department of Motor Vehicles may also take administrative action against you, which can include license suspension or revocation, costly fees, and mandatory drug & alcohol treatment and education.

Pennsylvania DUI laws are complex, and hiring criminal lawyers who specialize in DUI/DWI defense is essential to make sure you get the most effective legal representation for your case. Carosella Attorneys are well-versed in issues of enforcement and judicial procedures, sobriety tests and other factors that may affect your charges. Can mean the difference between doing jail time and having charges reduced or dismissed.

Traffic Tickets

Many people think that getting a traffic ticket comes with minimal consequences, but driving with a suspended license, reckless driving, and offenses such as failing to stop for a school bus with red flashing lights can have more serious repercussions than you may think.  When you pay a traffic ticket you are admitting to violating a traffic offense and any related penalties. Our knowledgeable traffic ticket attorney can advise you on how to take steps to contest a traffic ticket and help you avoid hefty fines, points on your driver’s license, revocation of your license and additional penalties.

Domestic Abuse

Unfortunately, domestic violence is a common problem that includes a wide variety of different charges such as threats of violence, assault, battery, child abuse, elder abuse, and stalking. The penalties for domestic abuse can vary widely depending on the physical and emotional harm inflicted criminal history of the accused, age of the victim and other factors.

Whether you are a victim and need to file a Protection from Abuse petition or have been charged with domestic abuse, we are familiar with the local criminal courts and can provide the representation you need to ensure your rights are protected. The National Domestic Violence Hotline provides help for victims of domestic violence at 1-800-799-7233.

Felony Charges

If you have been charged with a felony, it is essential to engage the counsel of a skilled criminal defense attorney who is well-versed in representing and advocating for clients in the criminal court. Depending on the charges, the complex jury trial process can take several months to more than a year. Having an experienced attorney in your corner who will create a well-developed defense can help you work toward the best possible outcome in your case.

If you or a loved one is facing criminal charges, our experienced Chester County criminal defense lawyer at Carosella & Associates can help you understand your rights and ensure that your interests are protected.

This blog was originally posted at  https://carosella.com/top-criminal-defense-lawyers-in-chester-county/

HOW TO BACK OUT OF A REAL ESTATE CONTRACT THE RIGHT WAY

Whether you are buying or selling property, sometimes real estate deals just don’t work out. Although most real estate purchase and sale agreements drafted by real estate attorneys contain provisions that legally allow you to terminate a deal based on certain contingencies, breaking a contract must often be done delicately. These tips for terminating a real estate contract the right way can help you avoid hard feelings between buyer and seller and make the process much less stressful.

1. Hire a real estate lawyer. Before you even begin the process of buying or selling property, seeking the counsel of an experienced real estate lawyer in PA is vital. Having an attorney in your corner who will properly draft contracts and advise you on the best course of action regarding your real estate transaction is an invaluable resource and will ensure that your rights and interests are protected.

2. If you’re a buyer, know your options regarding termination of the contract. Real estate purchase and sale agreements include contingencies for procuring financing; clean home inspections, and disclosure of any existing problems with the property. If a buyer fails to get a mortgage secured by the date specified in the agreement; the home inspection shows that serious repairs are needed, or if it is revealed that the seller didn’t disclose major issues with the property, a prospective buyer can usually terminate the purchase agreement without a problem. If all contingencies have been met and the buyer terminates the purchase agreement, the seller may be able to keep the buyer’s earnest money deposit.

3. Include a “kick-out” clause.  Adding this type of clause to a real estate purchase and sale agreement protects both the buyer and seller. If buyers need to sell their current home before purchasing another, the “kick-out” clause allows the seller to keep showing his or her home while the buyer’s home is for sale. If the seller receives another offer, the sale and purchase agreement can be terminated. Conversely, if a seller needs to find a new home and is unable to do so in a specified amount of time, the contract can be terminated. Contact a skilled contracts lawyer near you who understands the ins and outs of drafting a solid sales agreement.

4. Understand grounds for termination as the seller. The importance of having an experienced real estate attorney include stipulations that provide outs for the seller cannot be understated. Ideally, in a real estate sale and purchase agreement a seller has agreed to the price that has been offered and has accepted the terms and contingencies specified by the buyer; so it can often be more difficult for a seller to terminate a purchase and sale agreement gracefully and without repercussions.

5. If you need to back out, do so promptly. If you need to terminate a real estate deal, let the other party know as soon as possible. Backing out too late in the game can be considered breach of contract and lead to costly litigation and other problems.

Our West Chester real estate lawyers at Carosella & Associates can provide the experienced counsel you need to effectively bow out of a real estate contract.

This blog was originally posted at  https://carosella.com/how-to-back-out-of-a-real-estate-contract-the-right-way/

NON-COMPETE AGREEMENTS – THINGS YOU SHOULD WATCH OUT FOR

In today’s ever-changing business landscape, there is growing pressure on employees to sign non-compete agreements. More and more businesses are enforcing these types of agreements, even for non-corporate jobs such as dog trainers or yoga instructors. If you are looking for a new job or your current employer is requiring you to sign a non-compete agreement, seeking the counsel of experienced contracts lawyers can ensure that your interests are protected.

What is a non-compete agreement?

Sometimes called a covenant not to compete, a non-compete agreement is a contract in which an employee agrees not to open a competing business or work for a competitor for a specific period of time in a defined area after his or her employment ends. There are different scenarios in which you may be asked to sign a non-compete agreement, including: before you start a new job, when you are offered a raise or promotion, and before getting severance pay if you quit or are fired.

There are a few important things to keep in mind before signing any non-compete agreement, and a skilled non-compete lawyer can help you determine whether or not the terms of the contract are in your best interest.

Non-Compete Terminology

General non-compete agreements or covenants not to compete typically cover the following three aspects in the contract:

Standard non-compete agreements prohibit employees from working for competing businesses within a specific period of time in a demarcated geographical area.

Non-solicitation agreements prohibit employees from poaching customers, coworkers and/or vendors of the former employer.

Non-disclosure agreements (NDAs) forbid employees from using or sharing information that the former employer wants to keep confidential, and may include product design, advertising strategies, mailing lists and other proprietary information.

Is your non-compete agreement reasonable?

Although employers have a right to protect their businesses, non-compete agreements can go too far and impede your ability to make a living if you decide to leave the company. Courts will not honor provisions that they deem “unreasonable; and when it comes to negotiating a non-compete agreement, there are a few specifics that should be closely examined before you sign.

The Specified time period. Depending on the type of work you do, the time period in which you’re bound to honor the agreement can vary. Courts may consider six months for a dog trainer reasonable, but five years could be considered appropriate for a CEO.

The non-compete area. A 20-mile radius might be reasonable for a hairstylist, but if you’re a sales manager, the prohibited geographical area could cover a few states.

The impact on your livelihood. Make sure to consider whether or not the agreement will force you to relocate or impede your ability to make a living. Some courts weigh in on this, but there is no guarantee that a judge will rule in your favor.

It may be tempting to sign a non-compete agreement on the spot, but jumping the gun can have grave consequences down the road. Take the contract to experienced business lawyers for review. Our West Chester business attorneys at Carosella & Associates will make sure everything is in order and help to ensure that your interests are protected.

This blog was originally posted at https://carosella.com/non-compete-agreements-things-you-should-watch-out-for/

Steps to Contesting a Traffic Ticket

You may think a traffic ticket is merely a costly inconvenience, but some traffic violations can have substantial consequences. Being charged with a DUI, leaving the scene of an accident and other serious traffic violations can lead to a revoked or suspended license, costly fines and even jail time. Seeking the counsel of experienced lawyers who handle traffic tickets in Pennsylvania may help you get charges reduced or dismissed and lower the number of points that are placed on your license. These four steps for contesting a traffic ticket can help you understand how the legal process works when you receive a traffic ticket.

1. Pay Attention to Points

Pennsylvania uses a point system for traffic violations. The more serious the violation; the more points placed against your driver’s license. Points for multiple minor violations can also add up quickly and put your driver’s license, auto insurance coverage and even your livelihood at risk. Serious offenses such as speeding in an active work zone can result in an automatic suspension of your driver’s license.

2. Be Polite to Law Enforcement

It may seem obvious, but being rude or belligerent with a police officer will not help your case. Comply with the officer’s requests and respond politely and calmly. If you are apologetic and compliant, many officers will issue a citation for violation of PA Motor Vehicle Code Section 3111, Obedience to Traffic Control Devices instead of speeding, which will help you avoid putting points on your license.

3. Promptly Contest the Citation

If you believe you received an unfair ticket you can challenge it in court. To submit a not guilty plea, check the “not guilty” box and date and sign the citation. Mail it to the court that is listed on the citation in the specified time frame, which is typically 10 days. If you do not pay or respond to a citation within this period of time a warrant may be issued for your arrest.

4. Hire an Attorney

If you don’t feel confident about contesting your ticket yourself, it is vital to hire an experienced traffic violations attorney, which is often less expensive than paying hefty fines and higher insurance rates. Having a lawyer in your corner also increases the chances of charges and fines being reduced or dismissed.

Your attorney will review your driving record and the facts of the incident for potential problems with human error, traffic control and enforcement devices. If you are facing criminal charges such as DUI or were involved in a motor vehicle accident, criminal lawyers should handle your case.

An attorney will take care of negotiations with all involved parties, which may include the officer who issued the citation, the judge and/or district attorney; and will appear in court to handle the resolution of your case. If you are convicted, he or she can also file a summary appeal of your traffic conviction to the Court of Common Pleas to have charges dismissed or reduced.

If you have been charged with a traffic violation, our skilled West Chester criminal lawyer will protect your rights and work to achieve the best possible outcome in your case.

This blogs was originally posted at http://carosella.com/steps-to-contesting-traffic-ticket/

This Is Why Bankruptcy May Not Be Your Best Option

The stress that comes with being buried in debt can be overwhelming, and many people facing high credit card balances, possible foreclosure and repossession of other assets believe that bankruptcy is their only option to repair their credit problems. In many cases, this is simply not true.

Unsecured debts such as credit card balances are typically dischargeable in bankruptcy, but some debts are not. Student loans, child support and some tax debt will not be wiped when you file bankruptcy. If you are facing financial difficulties, seeking the counsel of local bankruptcy attorneys who are knowledgeable about bankruptcy laws in PA can give you a clearer understanding of your options for reducing or eliminating your debt.

When Bankruptcy May Not Be For You

Your debt is high, but not overwhelming. There are a few ways to bring down your debt without filing bankruptcy. If you own an expensive home or vehicle, selling them and buying a house or car that is more affordable can be a viable option to reduce your debt. It can improve or keep your credit intact and allow you to finance a new car at a reasonable interest rate. Although filing bankruptcy may wipe out your unsecured debt, if the majority of your debt is secured debt like car loans, it is possible that you will lose what you have paid into the loan and the car itself. When you go to buy a new car with a recent bankruptcy in your credit history, you will have to pay significantly higher interest rates.

If you have a decent amount of equity in your home, selling your home or refinancing your mortgage could also help you pay off unsecured debt such credit card balances as well.

You qualify for a debt consolidation loan with a lower interest rate. With a debt consolidation loan, all of your outstanding unsecured credit accounts are consolidated into a new loan with one monthly payment. Before you apply for a consolidation loan, it is vital to consult with an attorney at a bankruptcy law firm who can help you determine which option will most effectively help you clear up your debt.

It’s also important to note that if you own a home you may be required to use it as collateral for a debt consolidation loan. If this is the case, filing bankruptcy may be a better option. Chapter 13 Bankruptcy is similar to a debt consolidation loan in that it works as a repayment plan that consolidates all of your debt into one monthly payment. Although filing bankruptcy may affect your credit for a period of time, you won’t have to worry about being taken for a ride by a disreputable company or paying a lot more interest to get yourself out of debt.

If you are unsure about whether bankruptcy is right for you, our experienced West Chester bankruptcy Lawyers at Carosella & Associates can help you get your finances back on track.

This blogs was originally posted at http://carosella.com/bankruptcy-may-not-best-option/

7 Common Misconceptions About FSBO

The number of Americans who are choosing to sell their homes by owner (FSBO) is rising. There are quite a few misconceptions about FSBO, and having a good understanding of what the selling process entails can alleviate stress and make it seem much less daunting.

1. You Need a Realtor to Accurately Price Your Home

It is easier than ever to determine how much to ask for your home. Many real estate websites list property values online–check out a few different sites to find out prices of comparable homes in your area; then come up with a reasonable number that’s not too high or too low.

2. A Realtor Has Special Skills and Resources to Market Your Home

Again, online resources can empower you to sell on your own. Most home buyers begin house hunting online, so posting your home on FSBO sites, Craigslist and other websites can give you all the exposure you need. Make sure to include plenty of good photographs of the inside and outside of your home, and include all pertinent information about your home, schools and the neighborhood.

3. Only a Realtor Can List a Home on the MLS

This is simply not true. For a flat, one-time fee, discount brokers and websites will put a FSBO home on the local MLS, which gives agents, brokers and buyers an easy way to find it.

4. FSBO Takes Longer to Sell

Regardless of whether you use an agent or broker, selling a home takes time and effort. As long as you get your home properly prepared for sale, respond to inquiries and schedule showings promptly, it shouldn’t take any longer to sell your home FSBO than it would if you used an agent.

5. It’s Easier to Schedule Showings and Open Houses With a Real Estate Agent

Scheduling showings and open houses according to your schedule instead of a realtor’s actually makes it easier. Meeting and talking with prospective buyers and their agents can also add a personal touch that may lead to a quick sale.

6. Negotiating is Difficult Without an Agent

While it’s true that most real estate agents are skilled at negotiating a sales price, a seasoned real estate attorneycan also negotiate on your behalf, and will always have your best interests in mind.

7. You Need an Agent or Broker to Draft Documents and Arrange a Closing

Many real estate agents use attorneys to draft and review real estate purchase agreements and other transaction-related documents. Hiring a skilled real estate lawyer to review contracts and draft other important documents can cost a lot less than paying a realtor a 3-6 percent commission fee while still ensuring that the entire transaction is completed accurately and all legal bases are covered.

An experienced for sale by owner lawyer can help you develop a successful strategy for selling your home and ensure that your rights are protected from listing to closing. If you are interested in selling or buying a home, our experienced West Chester real estate lawyers at Carosella & Associates can guide you through the process and ensure that your rights are protected from start to finish.

This blogs was originally posted at http://carosella.com/7-common-misconceptions-about-fsbo/