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The Corporate Transparency Act (CTA), enacted as part of the Anti-Money Laundering Act of 2020 (AMLA), places new reporting requirements on many business entities in an effort to expose illegal activities, including the use of shell companies to launder money or conceal illicit funds. Around 30 million small businesses are impacted by the law, which has established a federal database of information, through FinCEN, that will be accessible to certain authorities and organizations.Why was the CTA passed?&nbsp; The CTA was passed as part of the National Defense Authorization Act for Fiscal Year 2021. It directs the US Department of the Treasury’s Financial Crimes Enforcement Network (FinCEN) to gather information from private companies about their owners and controlling persons. Acting Director Himamauli Das said, “FinCEN is taking aggressive aim at those who would exploit anonymous shell corporations, front companies, and other loopholes to launder the proceeds of crimes, such as corruption, drug and arms trafficking, or terrorist financing.”To counter the risks allegedly posed by anonymous shell companies, the CTA mandates the creation of a national registry that contains certain information about business entities that are formed by filing a document with a state’s secretary of state or similar office.What does the CTA require? Effective January 1, 2024, the CTA requires that certain businesses disclose to FinCEN information about the company, its beneficial owners, and in some cases, the company applicant.Reporting companies—defined as any company with twenty or fewer employees that is formed by filing paperwork with the Secretary of State or equivalent official—that are created or registered prior to January 1, 2024, have until January 1, 2025, to file an initial report; reporting companies created or registered after January 1, 2024, will have ninety days after creation or registration to file a report; and reporting companies created or registered after January 1, 2025, will have thirty days after creation or registration to file a report.Does the CTA require my business to report?&nbsp; The CTA applies to companies that are created by filing a document with a state authority. Typically, this includes corporations and limited liability companies. Depending on the state, it could also include limited partnerships, professional associations, cooperatives, real estate investment trusts, and trusts. In addition, the CTA applies to non-US companies that are registered to operate in the United States.However, the CTA exempts around two dozen categories of companies, including companies that● &nbsp; &nbsp; &nbsp; &nbsp;are publicly-traded;● &nbsp; &nbsp; &nbsp; &nbsp;have more than twenty full-time US employees;● &nbsp; &nbsp; &nbsp; &nbsp;filed a previous year’s tax return showing more than $5 million in gross receipts or sales;● &nbsp; &nbsp; &nbsp; &nbsp;have an operating presence at a physical US office location;● &nbsp; &nbsp; &nbsp; &nbsp;operate in a regulated industry, such as banking, utilities, or insurance, that already imposes similar reporting requirements; or● &nbsp; &nbsp; &nbsp; &nbsp;are subsidiaries of exempt organizations.&nbsp;The exemptions, which generally include larger companies that are already subject to regulation, underline the primary purpose of the CTA: to combat money laundering and other illicit activities conducted via small, private, and anonymous shell companies.<figure id="figure-716hipmuckls8xo6ny"><img id="716hipmuckls8xo6ny" src="https://images.unsplash.com/photo-1667312939934-60fc3bfa4ec0?crop=entropy&amp;cs=tinysrgb&amp;fit=max&amp;fm=jpg&amp;ixid=M3wyNjI5NjF8MHwxfHNlYXJjaHwzNHx8U3RhY2tlZCUyMGJvb2tzJTIwYW5kJTIwam91cm5hbHxlbnwwfHx8fDE3MDcxMzc2NDR8MA&amp;ixlib=rb-4.0.3&amp;q=80&amp;w=1080" alt="Stacked books and journal" class="object-cover bg-gray-100 rounded-sm md:rounded-md lg:rounded-lg" style="aspect-ratio: 16/9; object-position: center center;" data-corners="default" data-aspect="16:9" data-caption="" data-positionx="undefined" data-positiony="undefined" data-fullwidth="false" data-mce-src="https://images.unsplash.com/photo-1667312939934-60fc3bfa4ec0?crop=entropy&amp;cs=tinysrgb&amp;fit=max&amp;fm=jpg&amp;ixid=M3wyNjI5NjF8MHwxfHNlYXJjaHwzNHx8U3RhY2tlZCUyMGJvb2tzJTIwYW5kJTIwam91cm5hbHxlbnwwfHx8fDE3MDcxMzc2NDR8MA&amp;ixlib=rb-4.0.3&amp;q=80&amp;w=1080" data-mce-style="aspect-ratio: 16/9; object-position: center center;"></figure>What information must be provided in the reports?&nbsp; The CTA requires three categories of information to be reported: company, owners, and applicant.● &nbsp; &nbsp; &nbsp; &nbsp;Domestic reporting companies created before January 1, 2024, must provide information about the company and its beneficial owners.o &nbsp; Beneficial owner is defined in the CTA as an individual who exercises “substantial control” over the reporting company or has an ownership interest of at least 25 percent. Company senior officers, directors, and others who make significant decisions on behalf of the company may meet this statutory definition of “substantial control,” although the broad definition may cause confusion in some instances.&nbsp;● &nbsp; &nbsp; &nbsp; &nbsp;Domestic reporting companies created on or after January 1, 2024, must provide information about the company, its beneficial owners, and its company applicants.&nbsp;o &nbsp; A company applicant generally is the individual who files the formation document with state authorities for the reporting company.&nbsp;The information to be filed with FinCEN is called a Beneficial Ownership Information (BOI) Report. The following is what is required in the report for a company, an owner, and an applicant:● &nbsp; &nbsp; &nbsp; &nbsp;The reporting company must provide its name and any alternative (DBA) names, the address of its principal place of business, the state of formation, and its taxpayer identification number or FinCEN identifier.&nbsp;● &nbsp; &nbsp; &nbsp; &nbsp;Each beneficial owner of a reporting company must furnish their full legal name, date of birth, residential address, and an identification number from a driver’s license, passport, or other state-issued identification (ID), along with a copy of the ID document.&nbsp;● &nbsp; &nbsp; &nbsp; &nbsp;A company applicant is required to submit the same information as a beneficial owner.&nbsp;Who has access to FinCEN BOI reports?&nbsp; The CTA authorizes FinCEN to disclose BOI information to five categories of recipients:● &nbsp; &nbsp; &nbsp; &nbsp;US federal, state, local, and tribal government agencies● &nbsp; &nbsp; &nbsp; &nbsp;Foreign law enforcement agencies, judges, prosecutors, and other authorities● &nbsp; &nbsp; &nbsp; &nbsp;Financial institutions● &nbsp; &nbsp; &nbsp; &nbsp;Federal regulators● &nbsp; &nbsp; &nbsp; &nbsp;US Department of the TreasuryFinCEN may only disclose BOI information “under specific circumstances”: there are more stringent requirements for agencies other than those engaged in national security, intelligence, and law enforcement activities. There are also restrictions on how the information may be used and how it must be secured.Are there penalties for noncompliance with the CTA? Penalties for noncompliance may be steep. Willingly providing false information (including false identifying documents) to FinCEN, or failing to report complete BOI information, can result in:● &nbsp; &nbsp; &nbsp; &nbsp;Fines of $500 per day, up to $10,000● &nbsp; &nbsp; &nbsp; &nbsp;Imprisonment for up to two yearsCivil and criminal liability may be avoided if an individual who submitted an original, erroneous report did not knowingly submit inaccurate information and submits an updated report correcting the inaccurate information within ninety days.Get help with CTA reporting requirements.&nbsp; Understanding how the CTA applies to you, how it will affect your business, and what you must do to comply introduces new burdens that you may have scarce resources to address.Terms like “beneficial owner” and “substantial control” may seem vague and confusing, further complicating compliance efforts. But compliance is critical for business owners who want to avoid possible sanctions.We can help you determine whether the CTA applies to your business and the steps needed to meet its reporting requirements. <a data-mce-href="https://landofenchantmentlaw.com/contact" href="https://landofenchantmentlaw.com/contact" title="Contact Us">Please contact us if your entity would like more information or assistance.</a>

Corporate Transparency Act Imposes New Small Business Reporting Requirements

With the recent changes in NCAA regulations, college athletes now have the opportunity to capitalize on their Name, Image, and Likeness (NIL). This shift has sparked a significant discussion in the sports industry and beyond, as it presents a new era of opportunities for student-athletes.Understanding Name, Image, and LikenessThe concept of Name, Image, and Likeness refers to the ability of individuals to profit from their own personal brand. For college athletes, this means they can now earn compensation for the use of their name, image, or likeness in endorsements, sponsorships, and other commercial opportunities. This change has opened up a world of possibilities for student-athletes who were previously restricted from benefiting financially from their athletic prowess. It also brings about a fundamental shift in the dynamics of college sports and the way athletes are perceived and valued.<figure id="figure-s34o3vqjaalqtnimvs"><img id="s34o3vqjaalqtnimvs" src="https://images.unsplash.com/photo-1607962776853-346ec26811db?crop=entropy&amp;cs=tinysrgb&amp;fit=max&amp;fm=jpg&amp;ixid=M3wyNjI5NjF8MHwxfHNlYXJjaHwxNXx8Y29sbGVnZSUyMGF0aGxldGUlMjBzcG9uc29yc2hpcHxlbnwwfHx8fDE3MDM0MDEwNjV8MA&amp;ixlib=rb-4.0.3&amp;q=80&amp;w=1080" alt="woman in white long sleeve shirt and black pants sitting on red metal frame" class="object-cover bg-gray-100 rounded-sm md:rounded-md lg:rounded-lg" style="aspect-ratio: 16/9; object-position: center center;" data-corners="default" data-aspect="16:9" data-caption="" data-positionx="undefined" data-positiony="undefined" data-mce-src="https://images.unsplash.com/photo-1607962776853-346ec26811db?crop=entropy&amp;cs=tinysrgb&amp;fit=max&amp;fm=jpg&amp;ixid=M3wyNjI5NjF8MHwxfHNlYXJjaHwxNXx8Y29sbGVnZSUyMGF0aGxldGUlMjBzcG9uc29yc2hpcHxlbnwwfHx8fDE3MDM0MDEwNjV8MA&amp;ixlib=rb-4.0.3&amp;q=80&amp;w=1080" data-mce-style="aspect-ratio: 16/9; object-position: center center;"></figure> Implications for College AthleticsThe NIL rules have the potential to reshape the landscape of college athletics. Athletes now have the ability to build their personal brands, engage with sponsors, and monetize their social media presence, creating a new avenue for financial gain during their college years. This shift may also impact the recruiting process, as schools with strong marketing and endorsement opportunities could become more attractive to prospective student-athletes. It's a game-changer for college sports programs and the athletes they recruit.Challenges and OpportunitiesWhile the new NIL rules present exciting prospects for college athletes, they also come with challenges. Managing endorsements and sponsorships alongside academic and athletic commitments requires careful balance and guidance.<figure id="figure-gy6mmvobtllqj50k59"><img id="gy6mmvobtllqj50k59" src="https://images.unsplash.com/photo-1562793440-ba6f231b3bd4?crop=entropy&amp;cs=tinysrgb&amp;fit=max&amp;fm=jpg&amp;ixid=M3wyNjI5NjF8MHwxfHNlYXJjaHwyfHxjb2xsZWdlJTIwYXRobGV0ZSUyMGJhbGFuY2luZ3xlbnwwfHx8fDE3MDQwMzY2MjF8MA&amp;ixlib=rb-4.0.3&amp;q=80&amp;w=1080" alt="group of people walking on street during daytime" class="object-cover bg-gray-100 rounded-sm md:rounded-md lg:rounded-lg" style="aspect-ratio: 16/9; object-position: center center;" data-corners="default" data-aspect="16:9" data-caption="" data-positionx="null" data-positiony="null" data-mce-src="https://images.unsplash.com/photo-1562793440-ba6f231b3bd4?crop=entropy&amp;cs=tinysrgb&amp;fit=max&amp;fm=jpg&amp;ixid=M3wyNjI5NjF8MHwxfHNlYXJjaHwyfHxjb2xsZWdlJTIwYXRobGV0ZSUyMGJhbGFuY2luZ3xlbnwwfHx8fDE3MDQwMzY2MjF8MA&amp;ixlib=rb-4.0.3&amp;q=80&amp;w=1080" data-mce-style="aspect-ratio: 16/9; object-position: center center;"></figure> However, the opportunities are abundant. Athletes can now leverage their personal brand to secure partnerships with brands, create their own merchandise, and engage with their fan base in new and lucrative ways.Impact on the Sports IndustryThe impact of the NIL rules extends beyond college campuses, reaching into the broader sports industry. Brands, marketers, and agencies now have the chance to collaborate with college athletes, tapping into their influence and reach to promote products and services. This shift in the industry's dynamics presents an exciting and evolving landscape for marketing professionals, as they navigate the opportunities and challenges of engaging with college athletes in the new era of Name, Image, and Likeness.As the NIL regulations continue to unfold, it's clear that the sports industry is entering a transformative period. College athletes now have the chance to harness their personal brand and capitalize on their Name, Image, and Likeness, creating a new paradigm for student-athlete empowerment and commercial opportunities.Seeking Professional Guidance For those student athlets in New Mexico, consulting with an attorney can help navigate the complexities of Name, Image, and Likeness and protect their interests. ﻿<a href="https://landofenchantmentlaw.com/contact" data-mce-href="https://landofenchantmentlaw.com/contact">As a service to the New Mexican athlete community, the Law Office of Johnn Osborn, P.C. offers pro-bono and low-bono services for Student Athletes in New Mexico who need an attorney on their side to protect their interests.</a><a data-mce-href="https://landofenchantmentlaw.com/contact" href="https://landofenchantmentlaw.com/contact">Contact me here or call 505.585.1235 to speak with attorney Johnn Osborn at Land of Enchantment Law.&nbsp;</a><figure id="figure-8ltvrjeaxclqtnfq0u"><img id="8ltvrjeaxclqtnfq0u" src="https://cdn.durable.co/covers/146x21ErOCKzCsA20V1TFVfxno9yIRXPTzRZ98khwWwjzHEzahcTb6h5PUYVWDfo.jpg" alt="" class="object-cover bg-gray-100 rounded-sm md:rounded-md lg:rounded-lg" style="aspect-ratio: 16/9; object-position: center center;" data-corners="default" data-aspect="16:9" data-caption="" data-positionx="undefined" data-positiony="undefined" data-mce-src="https://cdn.durable.co/covers/146x21ErOCKzCsA20V1TFVfxno9yIRXPTzRZ98khwWwjzHEzahcTb6h5PUYVWDfo.jpg" data-mce-style="aspect-ratio: 16/9; object-position: center center;"></figure>

Name, Image, Likeness, and the Law.

three person pointing the silver laptop computer

As college students, estate planning might not be at the top of your to-do list. However, it's important to understand that estate planning is not just for the elderly or wealthy individuals. Regardless of your age or financial situation, having a plan in place can provide peace of mind and ensure that your wishes are carried out in the event of incapacitation or death.<h3>Why College Students Need Estate Planning</h3>While it may seem premature to think about estate planning at this stage in life, it's crucial for several reasons. First, creating a will or trust allows you to designate who will receive your assets in the event of your passing. Additionally, appointing a healthcare proxy and power of attorney can ensure that your wishes are respected if you become unable to make decisions for yourself.<figure id="figure-bcbjy2ekdlqj4o8kh"><img id="bcbjy2ekdlqj4o8kh" src="https://images.unsplash.com/photo-1516455590571-18256e5bb9ff?crop=entropy&amp;cs=tinysrgb&amp;fit=max&amp;fm=jpg&amp;ixid=M3wyNjI5NjF8MHwxfHNlYXJjaHwyMHx8Y29sbGVnZSUyMGVzdGF0ZSUyMHBsYW5uaW5nfGVufDB8fHx8MTcwMzQwMDQ5MXww&amp;ixlib=rb-4.0.3&amp;q=80&amp;w=1080" alt="college estate planning" class="object-cover bg-gray-100 rounded-sm md:rounded-md lg:rounded-lg" style="aspect-ratio: 16/9;" data-mce-src="https://images.unsplash.com/photo-1516455590571-18256e5bb9ff?crop=entropy&amp;cs=tinysrgb&amp;fit=max&amp;fm=jpg&amp;ixid=M3wyNjI5NjF8MHwxfHNlYXJjaHwyMHx8Y29sbGVnZSUyMGVzdGF0ZSUyMHBsYW5uaW5nfGVufDB8fHx8MTcwMzQwMDQ5MXww&amp;ixlib=rb-4.0.3&amp;q=80&amp;w=1080" data-mce-style="aspect-ratio: 16/9;"></figure><h3>Key Components of Estate Planning</h3>When it comes to estate planning, there are several key components to consider. These include:<ul><li>Creating a will or trust</li><li>Designating beneficiaries for your assets</li><li>Appointing a healthcare proxy and power of attorney</li><li>Establishing a living will or advance directive</li></ul>Each of these elements plays a crucial role in ensuring that your wishes are honored and your loved ones are taken care of.<h3>Protecting Your Digital Assets</h3>In today's digital age, it's important to consider your online presence when estate planning. This includes your social media accounts, email accounts, and any digital assets such as cryptocurrency or online businesses. Be sure to include instructions for how you would like these assets to be handled in your estate plan.<figure id="figure-vcrod25harlqj4o9sl"><img id="vcrod25harlqj4o9sl" src="https://images.unsplash.com/photo-1423666639041-f56000c27a9a?crop=entropy&amp;cs=tinysrgb&amp;fit=max&amp;fm=jpg&amp;ixid=M3wyNjI5NjF8MHwxfHNlYXJjaHwyfHxjb2xsZWdlJTIwZGlnaXRhbCUyMGFzc2V0c3xlbnwwfHx8fDE3MDM0MDA0OTN8MA&amp;ixlib=rb-4.0.3&amp;q=80&amp;w=1080" alt="college digital assets" class="object-cover bg-gray-100 rounded-sm md:rounded-md lg:rounded-lg" style="aspect-ratio: 16/9;" data-mce-src="https://images.unsplash.com/photo-1423666639041-f56000c27a9a?crop=entropy&amp;cs=tinysrgb&amp;fit=max&amp;fm=jpg&amp;ixid=M3wyNjI5NjF8MHwxfHNlYXJjaHwyfHxjb2xsZWdlJTIwZGlnaXRhbCUyMGFzc2V0c3xlbnwwfHx8fDE3MDM0MDA0OTN8MA&amp;ixlib=rb-4.0.3&amp;q=80&amp;w=1080" data-mce-style="aspect-ratio: 16/9;"></figure><h3>Getting Started with Estate Planning</h3>If you're ready to start estate planning as a college student, there are a few steps you can take. First, consider consulting with an estate planning attorney who can guide you through the process and ensure that your plan aligns with state laws. Additionally, be sure to regularly review and update your plan as your circumstances change.While it may not be the most exciting topic to think about, estate planning is an essential part of preparing for the future. By taking the time to create a comprehensive plan now, you can provide yourself and your loved ones with peace of mind and security for the years to come.<figure id="figure-ahic782fymlqj4oar6"><img id="ahic782fymlqj4oar6" src="https://images.unsplash.com/photo-1523050854058-8df90110c9f1?crop=entropy&amp;cs=tinysrgb&amp;fit=max&amp;fm=jpg&amp;ixid=M3wyNjI5NjF8MHwxfHNlYXJjaHwyMXx8ZXN0YXRlJTIwcGxhbm5pbmclMjBjb2xsZWdlfGVufDB8fHx8MTcwMzQwMDQ5NHww&amp;ixlib=rb-4.0.3&amp;q=80&amp;w=1080" alt="estate planning college" class="object-cover bg-gray-100 rounded-sm md:rounded-md lg:rounded-lg" style="aspect-ratio: 16/9;" data-mce-src="https://images.unsplash.com/photo-1523050854058-8df90110c9f1?crop=entropy&amp;cs=tinysrgb&amp;fit=max&amp;fm=jpg&amp;ixid=M3wyNjI5NjF8MHwxfHNlYXJjaHwyMXx8ZXN0YXRlJTIwcGxhbm5pbmclMjBjb2xsZWdlfGVufDB8fHx8MTcwMzQwMDQ5NHww&amp;ixlib=rb-4.0.3&amp;q=80&amp;w=1080" data-mce-style="aspect-ratio: 16/9;"></figure>

Estate Planning for College Students.

<body> Legal jargon can be confusing, especially for those who are not well-versed in the language of the law. Understanding some common legal terms can be beneficial, whether you are dealing with a legal issue or simply want to be more informed. Here are five common legal terms explained: <h3>1. Jurisdiction</h3> Jurisdiction refers to the authority of a court to hear and decide a case. It can be based on geographical location, subject matter, or the type of parties involved. For example, a court may have jurisdiction over cases within a specific county or state. <figure id="figure-j4jwbjnmymlqj4ublv"><img id="j4jwbjnmymlqj4ublv" src="https://images.unsplash.com/photo-1676312210846-104b89aafd81?crop=entropy&cs=tinysrgb&fit=max&fm=jpg&ixid=M3wyNjI5NjF8MHwxfHNlYXJjaHwxfHxqdXJpc2RpY3Rpb24lMjBjb3VydHxlbnwwfHx8fDE3MDM0MDA3Nzd8MA&ixlib=rb-4.0.3&q=80&w=1080" alt="jurisdiction court" class="object-cover bg-gray-100" style="aspect-ratio: 16/9"></figure> <h3>2. Plaintiff and Defendant</h3> In a legal case, the plaintiff is the party who brings a lawsuit or initiates legal action, while the defendant is the party who is being sued or accused of wrongdoing. Understanding these terms is essential when following a court case or legal proceedings. <h3>3. Liability</h3> Liability refers to the legal responsibility for one's actions or debts. In the context of personal injury cases, for example, a party may be held liable for damages if they are found to be at fault for causing harm to another person. <figure id="figure-253pvv1bkjlqj4ublv"><img id="253pvv1bkjlqj4ublv" src="https://images.unsplash.com/photo-1697650230789-165df5f7ccc8?crop=entropy&cs=tinysrgb&fit=max&fm=jpg&ixid=M3wyNjI5NjF8MHwxfHNlYXJjaHwxfHxsaWFiaWxpdHklMjBsYXd8ZW58MHx8fHwxNzAzNDAwNzc3fDA&ixlib=rb-4.0.3&q=80&w=1080" alt="liability law" class="object-cover bg-gray-100" style="aspect-ratio: 16/9"></figure> <h3>4. Due Process</h3> Due process is the principle that ensures fair treatment and protection of individual rights in legal proceedings. It guarantees that individuals have the right to be heard, present evidence, and receive a fair and impartial trial. <h3>5. Pro Bono</h3> Pro bono is a Latin term that means "for the public good." In the legal context, it refers to legal services provided by lawyers for free or at a significantly reduced cost to individuals who cannot afford legal representation. <figure id="figure-f08n2heruslqj4ublv"><img id="f08n2heruslqj4ublv" src="https://images.unsplash.com/photo-1507679799987-c73779587ccf?crop=entropy&cs=tinysrgb&fit=max&fm=jpg&ixid=M3wyNjI5NjF8MHwxfHNlYXJjaHwxfHxwcm8lMjBib25vJTIwbGF3eWVyfGVufDB8fHx8MTcwMzQwMDc3N3ww&ixlib=rb-4.0.3&q=80&w=1080" alt="pro bono lawyer" class="object-cover bg-gray-100" style="aspect-ratio: 16/9"></figure> Understanding these common legal terms can help demystify the legal process and empower individuals to navigate legal matters with greater confidence and knowledge.</body>

5 common legal terms explained

man sitting on black leather bench holding gray laptop computer on top of white wooden table

<h2>Introduction</h2>When starting a business, one of the first decisions you need to make is choosing the right business entity. The type of entity you select will have legal, financial, and operational implications for your business. Understanding the different types of business entities is crucial to making an informed decision. In this guide, we will walk you through the various types of business entities and their key characteristics.<h2>Sole Proprietorship</h2>A sole proprietorship is the simplest form of business entity. It is owned and operated by a single individual. In this structure, the owner has complete control over the business and is personally liable for all debts and obligations. While it offers simplicity and flexibility, it also carries the risk of unlimited personal liability.<figure id="figure-pjfldx6hwglqlr6a3f"><img id="pjfldx6hwglqlr6a3f" src="https://images.unsplash.com/photo-1434030216411-0b793f4b4173?crop=entropy&amp;cs=tinysrgb&amp;fit=max&amp;fm=jpg&amp;ixid=M3wyNjI5NjF8MHwxfHNlYXJjaHwzfHxzb2xlJTIwcHJvcHJpZXRvcnNoaXAlMjBidXNpbmVzc3xlbnwwfHx8fDE3MDM1NTkyMTh8MA&amp;ixlib=rb-4.0.3&amp;q=80&amp;w=1080" alt="sole proprietorship business" class="object-cover bg-gray-100 rounded-sm md:rounded-md lg:rounded-lg" style="aspect-ratio: 16/9;" data-mce-src="https://images.unsplash.com/photo-1434030216411-0b793f4b4173?crop=entropy&amp;cs=tinysrgb&amp;fit=max&amp;fm=jpg&amp;ixid=M3wyNjI5NjF8MHwxfHNlYXJjaHwzfHxzb2xlJTIwcHJvcHJpZXRvcnNoaXAlMjBidXNpbmVzc3xlbnwwfHx8fDE3MDM1NTkyMTh8MA&amp;ixlib=rb-4.0.3&amp;q=80&amp;w=1080" data-mce-style="aspect-ratio: 16/9;"></figure><h2>Partnership</h2>A partnership is a business structure owned by two or more individuals who share the profits and losses. There are two main types of partnerships: general partnerships and limited partnerships. In a general partnership, all partners have equal responsibility and liability. In a limited partnership, there are general partners who manage the business and limited partners who invest but have limited liability. Partnerships are generally discouraged by attorneys as they normally do not legally protect the assets of the individuals involved in the partnership.&nbsp;<figure id="figure-8440hritqblqlr6apt"><img id="8440hritqblqlr6apt" src="https://images.unsplash.com/39/lIZrwvbeRuuzqOoWJUEn_Photoaday_CSD%20%281%20of%201%29-5.jpg?crop=entropy&amp;cs=tinysrgb&amp;fit=max&amp;fm=jpg&amp;ixid=M3wyNjI5NjF8MHwxfHNlYXJjaHw3fHxwYXJ0bmVyc2hpcCUyMGJ1c2luZXNzfGVufDB8fHx8MTcwMzU1OTIxOXww&amp;ixlib=rb-4.0.3&amp;q=80&amp;w=1080" alt="partnership business" class="object-cover bg-gray-100 rounded-sm md:rounded-md lg:rounded-lg" style="aspect-ratio: 16/9;" data-mce-src="https://images.unsplash.com/39/lIZrwvbeRuuzqOoWJUEn_Photoaday_CSD%20%281%20of%201%29-5.jpg?crop=entropy&amp;cs=tinysrgb&amp;fit=max&amp;fm=jpg&amp;ixid=M3wyNjI5NjF8MHwxfHNlYXJjaHw3fHxwYXJ0bmVyc2hpcCUyMGJ1c2luZXNzfGVufDB8fHx8MTcwMzU1OTIxOXww&amp;ixlib=rb-4.0.3&amp;q=80&amp;w=1080" data-mce-style="aspect-ratio: 16/9;"></figure><h2>Limited Liability Company (LLC)</h2>A limited liability company (LLC) is a hybrid business entity that combines the benefits of a corporation and a partnership. It provides limited liability protection to its owners (known as members) while offering flexibility in management and taxation. An LLC can have one or more members, and its structure can be customized to suit the needs of the business. To maximize asset protectection, an Anonymous LLC may be created<figure id="figure-7v14pelqslqlr6ba4"><img id="7v14pelqslqlr6ba4" src="https://images.unsplash.com/photo-1556761175-4b46a572b786?crop=entropy&amp;cs=tinysrgb&amp;fit=max&amp;fm=jpg&amp;ixid=M3wyNjI5NjF8MHwxfHNlYXJjaHw0fHxsaW1pdGVkJTIwbGlhYmlsaXR5JTIwY29tcGFueXxlbnwwfHx8fDE3MDM1NTkyMjB8MA&amp;ixlib=rb-4.0.3&amp;q=80&amp;w=1080" alt="limited liability company" class="object-cover bg-gray-100 rounded-sm md:rounded-md lg:rounded-lg" style="aspect-ratio: 16/9;" data-mce-src="https://images.unsplash.com/photo-1556761175-4b46a572b786?crop=entropy&amp;cs=tinysrgb&amp;fit=max&amp;fm=jpg&amp;ixid=M3wyNjI5NjF8MHwxfHNlYXJjaHw0fHxsaW1pdGVkJTIwbGlhYmlsaXR5JTIwY29tcGFueXxlbnwwfHx8fDE3MDM1NTkyMjB8MA&amp;ixlib=rb-4.0.3&amp;q=80&amp;w=1080" data-mce-style="aspect-ratio: 16/9;"></figure><h2>Corporation</h2>A corporation is a separate legal entity from its owners, known as shareholders. It offers the highest level of liability protection, as the shareholders' personal assets are generally not at risk. Corporations have a more complex structure and are subject to more regulations and formalities. They can issue stock and raise capital through investors. Corporations, like all companies, should be cognizant of state and federal securities regulations.&nbsp;<figure id="figure-fnvmcpnct9lqlr6bz7"><img id="fnvmcpnct9lqlr6bz7" src="https://images.unsplash.com/photo-1654657225097-612b49b33b20?crop=entropy&amp;cs=tinysrgb&amp;fit=max&amp;fm=jpg&amp;ixid=M3wyNjI5NjF8MHwxfHNlYXJjaHwxN3x8Y29ycG9yYXRpb24lMjBidXNpbmVzc3xlbnwwfHx8fDE3MDM1NTkyMjF8MA&amp;ixlib=rb-4.0.3&amp;q=80&amp;w=1080" alt="a man walking down a sidewalk next to a tall building" class="object-cover bg-gray-100 rounded-sm md:rounded-md lg:rounded-lg" style="aspect-ratio: 16/9; object-position: center center;" data-corners="default" data-aspect="16:9" data-caption="" data-positionx="null" data-positiony="null" data-mce-src="https://images.unsplash.com/photo-1654657225097-612b49b33b20?crop=entropy&amp;cs=tinysrgb&amp;fit=max&amp;fm=jpg&amp;ixid=M3wyNjI5NjF8MHwxfHNlYXJjaHwxN3x8Y29ycG9yYXRpb24lMjBidXNpbmVzc3xlbnwwfHx8fDE3MDM1NTkyMjF8MA&amp;ixlib=rb-4.0.3&amp;q=80&amp;w=1080" data-mce-style="aspect-ratio: 16/9; object-position: center center;"></figure><h2>Nonprofit Organization</h2>A nonprofit organization is a type of entity that operates for charitable, educational, religious, or scientific purposes. It is exempt from paying taxes on its income and donations. Nonprofits are governed by a board of directors and must comply with specific regulations to maintain their nonprofit status.<figure id="figure-j2gb7niheelqlr6cnq"><img id="j2gb7niheelqlr6cnq" src="https://images.unsplash.com/photo-1511721285502-9f81e79be874?crop=entropy&amp;cs=tinysrgb&amp;fit=max&amp;fm=jpg&amp;ixid=M3wyNjI5NjF8MHwxfHNlYXJjaHwyNnx8bm9ucHJvZml0JTIwb3JnYW5pemF0aW9ufGVufDB8fHx8MTcwMzU1OTIyMnww&amp;ixlib=rb-4.0.3&amp;q=80&amp;w=1080" alt="nonprofit organization" class="object-cover bg-gray-100 rounded-sm md:rounded-md lg:rounded-lg" style="aspect-ratio: 16/9;" data-mce-src="https://images.unsplash.com/photo-1511721285502-9f81e79be874?crop=entropy&amp;cs=tinysrgb&amp;fit=max&amp;fm=jpg&amp;ixid=M3wyNjI5NjF8MHwxfHNlYXJjaHwyNnx8bm9ucHJvZml0JTIwb3JnYW5pemF0aW9ufGVufDB8fHx8MTcwMzU1OTIyMnww&amp;ixlib=rb-4.0.3&amp;q=80&amp;w=1080" data-mce-style="aspect-ratio: 16/9;"></figure><h2>Choosing the Right Business Entity</h2>When deciding which business entity is best for your venture, consider factors such as liability protection, taxation, management structure, and long-term goals. It is recommended to consult with a legal and tax professional to understand the specific implications for your business.Choosing the right business entity is a critical step in setting up your business for success. Each type of entity has its advantages and disadvantages, so it's important to weigh them against your specific needs and circumstances. By understanding the different types of business entities, you can make an informed decision that aligns with your goals and protects your interests.

A Guide to Understanding Different Types of Business Entities.

Shifting Career Paths: From Employee to Self-Employed
In recent years, particularly following pandemic-driven economic upheavals, many American workers are transitioning from traditional employment to self-employment. This shift is often driven by the desire to gain more control over one's career. For many, what begins as a side hustle evolves into a full-time venture. Unbeknownst to some, this journey often leads to operating a sole proprietorship. It's crucial for individuals on this entrepreneurial path to grasp the advantages and challenges of a sole proprietorship.<figure id="figure-pwkitebwflqtn1ynk"><img id="pwkitebwflqtn1ynk" src="https://cdn.durable.co/blocks/2bFktF1oSvaO4wyhVO7MLdx8uU3Cq6K1SMJccgcTLtXfXrnWw7RrB5udK6KJtXKA.png" alt="A woman sitting at her desk at home, deeply engrossed in work, surrounded by notes and a laptop" class="object-cover bg-gray-100 rounded-sm md:rounded-md lg:rounded-lg" style="aspect-ratio: 16/9; object-position: center center;" data-corners="default" data-aspect="16:9" data-caption="" data-positionx="undefined" data-positiony="undefined" data-mce-src="https://cdn.durable.co/blocks/2bFktF1oSvaO4wyhVO7MLdx8uU3Cq6K1SMJccgcTLtXfXrnWw7RrB5udK6KJtXKA.png" data-mce-style="aspect-ratio: 16/9; object-position: center center;"></figure>Evolving Employment Perceptions and the Rise of Self-Employment
Historically, a full-time job was the cornerstone of a successful career. However, this perception has drastically shifted, especially among younger workers who experienced job insecurity during the Great Recession and the COVID-19 pandemic. These events disrupted traditional career trajectories and fueled the rise in self-employment. In the post-pandemicera, this trend isn't limited to those who lost jobs; many willingly have embraced self-employment during the "Great Resignation." Today, self-employed Americans constitute a significant portion of the workforce, and this trend is expected to continue growing. Self-employment is not limited to low-skilled jobs like ridesharing or delivery services. Increasingly, highly educated and skilled professionals are opting for freelance and contractual work.Sole Proprietorship Defined
A sole proprietorship is a default business structure for many self-employed individuals. Unlike corporations, LLCs, or partnerships, which may require formal state filings, a sole proprietorship is often less formal. It's recognized by the IRS when an individual operates a business under their name without registering as another entity. Sole proprietors may need specific licenses and can operate under a DBA (Doing Business As) name. However, the legal and financial identity of the business and the individual remains the same.Benefits of a Sole Proprietorship
The simplicity and low startup costs of a sole proprietorship are its key advantages. Taxes are straightforward, as profits and losses are reported on the owner's personal tax return. Sole proprietors also enjoy certain tax deductions and complete control over their business decisions. They are their own boss. Transitioning to self-employment and running a sole proprietorship involves various considerations like registering a DBA, obtaining necessary permits, setting up a business bank account, and ensuring compliance with IRS regulations. While a sole proprietorship suits certain types of businesses initially, growth and expansion may necessitate transitioning to a corporation or LLC.<figure id="figure-blsirs5f6lqtn35v5"><img id="blsirs5f6lqtn35v5" src="https://cdn.durable.co/blocks/2a7qLhC9ac134HK0raVcXtOYL1gFNwHnkTsmiR8MP3wKTOxHfIVj0P0SaBQLkFks.png" alt="A worried business owner looking at financial documents" class="object-cover bg-gray-100 rounded-sm md:rounded-md lg:rounded-lg" style="aspect-ratio: 16/9; object-position: undefined undefined;" data-corners="default" data-aspect="16:9" data-caption="" data-positionx="undefined" data-positiony="undefined" data-mce-src="https://cdn.durable.co/blocks/2a7qLhC9ac134HK0raVcXtOYL1gFNwHnkTsmiR8MP3wKTOxHfIVj0P0SaBQLkFks.png" data-mce-style="aspect-ratio: 16/9; object-position: undefined undefined;"></figure>Challenges of a Sole Proprietorship
Despite its benefits, a sole proprietorship poses significant risks, legal and otherwise. The sole proprietor bears full responsibility for all debts and legal issues. Personal assets are extremely vulnerable in case of business liabilities. Additionally, raising capital can be challenging, which may hinder business growth. The business structure also involves paying self-employment tax, which is higher than typical employee taxes.Seeking Professional Guidance
For those considering or currently operating a sole proprietorship, consulting with business attorneys can provide valuable insights into the suitability of this structure, its benefits and limitations, and guidance on starting and growing as a small business owner. <a data-mce-href="https://landofenchantmentlaw.com/contact" href="https://landofenchantmentlaw.com/contact">Professional advice can help navigate the complexities of self-employment and business ownership. Contact me here or call 505.585.1235 to speak with attorney Johnn Osborn at Land of Enchantment Law.</a><figure id="figure-jov29r9efklqtmpixt"><img id="jov29r9efklqtmpixt" src="https://cdn.durable.co/blocks/aLdGRMmejcqS0peZcjFZS88f8HjWmkPDxU41DVZ1bdmOJd2fAXZ7zdhqUr69PxiZ.png" alt="Land of Enchantment Law - The Law Office of Johnn Osborn, P.C." class="object-cover bg-gray-100 rounded-sm md:rounded-md lg:rounded-lg" style="aspect-ratio: 16/9; object-position: center center;" data-corners="default" data-aspect="16:9" data-caption="Land of Enchantment Law - The Law Office of Johnn Osborn, P.C." data-positionx="null" data-positiony="null" data-mce-src="https://cdn.durable.co/blocks/aLdGRMmejcqS0peZcjFZS88f8HjWmkPDxU41DVZ1bdmOJd2fAXZ7zdhqUr69PxiZ.png" data-mce-style="aspect-ratio: 16/9; object-position: center center;"><figcaption class="body-normal text-gray-500 mt-2">Land of Enchantment Law - The Law Office of Johnn Osborn, P.C.</figcaption></figure>

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