Tax issues come up frequently for corporations, and small businesses, midsize businesses, and large businesses alike and there are important aspects of tax planning that a good corporate lawyer can assist you with.
One of the most important pieces is choice of entity, which means what kind of an entity is my business going to be if I’m in a start-up, if I’m starting a new business or purchasing a business. A corporate attorney who deals with tax issues can help a company understand the tax implications of having a regular corporation, which is called a C Corporation, which may be subject to taxation itself as well as taxation of income, or distribution to members or to shareholders. LLCs, limited liabilities companies, which may in some situations, provide more advantageous tax ramifications for smaller companies. There is also what’s called an S Corporation, which is a corporation which chooses to be taxed either as an LLC or a partnership. It’s important to talk to a good attorney who is involved in tax planning and understands the issues with the IRS code in the state.
Other issues that can come up on a regular basis for corporations involve property taxes for a property that is owned by a company. This can also involve sales, and use taxes, which are generally imposed by the state and by municipalities on the sale of goods as well as the actual use and consumption and storage of things such as lumber for a construction company, or your computer systems, or any kind of equipment that a business may own. Those tax issues can become complicated because in Colorado they’re dealt with both at the state level by the State Department of Revenue, but then, depending on what municipality you’re in there are very different laws and very different rules dealing with sales taxes and use taxes.
Again, it’s important if you have an issue or if you’re not sure that you’re handling your sales or use taxes properly within a jurisdiction, and perhaps you do business all over the metro area. It’s really important to consult with somebody who understands them.
