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Ellen
Ellen, Attorney
Category: Business Law
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3. Owen plans to open Owens Pet Store, a pet supplies outlet,

Resolved Question:

3.     Owen plans to open Owen’s Pet Store, a pet supplies outlet, and to hire Quinn and Ruth. Owen will invest only his own money. He does not expect to make any profit for at least two years and to make almost no profit for the first three years, but he hopes to expand eventually. Which form of business organization would be most appropriate for Owen?
Submitted: 8 years ago.
Category: Business Law
Expert:  Ellen replied 8 years ago.

Hello,


Thank you for your question. I am happy to assist you.


A sub-chapter S corporation would be appropriate.


A sub-chapter 7 would have the following advantages:

1. Flow through of current losses allowing Owen to deduct the business's losses in the first years;

2. Flow through of future gains allowing Owen to avoid double taxation in the later years; and

3. Corporate shield protects Owen from personal liability

I hope that the information which I provided was helpful to you.


Best wishes for a successful outcome. If you have additional questions, please do not hesitate to submit them to me directly.


Thank you,
FLAandNYLAWYER


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