A Texas professional association is a person or group of people, all of whom are required by law to be licensed in their profession (normally in the medical field for a Texas PA) or to acquire other legal authorization, incorporated for the purpose of rendering the same professional service to the public.
Those who are allowed to form professional associations may receive several tax benefits over operating as a sole proprietorship or partnership while at the same time avoid filing a Schedule C with their own IRS form 1040. Expenses that most businesses incur or needlessly avoid because of cost can create huge benefits and tax deductions.
Take for example, the escalating cost of health care which makes it necessary for people to carry health insurance. Sole proprietorships and partnerships currently may deduct only a portion of the health insurance costs from their taxes, which can be excessive to many or prevent obtaining insurance coverage. However, a professional association is able to fully deduct the cost of accident and health insurance plans for its employees and their families. This deduction may allow the cost of reimbursing employees for their uninsured medical expenses. Furthermore, a professional association may be able to deduct the cost of life and disability insurance.
Additionally, the tax deductions for accident and health insurance may be realized by forming a professional association. Moreover, a professional association may deduct up to 80% of the dividends, which it receives from a domestic corporation that is subject to taxation. This differs from a self-employed professional who owns dividend-producing stock which must include the entire amount of dividends in their gross income. Lastly, upon the sale of stock in a professional association, the gain realized would be taxed at a maximum rate of 28%, whereas a self-employed professional could be taxed at a rate as high as 39.6% on the sale of their interest in such a business.
Appropriate use of a Professional Association.
State and Federal Tax law authorize the formation and maintenance of a Professional Association. Although a Professional will be personally liable for their own malpractice, the professional Association will shield the shareholder Professional from the malpractice of the employees, partners and other Professional shareholders, and from countless other general business activities that can occur in a profession. To benefit from the tax advantages as well as the limited liability of a Professional Association, it is vital that contracts, activities, and other details be appropriately tended to so the Professional Association will be treated as a separate entity.
Reimbursements. The appropriate use of a Professional Association will limit personal liability of a professional for reimbursements that may be insisted from carriers.
Protection for receivables. Your advisors can easily consult you with the methods to protect your receivables.
Employee liability. Consult your malpractice carrier concerning your employment agreements.
Notify your insurance carriers. Your insurance carriers should be notified that your Professional Association exists. Additionally, your DBA/Fictitious name should be registered with the state and respective county of business and also should be disclosed to your Insurance carriers.
Appropriate maintenance for a Professional Association. You must keep sound financial records, maintain corporate minutes, updated employment agreements, lease agreements, loan agreements and never forget to file your Annual Uniform Business Report with the state. Such maintenance will help keep the State happy and the IRS and creditors at bay.
Medical Reimbursement Plan
Hire your spouse and get fully deductible health benefits for yourself. A Small business can fully tax-deduct health insurance and doctor’s bills for a spouse who is working and on the payroll. The owner spouse can get medical benefits not as an owner, but as a spouse of the employee-spouse. The business deduction is 100%- not the 70% as for the self-employed. The fee for this is only $60 dollars.
Establishing Series "A & B" Preferred and Common Stock
If you are in need of a corporation with class A Preferred and Class B common stock we can establish the thorough stock certificates and statement of resolution to establish shares as you need in a legal manner; our 25 page statement will cover all issues in a precise manner, the fee begins at $375.00
FEMALE/MINORITY STATUS FILING (HISTORICALLY UNDERUSED BUSINESSES
Minority/Women owned businesses receive first tier referrals which means they are the first businesses referred to state agencies seeking to include supplier diversity as a part of their purchase order and contract opportunities; Loan mobilization programs assist state certified minority business enterprises in obtaining funding when starting a state-funded project. The loans made through participating banks are designed to enhance relationships between the banking community and CMWBEs. We can complete the documents for your minority registration and receive a state determination within 3-4 weeks for $700.00 plus any additional filing fees.
DUNN & BRADSTREET REGISTRATION NUMBER
The benefits of having a DUNS number are that you may list the number in the Dunn & Bradstreet database; after you are listed you may use the D&B as a credit reference; and you will be able to update your record anytime with D&B. We will acquire your DUNS number within 30 days for $135.00. Prospective vendors must be registered in CCR prior to the award of a contract: basic agreement, basic ordering agreement, or blanket-purchase agreement, unless the award results from a solicitation issued on or before May 31, 1998. Prime contractors are not required to have their subcontractors register in CCR. If a prime subcontractor wants to bid directly for contracts with the DOD, they should register in the CCR. We can acquire the CCR registration within 1-2 weeks for $135.00 dollars.
1244 stock (TAX TIP)
A Corporate Shareholder is normally allowed to write off only a capital loss of $3,000 dollars. However, the issuance of 1244 stock provides the Shareholder with a maximum ordinary loss of $50,000 (or $100,000 in the case of the husband and wife filing a joint return.) Take advantage of this special stock issuance plan complete with resolutions for only $50.00 dollars.
Independent Contract Agreement (ASSET PROTECTION TIP)
If you would like to hire a worker as an independent contractor (and file a 1099 for them) without the worry of the IRS coming after you because of the worker's failure to complete their own tax withholdings, then having an executed Independent Contractors Agreement is must. Additionally, if vicarious liability (being sued because of a worker's negligent actions) is of a concern, again an executed Independent Contractors Agreement is a necessary layer of protection. The cost for an independent contractor’s agreement is only $65.00 at the time of incorporating.
Sub-Chapter S Corporation Election (TAX TIPS)
The Sub-Chapter S Corporation allows the Shareholders to avoid having their profits taxed twice because there are no corporate taxes with a Sub-Chapter S Corporation. This type of Corporation also allows the owner to avoid the majority of his/her profits from being hit with a self employment tax. Lastly, the Shareholders of an S-Corporation are able to write off their losses on their personal taxes, even against separate income (money from other employment or a spouses’ income on a joint return.) If you want your business to have these major tax advantages the cost is only an additional $60.00. We will complete the Federal requirements and draft the Corporate articles, bylaws, resolutions and stock certificates to reflect the companies status as an S-Corporation.
Unemployment Tax Account Number and new Hire Report
If you are going to be paying a wage to yourself or other employees at the time you incorporate, state law requires you to have an Unemployment Tax ID so that you may comply with the state unemployment withholdings. You will use the Unemployment Tax ID to mail in your quarterly unemployment withholdings due to the state. We can help you acquire this number for $85.00 and there is a $30.00 fee to prepare 10 new hire reports.
Federal Tax ID Number
The Federal Tax ID Number is required to open a business account and to put your license into the corporate name. It is also necessary for those who need to get exempt from workers compensation insurance. The tax Id is only $35.00 and we will acquire the actual number for your convenience.
Security Agreement with a Loan Agreement
The flow of money is the grease that lubricates the wheels of commerce. Over the years important rights and protections have been developed to insure this flow continues. If you would like to loan money into your company other than that which you give in exchange for your stock, a loan agreement and promissory note is the proper way to do so. This works by having the loan agreement and promissory note signed between the corporation and Shareholder so the extra money is seen as a loan to be repaid. Additionally, a security agreement, when recorded acts as a buffer securing the loan agreement and promissory note against subsequent corporate creditors, thus keeping you first in line as the priority creditor to recover the loaned money. The fee for drafting the security agreement and helping with the state UCC filing is $150.00 plus any filing fees. The loan agreement and promissory note fee is an additional
Sales Tax ID Number
If you need to purchase products for resale you will need a Sales Tax ID Number. The Sales Tax ID allows you to purchase the products tax free prior to resale. We will acquire sales tax ID number for an additional $85.00
Shareholders Agreement (ASSET PROTECTION)
When a non-publicly traded corporation is formed, we strongly advise to have an agreement among the Shareholders as to how the corporation will be organized and operate. The Agreement issued is in addition to the By-laws of the corporation and should contain clauses concerning the Buying and selling of the company’s stock. It is a good idea that corporate governing procedures be establish and memorialized in a written Shareholders Agreement at the time of incorporating, because after the formation of the corporation matters may not be so easily agreed upon. Our Shareholders Agreement spells out the rights and obligations of the parties in the event disagreements come up. Even family corporations should consider a SHAREHOLDERS AGREEMENT, since it could settle some issues without the expense of litigation. Issues such as the rights of the shareholders to vote, rights of the directors, salaries, nominating officers and employees, buy-sell agreement concerning stock transfers of shares and endorsement rights. We will draft this agreement for only $65 at the time of incorporating.
Employment Agreement (ASSET PROTECTION)
The agreement will include the important parameters for new hired employees such as protecting your trade secrets and other intellectual property from being stolen as well a non-competition clause. Additionally, the beginning and ending dates of the employment period, the amount of the salary and time period it will cover, a description of duties and title for employee, agreed paid vacation days and severance pay. We will draft an agreement that entails all the above elements and more. This agreement is only $65.00 at the time of incorporation.
Indemnification Agreement (ASSET PROTECTION)
When you incorporate or organize your business you are protected as a Shareholder or Member (owner of a company); however, when you act as a director, officer or manager you have to understand there is no personal protection if you are sued. Therefore, it is strongly recommended to have us draft a contract between the corporation/LLC and the directors/officers for an important layer of protection agreed to by the company for its directors, officers and managers. The fee for this work is only $65.00 dollars at the time of incorporating. A contract will be drafted for all involved, the indemnification language will be also placed into your articles and the proper resolutions will be drafted.
Registered Agent Service/Attorney Counsel
The state of Texas requires a registered agent to be registered in your articles of incorporation so that a sheriff may serve legal papers in conjunction with a prospective law suit. We can help with your registered agent services for $165.00 for 12 months and for an additional $88.00 we can act as your general counsel for 12 months so that you may call or email with your legal business questions; we will also complete your annual minutes.
Speed of service
We normally get you your documents in about 7 TO 9 days If you need your corporation completed quicker we have a same day incorporation for an additional $175.00 dollars and if you need to be incorporated next day it will cost an additional $120.00 dollars and $65.00 for 3 days.
If you would like to have a secondary name to advertise your corporation under, it is required to have what is called a DBA or fictitious name registered correctly with the state of Texas under your corporation. We will register the fictitious name and complete the required resolutions for only $135.00 (7-8 day completion time) after receiving the registered fictitious name from us you can then complete a second registration at the county level where you are conducting business. We can expedite the process and have the work completed same day for an additional 175.00 1 day for $120.00 or 3 days for $65.00
If you want your corporate name to be protected from others using it, a Trademark is a must. We can have your name Trademarked for $795.00 dollars, $499.00 extra for a logo and additionally we will perform the crucial due diligence (Trademark name searches) at the Federal and most importantly at the Common Law level for $499.00 dollars and continue to monitor and keep up the formalities for $850.00 a year. The Search normally takes about two weeks, however the process can be expedited to Same Day completion for an additional $225.00, 2 day service for $150.00 additional and 4 day service for $75.00 dollars additional. With regards to the Trademark registration, normally 10 full months are necessary for the Federal Government to determine if the name will be awarded a Trademark.
A copyright gives the owner of a creative work the right to keep others from using the work without the owner's permission. Copyright protection may be applied for with regards to all original expressions, including art, sculpture, music, songs, choreography, crafts, poetry, flow charts, software, photography, movies, CD-ROMS, video games, videos, web sited and graphic designs. Copyright lasts for many years. Most often it lasts for the life of the work's creator (its author) plus 70 years. In cases where the creator is a business, the copyright lasts between 95 and 120 years. We will register your Copyright for $399.00. We can also get your immediate confirmation evidence for an additional 600.00.
Home Office Lease (TAX TIP)
If you would like to take valuable deductions from the use of your home office you must have a lease agreement since real estate is involved. We can draft a home office lease for just $70.00 dollars at the time of incorporating.
Vehicle Lease (TAX TIP)
Do you use your vehicle for business purposes, if so a vehicle lease agreement is a tremendous tax break that you must not pass up. We can draft a vehicle lease for only $70.00 dollars at the time of incorporating.
Business Equipment Lease (ASSET PROTECTION TIP)
Do you have office equipment, construction equipment or other expensive equipment that you would like to protect from a law suit and yet still receive a valuable tax write off. If so have us draft a standard Equipment Lease for only $135.00 dollars at the time of incorporating.