BMG Core Services

TAX PLANNING

Tax planning is the process of organizing your financial affairs in such a way as to minimize your tax liability. It involves analyzing your financial situation from a tax perspective and making strategic decisions to take advantage of tax laws and regulations. Here’s a detailed description of tax planning:

Understanding Tax Laws: Tax planning starts with a thorough understanding of the tax laws and regulations that apply to individuals, businesses, investments, and other financial activities. This includes income taxes, capital gains taxes, estate taxes, and any other relevant taxes.

Strategic Decision-Making: Based on your understanding of the tax laws, you can make informed decisions about how to structure your income, investments, expenses, and other financial transactions. This might involve timing income and expenses, choosing between different investment options with varying tax implications, and utilizing tax-advantaged accounts or deductions.

AUDIT ASSITSANCE

IRS audit assistance refers to the support provided to our clients in the unlikely occurrence of an IRS audit. IRS audit assistance consists of the following steps:

Documentation Preparation

BMG will assist with document preparation which may include tax returns, financial statements, transaction records, invoices, contracts, and any other relevant paperwork. Audit assistance involves organizing and preparing these documents in a clear and accessible manner to facilitate the audit process.

Communication with IRS Auditors

Audit assistance also includes acting as a liaison between the IRS and the individual or company. This involves scheduling meetings, facilitating discussions, and ensuring that auditors have access to all necessary resources and personnel.

Compliance and Accuracy

The primary goal of IRS audit assistance is to ensure that the audit is conducted smoothly and efficiently. This requires compliance with auditing standards and regulations and ensuring the accuracy and completeness of the information provided to auditors.

Problem Resolution

During the audit process, auditors may identify issues or discrepancies that need clarification or resolution. IRS Audit assistance involves working closely with auditors to address these issues promptly and effectively.

Audit Trail Documentation

It’s crucial to maintain a clear audit trail documenting all communications, decisions, and actions taken during the audit process. Audit assistance includes documenting these activities to provide a comprehensive record of the audit process.

Overall, IRS audit assistance plays a critical role in facilitating a transparent and efficient audit process, ensuring that auditors have the necessary resources and support to perform their evaluations thoroughly and accurately.

CORPORATE STRUCTURING

Corporate structuring refers to the process of organizing a company’s legal and operational framework in a manner that optimizes efficiency, minimizes risk, and aligns with strategic objectives. It involves designing the hierarchy, ownership, governance, and operational processes of a corporation to achieve its goals effectively. Here’s a detailed description of corporate structuring:

Legal Entity Selection:

One of the initial steps in corporate structuring is choosing the appropriate legal entity for the business, such as a corporation, limited liability company (LLC), partnership, or sole proprietorship. This decision impacts taxation, liability, ownership structure, and regulatory compliance.

Ownership and Governance

Corporate structuring involves defining the ownership structure of the company, including the distribution of shares or ownership interests among shareholders, partners, or members. It also establishes governance mechanisms, such as the roles and responsibilities of directors, officers, and managers, as well as the decision-making processes within the organization.

Capital Structure

Determining the capital structure involves deciding how the company will finance its operations and growth. This includes issues such as equity financing (issuing shares or membership interests) and debt financing (taking loans or issuing bonds), as well as managing the balance between debt and equity to optimize financial leverage and minimize risks.

Tax Planning

Corporate structuring includes tax planning strategies to minimize tax liabilities while complying with tax laws and regulations. This may involve choosing jurisdictions with favorable tax treatment, utilizing tax incentives, structuring transactions efficiently, and optimizing deductions and credits.

Asset Protection and Liability Management

Structuring aims to protect the company’s assets and limit the liability of owners and shareholders. This may involve segregating assets, implementing legal safeguards, and choosing entity types that offer limited liability protection, such as corporations and LLCs.

Compliance and Regulatory Requirements

Structuring ensures that the company complies with legal and regulatory requirements applicable to its industry and jurisdiction. This includes filing necessary documents, obtaining licenses and permits, adhering to corporate governance standards, and fulfilling reporting obligations to regulatory authorities.

In summary, corporate structuring is a comprehensive process that involves designing the legal, financial, operational, and governance framework of a company to achieve organizational objectives effectively while mitigating risks and ensuring compliance with regulatory requirements. It plays a crucial role in establishing a solid foundation for business operations and growth.

CORPORATE FORMATION

Corporate formation refers to the process of legally establishing a corporation as a separate legal entity distinct from its owners (shareholders). This process involves several steps and considerations to ensure compliance with legal requirements and to set the foundation for the corporation’s operations and governance. Here’s a detailed description of corporate formation:

Choose a Business Name

The first step in corporate formation is selecting a unique and distinguishable name for the corporation. The name should comply with state regulations and typically must include a corporate suffix such as “Inc.” or “Corp.”

Determine Jurisdiction

Corporations are formed under state law, so the next step is to choose the state of incorporation. This decision is often based on factors such as tax implications, regulatory requirements, and operational considerations.

Draft Articles of Incorporation

The Articles of Incorporation (also known as Certificate of Incorporation or Charter) are legal documents filed with the state’s Secretary of State. These documents outline essential details about the corporation, including its name, purpose, registered agent, authorized shares of stock, and initial directors.

Appoint Directors and Officers

The corporation must appoint initial directors who oversee the company’s affairs until the first shareholder meeting. Officers (such as President, Secretary, and Treasurer) may also be appointed to manage day-to-day operations.

File Articles of Incorporation

Once the Articles of Incorporation are drafted and signed by the incorporators (those initiating the formation), they are filed with the appropriate state authority (usually the Secretary of State’s office). Filing typically requires paying a fee.

Issue Stock Certificates

Corporations issue stock to shareholders as evidence of ownership. The initial shareholders receive stock certificates indicating their ownership percentage in the corporation.

Draft Bylaws

Bylaws are internal rules and procedures that govern the corporation’s operations and management. They typically cover matters such as shareholder meetings, director duties, officer roles, voting procedures, and other governance issues.

Hold Organizational Meeting

After the Articles of Incorporation are filed, an organizational meeting of the board of directors and shareholders is held. During this meeting, bylaws are adopted, officers are appointed, and other initial organizational matters are addressed.

Obtain Necessary Licenses and Permits

Depending on the nature of the corporation’s business and location, it may need to obtain licenses, permits, or registrations at the federal, state, or local level to operate legally.

Comply with Ongoing Requirements

After formation, corporations must comply with ongoing requirements, such as filing annual reports, holding shareholder meetings, maintaining corporate records, and complying with tax obligations.

Corporate formation establishes the legal framework for the corporation, providing it with legal personality and limited liability protection for its shareholders. This process is crucial for businesses looking to operate as separate entities, attract investment, and conduct business in compliance with regulatory requirements.

FINANCIAL STATEMENT PREPARATION

Financial statement preparation is the process of compiling and presenting financial information of an organization in a structured format that reflects its financial performance and position. These statements are essential for internal management, stakeholders, investors, and regulatory bodies to assess the financial health and stability of the entity. Typically, the following documents are included in financial statement packages:

• Income Statement (Profit and Loss Statement)

• Balance Sheet

• Statement of Cash Flows

• Footnotes and Disclosures