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Old 03-24-2012, 10:13 AM
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C-Corp Business Restructuring

I have a few questions on business structure. I am going to try and make this as simple as possible although it may end up being a little confusing.

I have a business that was incorporated in 10/2006 and under this Corporation I have a DBA that I operated under until 2008. In 2008 I shortened the name of the DBA to the first letter of each word of name of the DBA but I never filled a DBA with the state or county. All of my taxes such as corporate federal taxes, state unemployment, EIN taxes, state corporation tax, and sales & use tax have been filled under the corporation never using the DBA. Under the corporate name I have a business checking account. I deposit income from the DBA (service business) from clients to the corporate checking account. The DBA name, and the shorten version of the DBA and the corporate name is written on checks for deposits. Of course the bank always accepts the deposits.

My situation now is that I have two other businesses I am starting. One required a federal license that I filled and obtained under the corporate name with a new DBA. The second business I have not filled any DBA for as of yet. Neither of these last two businesses has started having any income yet as they are just starting.

I want to or would like to separate these businesses in hopes of simplifying things. The first business has been very slow with little income and is a service business. The second business will carry some inventory and is a retail business starting operations on the internet and eventually a brick and mortar location. The third business will be strictly internet retail and very unlikely ever carry any inventory.

The second business has to keep the corporate name and its newly filled DBA because of the federal license. This second business along with the third business will have much higher sales than the first business. As the first business is going to be scaled back once the other two are producing income to very occasional sales/ income.

How should I structure these three businesses keeping in mind the second business must remain with/ under the corporate name? I would like to keep some sort of protection with the third business the corporation provides but am not worried about the first business in this aspect.

Note I am the sole stock holder (100%) and the only board member of the corporation.

This is one possible example I was thinking of but not sure this is the best way to go.

Abandon the first businesses DBA under the corporation. Then file another DBA with the shortened name of this DBA as a sole proprietorship and accept income payments/ deposits in my personal checking account. Maybe create an LLC for the third business that the corporation owns with a new checking account. Then separate books for each. The proprietorship taxes will be simple, just filling with my 1040. The corporate taxes of the second will remain the same but us a DBA as well as the corporate name. Then a question comes in of how would the third business file its taxes, as an owned entity of the corporation? Would the third business need a separate EIN from the corporation? Would this even be the best way to do all of this?

The major reasons for all of this restructuring, is to simplify taxes and bookkeeping for all businesses (if even possible). I use QuickBooks for bookkeeping and file all of my own taxes using turbo tax for business and then personal with turbo tax basic.

Anyone have any suggestions or could answer my questions would be greatly appreciated?

Thank you,
Robert



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