Financial Resources

What considerations should you consider when deciding the best structure for you?

• Legal liability. To what extent do you as owner want to be shielded from liability?
• Tax implications. Which business structure offers the best tax minimization?
• Cost of formation and ongoing record keeping.
• Future needs. Will you need financing? Do you want to create a new credit record for your business?

Understanding the key advantages and disadvantages of an LLC compared to a sole proprietor will help you to make the best decisions.

• No annual paperwork.
• No annual state filing.
• Quick and inexpensive to form.
• All profits/losses are passed through to the owner’s personal tax return and you are only responsible for paying personal federal, state, local and Federal Insurance Contributions Act (FICA) taxes. You are not required to pay any specific business taxes or unemployment taxes.
• You enjoy tax benefits of being self-employed.

• Sole proprietor uses your social security number and this means your credit is not separate from your business credit. This can make it difficult to obtain funding and to build business credit.

• There’s no liability protection against commercial debts, law suits and obligations of the business.
• Legally a sole proprietor can hire employees by obtaining an EIN, however in doing so you may put yourself at risk.  If you face legal issues related to an employee, you could be putting your personal assets at risk if you operate as a sole proprietor.

• A member’s liability is limited to the amount of their investment in the LLC. A member cannot be held personally liable for the debts or obligations of the LLC. You can have a single member or multiple members.
• Forming an LLC separates your personal assets from lawsuits and creditors. When you form an LLC, you are creating a business entity separate from yourself.
• You have a higher degree of market credibility with an LLC compared to a sole proprietor.
• Because your LLC has a separate and distinct Employee Identification Number (EIN) you can build business credit much easier and establish your business with a separate credit score.
• You still enjoy all the tax benefits of being self-employed.

• Increased paperwork compared to a sole proprietor including any industry specific licensing.
• Annual state filings required
• Additional taxes such as a state business tax or unemployment taxes
• Costs for forming and completing a tax return for an LLC are higher than those of forming a sole proprietor.

If you are an entrepreneur looking to start a new business this is an exciting time for you.  Knowing the proper way to legally form your business will be an important first step. The Duquesne University SBDC has knowledgeable consultants at no charge, who can assist you with your business planning needs. This includes assistance in legally forming and structuring your business. Call us today for an initial consultation.

Minority Business Development Agency – part of the U.S. Department of Commerce, specifically created to encourage the creation, growth, and expansion of minority- owned businesses in the United States.

8(a) Business Development program – program to help provide a level playing field for small businesses owned by socially and economically disadvantaged people or entities

Office of Indian Energy and Economic Development – government agency focused on helping Indian communities gain economic self-sufficiency through the development of their energy and mineral resources, application of established business practices, and co-sponsorship of innovative training programs

Latin Business Association – provides resources to promote the growth of the Latino business community

Minority Enterprise Development Corp. – a partnership of public, private and nonprofit agencies supporting minority business leaders

The National Black Chamber of Commerce – representing 95,000 Black-owned businesses and 190 affiliates in the United States and internationally

The National Minority Business Council, Inc. – provides business assistance, educational opportunities, seminars, purchasing listings and related services to

National Minority Supplier Development Council – advances business opportunities for certified minority business enterprises and connects them to corporate members

U.S. Pan Asian American Chamber of Commerce – organization representing Pan Asian American and their related groups in business, sciences, the arts, sports, education, public and community services

U.S. Black Chambers, Inc. – provides advocacy, access to capital, contracting opportunities, training and development

U.S. Hispanic Chamber of Commerce – provides business partnerships, through dialogue, networking, workshops, and more for Hispanic Owned businesses

ACCION – microfinance organization that supports Hispanic businesses, among other minority-owned businesses, through micro-loans of up to $50,000 and financial education

Grants and Loans – business consulting, procurement matching and financial assistance to minority-owned firms

First Nations Development Institute Grants – improves economic conditions for Native Americans through direct financial grants, technical assistance & training, and advocacy & policy

Minority-Owned Businesses – what you need know to get certified and take advantage of the grants, loans, and government programs specifically designed to help minority- owned businesses

SBA’s grant programs generally support non-profit organizations, intermediary lending institutions, and state and local governments in an effort to expand and enhance small business technical and financial assistance. Other federal grant programs generally support non-profit organizations, and state and local governments and are not given directly to small businesses. A list of Federal Grant programs can be found on SBA’s web site at: SBA Federal Grant Resources.

Unfortunately, some unscrupulous operators sell manuals, workshops and other materials on how to obtain “free money.” To find out how to avoid these scams, see the Federal Trade

Commission’s article about wealth building scams.

Black Enterprise – business news, educational tools, and minority business trends

Making It TV – information pertaining to minority enterprises

Minority Business Entrepreneur – serves as a forum for minority and women business owners, corporations and government agencies concerned with minority and women business enterprise development

Operation Hope Small-Business Empowerment Program – intensive course, anchored by entrepreneurship training, allows participants to master business basics and gain access to funding to support a strong launch and the ongoing growth of their businesses

Hispanic Network – a Latino business & employment magazine

Latin Biz Today – resources on starting and growing a business directed at Hispanic business owners

The Asian Entrepreneur –digital publication and information exchange with content from Asian entrepreneur in the U.S. and Asia

Native Business – promoting and advancing Native American business, entrepreneurship and economic development

Already in business or thinking about starting your own small business? Check out our various small business resources:

• View more small business help topics here: Small Business Information Center
• View business reports here: Small Business Snapshots
• View industry-specific research here: Market Research Links

Remember, you can also receive free professional business advice and free or low-cost business training from your local Small Business Development Center!

Photo credit: Photo by Christina Morillo on Pexels.

Women and Small Business – resources, programs and guides dedicated to helping women entrepreneurs from the SBA

Women-Owned Small Business Federal Contracting Program – government contracts for industries where women-owned small businesses are underrepresented

Contracts for Women-Owned Small Businesses – eligibility requirements, checklist and guidance from the GSA to take advantage of women-owned small business programs

Women’s Business Center – directory of 122 Women’s Business Centers throughout the U.S., funded by the SBA and offering small business assistance to women entrepreneurs

American Business Woman’s Association – provides opportunities for women to grow through leadership, education, networking support, and national recognition

Awesome Women Entrepreneurs – national organization for female professionals to connect to one another in and connect with fellow businesswomen about business and daily entrepreneur life

The BOSS Network – female empowerment alliance dedicated to highlighting women and creating opportunities for growth

Catalyst – non-profit membership organization building inclusive workplaces and expand opportunities for women in business

The Committee of 200 – advances women’s leadership in business by offering current leaders access to unique programming as well as a professional and personal network of peers

Female Founders Alliance – organization that focuses on accelerating venture-scale female founded companies

Lean In – one of the largest networks for helping women find their niche and build their strengths in a variety of disciplines

National Association of Negro Business and Professional Women’s Clubs, Inc. – promotes and protects the interests of African-American women business owners and professionals through community service and social activism

National Association of Women Business Owners – advises on issues of impact and importance to women entrepreneurs and business owners

National Women’s Business Council – federal advisory council created to serve as an independent source of advice and policy recommendations on economic issues of importance to women business owners.

National Women Business Owners Corporation – certifier of WBEs and provides national certification for women and veteran-owned companies

Women’s Business Enterprise National Council – provides access to a national standard of certification and provides information on certified women’s businesses to purchasing managers through an Internet database

Women’s Business Exchange – organization providing networking, professional education, leadership training, mentoring, and exposure to community issues

Women Construction Owners & Executives USA – organization that promotes the growth of female owners and executives in the construction industry through publicity, education, advocacy, and business services

Women in Technology International – mission to empower women worldwide through technology

Women Presidents’ Organization – non-profit membership organization for women presidents of multimillion-dollar companies

U.S. Women’s Chamber of Commerce – independent organization that provides resources and advocacy for women business owners

Grants for Women-Owned Small Business

Grants for Women Business Owners – guide from American Express on finding and applying to grants

Grants for Women – listing of opportunities for women across industries Amber Grant – grants for women entrepreneurs launched by WomensNet

Cartier Women’s Initiative – grants for women entrepreneurs heading companies with significant potential growth

Eileen Fisher – grants for women with focus in the areas of environmental justice & local communities

Girl Boss – biannual grant for female entrepreneurs pursuing creative endeavors

Halstead Grant – grants for emerging silver jewelry artists

Open Meadows – grants designed and implemented by women and girls that promote gender, racial, and economic justice

SBA’s grant programs generally support non-profit organizations, intermediary lending institutions, and state and local governments in an effort to expand and enhance small business technical and financial assistance. Some specialized federal grant programs, particularly in STEM fields, provide assistance directly to small businesses. A list of government grants and other funding programs can be found on SBA’s web site at: SBA Funding Programs.

Unfortunately, some unscrupulous operators sell manuals, workshops and other materials on how to obtain “free money.” To find out how to avoid these scams, see the Federal Trade

Commission’s article about wealth building scams.

37 Angels – community of angel investors created by women with a focus on women owned businesses

Ready Set Raise – national startup accelerator created by and for women

Women’s Venture Fund – helps women build businesses in urban communities offering mentorship, one-on-one classes and small business loans

Womensphere Venture Incubator – incubator designed to help women in science, technology, engineering or mathematics startups through in-person events and online educational classes

eWomen Network, Inc. – helping women and their businesses achieve, succeed and thrive in the new economy through a loyal, dedicated community of women-owned businesses, corporate professionals and entrepreneurs

Forbes Women – articles on work, life, balance, career, leadership, relationships, health, style, beauty, and personal finance

Freelance Mom – helps members locate freelance work from home jobs, providing home business ideas, and sharing Internet marketing strategies to help working moms make smart decisions in business

Mompreneur – teaches mom entrepreneurs how to manage time, generate business ideas, balance business and family, and grow their businesses

WomenOwned.com – business tools and resources to help small businesses profit, connect and grow

Women Entrepreneur – online magazine that provides advice from leading female experts

Women in Business – collection of TED Talks on the topic of women in business

Women on Business – news and information women need to be successful in the business

Women Home Business – trending topics pertinent to women entrepreneurs who own or want to start up home-based businesses

Already in business or thinking about starting your own small business? Check out our various small business resources:

• View more small business help topics here: Small Business Information Center
• View business reports here: Small Business Snapshots
• View industry-specific research here: Market Research Links

Remember, you can also receive free professional business advice and free or low-cost business training from your local Small Business Development Center!

Photo credit: Photo by CoWomen on Unsplash