see attached. 2 Discussion replies
Shania, Marvin, Kelsey, and Carlos are interested in the venture of opening up a Christian coffee house in Denver, Colorado. Shania and her partners have agreed to name the business ‘The Neighborhood Coffee Shop’ after performing a corporate name search and found the name available as well as a trademark in Colorado. I suggested it would be unique and a name easily remembered by customers.
In suggesting a partnership business for the four friends, subsequently, would be vital that they work together in good faith of benefiting the business. It is not necessary to create a written agreement but suggestive to advised that they create an Article of Partnership. The respective state law will apply and dictate major partnership affairs. Most states have adopted a version of the Uniform Partnership Act (or Revised Uniform Partnership Act). A well-drafted partnership agreement not only outlines rights and obligations but also outlines how to settle conflicts that may arise from time to time. Additionally, partnership agreements address anticipated “change” such as succession, growth, retirement, and dissolution (Brim, 2021).
It would help distinguish the name of the business, the actual names of the owners who would be in partnership, the time frame of the partnership or whether it would be indefinite, how much each partner will be contributing to the business, how the profits and losses are to be divided, and the management duties of each partner would be written into the article. Each partner would be able to file individual taxes as personal income and deduct business losses.
However, they would altogether be liable for any debts and personal liability that occurred within the business. I would suggest this also because they would be able to divide the necessary funding for the business, loans, and any other liabilities together and not be a severe burden on just one person. The business could be dissolved if either of them became deceased at any time.
If Shania were interested in the prospect of sole proprietorship, the ease of formation is that she would then complete management and control over her business and determine how she wants her business ran. Also, the business would be taxed as personal income and she would not have to share profits with anyone else. Essentially, she would be personally funding the business with her own money and if she is in need of loans to help fund the business, that would be her own obligation which could be a disadvantage to her.
The concerns with being a sole proprietor is being liable for debts and losses that could occur if there were an injury at the business, she would then be compelled to the responsibility of liabilities, debts, and contracts that are tied into that business. I certainly would not suggest sole proprietorship even with the sparse legalities involvement and this is not feasible for her because she has the others to consider, and they are willing to be in partnership with her to share the responsibility of investing for profits.
S corporation for Shania and her friends could be suggested because of the limited number of partners for Shania and her friends. It is like a partnership and only formed under federal tax laws. The advantage of the S corporation for them would be that the income from an S corporation is simply passed onto the shareholders of the company instead of being taxed at the corporate level. They would pay taxes on the money at marginal tax rates. They can minimize self-employment taxes but are subject to self-employment taxes, but the owners sometimes may have to pay taxes on profits distributed and reinvested back into the company (Arthur, 2021).
As a general partner may invest money into the company but be personally liable for the debts and obligations of the company, responsible for the management of the affairs. It may be suggestive for Shania to be a limited partner for liability purposes, but still, be an investor in the business. This may also be agreeable for Marvin since he will be considered an uninvolved investor who contributes money to the partnership but doesn’t want any say over management decisions.
Overall, after careful review of all the partnerships, I would suggest that Shania and her friends create an LLC (limited liability partnership). Unlike a general partner, who is responsible for the debts and liabilities of the company and personal assets are at risk, she will not have that concern. Yet, she will not have authority completely over the day-to-day operations, she will be limited to such. She and her partners will all have an active role in the day-to-day operations and management of the company and the overall raising of money for the business. She can have an unlimited number of members; it would protect each of them from any liabilities of the other’s professional misconduct in the business. Also, the key takeaway in an LLC is that it will shield the personal assets of the members from business creditors, and can only go after the business’s assets, not the personal assets of the LLC members and they will report earnings on their personal tax returns (Business Daily News, 2021). Each of their personal assets would be protected and would not be considered for seizure. It is a small business managed solely by only 4 members which would be Shania, Kelsey, and Carlos, excluding Shania’s husband, Marvin, who chooses to be a silent partner with little or no involvement.
The LLC must have less than 100 partners and that she does have. She would then create the operating agreement, comply with tax and regulatory requirements by obtaining an EIN (employer identification number), obtain a business license, sales, and employer taxes in cases you have employees and are selling goods, you will need to register with appropriate taxing information. She will need to file annual reports dependent upon the state in which the business is being created (Fitzpatrick, 2021). Shania and her partners are in Denver, CO, and will need to file annual reports (Colorado LLC Annual Report, 2021).
From a Christian worldview of the partners who are not Christians would not deteriorate the purposes of making a profit as long as it is a legal business, conducted with ethics, and uphold the morality of humans mankind. As long the business is run with integrity and respect each and every person with kindness and human decency. Overhearing what they said, Jesus told them, “Don’t be afraid; just believe” (Mark 5:36 NIV). I personally believe that in doing business with people don’t abandon their beliefs because there is a disagreement in a business matter. There will be many times when you are the only one who believes.
Paul wrote, “Do not be yoked together with unbelievers. For what do righteousness and wickedness have in common? Or what fellowship can light have with darkness?” The underlying principle here is that whenever a relationship, be it personal or business, is such that a believer’s testimony to Christ’s goodness and faithfulness could be harmed, damaged, or compromised, then that relationship should be avoided (2 Corinthians 6:14). There will those who may feel this. I feel we must be firm believers in the doctrine and move forward. We just might be the ones who changed their mindset by the way we conduct ourselves and our business.
Arthur, L. (2021). Advantages & Disadvantages of a C-Corp or S-Corp. Chron. com/advantages-disadvantages-ccorp-scorp-21120.html”>https://smallbusiness.chron.com/advantages-disadvantages-ccorp-scorp-21120.html
Brim, G. (2021. 31, August). 8 Key Provisions to Include in Your Partnership Agreement. Brim Law. https://www.brimlaw.com/2017/08/31/8-key-provisions-partnership-agreement/
Colorado LLC Annual Report. (2021). Truic. How to Start an LLC. https://howtostartanllc.com/colorado-llc-annual-report
Fitzpatrick, D. (2021). How to Form an LL. Step-by-Step Guide to Starting a Limited Liability Company (LLC). Nolo. com/legal-encyclopedia/form-llc-how-to-organize-llc-30287.html”>https://www.nolo.com/legal-encyclopedia/form-llc-how-to-organize-llc-30287.html
Should You Set Up Your Business as an LLC or S Corporation? (2021). Business Daily News. https://www.businessnewsdaily.com/15339-llc-vs-scorporation.html
God, Family, and Business
Top of Form
God, Family, and Business
In the United States the American Dream is what we all strive for. Technology has made this dream even more achievable. The advantages of technology have made almost every aspect of life better, easier, faster, and more accessibility. Innovation of technology has become a major factor in the success of operating a business. There has not been a better time to become a business owner than right now.
Shania Jackson is someone who is trying to take advantage of the times. Mrs. Jackson is interested in starting a Christian coffeehouse in Denver, Colorado. She has a lot to consider upon starting her business, like business entities. I would recommend Shania use an LLC (Limited Liability Company) for the business entity to best help accomplish her business goals. Limited Liability Company means just that, limited liability. When you file an LLC, it separates your business from your personal assets. For example, if Shania business involved in a lawsuit or has accumulated debt, her personal assets are secure. Another benefit to consider is an LLC is considered a pass-through taxation entity. Amy Fontinelle (2020) defines a pass-through taxation as, “An LLC is considered a pass-through entity—also called a flow-through entity—which means it pays taxes through an individual income tax code rather than through a corporate tax code.” In other words, you only get taxed once unlike a C-Corporation. Simple maintenance is also a contributing factor to the popularity of an LLC. The LLC has a simple business structure, which makes it easier to form and maintain compared to corporations. In an LLC, an owner is known as a member. There can be a single-member or multi-member, which are good options for Shania, considering her husband is interested in contributing to the business. There are only a few restrictions on who can be a member and location requirements. If Shania and her husband decides to uproot to another state and keep their company in Colorado, they can do so.
The Legacy of the Name
You only get one chance of a first impression. The first impression of a company is its name. A company’s name is the first thing a customer sees (Fridman, 2015). The name plays a significant role for the identity of branding, which is vital for a business success. A brand’s identity is a company’s introduction to an audience. Uniqueness in name is a step in the right direction.
Shania has a brand identity in mind for her business. Her business idea is a good example of what 2 Corinthians 5:20 speaks about, “We are therefore Christ’s ambassadors, as though God were making his appeal through us” (New International Version, 2011). Considering her brand identity is based on a Christian coffeehouse, she is thinking about calling her business The Gathering Place. Searching the availability of The Gathering Place, forty-three matches were found. There is a current LLC that has the name The Gathering Place. Even if the name was available, I would not recommend the name. From the results of the search, the name is commonly used. Shania should not only want a name that represents her but stands out from others with a similar idea.
Once the brand identity and entity are established, executing what the brand is about is next. The company’s product and services are a part of the consumer’s experience. Product and services are critical to the type of business Shania is running because it is a space where you are constantly dealing with people. Hiring the right people to promote the product and provide good services could contribute to the company’s success or failure.
Family and/or Business
Who Shania hires is a representation of her business, who better to hire than people she knows? Well mixing family and business could be a great idea or a horrible one. The potential positives of working with family is the comfort of having them around. Family adds to confidence, knowing you have the support of your family. Family members are more invested due to the connection to the business. Family has an understanding of comradery when accomplishing a common goal (“Working In”, “n.d.”). Understanding how to separate business from personal is difficult dealing with family. When unable to separate the two is the result of the potential negatives Shania could face hiring family. If a disagreement in business spills over to personal, not only is an employee lost, but the relationship as family. Entitlement among family is a big one. Some family may think they are the exception to the rules or feel because they are family things should be given and not earned. Resentment from other employees is a possibility. Whether it is an accurate perception or not, employees who are not related may feel they are at a disadvantage or treated unfairly due to circumstances.
Considering the pros and cons that come with mixing family and business, a way for it to be successful is the foundation. A foundation to any structure is key. Shania working with her husband, I believe could work. The foundation of their marriage is going to be the glue that holds everything together. Keeping in mind God’s Knot, “Though one may be overpowered, two can defend themselves. A cord of three strands is not quickly broken” (New International Version, 2011, Ecclesiastes 4:12). I think it is a good idea for them to have different roles.
She deals with the day to day of the business he deals with the finance side.
As for her Shania’s sister Kelsey, I do not believe bringing her on board is a good idea. I think Kelsey could contribute greatly considering her motivation of wanting to do something different. However, she and her husband are not on the same page, which could lead to further conflict in the marriage, the sisterhood, and possibly the business if hired. Before bringing Kelsey on board, I would give her time to figure out the situation between she and her husband.
Believer Plus Non-Believer
Carlos, Shania’s neighbor who is a non-believer, also has an interest in Shania’s business. I do not see Carlos being a non-believer as an issue. Jesus and the disciples are the best example of excepting everyone from all walks of life. Shania should look for good and qualified people, who adds to the success of the company regardless of background. Jesus did not discriminate people, who showed interest in his message, if so, the message would have been lost. A possible outcome of hiring a non-believer is one becoming a believer. Jesus demonstrated the commonly used phrase, “Come as you are.” In scripture John 6:37 Jesus says, “All those the Father gives me will come to me, and whoever comes to me I will never drive away” (New International Version, 2011).
Fridman, A. (2021, February 09). Why Your Company Name Is As Important As Your Company Function. Inc. com/adam-fridman/why-your-company-name-is-as-important-as-your-company-function-adam.html”> https://www.inc.com/adam-fridman/why-your-company-name-is-as-important-as-your-company-function-adam.html
Fontinelle, A. (2021, February 17). How Becoming an LLC Could Save Taxes Under Trump’s Tax Cuts and Jobs Act of 2017. Investopedia. https://www.investopedia.com/taxes/how-becoming-llc-could-save-taxes-under-trump/
Working in a Family Business. (n.d.). MindTools. https://www.mindtools.com/pages/article/newCDV_40.htm
New International Version. (2011). BibleGateway. https://www.biblegateway.com/passage/?search=John+6%3A35-37&version=NIV
New International Version. (2011). BibleGateway. https://www.biblegateway.com/passage/?search=2+corinthians+5%3A20&version=NIV
New International Version. (2011). BibleGateway. https://www.biblegateway.com/passage/?search=Ecclesiastes+4%3A12&version=NIV
Bottom of Form
Discussion Assignment Instructions
post a replyof at least 450words (content, not including references)
For each thread and reply, analysis must be supported with a minimum of 3 scholarly sources other than the course textbook and materials. Each source must be cited in current APA format. Each thread and each reply must include both full citations in a reference list at the end of each post, and short-form in-text citations.
Acceptable sources include books, legal and business journals, legal cases, the law (cases, statutes, regulations, etc.), the Bible, biblical commentary, etc. Dictionaries and other web sources that lack scholarly support are not acceptable sources. Any sources cited must be current to the issue (e.g. Bible commentaries may by applicable from any age, but articles discussing current legal or healthcare practices may no longer be relevant after 5 or 10 years).
A well-developed, complete worldview analysis of the situation requires more than simply adding a Bible verse at the end of the post. Each thread must include at least 2 separate verses from Scripture, quoted and applied as an integral part of the discussion of the applicable issues in the context of a biblical worldview.