Howard, LLP

Howard Insights: Business Restructuring

< Back

Dallas, Texas, September 2017– When you start a new business, a lot of time is spent before formation determining what entity structure is right for this business.  Some of the topics addressed are:

  • How many owners will there be?
  • What kind of flexibility do you want for income allocation? Distributions?
  • Do you intend to take the company public?
  • What is your exit strategy?
  • What is the tax impact for the owners with each type of structure?

This planning is very important in the beginning, but many businesses continue to move through their business with the same entity structure even though their business situation has changed.  As a company grows, switches owners, etc., the entity structure may need restructuring to accommodate these changes for the owners.

Some of the changes that will need to be made for the long run, may have a tax impact at the time of conversion.  You will need to discuss that at the time of conversion to make sure all the owners understand the restructuring.

If your business is changing or you aren’t happy with the tax impact of your current business, we encourage you to contact the Howard team to discuss what options are available for your business.