How to Start a Company in the US | Prager Metis

Luca Cancellieri
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Published on 14 Jan 2018 Time to read 8 min read Last update on 2 Feb 2022


Learn how to start your own company in the US. If you plan on applying for an E-2, L-1, or EB-5 investor visa, this webinar should provide valuable information on the first steps to company formation and tax structure.


Visa Franchise

Patrick: This is Patrick Findaro, Business Development Director with Visa Franchise. Thanks to everyone for coming to our webinar today. We have a special guest that I will introduce, Luca Cancellieri from Prager Metis, who is a CPA and we’ll talk about more of an Accounting 101, what are the important aspects to understanding as you open up a franchise in the United States. Before I turn it over to Luca in some of the other brief introduction of Visa Franchise. We’re based in Miami, Florida, although we have offices across the United States, Latin America, as well as Turkey. We have a portfolio of about 90 franchise businesses and license businesses that we emulated this portfolio after analyzing over 1200 opportunities. Most of our clients are seeking investor visas, but not all. Many of them are just looking to invest in U.S. franchises, businesses in the United States. So, [inaudible 00:00:54] advise clients from 35 plus nationalities in our firm. Internally, they’re Portuguese, Spanish, Turkish, and Chinese Cantonese language. Our team has deep experience in the financial markets as well as working with some of the largest finance orgs in the world.

We’re very focused on what we do. We help find and analyze franchises for Investor Visas like E-2, L-1, or EB-5 Visa. We do this throughout the United States. You get clients from California, Texas, or Colorado, Illinois, New York, New Jersey, the list can go on for at length. And we’re constantly on the search for finding the best opportunities for our clients.

So feel free to reach out. Here’s our contact. But really, I wanna turn it over to Luca who is our special guest today. He’ll give an Accounting 101 for your Franchise and Investor Visa. Thanks. Any questions you have, please use the dialog box or you can also send us an email at

Prager Metis

Luca: Here I am. I hope everybody can hear and see me well. Thank you so much for the opportunity today of being here, Patrick and Visa Franchise. My name is Luca Cancellieri from Prager Metis CPAs, LLC, based here in Miami, Florida. Let me give you a little introduction on our company. Prager Metis is an international accounting firm, top 16 in the U.S., and top 10 international level. We have more than 70 partners and principal, more than 400 team members and 13 offices worldwide including New York, New Jersey, Los Angeles, Miami, and London. We are able to provide a full range of service, accounting, audit, tax advisory, and international services. We have a level of expertise and a global presence that are unique. We have staff other than English and Spanish, speaking Chinese, Italian, French, Portuguese, Turkish, and even Russian. Therefore, we can better serve a diverse, domestic, and international clients in a wide range of industries.

So, let’s start with our presentation. Today topic is “Accounting 101 for your Franchise and Investor Visa.” So, we’re gonna give an introduction of doing business in the United States from an accounting and tax perspective. Change slides. Here we go. So, before it starts, let me give you an overview on what we’re gonna talk today. Introduction of the United States legal system, entity choice information, entity income tax, and then we will go deeper into detail for individual income tax, and then I would like to conclude my presentation with some hint and some statement about franchising to and within the United States.

Here we go. Let’s start with the United States Legal System. The United States has a federal system of government. We have three levels, national levels or federal level, state, and local. Local laws are those made by cities and county that applies in those geographical region. All 50 states have their own state and local laws that apply. There are some areas of law that are governed exclusively by federal law such as patent and copyright. Other laws primarily set by individual states. We have for example, contracts, employment relationship, and also sales transaction. Then other areas of law are governed by both federal and state law.

Let’s turn now to entity choice and formation. And let me tell you something before I [inaudible 00:05:06] this topic. When doing business in the United States, foreign companies should be aware that they are subject to these two parallel system of [inaudible 00:05:16], federal and state which often different, depending on the state and the region you decide to start. So, choosing the proper legal entity for your business is one of the most important initial decision. As an owner, your personal liability, your legal rights, and obligation, and tax responsibility are affected by the [inaudible 00:05:40] you decide to take. Making an informed choice at the onset can impact the long term success of your business. So, understanding the differences between entity types, I can tell you it can be very confusing and time-consuming. You might find that two or more formation options seem equally satisfying your needs, but making the final choice quickly, in a rush, based on price, or on what seems most common in the marketplace you are, it’s not usually advisable.

Types of Business Entities

Common type of domestic business entities in the United States are partnership, Limited Liability Companies, so LLCs, and corporation. Each business form has its own benefit and the choice of the form depends on case-specific legal and business factor. Following what we said before, each type of business entities are then…must be formed according to the laws of the state in which the entity is formed. All entity types other than partnership require organizational documents to be filled with the state governments.

So, let’s turn the attention on the first common type of domestic business entity. That is partnership. What is a partnership? A partnership is an association of two or more individuals or entity engaged in business for profit. So, it’s a business…we can say it’s a business arrangement in which two or more people own an entity and personally share its profit, losses, and risk. In fact, partners are jointly and severally liable for all the debts and liability of the partnership and for all wrongful act of any co-partner acting in the ordinary course of the business. Let me give you a practical example. Partnership may not be the optimal choice for startup for example, they are looking for a fundraise. Why? Because most of the time, investor don’t want to be subject to an un limited liability as a member of a general partnership and maybe prefer to invest in an entity that limits their personal liability. We keep mentioning liability and liability. What is the liability here in the United States? Liability just means that if I’m paying bills or the company loses a court case after, of course, a judge’s decision, then you, as a shareholder member, partner, owner, whatever you are, must pay up from your personal fund or asset like your bank account, your house. That’s why this concept of limited personal liability is very important.

A partnership can be formed by a verbal agreement. There is no need to a documentation or arrangement at all at the beginning. However, there might be subsequent disagreement among owners at a later date. So, it makes sense and recommended to create a written document that states out sophistication [inaudible 00:09:00]. This partnership agreement should at least cover some important topics for example, the right and responsibility of each partner, whether partners are designated as general partner or limited partners, the proportion of the partnership gain and losses to be apportioned to each of them. And then also proceed around provision regarding how to add a partner, terminate a partner, liquidating the partnership, or dissolve the partnership. In addition to the partnership agreement, all the partner must engage in a number of formation activity that are common to all type of business. And this action include register the business name, obtain an ID number, obtain a license required by governments where the partnership tends to operate, open a bank account.

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