Are you starting your new construction company or general contractor business? Today, Sonia Narvaez – Licensed CPA, shares 3 Things to Consider when Starting a Construction Company. Sonia has 25 plus years of accounting experience. And by now, she has seen it all when it comes to what you should and should not do with your finances. If you want to run a successful contracting business, having your financial house in order is an absolute must!


First off, consider what type of business structure you are going to use as a contractor or construction company. Options include operating your business as either a corporation, a sole proprietorship or a Limited Liability Company. It’s very important to understand the differences of these three options. When it comes to selecting which business structure is right for you, you should consult with a proven CPA for tax related questions because It is vital that you understand what each business structure will do for you tax wise.

However, when it comes to the legalities and some of the liabilities of the various business structure options, you should consult an attorney. You are really going to want to make sure you understand both the legal and tax implications of your new business entity. So any questions you have, should be addressed before choosing your corporate structure.

Now, setting up your business is not a good time to go cheap. A licensed CPA will be sure to get you going on the right path and can save you lots of time and money in the long run.


When you open a business bank account. It’s important that you get in the habit of treating the business account as if it belonged to a separate person. After all, the money belongs to your company and not you personally. In fact, the company is considered a separate entity and it will need to file taxes just like you do. This is why it is very important that you do not commingle your funds with your business. This means you keep your personal money separate from the business at all times. For example, you don’t use the business account to pay your electric bill or any of your personal expenses. Of course, there are ways to legally draw a salary, make withdrawals or distributions from your businesses bank account that comply with IRS guidelines. 


When it comes to the day to day accounting of the business, most contracting and construction businesses are not properly set up and they’re poorly organized. Their accounting books are normally in a mess. This actually hurts contractors because they will not be able to readily see the true profits or losses of the business when the need it.

If you have any questions about setting up your contracting or construction company, be sure to give us a call at 407-382-6658. We are always here to help.