The various options for legal structures for your business vary from country to country and can vary within a country; for example, in the U.S. there can be slight differences from one state to the next. Liability Is Your First Big Issue The first core question to think about is liability. If the business cannot... READ MORE
BUSINESSTOWN LLC, Corporation, Partnership Or Sole Proprietorship?
What Kind of Legal Form Does My Business Need?
The Pros and Cons of a Sole Proprietorship
This form of business is the easiest to start because you need to obtain only whatever licenses are required in order to begin business operation. A Sole Proprietorship Puts You in the Driver’s Seat Deciding what legal entity to use for your business is an important step in starting a business. Hence you want to... READ MORE
Should I Enter into a Partnership Agreement?
A partnership is a legal association of two or more persons to carry on as co-owners of a business for profit. Although not required by law, you may have to create written Articles of Partnership. This may be required, for instance, if you want to open a company bank account. These articles would define the... READ MORE
What Is a Limited Liability Company?
The limited liability company (LLC) is a relatively new business structure but already vastly popular for small businesses in the U.S. It is a cross between a corporation and a partnership or sole proprietorship. Essentially, an LLC carries the limited liability advantages of a corporation but operates with the flexibility and tax obligations of a... READ MORE
Should I Incorporate or Form an LLC?
Because a corporation or a limited liability company is considered a distinct legal entity with no ties to the individuals who own it as a legal structure, it is a very attractive option for small business owners. It gives you the opportunity to present your firm to the public as a bigger company than it... READ MORE
The S Corporation Legal Structure Option
In some cases, to alleviate a tax burden, individuals may choose to form an S corporation. An S corporation is a corporation in the United States for which an election has been made with the Internal Revenue Service for the income to pass through and be taxed directly to the stockholders on a pro-rata basis.... READ MORE
Q&As: Issues about Different Forms of Business Organization
Q: Is it possible to change the type of organization my business is? A: Yes, it certainly is. For example, my book publishing business started out as a sole proprietorship. Later, I converted it to a corporation. Initially, the corporation was an S corporation; then I changed it to a traditional corporation in order to... READ MORE