Types of Business Entities 2018-03-16T20:44:02+00:00

What Business Entity Is Right For You?

One of the most important decisions you’ll have to make when forming your business is choosing the type of legal structure you’ll need for your company.

When choosing a business entity, whether it be a sole proprietorship or a corporation, the decision should not be entered into lightly. No one situation is the same, and not one structure is necessarily better than another. There are several key criteria you must consider before filing the paperwork, and King Law Firm Attorneys at Law, Inc. can advise you in what type of business you’re operating, the short- and long-term goals of your company, what entity best suits your company, and whether or not a change in business entity (i.e., changing from a partnership to an LLC) would benefit your business.

The following are the different types of business entities you may be considering as you look to start your business.

Sole Proprietorship

A sole proprietorship is the easiest and most popular form of business entity. It’s rather easy to form and allows a single owner full managerial control. It is also used most often as a starting point to a long-haul business plan, in which the company will continue to grow and evolve into a much larger, corporate entity. But the owner is also liable for all legal, financial and tax requirements, and is personally liable for all obligations that come with that. Learn More

Limited Liability Company (or LLC) 

A limited Liability Company, or an LLC, is a bit of a hybrid entity, as it has a mix of advantages from all of the other entities. LLCs are generally owned by a single individual who can maintain control of all managerial issues, however, they are shielded from personal liabilities should the business fail. Learn More

Partnership

A partnership is a mutual agreement between two or more parties to share in all financial, legal and taxation obligations, including profits and losses. Partnerships can also be problematic as there are always more than one person calling the shots, which means that decisions can be affected based on the goals, strengths and weaknesses of the individual owners. Learn More

Corporation

A corporation is an entity that is completely separate from the owners who founded it. The corporation is taxed as a separate individual and is liable for the legal, financial and tax obligations of the business. However, a corporation is extremely expensive to create and requires a lot of record-keeping to maintain. Learn More

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