Businesses can be structured in different ways including sole proprietorships, partnerships, limited liability companies, and corporations. It is important when starting or growing your business to understand the different types of business structures and to make an informed choice regarding which is best for you.
At Pintar Alibston, LLP, our experienced Las Vegas business law attorneys can assist you when you begin operations. After a careful review of your individual situation, we can help you to select the right type of business entity for your needs. Call today to get started and learn more about how our attorneys can provide the assistance that you need.
An Attorney Can Help You Select the Right Type of Business Entity
To select the right type of business entity, there are a variety of different factors that must be considered including:
- Initial cost and paperwork requirements. Operating as a sole proprietorship is very simple. Beyond any required licensing for the specific type of business (such as professional licensing or a liquor license), there are no legal steps you must take to start operating as a sole proprietorship. For a corporation, on the other hand, Articles of Incorporation must be filed with the state and a variety of other steps must be undertaken to begin operations.
- Ongoing costs and paperwork requirements. Again, a sole proprietorship generally has no ongoing paperwork requirements or fees, while a corporation and other business entities typically require you to fulfill certain requirements each year.
- Liability protection. A corporation is a separate legal entity and the business finances are distinct from your personal finances. You are protected personally if someone sues your business. You are also protected from being held personally responsible for repaying corporate debts unless you co-signed for the debt obligation. When you are a sole proprietor or a part of a partnership, on the other hand, you face personal responsibility for financial actions the business takes. If someone sues the business or if the company goes bankrupt, you could lose your home or other personal assets.
- Taxes. Different types of businesses are taxed in different ways. For a sole proprietorship, a partnership and an S-corporation, you declare business profits and losses on your personal tax returns. However, depending upon the business structure, you may need to file a separate tax return for the company. For a C-corporation, on the other hand, the business pays taxes on its own profits. This can sometimes lead to double taxation as the company is taxed and the owners are also taxed when money is taken out of the business.
These are just a few of the many different considerations that come into play when making the choice about how a particular business entity should be structured. Pintar Albiston, LLP can provide you with comprehensive information about all of the different kinds of business entities you could choose from and about the advantages and the disadvantages of each option. We can also help you to understand the legal obligations and protections each business structure will provide. Call today to get help selecting the right type of business entity that will be best for the long-term security of your organization.