Have you decided to start your own business? The first and foremost of many crucial decisions is to determine what type of structure suits your business the best. There are several options, each with its own advantages and disadvantages.
Choosing the proper business entity is important!
Rather than making this decision on your own, gain the assistance of a Los Angeles business attorney to guide you. There are serious differences and penalties should your business fail.
Here are a few options available:
This is a one person business inseparable from its owner. The owner reports business income and losses from his or her personal income tax return. He/she is personally accountable for debts and obligations of the business.
The partners share the rights and responsibilities equally in a general partnership. Any one partner can legally bind all other partners to a legal obligation and each of them is personally responsible for all the debts and obligations of partnership.
The general partner takes care of the daily operations and is personally liable for the partnership’s debts. Limited partners have very little control and their personal liability is limited to their amount of investment.
A corporation is a self-governing legal and tax entity that is separate from the people who own, control, and handle it. A corporation restricts its owners’ personal liability for business-related debts and judgments.