When you are starting or expanding a business, there are multiple business entity structures available. Separate business entity structures include C corporations, S corporations, Limited Liability Companies (LLCs), partnerships – both limited and general. And of course there is always the sole proprietorship, however this type of business structure is not considered to be a separate entity from its owner.
Each business structure provides different benefits, different levels of asset protection, and they result in different tax treatment for the business and its owners. Understanding the many differences is important for startups and business owners adding new lines of business to their existing enterprises.
Once you have selected your business entity or structure, do you know the necessary steps to set up the business? In our Infographic below, we cover some of the set up steps for different types of business entities or structure, as well as the important titles and roles that go along with each type. The forms to be filed by the business owner for each business type differ from state to state. Visit the SBA.gov website for your state’s specific filing requirements and forms.
We have created an e-course to help business owners learn all they can in one place so they are able to make sound decisions as they start their businesses. To learn more, check out our Business Entity Optimizer course.
Learn more about how to use business entities to protect your personal assets, reduce risks and lower taxes in our Business Entity Optimizer course!
Holly also founded ExitPromise.com and to date has answered more than 2,000 questions asked by business owners about starting, growing and selling a business.
Latest posts by Holly Magister, CPA, CFP
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