Deciding Which Business Formation is Best For You
Entering the world of entrepreneurship and forming your own business can be a rewarding endeavor. Starting a business is almost as exciting as owning a home and some feel that entrepreneurship, much like homeownership is the American dream. But starting a business is more than using your talents and gifts to provide a product or service. Starting a business requires you to go through the business formation process before you even get started on your journey.
Types of Business Formations
Essentially, there are four types of business formations or entities in Florida. These formations are as follows:
- Sole proprietorship
- Limited Liability Company (LLC)
Each type of entity is formed and structured differently. Some entities require documentation to be filed with the Florida Department of State, whereas others do not. An entity may require multiple parties, where another can be formed by an individual. According to the Florida Department of State the differences in the types of business entities are below:
- Sole proprietorship. The simplest and most common structure. A sole proprietorship can be operated by an individual and does not require documents to be filed with the state, unless the sole proprietorship is not operating under the owner’s legal name.
- Limited Liability Company (LLC). An LLC is a business entity that is separate from the owner, who is also a member. This structure can limit the liability of the owner, which makes it a popular entity.
- Corporation. This is also a separate legal entity. The owners have limited liability and the corporation does not end when its owner dies. It’s similar to an LLC but this structure requires shareholder meetings.
- Partnership. This type of formation exists when two or more people own a business and share the profit and loss. A partnership can be formed as a general partnership or limited partnership, with each containing varying differences.
How to Decide What’s Best for You
Every business owner should take some time to discover what the plans are for the business. It’s best to always look at the end result. Do you want to sell the business and start another? Do you want to work alone? Do you want to pass the business down from generation to generation?
These are all questions to ask yourself when you’re starting a business in Florida, or anywhere. A knowledgeable business and corporate law attorney will be able to help you figure out the type of business structure that will work best for you and allow you to reach your goals.
Need Help Deciding a Business Structure in West Palm Beach? Contact Our West Palm Beach Business and Corporate Law Attorney.
We offer personalized attention to those needing business legal advice and will work closely with you to ensure your business has the best chance at thriving. If you’re looking to start a business, contact the West Palm Beach business and corporate law attorneys at Kelley Fulton Kaplan & Eller. We’ll meet with you to discuss your present and future business needs. For a no obligation consultation, contact our firm at 561-264-6850.