Building A Strong Foundation With A Business Formation Attorney
Starting a business is exciting. But before you can grow your venture, you need to make sure you’re laying the proper foundation. Forming a legal entity is an important step for business owners to take. A business formation lawyer at Brown Borkowski & Morrow can help Michigan entrepreneurs in Detroit, Farmington Hills, and beyond put their best foot forward.
Choosing The Right Entity Formation For Your Business
Selecting a legal entity is an essential step for business owners to take. The entity you choose can create a framework within which your business operates effectively, protects you from liability, has tax benefits, and projects an image of professionalism. Making the right selection is crucial to accomplishing your goals for your business.
Types Of Business Structures
The most common business entities are:
- Corporation
- Limited Liability Company (LLC)
- Partnership
- Sole proprietorship
Corporation
A corporation is a legal entity that – while entirely separate from the individuals who own it – functions similarly to a person in the eyes of the law. One particularly attractive benefit starting a corporation offers business owners is limited debt liability, which frees them from being personally responsible for debts the corporation incurs. Setting up a corporation could include many different subtypes of corporations, including:
- C Corp
- S Corp
- B Corp
- Close corporation
- Nonprofit corporation
- Cooperative
Limited Liability Company (LLC’s)
Setting up an LLC shares similar characteristics with both corporations and partnerships. Starting an LLC protects business owners from debt liability, but the way taxes work in an LLC is more similar to a partnership.
Partnership
A partnership represents a legal agreement between two people to operate a business, split profits, and share responsibility for liabilities. Unlike a corporation or an LLC, each member of a partnership is personally liable for debts incurred. However, a partnership could have more tax benefits than a corporation.
Sole Proprietorship
A sole proprietorship is the simplest business structure. As the name suggests, these entities consist of a single person. In a sole proprietorship, your personal and business finances aren’t separate, but it offers tax benefits you wouldn’t usually have.
Why Should You Hire A Lawyer For Business Formation?
These days, online services like LegalZoom make creating a business entity quick and easy. But the value of going this route is equal to the time and money you invest – very little.
When you work with a legal professional, you get:
- Robust knowledge
- Individualized guidance
- Ongoing support
A business formation attorney can ensure the entity you choose works for your business and puts you closer to reaching your goals.
Talk To A Business Formation Lawyer Today
Our attorneys are here to help you explore the different business structures and form the correct entity for you. To get started, contact us to schedule a free consultation. You can reach our firm at 888-757-1681 or submit an appointment request form online.