There is several initial questions to be addressed by an entrepreneur contemplating the formation of a business:
What legal form should the business take?
* Corporation (S Corp, C Corp)
* Limited Liability Company (LLC)
* Limited Partnership ((LP)
* General Partnership (GP)
* Sole Proprietorship
What are the creditor protection and asset preservation benefits for each type of entity?
What is the tax treatment to the entity and the owners of each type and how can I minimize taxes?
Which structure is most suitable and flexible from a managerial and governance standpoint?
What assets should be transferred to the business?
How will the business form affect the raising of capital?
How should I properly document the arrangement that I have with co-owners?
Making the right choice depends upon a variety of factors. And to do it properly will require the involvement of a business attorney and your accountant. Also, especially when family members are involved in the business, it is frequently advisable to integrate your business plan with your estate plan.
