5 Tips for Forming the Perfect Company
Too many options!
Am I right?
You could be a sole proprietor, partnership, llc, corporation, or s corp. How you do you know which choice is right for your company?
You can find a major breakdown of the options in The Small Business Checklist. But how do you know which one is right for you?
Here's how to tell...
1. How many owners are there?
If you have one owner, you can form an LLC, Corporation, or S Corporation. If you have two or more owners, you can form a partnership, LLC, Corporation or S Corporation.
2. Do you sell products or services?
If you're selling products, it's especially important to have the limited liability protections of a formal company.
If you're selling a service, it may be a good idea to have limited liability protection, but you may also be safe with an insurance policy that covers your risk.
3. What kind of tax treatment do you want?
Some companies have similar tax structures that are easy to compute and file, while others are more complicated.
4. Can you handle a formal management style, like a board of directors and record keeping requirements?
Consider whether you want something easy or whether you can handle annual filings, fees, and record keeping.
5. Are you interested in investors?
There are certain company types that investor will require. So if you want to attract them, you’ll need to file correctly.
So how do you pick?
There's no right or wrong company choice. It's about which one is the best fit for your company goals. Think about which factors above are most important to you.
Learn How to Start Your Company
Are you ready to start your company legally? You came to the right place! Download The Small Business Checklist. We’ve worked with hundreds of women to setup their business legally and we’re teaching you how to do it in 10 simple steps.