The main disadvantage of doing business as a sole proprietor (one person) or partnership (two or more individuals) is the risk of liability. You have no limited liability protection like you do if operating in the corporate or LLC form.…
The two most important considerations for most small businesses are 1) liability protection and 2) tax considerations. Textbooks sometimes cite other issues such as perpetuation of the entity, continuity, ability to raise capital, etc. However, in my experience, these are…
S corporations and LLC’s are similar in both the way they provide liability protection to the owners and in the way they report taxes. Both provide limited liability protection to the business owners. It has been suggested that the liability…
The difference between a regular C corporation and an S corporation is in the way taxes are reported and paid. Both types of corporations are initially formed as regular C corporations. Both are subject to the same state corporation laws…
Some new or start-up businesses operate as sole proprietorships due to the ease and low cost of starting up. However, if the business owner desires to operate in one of the legal forms or entities, the most common and practical…
The State of Delaware for many years had the distinction of having the most new corporations each year. Many Delaware corporations tend to be larger companies. Nevada now boasts that it is the state with the most new incorporations each…
The first place to find answers to questions regarding corporations is to review the corporate laws for the state in which the business is incorporated. These laws are usually contained in the state’s code or statutes and can often be…
You must choose a state to incorporate in, and once you incorporate, your corporation is considered a domestic corporation of that state. Each state has its own corporation laws and its own requirements for incorporation, and your corporation is governed…
The law of each state gives people the opportunity to operate a business in one of several different legal structures or forms. Each form has its own advantages and disadvantages depending on the individual circumstances of the owners. The most…
In earlier times, business in the United States tended to be much more local and of primary concern to each state. Corporations during this period were often created for public purposes like building roads, canals, bridges, and toll roads. They…