As a business owner, you have a lot of important decisions to make. Often, the first important choice you must make is how to legally structure your business. There are a number of different business types available to choose from, and each has its own advantages and disadvantages. In order to help get you started, below is an overview of the most common types of business entities in Georgia.
- Partnership – A partnership is the type of business that is considered to be a separate entity from its shareholders. Partnerships must have at least two partners, one of which must assume the role of general partner. A partnership’s net income is considered the income of the partners.
- Limited liability partnership – A limited liability partnership is similar to a general partnership, the main difference being that the partners in a limited liability partnership must assume at least some personal liability.
- C corporation – A C corporation is a type of incorporated business that affords its shareholders limited liability protection, and it must have at least one shareholder. This type of corporation is allowed total discretion over the amount of profit that it can retain and distribute.
- S corporation – An S corporation gives its shareholders limited liability protection and must have between one and 100 shareholders. In addition, this entity type is allowed full control over the amount of profit that it can retain and distribute.
- Sole proprietorship – A sole proprietorship is an unincorporated business that requires no special paperwork or registration to form. In order to form a sole proprietorship, all that an individual must do is report all business expenses and income on a 1040 Schedule C tax form. Given the lack of filing requirements, sole proprietorships are considered the easiest types of businesses to create and dissolve.
- Limited liability company – A limited liability company is essentially a combination of a corporation and a partnership or sole proprietorship. Limited liability company members cannot be held personally liable for the organization’s debts or liabilities.
- Stock corporation – A stock corporation is a business with shareholders who acquire ownership through the purchase of stock. In addition to owning shares of the company, shareholders typically receive dividends based on the total number of shares they own.
Georgia Business and Corporate Law Attorneys
At Klosinski Overstreet, our attorneys can help you determine which type of business organization best suits your needs. In addition, as experienced Georgia business and corporate attorneys, we can assist your organization with a variety of contractual, structural, and financial transactions. And unlike some law practices, we are committed to honest and open communication, as our experienced Georgia attorneys understand that you must be fully informed of your legal options in order to make the best decisions for your business. If you are in need of a business and corporate law attorney, please contact us for a consultation.
Posted in: Business Law