BUSINESS START UP
How to Structure Your Business
Starting or buying a business requires thoughtful planning. The decisions you make today will set the course for your future success. For assistance during this crucial time, consult with a knowledgeable business attorney.
Our lawyers have helped business owners across Mississippi with start-up, acquisition, and restructuring. Whether you are buying a local convenience store or are involved in the start-up of a small privately-held business, we have the business law knowledge you need.
Choosing The Right Corporate Entity
You have choices when it comes to selecting the appropriate business structure for your organization. Therefore, it is important for you to understand the pros and cons of the different entities and structures that are available.
One of our business lawyers will sit down with you to discuss your vision for your company and explain the different entity types, including:
- Sole proprietorships
- Limited liability companies
- For-profit corporations
- Not-for-profit corporations
- Family limited partnerships
Taking into consideration the specific needs of your business, our legal team will help you determine the right structure for your business.
A sole proprietorship is the most common structure used for starting a business. A sole proprietorship is an unincorporated business run by one person. Legally and for tax purposes, there is no difference between you and the name of the business or the business itself. A disadvantage of a sole proprietorship is the fact that you can be held personally liable for the debts and obligations of the business.
A partnership is a business owned by two or more people. There are two types of partnerships: General Partnerships and Limited Partnerships. With a general partnership the obligations and profits are divided equally among the partners. One of the disadvantages of a general partnership is that the partners may be individually liable for their own actions as well as the actions of other partners. With a limited partnership, the limited partners may have limited liability and also limited input with management decisions.
Limited Liability companies
A limited liability company is a legal structure that provides limited liability similar to a corporation with certain tax advantages while maintaining much of the flexibility that you would have in a partnership. Ownership can be by a single member or many members. Another advantage of a limited liability company over a traditional corporation is that there is less paperwork involved and start up costs are usually less.
A corporation is a legal entity owned by its shareholders. Corporations are more complicated than sole proprietorships and limited liability companies. The additional requirements for a corporation generally make it less cost effective for smaller businesses. Corporations must be formed under the laws of the state where it is registered. Corporations have liability advantages in that the personal assets of shareholders are normally protected.
To discuss how our firm can assist your company with a business organization issue, contact us by email or call our office locally at 601-957-3101.