Florida business lawyers know Florida business and laws. So, when you have a business-related legal question, you know where to turn. Legal issues arise even when you are just starting out. For example, it is crucial to understand what kind of business structure is best for your new business.
But why is business structure so important?
Types of Business Structures
First, understand that you have various kinds of business from which to choose:
- Corporation
- Limited Liability Company
- Partnership
- General Partnership
- Limited Partnership
- Sole Proprietorship
Each kind of business structure has its advantages and disadvantages. Talk to your Florida business lawyer about tipping points that may push you toward one business entity over the others.
Formation
The cost of forming your company may be a big concern. Generally, the least expensive business to create in terms of formation costs is the sole proprietorship. That’s because the state does not require you to file much paperwork. You will usually pay a lot more in filing fees and legal fees if you are forming a corporation.
Keep in mind that some businesses do require you to have a license.
However, filing cost is not the only major consideration. For example, liability is one of the disadvantages of conducting business as a sole proprietorship. Corporations and limited liability companies offer at least some protection to their owners. Your Florida business lawyer can review your goals as related to forming each type of business entity.
Management and Your Florida Business Lawyer
How would you like to manage your new company? As a sole proprietor, you will be on the hook for every decision and all the work. In a partnership, responsibilities and duties may be split among the partners. And corporations usually have directors and executives who manage the business for shareholders.
You should explore management issues while choosing a business structure. Make sure you consult with a Florida business lawyer as soon as you decide to start a business.
Recordkeeping and Tax Issues
State, local, and federal governments require some business entities to file annual reports and other documents. For example, corporations are expected to maintain corporate records, including minutes from the board of directors’ meetings. All of this recordkeeping takes time. Of the business entities we mentioned above, sole proprietorships generally have the least amount of recordkeeping. However, all companies keep financial records related to taxes.
In fact, taxes are another issue that separates business entities. Sole proprietors and limited liability companies pay taxes on their earnings. On the other hand, corporations are taxed twice. The corporation pays taxes on annual earnings, and then the shareholders also pay taxes on their dividends.
Here, again, the advice of a Florida business lawyer could help you choose a business structure that minimizes both recordkeeping and taxation burdens.
A Florida Business Lawyer Can Help You Choose a Business Structure
Attorney Richard Sierra at the Florida Small Business Center assists clients like you with business and litigation matters. As always, Our Goal Is to Help You Succeed™. For an appointment, you may call us at 1-866-842-5202 or use the contact form on our website. We represent clients throughout the State of Florida, including Coral Springs, Coconut Creek, Boca Raton, Delray Beach, Pompano Beach, Sunrise, Fort Lauderdale, Miami, West Palm Beach, Jupiter, Deerfield Beach, Stuart, Port St. Lucie, Orlando, Naples, Fort Myers, Sarasota, Tampa, and surrounding communities.