Establishing a Contra Costa County Business
If you want to start a business, you may be wondering which type of company is best for your situation. There are many different options for you to pursue, each with its own advantages and disadvantages. To ensure that you choose the right one, you should contact one of our San Ramon business lawyers at Jahangiri Law Group, APC. With our knowledge, you can trust that our legal team will give you wise advice as you are planning.
Depending on your specific situation, you may want to pursue the creation of one of the following types of business:
- Sole Proprietorship – This kind of business is the simplest to set up, as no papers need to be filed to begin. You simply start doing business. For a small business with exposure to minimal risk, a sole proprietorship may be acceptable. Since sole proprietorships offers no protection to the owner, however, any lawsuit puts your personal assets including your home, car and bank accounts at risk. To avoid this, most individuals want to consider a more formal business entity.
- General Partnership – This is a relatively informal business entity. General partnerships do not require documentation to come into formation; however, it is always a good idea to document relationships and responsibilities with a written agreement. These do not provide any asset protection.
- Limited Liability Partnership – This option requires at least one general partner and one limited partnership to create. To form this type of business entity properly, documentation must be filed with the Secretary of State. A limited partnership is best used when someone intends to be a “silent partner” or “money man.” The general partner runs and manages the business while remaining personally liable for the business. The limited partner, on the other hand, cannot participate in daily management and has no personal liability for partnership debts.
- Corporations – This provides personal liability protection for all shareholders. If certain formalities are not adhered to, however, the protection can be lost. The corporate structure is simple: the shareholders own the business, and they elect a board of directors who oversee the long-term objectives. The directors appoint officers who run the daily business. The corporation is a distinct and separate entity from its shareholders; this distinction is what provides for the protection because the corporation is liable for corporate debts, not the shareholders. Once the decision to form a corporation is made, there is a second decision to make. You need to choose between a C-corporation or a subchapter S corporation. There is no difference between C and S corporations for the purposes of liability. It is merely a tax election, which can often save money.
- Limited Liability Company – LLCs generally provides the same liability protection as a corporation but can have different tax consequences. It is often said that an LLC is more flexible than a corporation. Moreover, the tax liability can be more substantial than a Subchapter S corporation. It is important to discuss your business needs with an attorney or accountant before you elect to become an LLC.
Counsel from Our Knowledgeable Business Attorneys
Before you establish your business, it is vital to meet with our legal team. We can discuss your specific situation and any business needs you want to meet. The San Ramon business formation lawyers at Jahangiri Law Group, APC take as much time as is necessary to make sure that you are secure in your decision.