Business Entity Formations
Starting a new business can be daunting. Byrne Westmoreland, PLLC can advise and assist you through the many steps of forming a new business entity. For any new business, the process will start with a conversation about which form of business entity is right for you and your venture. The most important considerations are often liability protection and taxation.
Sole Proprietorship. A sole proprietorship is a form of business owned and managed by one person. No formal legal filing is necessary to form a sole proprietorship. A sole proprietorship is the simplest business entity, but it may not be the best option for larger, more complex businesses and those concerned with personal asset protection.
Partnerships. A partnership is a business agreement between two or more partners to share in the profits and losses of the business. The partnership is governed by a partnership agreement, whether verbal or written. In a General Partnership, all partners are personally liable for the obligations and debts of the partnership. In a Limited Partnership, certain partners known as “limited partners” may only have limited personal liability for partnership debts and obligations. Limited partners cannot participate in the management of the partnership and may also be restricted from transferring their partnership interest. We strongly recommend that all partnerships by documented in a Partnership Agreement drafted by an experienced attorney.
Corporations. A corporation is a business created under applicable state statutes and is treated as an entity completely separate from its owners (“shareholders”). Shareholders own stock in the corporation and are generally not liable for the debts and obligations of the business. Corporations are often the most complex form of business entity due to strict filing requirements and tax considerations. It should be noted that a corporation must file its own tax return. We strongly advise you to consult an experienced attorney before forming a corporation.
Limited Liability Company. A Limited Liability Company (LLC) is a popular form of business entity that combines many aspects of partnerships and corporations. The owners (“members”) of the LLC have limited liability for the debts and obligations of the business. LLCs also offer tax flexibility, as the entity can elect to be taxed in the same manner as a partnership. Though there are many online business formation services, we would strongly encourage you to consult one of our experienced attorneys before forming an LLC.
Our attorneys have provided counsel to many local business and new entrepreneurs. Please contact our office today to discuss our business formation services. We would welcome an opportunity to have a strategic conversation to determine the most appropriate business entity for your needs. We offer many additional services to business owners, such as drafting Operating Agreements, Joint Venture Agreements, and serving as a Registered Agent for our business clients.