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Deciding what kind of corporation to be, LC, LLC, Corp, etc.
The most flexible entity available to small business owners is the limited liability company or the LLC. Small businesses are great targets for lawsuits. An LLC protects business owners from losing their personal assets in case their business is sued. An LLC is very attractive if you decide to start up your own business.
When you decide to incorporate your business, you need to do so in the state in which you conduct your business. You need to file your state and sales tax returns in the state that you run your business from and where most of your earnings come from. Some business owners with massive nationwide activity choose to be incorporated in Delaware or Nevada because of the business laws in those states. Although you have the choice of incorporating your business in Delaware or Nevada, you still need to register your business in those states. State law mostly establishes that the many forms of organizations like limited liability company, sole proprietor, corporation, partnership, S-corporation, trust and non-profit organization be formed in the state in which they reside. The main reason many business owners choose to incorporate is to gain the advantage of limited liability meaning to avoid putting their personal assets at risk while running their business. When you decide to open up your business, consider the legal aspects of the matter. If you want to have a trustworthy business that shows your customers you run a serious and professional business, you have to give your company a legal structure. Having a legal structure helps the customers to feel comfortable about doing business with you and knowing that you are not going to disappear after you have receive payment from them. Depending on the kind of business you want to start, an LLC can protect you as an individual in case of bankruptcy or lawsuit. The final decision of the kind of corporation you want your business to be is something that you have to choose on your own. You need to educate yourself as much as possible about your options. |
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