California Sole Proprietorships C-Corporations, S-Corporations, and Limited Liability Companies (LLCs) - Things to Consider When Starting a Business


Things to Consider Before you Start Business Operations as a Sole Proprietorship, C Corporation, S Corporation, or LLC - How do you start business on the right track?

Selecting the right type of business entity is an important step in building a successful business. Many of the business owners that I speak with at initial business formation consultations have the following threshold questions:

1. What are the advantages and disadvantages of running my business as a sole-proprietorship?

2. If I want to avoid the risks involved with a sole proprietorship, what are my business entity choices, and which should I choose for my business?

Searching the Internet for answers to these questions is a bit overwhelming. There is a lot of information available, but much of it is confusing, misleading, contradictory, or flat-out inaccurate. This is a complicated area of law, and it is difficult to get clear answers to these questions.

The goal of this article, therefore, is to discuss these questions in as straight-forward a way as possible, and to give California business owners a good idea of the issues they should consider when they start business operations and need to choose from among the following popular kinds of business entities – Sole Proprietorship, California C-Corporation, S-Corporation, and Limited Liability Company (LLC).

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DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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