Starting a Business? Start the Right Business.


After many years of working for other people, you’ve decided to strike out on your own and start a small business in your home town. You have the financial means and some initial ideas to get things going, but you are unsure about what is required to establish a business in California and you don’t understand the differences between business entities.

The web site for the California Secretary of State provides the information you need to know to meet the requirements for starting your business. You have a number of choices as far as the type of business entity you want to start, including:

  • Corporation – A legal entity that exists apart from its owners and reduces their personal liability.
  • Limited Liability Company (LLC) – One or more managers or one or more members manage the LLC.
  • Limited Partnership (LP) – Requires at least one general partner who is the controlling partner and one limited partner with a lesser level of control or participation.
  • General Partnership (GP) – Requires two or more persons working in a business for profit.
  • Limited Liability Partnership (LLP) – A partnership that provides professional services including accountants, attorneys, architects, engineers and land surveyors.
  • Sole Proprietorship – A sole proprietor has total control, receives all profits from and is responsible for taxes and liabilities of the business.

Each of these business entities has different liability and tax implications that you need to understand. A California attorney experienced in business law can help you decide on the right option, ensure that you file all of the required forms, pay the appropriate fees and help you avoid the common pitfalls that can occur in starting a business.

Posted in Business Law | Tagged business law, corporation, entity formation, LLC, partnership

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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