Choosing the Right Entity for Your Florida Business
When you are forming your Florida business, you have to choose what type of entity works best for your individual needs. Since everyone’s needs differ, there is no definitive answer that will serve everyone. Factors that influence decision making usually involve topics like personal liability and taxes.
Choosing the right business entity can feel overwhelming. Speaking with a Florida business entity formation lawyer can help you narrow down your options and ensure you are moving forward with the best option for your particular situation. At the Law Office of Clifford J. Hunt, P.A., our practice focuses in helping Florida clients choose the appropriate entity type.
Here is a look at some of the most common business entity types:
A sole proprietorship is usually attractive to a single person or a married couple who are starting a business. It’s simple to create and operate, plus it has the least amount of legal controls. The main downside is you are personally liable for any debts and liabilities of the business.
A general partnership has two or more people (not usually a married couple) who have agreed to contribute labor, money, and/or skill to a business. Each partner is equally responsible for management, profits, and losses. Each partner will also be equally liable and personally responsible for partner debts. In a limited partnership, there is one or more general partners and one or more limited ones. General partners fully share in management, profits, and losses, while limited partners share in profits, but are only limited on losses to whatever they invested.
In some cases, an LLP or an LLLP may be an option. LLP is a limited liability partnership and an LLLP is a limited liability limited partnership.
Limited Liability Company (LLC)
The LLC has one or more people (or other entities) who form a business through a special written agreement. It will detail all the organization elements and discuss how the company is managed, how interests are assigned, and what the process is for distributing profits and losses.
Corporations are the more complex option for business entities. They also have more rights, benefits, and liabilities compared to an individual person. There may be financial and/or tax benefits to a corporation, but there are some challenges and considerations you can’t ignore. In some cases, a business is not earning money for profit, it is a charity for example. In these situations, there may be an option to form a non-profit corporation.
There is also another corporation type, the S-corp. This is essentially a tax election that only some businesses will qualify for. Talk to your Florida business entity formation attorney to understand the strict requirements necessary to form an S-corporation.
Contacting a Florida Business Entity Formation Attorney
When you’re ready to start a business in Florida, it’s important to discuss your business plan with a Seminole entity formation attorney. Your attorney can assist with helping you decide what business entity style is right for you. Contact the Law Office of Clifford J. Hunt, P.A., to schedule an appointment with one of our business formation attorneys today. We are conveniently located in the Tampa Bay area, but we can also assist with clients throughout Florida and nationwide.