When a business opportunity is ready to get off the ground, it is important to make sure that it forms properly. Not only does the type of business formation you use affect the way the business runs, different types of businesses have different protections available and tax advantages or disadvantages that come with them. Many business owners choose to form a limited liability corporation, or LLC, because of the tax advantages and protections they offer when properly established.
Form your LLC only after planning ahead and executing each step correctly.
- Choose a name for your LLC that is not already in use by another business. For some entrepreneurs in a crowded field, this is one of the most difficult steps.
- Create and file articles of organization, including the required fees.
- Create an operating agreement that outlines the duties and privileges of each member within the LLC
- Secure the various licenses and permits that your specific business requires under state and federal laws. This may vary widely, depending on your field.
While it is certainly possible to form an LLC independently, it is always wise to use strong legal resources when getting your LLC off the ground. If you do not establish the business properly, you may run into complications with the state when it comes time to pay taxes or secure the licenses you need to operate.
These types of mistakes can and do sink businesses that might otherwise grow into successful ventures. Do not hesitate to use the legal resources that you have available to ensure that you understand your rights and how to protect them while you begin an exciting new business opportunity.