Creating a new company always comes with inherent risks. When starting a new company, choosing a legal business structure that meets your needs and goals is important. Your business formation will impact everything, including day-to-day operations, taxes, and personal liability protection.
Founding attorney Spiro J. Verras can provide the legal counsel you need to start your company on the path to success. He will take the time to understand your unique business needs and advise you on the positives and drawbacks of different business structures in Florida. When you decide what business structure works for you, he will help you prepare and adopt clear, definitive governance documents to form your business legally.
Providing Florida Businesses with End-to-End Company Formation Services
No matter how long your business has been operating in Florida, having an experienced attorney in your corner can mean the difference between success and failure. Taking the time to work with an experienced attorney to form a business legal structure can help you protect yourself and your business. Attorney Spiro J. Verras provides business clients with end-to-end business formation services related to organizational structure.
He regularly helps established businesses and Florida start-ups negotiate and draft business formation paperwork, contracts, employment guidelines, vendor agreements, and other legal documents. He provides clients with solution-oriented legal advice, guiding business owners through the complexities of their transactions and ensuring their interests are protected.
Sole Proprietorships
A sole proprietorship is the most common, straightforward type of business structure. There is no legal distinction between the business owner and the owner. The business taxes pass through to the business owner.
General Partnerships, Limited Partnerships, and Limited Liability Partnerships
A partnership includes two or more business co-owners who share in the business’s profits and losses. The rights and responsibilities are divided equally among the business partners in a general partnership. General partners can act on behalf of all of the partners. Each partner is responsible for the debts and obligations of the partnership.
A limited partnership is a business structure comprising both general and limited partners. Each partner has the right to determine and limit his or her personal liability. Limited partners aren’t responsible for the partnership’s actions, debts, and obligations. General partners have the right to manage the partnership, while limited partners do not, but both types of partners benefit from the business profits.
Limited Liability Companies (LLCs)
Many business owners choose to form limited liability companies (LLCs). LLCs are similar to corporations because they offer business owners limited personal liability protection. However, LLCs do not provide the exact extent of personal liability protection as corporations. LLCs are not required to hold regular management or stockholder meetings, and owners aren’t required to comply with the ongoing corporate formalities of corporations.
Corporations
Corporations are considered independent legal entities. They exist separately from people who own, control, and manage the corporation. A corporation does’t dissolve when the owners or shareholders die because it is considered a separate legal entity or person. Corporations provide owners with the most thorough personal liability protection. Additionally, corporations can pay taxes, enter contracts, and transact business.
The biggest difference between a corporation and an LLC is that corporations do not allow pass-through tax treatment like corporations. Generally, corporations are taxed at the corporate level. Shareholders are also taxed on distributions they receive. S-corporations allow for pass-through tax treatment. However, S-corporations allow for only one class of stock and have other ownership restrictions that LLCs don’t have.
What Type of Business Formation Should I Choose?
Deciding between a limited liability company (LLC) or a corporation or selecting which type of corporation to form can be challenging. Before you decide on a business structure, speaking to a Florida business attorney can be beneficial. Attorney Spiro J. Verras will explain the differences between each type of business entity, allowing you to make informed decisions about your company’s future.
Lessening Personal Liability by Incorporating Your Business
Incorporating your business can provide financial security by protecting your personal assets. Other benefits of incorporation include tax savings, raising capital, and ensuring continuity to operate without interruption, even if disputes arise. Generally, a business owner’s assets are no longer at risk when incorporated, unlike with a sole proprietorship or general partnership.
In sole proprietorships or general partnerships, business owners can be personally liable for lawsuits against the business. Although some of these risks can be covered by liability insurance, inadequate coverage could lead to owners’ personal assets at risk of business creditors.
How to Create a Business Entity in Florida
The exact process for creating a business depends on the type of business formation involved. LLCs and corporations are formed at the state level and require proper documentation, filings, and fees to form an entity properly. At Spiro J. Verras Law, we help clients throughout the business formation process. When you work with us, we will handle every aspect of the process and help you file all necessary paperwork.
The Benefits of Working with a Business Formation Attorney
Working with an online company to form your business may seem cheaper than working with an attorney. However, an online service cannot provide you with legal advice. Only a skilled business formation attorney can help you understand what type of entity best suits your unique needs and goals.
An attorney can also provide all government entities involved with your business formation with the necessary paperwork, advise you on complying with Florida law, and assist you with ongoing legal requirements after your business has been formed.
Discuss Your Business Formation Strategy with a Skilled Attorney
Choosing the right business structure helps you maximize the best balance of legal protections, ease of use, and benefits. Verras Law has extensive knowledge and understanding of Florida’s business incorporation laws. Don’t hesitate to contact Verras Law to schedule an initial case evaluation.