When it comes to business formation, they are normally of four main types. Some of them have been found to be easy to start while others have been found to be inexpensive. However, all of them require that you put a lot of your time in them because they need it. Others are also able to offer you with a kind of limited liability that you can use to your advantage. Below are some of the business formations that you can be able to find in the market.
In this kind of formation, there are no documents that you have to file with your current state. However, there is going to be a partnership agreement that is going to be drawn between the people who are forming the partnership. Also, some business laws are going to have to be followed. The actions of each of the partners are the business is going to affect whatever it is that is going to take place in the current affairs of the said business.
This is the easiest type of business formation that you can be able to find and it is also one that is not going to cost you a lot of money. Here, there is no kind of incorporation documents that you will have to file. Depending on the kind of occupation that you are opening, you are going to have to get a license based on that occupation. It is also important for you to note that you are going to have no kind of protection from creditor claims and lawsuits. Also, another thing that you have to keep in mind is that your personal wealth may be used to settle any business debts just in case things do not work out in the way that you expected them to.
This is the most formal and expensive type of business formation that you can be able to find out there. When you are thinking to file for a corporation formation, you have to open an incorporation account with the state where you are starting your corporation. You also have to keep in mind that with corporations, there is going to be a kind of limited liability protection for the owners of the corporation. However, the earnings are taxed to the shareholders as well as the earnings that are going to be made on the dividends.
Limited liability Company
Limited Liability Company is very beneficial since it is able to offer the owners of the business with a kind of limited liability to all the members of the company. Once you are able to open an account for limited liability Company, the LLC is the one responsible for the money and not its members.