A Few Words About Choosing an Entity
In a Nutshell
If you intend to organize a limited liability entity, your primary options are a C-corp,  an S-corp, or an LLC . If you seek a limited liability entity with pass-through taxation, the choices are an S-corp or an LLC.
How to Choose the Right Entity for Your Business
Choosing a business form is one of the most important decisions you will make in starting any enterprise. This choice will affect your vicarious liability, the tax treatment of your business income, the tax characterization of any personal income you receive from your business, the tax treatment of property exchanges you will make with your business, any state mandated requirements you must fulfill in maintaining your business, and your business’s potential management and ownership structures.
To select the right entity, compare and contrast the features of the various forms with the unique aspects of your business.  There will likely be more than one viable option; each with its own advantages and disadvantages. Assess the costs and benefits of the various forms. Determine the factors most important to your endeavors. Plan ahead.
If you are handling formation on your own, please consider working with a local entrepreneurial or business attorney to execute your organization’s primary governing document, whether it is a partnership agreement, operating agreement, or set of bylaws. Every business entity should have a comprehensive governing document. Some entities require one for legal formation. Even where not legally required, this document is crucial to smooth business governance and success. A well crafted document serves as a blueprint for your business. It memorializes your intentions and enlivens, guides, and supports all aspects of your enterprise.
Your governing document is a contract that becomes part of the law by which you and your business are bound. It should cover a number of issues, and contains terms and provisions that govern the business and the participants’ actions. It details the rights, duties, relationships, and responsibilities of the participants to the business, each other, and third parties.
You do not need a governing document; you need a governing document for your business. It is best not to download or copy such a document from a source with no knowledge of your situation, endeavors, goals, or expectations. Use templates, samples, and other business’s primary documents as reference material, but thoughtfully create a document applicable to the particulars of your business.
This site describes a number of the key elements related to the primary business forms: Sole proprietorship, Partnership, C-corporation, S-corporation, and Limited Liability Company (LLC). But note: there is more to consider regarding entity characteristics and the particulars of your business! Consult your local attorney for help.
This site does not constitute legal advice. No one can or should give you legal advice you regarding entity choice without understanding your unique circumstances. These pages do not create any attorney-client relationship. If you contact an attorney, do not include confidential information in any exploratory email. Until you establish a working relationship or sign an engagement agreement, no attorney-client privilege exists, and your information is not protected.