Are you a Massachusetts resident that has decided to start your own business? Perhaps you have always dreamed of owning your own business and this dream has become a necessary reality due to downsizing at a previous job, or you have decided that now is the perfect market for your business to begin. Even as a small business owner, it’s important to make sure you are up-to-date with recent developments in business law to set your new business apart from the rest.
Choosing a legal structure may be one of the most important issues at the start-up of your new business. The three basic business structures are a sole proprietorship, partnership, and a limited liability corporation.
A sole proprietorship is an unincorporated new business organization that’s owned and operated by an individual. Sole proprietors do not run their operations through separate legal entities like corporations do.
When two or more people decide to join together to carry on a trade or new business, their relationship is a partnership. Usually, each partner contributes to all parts of the business including money, property, and labor. In return, each partner shares in the profits and/or losses of the business.
A corporation is an independent legal entity owned by shareholders, meaning that the corporation itself, and not the shareholders that own it, will be held legally liable for the actions and debts incurred by the business.
Each legal form has its own unique characteristics, each with different potential benefits to the owner. Your goal is to choose the structure that works best for you and your new business. As a small business owner, paying attention to the legal set up of your business is vital, as failing to choose the proper format could be costly and extremely detrimental.
If you are considering starting your own business, the attorneys at Wynn & Wynn have the knowledge of appropriate business structures and business law matters. We understand the legal needs of your business. Contact us today at 1-800-852-5211 or request a free consultation.