The nine “most terrifying words in the English language,” according to one of President Ronald Reagan’s favorite jokes, were these: “I’m from the government and I’m here to help.” The line never failed to get an appreciative laugh. Of course, few pointed out to the president that he, too, was from the government and was there to help.
When we recently looked at the U.S. Small Business Administration’s website, we were reminded of the late president’s humor. The site is a well-intentioned, neatly organized group of ideas, forms and information for those interested in launching a new business.
One of the categories explored on the government site is deciding on the business structure for your endeavor. After all, the structure “you choose will have legal and tax implications,” the site notes with a bit of understatement. Indeed, the structure you choose will help define your business and how it interacts with the public, other businesses, St. George regulators, the taxman and your wallet, among other things.
The site helpfully lists different types of business structures, with brief explanations of each. As you read through the contents, you learn a bit about each one:
- Sole proprietorship: most basic structure; you own the works and are responsible for liabilities and assets
- Limited Liability Company: a mix of corporate limited liabilities and tax efficiencies of partnerships
- Cooperative: a collective designed to benefit member-owners
- Corporation: for those with employees, this more complex structure might suit your needs
- Partnership: different types of partnerships can be entered into, depending on the roles of the participants
- S Corporation: tax implications here are different than for C corporations
Useful information, to be sure, and while there is more detail to be found there, it’s mainly of the “I’m doing basic internet research” variety. If you are actually ready to sit down and make the hard decisions needed to launch a business, discuss your ideas, needs and plans with a business law attorney who knows St. George and the law.