Selecting the Business Entity

You’ve got an idea and you’re ready to take the next step (or maybe you’ve even begun your new venture), but you haven’t formed your business entity yet (i.e., corporation, limited liability company, limited liability partnership, limited liability limited partnership, subchapter S corporation, partnership, or sole proprietorship).  Selecting the entity type is an important facet of how your company will operate.  Issues that you should consider before picking an entity type are:  1) amount of personal liability the owner’s of the company are willing to accept; 2) amount of control the owner’s wish to exert over the company; 3) number of owners of the company (i.e., is the plan for the company to go public or will you be the sole proprietor indefinitely?); and 4) tax issues and consequences.  Plan for the future and the entity type will help you get there.