When starting a business, seven issues must be addressed by the business owners and the business attorney to help determine both the business structure and the tax structure to be used:
- Who is going to own the business in the short term?
- Who is going to own the business in the future?
- What is the purpose of the entity?
- What is the exit strategy of the business owners?
- How is the business going to be funded?
- What are the financial situations of the business owners?
- Is the business going to own assets and, if so, what types of assets?
The answers to these questions will help the business owners and the business attorney determine whether a partnership, corporation, or limited liability company is more appropriate for the business. It will also help the business attorney or the accountant, if one is involved, help determine the tax structure of the business.
If you are looking to start a business and need help, please contact me, your small business lawyer. Prior to our first meeting, please think about the above as the answers to these questions help build the formation of your small business!