Starting a business is an exciting time for a Wisconsin entrepreneur. During this stage of your business career, you will have to make many important choices that will affect the future of your company. This includes choosing the most appropriate type of business entity, or structure, for your company.
This is a significant choice that will impact your operations for years to come. It is not a decision to take lightly, and you will benefit from doing the research necessary to ensure that you make the right choice. There are certain factors to consider, including the type of business you have, your goals for the future and more. Business owners often find it beneficial to speak about their concerns with an attorney before moving forward with a choice of entity.
Look at the big picture
Deciding on an entity involves more than just looking at what makes the most sense in this moment. It determines how you will set up your company, and you will want to consider your long-term objectives and the impact of your potential choices in the future. You will want to consider a few primary areas as you weigh your options, and they include:
- Expenses and company procedures -- With some types of entities, there are certain fees involved, and it can be expensive to maintain them. Certain types of entities also require that you keep specific records about certain business decisions and more.
- Taxes -- With some business structures, you will be responsible for paying income taxes on company profit. Others allow you to avoid personal responsibility for company taxes.
- Investment -- If you hope to sell shares of your company in the future, this could determine what type of business structure is most appropriate for your situation.
- Liabilities -- The various structure types all come with various levels of personal liability that you will have for the company's debts and financial obligations.
Whether you are just starting out or you think another type of structure could be useful for your company, these important factors will affect your decision-making. You do not have to make these crucial choices on your own, but instead, you will probably find significant benefit in speaking with an experienced business law attorney about your concerns.
In the initial stages of your business, you would be wise not to overlook the importance of choosing the right organizational structure, since this will set the foundation on which you will build various aspects of your business.