Lake City Attorneys Guide You through Business Formation
Starting your business with a strong foundation
Business formation is a necessary first step to building a successful company. Doing it correctly can provide substantial tax and liability benefits and create a comprehensive and workable management structure. Doing it incorrectly can create an unmanageable company constantly mired in disputes among business partners. If you truly want to build a strong company, it is a wise investment to secure professional guidance during the business formation process. With more than 100 years of combined business law experience, Robinson, Kennon & Kendron, P.A. can evaluate your business plan and expectations to help you choose the business structure that is right for you. Whether you are starting a new company in Lake City, forming a new division or restructuring an existing entity, they can help you do so with confidence and efficiency.
Choosing the right business structure
Florida business law provides for several distinct types of business entities and no one structure is superior under all circumstances. Choosing the right one can depend on a number of factors, including your management style, liability exposure, expected profits, personal finances and plan for raising capital. Some structures you may consider include:
- General partnerships — General partnerships have fallen into disuse in Florida because they do not provide liability protection to the individual partners. There may, however, still be limited circumstances when a GP can be useful, such as for a joint venture between two limited-liability entities.
- Limited partnerships and limited-liability partnerships — LPs and LLPs have the tax advantage of being pass-through entities — only profits actually distributed to the partners are subject to income tax. And unlike general partnerships, they offer some liability protection.
- Limited-liability companies (LLCs) — LLCs offer liability protection without the formality requirements and tax consequences of a corporation. This type of entity can be either single-member or multi-member and can be managed either by its members or by a manager the members designate.
- Corporations — The corporate form can be ideal for companies that plan on selling stock to secure funding. Unfortunately, with the exception of S corporations, these entities are subject to double taxation — the entity itself pays corporate income tax and then shareholders pay individual income tax on any dividends or disbursements. Corporations must also adhere to numerous formality requirements, including maintaining a board of directors and holding annual shareholder meetings, in order to keep their corporate status.
The steps to business formation
Forming a business organization usually requires the founders to file documents with the Florida Department of State, Division of Corporations. In addition to these documents, each company should have an organic agreement — partnership agreements for partnerships, operating agreements for LLCs, and articles of incorporation and bylaws for corporations — that clearly establishes how the business is to be run. Especially in companies with multiple stakeholders, keeping these agreements clear and comprehensive is essential to avoiding commercial disputes between business partners in the future.
Contact an experienced business law attorney today
The attorneys of Robinson, Kennon & Kendron, P.A. can provide reliable counsel to your business from beginning to end. Call today at 844.210.0025 or contact the firm online to schedule a consultation at their downtown Lake City office to lean how their experienced lawyers can help.