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Choose the best entity type to help your business succeed

According to the Internal Revenue Service there are a variety of different forms that a business owner may choose for his or her new entity. Each of these forms has different tax obligations and can benefit different businesses depending upon their practices and industries. This post reviews a few possible business forms that entities can take. Please speak with a corporate attorney about how to choose the best entity type for your new business venture.

First, a business may be held by a single person. These businesses are generally called sole proprietorships. Limited liability companies held by individuals are not necessarily sole proprietorships, however. Individuals with questions about this distinction may choose to work with tax or business legal professionals.

Second, a business may be held as a partnership. A partnership may involve only two individuals or it may have multiple partners involved in a single business venture. In a partnership the partners all share in working to make the business succeed.

Third, a business may take the form of a corporation. Corporations exchange money or assets of value for stock in the entity's capital. Corporations may take on specific forms, such as C corporations or S corporations. This post will not delve further into the intricacies of these different types of corporations.

Finally, a business may be held as a limited liability company. The owners of a limited liability company are members and the number of members can vary. States tend to regulate limited liability company formation and therefore individuals interested in this form of business may choose to look to New Jersey law for more information.

Making good decisions about business formation can have lasting repercussions for a New Jersey corporate entity. Lawyers who practice business law can help their clients choose the best entity type for their business start-ups. Picking the right entity type can give a business the start it needs to prosper into the future.

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