When you have an idea for a Louisiana small business, one of the first important decisions you will need to make is what type of business structure you want to establish. Different business structures can help you accomplish different objectives, and each type has its own benefits and drawbacks. Dale M. Maas, Attorney at Law, recognizes that different business structures bring with them varying levels of personal liability, and he has helped many clients looking to reduce their level of personal liability in their businesses establish business formation types that meet their needs.
According to Quickbooks, just about any type of business exposes you to at least some level of liability, even if the type of business you plan to establish is not in an inherently dangerous industry. In other words, unless you take steps to reduce your level of liability in your business, your personal assets may be at risk in the event that someone files a lawsuit or judgment against your business. So, what types of business structures can help protect you in such circumstances?
One such formation type is the limited liability company, which, as the name implies, reduces your own level of liability in your business. In addition to being relatively simple to operate, this type of business structure does not limit the number of owners your company can have, as is the case with the next business structure known to reduce personal liability.
The S corporation is another business type that reduces personal liability, but, as noted above, there are certain limitations involved with establishing this type of structure. Your business cannot, for example, have more than 100 owners if you establish it as an S corporation, and there is also typically more red tape involved in creating and maintaining this type of business. You can find more about business formation by exploring our webpage.