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Best Business Structure Startup For Big/Small Business Owners



HOW TO DECIDE THE BEST BUSINESS STRUCTURE FOR YOU AS AN ENTREPRENEUR, REAL ESTATE INVESTORS & AGENTS, DOCTORS, FARM, RETAIL AND COMPANIES


Are you planning to venture into business either full time or part-time? Or are you planning to become self employed through business? If so, there is a factor guiding this. You shouldn't just get into business just like that; you should first decide the very perfect business structure that would suit your personality.
We all know that not all business strategy would work for everyone, if so, nobody would be poor by now because all you would have to do is follow the same "business strategy" of Mr. A and you would achieve success.

However, deciding the best business structure for you is quiet tactical, therefore, most people need help, and if you happen to be one, you are on the right spot, because right here at sharpestarena, we bring you a life changing topic that teaches "How to decide the best business structure for you".

How would you know the best business structure for you?
This is a question that would determine your career as a "business tycoon" and as well change your life for good if you have the right answer.

As a person concerned with the well being of the society, we would place you on the right paths to determining the "best business strategies" you have to follow as well as the "best business structure" you can handle for you to attain the very (peak of success in the business) you have decided to venture into.

Therefore, make the proper decision using the "guidelines" that would be laid out a few moments from now and head straight back to focusing on staring the business and nurturing the growth of the business as well.




Right below are listed and explained the six types of business structures you can make a choice from depending on your capabilities.



Sole Proprietorship

The business of a sole proprietorship appears to be the easiest type of business structure you can get entangled with. Don't be so fast at deciding, this business has some forms of risks attached to it, but before we get to discuss the risks found or entangled with this type of business structure, lets first give you the clue and the good sides of the business.

Who knows? It may be the perfect business structure for you and would quickly help you attain the peak of success in business. 
When it comes to a sole proprietorship business structure, luckily for you, there are no incorporation forms for you to fill to get started neither is there any fees that would be required of you to pay with the government, you are as free as the wind, expect the governments wants to deprive you of your rights which I know you wouldn't allow.

This business structure gives you the ability to pick any business of your choice and get stated with work. With this, you get to avoid double taxation that is liable to occur in corporations as every penny you earn from this "business structure" dives straight into your personal pocket.

Now that you have the idea of what it entails to start this business, here we also have the risks of this business structure, due to the starting ease of this "business structure", it is considered that is a larger amount of risk involved with this business structure which is involved with the lack of incorporation.

People would like to ask, how much risks? Actually, here is the deal, choosing this business structure renders you personally liable for everything that goes wrong in the business name, you might be able to hire employees, but if they damage a clients property in the firm, you can be sued for the damages, and this hereby puts everything at your risk.

Anyways, if you feel you can handle this perfectly, there is no harm in venturing into a sole proprietorship business structure.



Partnership

This business structure should actually ring a bell even without much explanation about this, but for the benefit of doubts, lets get you to understand much about this business structure.

A Partnership business structure involves the collaboration of two or more individuals to formally agree to run a particular business together.
This business structure also happens to easy to form, more also, the income you all earn from the business you have ventured into goes into your (individual partners tax) returns.

However, just like the sole proprietorship structure, you get to pay no corporate income tax and also you get to avoid double taxation.
When we get to the risk aspects, just as the previously discussed structure of business, you and your partner get to be liable for not only their individual actions but for the actions of the general partners, let me give you an instance, if it appears that your partner receives a business loan, you stand liable as well because you all would be responsible for paying back the loan.



Limited Liability and Corporations Businesses

Under this structure of business, there are several types of corporations as well as "limited liability business structures" which can be made use of to avoid most of the business liability which are undertaken with a partnership or sole proprietorship which are as follows;


C Corporation

For this kind of structure, it appears that you would have to pool your money together with "shareholders" involved in the scheme, more also, you would be liable to stock, which means you would be given stock in the business formed.

This structure of business is taken as a completely separate tax body in the sight of the Internal Revenue Service, which means that your business scheme can take a deduction in tax just as a normal individual would.
As much as it could be said, this also means that your profit would be taxed twice: one at the corporate income tax level and the other when you get paid via your salary, dividends, or bonuses.

Lastly, if the *C Corporation* is a separate body entirely, this gives out a result that your personal liability is limited.

S Corporation

Here we have another business structure you can as well venture into if you deem it fit for you... This happens to be a legal body formed just the same way the C Corporation structure is formed but with an extra bonus.

This extra bonus gets the income flowing directly into personal income taxes through a process known as Pass Through Taxation. Right in the business structure, there is no double taxation and the structure is made nice due to the fact that your liability is made limited to that of a normal shareholder, but you only have to pay tax once.



Limited Liability Corporation (LLC)

This form of business is considered a state allowed business structure that earns you the benefits of a (sole proprietorship and corporations) and at the same time extracting some of the disadvantages of the structure.

However, the owners of this business structure are referred to as members, and there are no limitations to the number of members, but then, there is a sole member who would be made a managing member who would be in charge of the daily operations of the business.

 Meanwhile, all members are not individually responsible for the judgments made against the firm; moreover, taxes are made to pass through their personal income taxes.

This structure does not involve much paperwork just as a C or S corporation would require, and you are not necessarily required to hold a meeting involving all shareholders every year, nor a meeting for the board of directors.



Limited Partnership

This structure of business happens to be an interesting twist on the partnership business structure.

 For a partnership form of business, you may find it a bit hard to raise capital considering the risks involved with the structure and with all partners made liable for all partners actions, but for a limited partnership scheme, this scenario can be avoided due to the fact that this structure is involved with two types of partners which are; General and limited.

General Partners: These are partners that are involved with the daily operations of the company and still partake in all the liabilities of all general partners actions.

Limited Partners: These set of partners are merely passive investors, who contribute funds to the company and earns profit from the process, they are not given the opportunity to get involved in the management of the business.




Conclusion On How To Decide The Best Business Structure For You

Getting to select a business structure, limitations to your liability should be your first priority, if you are going to choose more liabilities due to the ease in startup, you should be ready for the consequences. Even if you play very safe and become very confident in your future performances, there are still chances or probability that an error would occur.

But when taking a second thought, the time and efforts as well as "capital required setup a business structure with lesser liabilities" could be costly and choking, depending on your pocket.

Therefore, you should opt in for the perfect one you know you can handle as far as the "advantages and disadvantages" as been revealed. I hope you find this useful as you startup your career in business.

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