Choose a business structure

Updated: Jan 16

Here are the main highlights from the SBA's guide on choosing a business structure:

Sole Proprietorship: Easy to form, complete control, personal liability for business debts.
Partnership: Simple structure for two or more owners, includes limited partnerships (LP) and limited liability partnerships (LLP).
Limited Liability Company (LLC): Combines the benefits of a corporation and a partnership, limited personal liability.
Corporation: Separate legal entity, limited liability, more complex and costly to form, subject to double taxation.
S Corporation: Special type of corporation, avoids double taxation, limited to 100 shareholders.
B Corporation: For-profit corporation that includes positive impact on society, workers, the community, and the environment in its legally defined goals.
Close Corporation: Similar to a corporation but with less formalities, often run by a small group of shareholders.
Nonprofit Corporation: Organized for a charitable, educational, religious, literary, or scientific purpose, eligible for tax-exempt status.
Cooperative: Owned and operated for the benefit of those using its services, profits distributed among members.