Starting your own business in New York is as gratifying as it is challenging. The way you organize your new organization is key, so make sure you’re getting organized in the right way.
Keeping things simple when it makes sense
The most common way for a business to start is as a sole proprietorship. This is because it’s a simple way of setting up a company if you’re the sole owner. You don’t need to have much other than a tax ID number for this kind of organization.
But when there’s more than one owner in the picture, it may be time to start thinking about what your other options are. This may also be the case if you have concerns regarding how taxes are going to work or who is going to be liable if there are issues.
Determining which form of organization is going to help your business thrive and succeed the most depends on a variety of factors. Foremost among these is what kind of business you have, how many owners are working together to make it run and how concerned you are about liability and taxation.
If you’re looking for the next simplest thing to a sole proprietorship, then a partnership may be a good option to look into. There’s not a lot of added complexity, and all that you’ll need is an agreement put into writing – or just spoken out loud.
Your business organization options are:
- Sole proprietorship
- Limited liability company
- C corporation
- S corporation
The benefits of an LLC
If you’re willing to bump it up a notch in terms of business complexity, you might consider an LLC. In that case, you’re protected from personal culpability for any liabilities and debts that the company may rack up.
This is done by keeping the personal assets of the owners and the business assets of the organization separated. Remember that with an LLC, you have to take care of filing an information return with the IRS.