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Corporation or LLC? Business Organizations for Tech Startups.

YoungUpstarts

One of the first actions you will take with your startup is to organize your company a separate legal entity to protect yourself from personal liability for the company’s debts. In the tech startup context, you’ll typically choose between a Corporation and a Limited Liability Company (“LLC”). Verdict : LLC.

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4 Types Of Tax Structures For Your Business

The Startup Magazine

The Limited Liability Company (LLC) is a common business structure, but it exists according to state statute. However, if that individual is the only member of a domestic limited liability company (LLC), that individual is not a sole proprietor if they choose to treat their LLC as a corporation.

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Business Prenup: What To Do Before You Start A Company With A Partner

YoungUpstarts

For example, an attorney can assist with issues concerning corporate formation (such as the pros and cons of corporations, limited liability companies and other structures) that may impact liability. If you stop working for the company, how will that impact your voting and distribution rights?

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How To Choose A Legal Structure For Your Business

The Startup Magazine

State statutes allow the formation of a limited liability company (LLC). A corporation is formed when prospective shareholders exchange money, property or both, for a share of the company’s capital stock. It exists to conduct business, earn profits (or losses), pay tax and distribute dividends to its shareholders.

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What is a Social Enterprise?

Up and Running

An excellent example of a social enterprise is The Empowerment Plan —an organization that hires people currently living in homeless shelters to create a combination winter coat, sleeping bag, and over-the-shoulder bag, which is then distributed to the homeless of Detroit free of charge. that social enterprises can take.

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How To Choose The Best Legal Structure For Your Business

The Startup Magazine

A general partnership shares up the responsibilities and liabilities of the business between all parties equally. On the other hand, a limited partnership has distributed responsibilities, with one or more individuals running the company and the others contributing in some way, either financially or through their skills or knowledge.

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What Kind Of Company Should You Create?

YoungUpstarts

Additionally, it will be important to consider whether you plan on attracting investment capital through the distribution of stock, because only certain types of businesses can issue shares of ownership. Limited Liability Company (LLC). S-Corporation. The S-corporation is a popular choice for solo business owners.

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