1400 Gables Ct #103 Plano, TX 75075
5601 Bridge Street, #300, Ft. Worth, TX 76112

Choice of Entity is an Important Decision for Small Business

Richard Armstrong comments on factors which go into which entity you select in setting up your small or medium-sized business in Texas

In Texas, business are generally created and operated in one of the following structures, recognized by statute:
• Sole proprietorship
• General Partnership
• Limited Partnership
• Registered Limited Liability Partnership
• Corporation (Both “S” Corp and “C” Corp)
• Limited Liability Company

While there are many variations within these categories, the majority of small businesses will fit within one of these general categories.

As you might imagine, the most apt business entity in any particular situation depends upon the objectives of the business that will utilize that entity. To start with, we recommend  that in all but the most basic  of trades, you not use the sole proprietorship form. Yes, it is still possible for a single owner to operate this way, but it has become so easy to set up a business entity (notice I said “set up”, not “maintain”), that there is little reason left not to do so to limit the potential liability from a disgruntled customer or other third party. Use of an entity is not the panacea that some business owners think it is: a thorough review of your insurance needs should be undertaken in order to see how you can make your risks manageable at a price you can afford.

Next week, we will undertake discussion of the General Partnership form.

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Armstrong The Law Firm, P.C.
Plano Location
1400 Gables Ct #103
Plano, TX 75075

Fort Worth Location (By Appointment Only)
5601 Bridge Street, Ste. 300
Ft. Worth, Texas 76112

Phone: (972) 424-5297