One of the first decisions that you will have to make as a business owner is how the company should be structured. This decision will have long-term implications. In making a choice, you will want to take into account the following:
The size and scope of business you hoping to attain
The level of control do you wish to have
The level of structure you are willing to deal with
The business's vulnerability to lawsuits
Tax implications of the different ownership structures
Expected profit (or loss) of the business
Whether or not you need to re-invest earnings into the business
Your need for access to cash out of the business for yourself
There are four basic legal forms of ownership for small businesses:
Sole Proprietorship
Partnership
Corporation
Limited Liability Company
To learn more about deciding which is the right legal structure for your business take a look at How to Choose the Legal Form of a Business.
