Selecting the appropriate business structure is one of the most crucial—and frequently most difficult—steps in establishing any business. The structure you choose will influence everything from your operational flexibility to your tax and legal responsibilities. Obtaining the appropriate advice early on is crucial because every business entity has a unique set of regulations, advantages, and restrictions.
David R. Mullany, Esq., a reputable Boston-based business law practice, assists entrepreneurs and business owners in making well-informed decisions about entity formation. Whether you want to form a corporation, partnership, LLC, or sole proprietorship, our knowledgeable staff can guide you through your options and ensure your decision fits your long-term objectives.
Call David R. Mullany, Esq. at (978) 549-8900 for your Free Consultation with a Boston Entity Formation lawyer.
Factors to Consider When Choosing a Bess Entity
Before you look into how to start your own Boston business, you must decide what kind of business structure you want your business to have. The structure you have selected will establish the foundation for your company's operations, taxes, and legal protections. Each also has different registration procedures, which can entail additional permits and requirements.
Here are some considerations that you should think about when choosing your business entity:
- Liability protection and responsibilities—Every business entity indicates how liability is distributed between owners and how personal assets are protected from business liability or obligation.
- Initial capital—Each business entity will require capital to function, and depending on what you selected, you may be limited in the financing options you can explore to collect that capital.
- Future expansion and flexibility—If you intend to reach out to new partners or merge with another entity, some business entities may offer flexible structures compared to other entity types.
- Tax classification—Each business entity has specific tax structures that owners or shareholders must comply with, which will be crucial if one party is held liable for the business’s debts or liabilities.
Types of Business Entities
Down below are the different types of business entities that you can consider if you are starting any business in Boston:
Sole proprietorship
A sole proprietorship is a structure in which an individual owns and runs the business online or in an office space. The proprietor gets all the profits and is liable for any liabilities or debts the business accumulates.
Partnerships
This type of business structure is established by two or more people or entities. Partnerships are not taxed directly but are taxed to each member based on their share of the business.
There are several types of partnerships that differ when it comes to the responsibility of each partner and how the assets or liabilities are handled. These types are as follows:
- General partnership—In this partnership, you and your business partner are legally responsible for the business’s assets and liabilities. If the business incurs debt, it can be paid with your personal assets.
- Limited liability partnerships: The partners’ personal assets and liabilities are separate from their business assets and liabilities.
- Limited partnership: One partner assumes full personal liability for the business while the other partner(s) assume limited liability.
Limited Liability Company (LLC)
An LLC offers flexible administration and advantageous tax status, combining the advantages of corporations and partnerships. Under this structure, partners will not be ordered to use their personal assets to pay any business liabilities.
Corporation
A corporation, or C corporation, is a legal entity that is separate from its owners. Because of this structure, owners or shareholders are protected from any business liabilities. When it comes to income taxes, both the corporation and its shareholders are responsible for them.
There are four different types of corporations recognized in Massachusetts, and they are:
- Profit - Corporations are built to conduct business for profit.
- Non-profit - Corporations that focus on conducting educational, charitable, religious, or scientific work.
- Professional - Corporations owned by licensed professionals to streamline how their professional services can be provided.
- Foreign entities - These are non-profit or for-profit corporations established outside the state.
S corporations, or corporations that allow the entity to pass both its income and losses to its shareholders or owners, are not considered a business structure. If one wishes to start an S-corporation, they must first file as one of the four corporation types and contact the Internal Revenue Service (IRS) to adjust the tax arrangement for their corporation.
Key Entity Formation Services by David R. Mullany, Esq.
Once you have a clear idea about the business entity you wish to use for your business, the next step is establishing it. David R. Mullany, Esq. will be with you through every step of the process to ensure your chosen business entity suits your preferences and business goals.
Entity Selection and Structuring
Our Boston entity formation lawyers will meet with you to discuss your business goals, preferences, and concerns and identify which entity best suits your needs. We will also assist you in exploring how you can structure your business based on the entity you are considering.
Drafting and Filing Formation Documents
Establishing any business entity requires an extensive list of legal documents that must be submitted before the Massachusetts’ Secretary of the Commonwealth, the IRS, and Boston’s local government before it can be recognized. Our business entity formation lawyers will prepare all the documents needed for your entity and have them filed with the appropriate government institutions.
Entity Compliance
No matter which business entity you select, it is crucial that your business entity abides by Massachusetts’ General Laws and complies with all expected responsibilities. This includes registering with the state government, reporting their business’s yearly income and losses, and paying taxes. David R. Mullany, Esq.’s lawyers will ensure you meet these requirements and maintain good standing with the state and local government.
Tax Advice
Every business entity has different tax obligations that affect how owners manage their finances. We can contact trustworthy tax advisors on your behalf to help you understand how your business’s structure will influence the taxes you pay.
Continuous Legal Support and Strategy
As your business grows, so too will your targets. With this in mind, our lawyers are always on standby to assist you with future restructuring, mergers, acquisitions, and other major business decisions.
Why Choose David R. Mullany, Esq.?
Our Boston, MA business law firm understands how challenging it can be to launch a business in Boston, especially if it involves large capital, numerous stockholders, and liabilities.
With us as your business lawyers, we will provide you with the following benefits:
- Personalized legal solutions and strategies—Every business is different, which is why we personalize our approach to meet our clients' needs and achieve their goals.
- Build connections—To provide our clients with excellent services, we work alongside trusted accountants, financial advisors, and other professionals to ensure that you understand every aspect of your business’s operations and that it succeeds in the future.
- Local know-how—Since we are based in Boston, we understand the local business climate and the trends that can affect your business’s success. We will ensure your business is ready for any challenge and inform you of potential problems you need to prepare for.
Whether you are a new business owner or an established business, our entity formation lawyers are always ready to assist!
Start Your Boston Entity Today with David R. Mullany, Esq.!
A solid foundation is necessary before your company can expand, prosper, and realize its full potential. The correct structure and documentation are the first steps in this process. We at David R. Mullany, Esq. are here to walk you through the Boston entity formation procedure confidently.
We'll assist you in selecting the best structure for your objectives and preparing all required paperwork for a seamless and legal setup, whether you're starting a new business or improving your existing one. We offer more than simply documentation; we offer the legal advice and defense you require to steer clear of pitfalls and protect your company from future problems.
When David R. Mullany, Esq. is on your side, you're preparing your company for long-term success rather than merely ticking boxes.
Call David R. Mullany, Esq. at (978) 549-8900 for your Free Consultation with a Boston Entity Formation lawyer.