This session, hosted by EGC Director of Accounting, Jeremy Hinckley, CPA, MBA, and Brooks Pierce Partners, Haniya Mir, and Adam Tarleton, explored the different types of business structures – including Limited Liability Companies (LLC), C Corporations (C-Corp), and S Corporations (S-Corp) – that may work best for your business and what you should know about each one. EGC and Brooks Pierce also shared an overview of the entity formation process, including the choice of entity and jurisdiction, and how to best move forward.
Choosing the right business entity is absolutely crucial to a growing company as it will ultimately affect its legal protection, tax obligations, growth potential, the ability to raise capital, and day-to-day operations. However, making the right choices during the business entity formation can be complex and time-consuming. That is why it’s essential to have the right legal and financial guidance to ensure companies are making informed decisions tailored to their specific needs and goals.
Key takeaways from the session included:
- Choosing the best entity type will minimize your risk exposure, limit your income taxes, and prepare you for growth.
- Certain entity types restrict owners from being employees.
- LLC’s can be taxed as either Partnerships, S-Corps, or C-Corps.
- When in doubt, form as an LLC and easily switch to another entity in the future.