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CORPORATION (INC)
A corporation is an independent legal entity that operates separately from its owners, who are referred to as shareholders. It can enter into contracts, pay taxes, and conduct business. Shareholders benefit from limited liability, providing them with protection compared to other business structures. Additionally, a corporation continues to exist even after the death of its shareholders, as it is considered a separate legal "person."
LIMITED LIABILITY COMPANY (LLC)
A Limited Liability Company (LLC) is an advantageous business structure that combines the benefits of a corporation and a partnership. It offers personal asset protection while allowing flexibility, as there are no mandatory stockholder meetings or stringent corporate formalities. Additionally, an LLC may provide valuable tax savings, making it an appealing choice for business owners.
PARTNERSHIP (GENERAL or LIMITED)
A partnership is a powerful way for two or more individuals to jointly own a business, sharing in its profits and losses. Each partner contributes uniquely, whether through financial investment or real property. Florida recognizes two types of partnerships: General Partnerships and Limited Partnerships.
In a General Partnership, all partners share equal responsibility for managing the business and are collectively liable for its debts, creating a strong sense of teamwork.
In contrast, a Limited Partnership consists of general partners who manage the business and limited partners who enjoy profits without personal liability for debts. This structure allows limited partners to minimize risk while benefiting from the venture.
Both types of partners can achieve financial success, making partnerships an attractive option for collaborative business growth.
SOLE PROPRIETORSHIP
A sole proprietorship is often the simplest and most popular option for starting a business. As an unincorporated entity owned by one person, it allows for complete control. However, if you operate under a name different from your legal one, you must register a fictitious name with the Florida Division of Corporations.
While this structure's simplicity may be appealing for some, it carries significant risks. There is no legal distinction between you and your business, meaning your personal assets are vulnerable in case of a lawsuit or financial troubles.