Going into business is a big leap of faith, so it is smart to limit your personal liability where you can. The most effective way to do this is by creating a corporate entity. However, there is no such thing as a one size fits all approach to corporation formation. You and your business have unique needs that you must be sure are met.
Georgia state law views corporations as independent entities. These entities can engage in any number of activities that people can do as well, including sue, be sued and assume liabilities. This is different than in a sole proprietorship, a type of business in which the owner does not have any type of limited liability protection. Depending on your business, choosing a corporate formation over a sole proprietorship can give you more flexibility and protection.
There are several different types of corporate entities that the state of Georgia recognizes. These include C corporations, S corporations, limited liability companies, partnerships, limited partnerships and more. Each entity has specific requirements that must be met, and they all provide varying levels of liability protection and other benefits.
Selecting the correct corporate entity is essential to the success of your business. This can be harder said than done, especially when the law is not always clear about the various requirements and benefits of your choice. To avoid unintended consequences or even future disputes, you should consider visiting our website to learn more about your options for corporate formation and where to go for help.