When forming a new corporation in the U.S., each state has different requirements. California has a particular set of requirements and there are some very good reasons to incorporate a business. Coachella Valley corporate attorneys are experts in professionally setting up new American corporations.
In California, it starts with the Articles of Incorporation. The types of corporation to select from are many. The following six types are the most common types in California:
- Sole Proprietor - This is for single-person businesses that are named either an individual’s name or a company name, but legally it is the same as using a simple assumed name. It requires a Doing Business As (DBA) certificate to be filed with the local County clerk.
- LLC – Limited Liability Company - It is like having the security of a regular corporation, but the profits and losses are passed directly to the owners on their tax returns.
- S-Corporation - Gives the owners the security of a C-Corporation but with similar taxation rules to the LLC. Again, the profits and losses are passed through to the individual owners. This type requires filing a document with the IRS.
- C-Corporation - This is needed for public companies. It is relatively difficult to setup and maintain, but it gives maximum benefits for corporate tax deductions. The downside is double taxation: the company is taxed and the individual owners and stockholders are taxed on their portion as capital income.
- Limited Liability Partnership - This is a partnership where some owners are silent partners with no management responsibilities or legal input into how the company is operated.
- General Partnership - Multiple owners can form a simple partnership. This puts all partners at risk personally for all liabilities and all profit.
Which corporation are you ready to set up? Give us a call at (760) 322-2275 to receive a complimentary consultation to set up your business.