There Are Many Small Business Incorporation Models, but What’s Option?

small business entity

Deciding the legal form of an enterprise is one of the first questions to be addressed by entrepreneurs.



For an entrepreneur starting up a business, one of the first legal questions he or she will encounter is what kind of business entity should be organized.

Most of the time, little consideration is paid to this question beyond the issue of how the entrepreneur will be taxed, but the fact is that the legal vehicle chosen comprises a bundle of positive and sometimes negative characteristics.

The most common forms of entity are the Standard Corporation (sometimes referred to as the C Corporation), the S Corporation, and the Limited Liability Company (also called an “LLC”).

In my review of the literature, I found a range of sources commenting on different aspects of these forms, but no one document, which compared them in an easy to review format.

As such, I provide the reader with the following chart, which I hope will be useful.  The chart does not pretend to have exhaustively hit on every point that could arise, and is not intended to be the reader’s sole basis for deciding what form of entity would be best.

What I hope it does do is assist entrepreneurs in identifying issues of concern and, hopefully, promote a more thoughtful discussion between business owners and their professionals.

As expressed in the chart, one size does not necessarily fit all, and state law can differ in material ways.

*I want to thank Louise Martin-Valiquette, Esq., based in Westchester County, New York, for reviewing and providing comments on the chart. Louise has a very active U.S.—Canada practice, represents a diverse range of U.S. based and foreign clients as outside general counsel, and is an expert on international distribution agreements.

Related articles:

Small Business Start Ups- Making It Legal 

The S-Corp or the New LLC?

Consider the Flexibility of an LLC


FTC Bans Non-compete Clauses

FTC Bans Non-compete Clauses

Here are six FTC non-compete provisions In a previously article on non-competes entitled “Are Non-Compete Provisions Still Enforceable”, there was a reference to a rule published for comment in January 2023 by the U.S. Federal Trade Commission. The proposed rule would...

Seven Lessons Before Entering into a Bad Agreement

Seven Lessons Before Entering into a Bad Agreement

Look before you leap, do your home work before the commitment Jose, the President of Software Development Group (“SDG”), was desperate to expand his business. He saw many opportunities of exploiting the market for products to enhance the data security of medical...

Video Gallery

Modern version of Stoic philosopher Epictetus
A professional leads a cybersecurity training session for employees, emphasizing best practices. The photography captures the engagement of participants, showcasing the educational aspect of safeguard
Hispanic bearded male businessman trainer teaching coaching new recruitment African American female businesswoman employee in formal suit sitting studying learning company graph chart strategy
The presence of a robot using a computer. Office keyboard being typed on by machine. future IT group,.
Latino Streetwear Entrepreneur Latin Biz Today
Chef Lorena Garcia cooking with a wok
Latina Chef Loren Garcia
Latin Biz Today partner Johanna at the San Sebastián Festival


Which item currently represents the greatest hurdle in the growth of your business?(Required)

Sign Up for the Latin Biz Today Newsletter

PR Newswire

Featured Authors

avatar for Terry PittmanTerry Pittman

Terry Pittman is a digital media and marke...

The Customer Experience

Innovation & Strategy


Four Basic Principles for Raising Capital

Four Basic Principles for Raising Capital

Outside investors want to understand a business' strategy as well as its financial statements.   The need to raise capital from outside investors requires a great deal of preparation across multiple dimensions. Among many things, investors look to understand...









Work & Life


Health & Fitness

Travel & Destinations

Personal Blogs

Pin It on Pinterest