How do I Know Which Type of Business to Start?
One of the decisions you will have to make when growing your business is
deciding what kind of company it is going to be. There should not be any
mystery to selecting the right entity, and our goal is to make sure you
understand why and how a particular business structure is the right one for you.
Your business entity can take many forms:
Limited liability Company (LLC) – A popular choice for small business owners who don’t plan
on raising investment money. This limits your liability for company debts
or wrongdoing. Think of it as a combination of a partnership and corporation.
Professional Corporation (PC) – A group of professionals in the same, or similar careers who create
a business often form PCs. One of the benefits of this model is that it
limits personal liability, and instead puts liability on the company,
meaning the entity as a whole comes together to protect its members.
“S” or “C” Corporations – Deciding between an “S” or “C” corporation
will affect your taxes. In a C corporation, taxes are filed by the corporation
as a whole. In an S corporation, the profits and losses of a business
are “passed through” the business itself, and instead reported
in the owners’ tax returns.
Not-for-Profit – These types of businesses generate funds for the business or service
itself, not the owners. This is a common model for hospitals and charity
organizations whose primary goal is to serve the community.
How Long Does it Take to Form an LLC in Oregon?
In Oregon, it takes about 3 - 5 to file the articles of organization or
about 24 hours online.
How are LLCs Taxed in Oregon?
In Oregon, LLCs are taxed by the following ways:
- LLC Owners are taxed through "pass-through" income
- Profits from the business must be reported to federal and Oregon personal
tax returns, and that’s where you will pay those taxes.
These are just the basics of entity formation, and by no means the extent
of your options. Our
Washington County business law attorneys can give you a full assessment of the pros and cons of each entity formation
based on the specifics of your company. We are there for our clients anytime
they need help making a decision that will affect the future of their business.
We guide clients through the complexities of business formation and management.
Call us at (503) 461-5005 to arrange an initial consultation.