Tips & Advice
What is the best type of business entity?
In terms of simplicity, a sole proprietorship is the best - and most common - type of entity, in that it allows all debts, profits and decision making to fall under the responsibility of one person. According to the Small Business Association, 70 percent of all U.S. companies are classified as sole proprietorships. Corporations, on average, are generally the most profitable business structures.
The legal definition of a corporation is a business with a distinctly different existence from its owners, who are shareholders. In function, this often means a large and diversified firm, while for classification purposes, it entails the ability for shareholders to buy, sell, or enter into a new contract. Managers and officers within a corporation have obligations only to the law and the shareholders possessing ownership.
An LLP, or limited liability partnership, operates similarly to an LLC in terms of tax status and liability, but with multiple proprietors. The primary distinction lies is that in the event of misconduct or negligence on the part of one partner, the other partner or partners are not liable for those actions.
What are the different types of business entities?
The most common types of business entities, or business structures, included the following:
- Sole proprietorships
- Limited liability companies (LLCs)
- Limited liability partnerships (LLPs)
- S Corporations
Is a business lawyer the same as a corporate attorney?
Corporate attorneys are technically business lawyers, but not all business lawyers are corporate attorneys. Corporate lawyers are categorized as such by being full-time salaried employees of a given corporation, retained to exclusively represent that company’s rights and available for litigation at all times. Many larger corporations will retain a team of corporate attorneys with varied specializations or areas of expertise.
What is business succession?
Business succession generally refers to plans laid for transitioning the company, whether in terms of ownership, proprietorship, management, or family inheritance. Business succession planning requires legal counsel and careful guidance, with factors such as the size, liquidity, and stock ownership of the business dictating many decisions.
LLC stands for “limited liability company,” a designation for smaller, privately owned businesses. The limited liability entails protection for personal assets and pass-through tax status, while reserving the entity the right to open business accounts and licenses, like larger corporations. Enlisting as an LLC allows a business owner to retain the autonomy of sole proprietorship while being recognized as a fully functional, licensed operation.
How much does a business lawyer charge?
Business lawyers in the United States might charge anywhere from $400-$800 an hour for their services, though the figure will vary depending on the demand for the firm or attorney in question, as well as the billing increments, usually charged in increments of five to 10 minutes.
What types of cases does a business lawyer handle?
Depending on the nature of the industry in question, a business lawyer’s skills might be better suited for particular cases, but most will have experience with mergers and acquisitions, commercial litigation claims, and intellectual property patents, copyrights or trademarks. Many larger independent firms will employ multiple business attorneys, each with their own industry focus and specialization.
What is a business lawyer?
Business lawyers typically focus on issues that affect companies of all sizes, such as taxation, succession planning, and property rights - both of the physical and intellectual variety.