Picking the right structure in a business can impact overall success. It might seem like a big decision with a ton of choices, but it’s usually pretty easy to narrow down what structure works best for specific goals.
It’s even easier to use a company like Dorado Management Services that helps businesses with this regularly. Having the ability to get help with structuring a business and taking care of all the paperwork with a company like that leaves time for other important tasks. They have provided professional services for years, making a very tedious part of the business process easy.
The Main Ways to Structure a Business
A few main categories exist for structuring the right way. If a person doesn’t know which way to go, Dorado Management Services can provide help in deciding in the present day.
Sole Proprietorship
If the goal is to start a business that stays relatively small and owned/operated by one person only, a sole proprietorship may be the way to go. This is when the owner becomes personally liable, meaning that they take on all debts and obligations of the business. They need to report the business’s income and expenses on a tax return.
Simplicity is a huge advantage of a sole proprietorship. There’s no issue regarding making decisions because an individual is in control. There can always be a point where people feel like they want to transition to another type of structure, but smaller setups make life easier for business owners.
Partnership
A sole proprietorship is nice, but not everyone wants to go into business alone. A partnership might be a better idea for people wanting to secure additional funding and not take on all the debts and obligations by themselves.
Within the partnership category, there are several different types of structures for a business. A lot has to do with what type of partner is brought on. Some partners want to be hands-on and be 50% of the company in every aspect. Others just provide guidance or financial assistance but leave it up to the other partner.
Anyone who doesn’t have money for great ideas right now or just wants to take on a little less risk will find a partnership to be a quality option. Many successful businesses launch with a partnership set up to get moving faster.
Limited Liability Company
Any business that has LLC at the end is a Limited Liability Company. It is one of the most popular structures, blending partnership setups with a corporation. Anyone who owns the company has limited personal liability. That means they don’t get hit with debt and obligations connected to the business.
Working with Dorado Management Services or a similar company that can help with the organization of the paperwork makes the most sense for owners.
LLCs are pretty easy to set up, and it adds instant credibility to any business. There’s also a lot of versatility regarding changing the business if necessary. If someone with a business idea doesn’t quite know what the future holds regarding growth, it is very flexible going with an LLC.
C Corporation and S Corporation
Any corporation is a separate legal entity from everyone taking part in the business. What happens is shareholders take on limited personal liability while the corporation is taxed separately.
Some of the biggest businesses out there have a corporate business structure so that they can operate at a high level. Within the corporation category, the two main types of options are the S corporation and C corporation.
.A C corporation is pretty much considered the default option for corporations. It makes them entirely separate taxable entities. There is a corporate tax return, and that income tax is paid first. There’s also a chance that anyone paying at the individual level with dividends will also need to be taxed.
Meanwhile, an S Corporation involves taking the business’s income and losses and passing it through to the shareholders. It’s the responsibility of every shareholder to file a federal return.
Dorado Management Services has experience working with some huge companies that have found success going the corporation route. It’s the most intricate business structure, but it saves a ton of money when done professionally.
The Process of Picking the Right Business Structure
Learning about all the different business structures and finding the right one can seem like an overwhelming task. So many people want to get their business off on the right foot, but they might not know how to do so. The good news is that a company like Dorado Management Services can help.
What they usually do is go over the pros and cons with every business they talk with and help them organize the paperwork. There are a lot of factors to consider, and picking the right business structure can make life easier and reduce the tax bill all at once.
The experience that Dorado Management Service has makes the process easy. Owners can discuss their goals and ultimately make a decision that works. The best part is that business owners don’t have to tackle everything on their own.
Can Dorado Management Services Help in Other Ways?
Business owners heavily rely on Dorado Management Services to help them out with a bunch of different tasks. This mainly comes down to specializing in different focuses of expertise. Document preparation options are one specialty, but they also handle additional day-to-day tasks that keep people up-to-date with the legal side of running things. Laws, rules, and regulations have tripped up plenty of businesses in the past.
There’s so much for a typical business owner to handle that they probably don’t want to do much of the tedious work. Getting results and having everything well organized and documented can relieve a ton of stress as a business owner. Whether it’s a single project or something ongoing, Dorado is there to help out all the businesses they work with.