Choosing a legal structure is one of the early decisions a business owner must make when starting a business in the United States. Two common options are a limited liability company (LLC) and a corporation.
Both structures can provide liability protection, but they differ in how they are formed, governed, taxed, and operated. The appropriate choice depends on factors such as the nature of the business, ownership structure, plans for raising capital, tax considerations, and the state where the business is formed.
Understanding these differences before forming a business can help owners establish a structure that better fits their current needs and future plans.
