Starting a Business
The type of business you intend to operate, the number of owners of the business you intend to have, and your finances (and tax implications) are typically the primary criteria for determining what business entity, if any, you should use. In other words, one size does not fit all and the correct business entity (i.e., limited liability company, professional limited liability company, corporation or limited partnerships) all have their benefits and drawbacks depending upon your situation.
Also, it makes good sense to have a mechanism to determine the valuation of the company so that upon its sale or division the members can determine each party’s interests. This is typically done through a buy–sell agreement, also known as a buyout agreement. This agreement sets forth the triggering events that will allow the other member(s) to buy the departing member’s interest and the price for that member’s interest.
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Next, you will want to have: (1) Articles of Organization (think of it as a birth certificate); (2) Operating Agreement (think of this as an agreement between the owners governing their relationship); (3) obtain an employer identification number from the IRS (can be done online); (4) start a bank account; (5) initial meeting minutes; (6) get insurance; and (7) keep good records of your regularly conducted meetings.