when running a dog treat business, is it best to register as a sole proprietor, LLC, or corporation?
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when running a dog treat business, is it best to register as a sole proprietor, LLC, or corporation?
I want to start my own dog treat business from my home, but I don’t know what the
first initial steps are to doing this ‘legally’. I am located in CA.
Asked on August 23, 2019 under Business Law, California
Answers:
SJZ, Member, New York Bar / FreeAdvice Contributing Attorney
Answered 4 years ago | Contributor
LLC is the best.
1) As a sole proprietor, you are the business and will be liable if the business is liable: so if, for example, the business is sued (a dog gets sick; you fail to pay a supplier), that is you personally being sued.
An LLC (limited liability company) or corporation, nowever, will protect you from the vast majority of business-related debts or liability, so long as you do not personallhy guaranty the debt or obligation. No protection is perfect, which is why we do not say that it will protect you from all business debts or obligatios, but you are much safer conducting your business under an LLC or corporation than not.
2) There is little to choos between in terms of either liability protection or tax treatment between an LLC and a subchapter-S corporation, but an LLC involves less paperwork, formalities, and record keeping, making it slightly superior.
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