Our Redwood City Business Lawyer Answers Your Questions
Creating, selling or merging a business can be a difficult process if you do not have experience with the specifics of California business law. If you have intellectual property, then a business law attorney can help you safeguard your works. A business law attorney may be able to help you resolve an employment law dispute. You may have an easier time navigating these issues by working with an experienced attorney. Below, our Redwood City business lawyer answers some of your most common questions about business creation and operation in California.
What Is the Difference Between an LLC and a Corporation?
You may have a few options for how you want to structure your business. One possible option may be a limited liability company, or LLC. With an LLC, one or more people are the owners and there are generally fewer formalities and requirements. On the other hand, with a corporation, the shareholders are the owners and there are more recordkeeping requirements. Keep in mind, there are different types of corporations.
You could speak to our Redwood City business law attorney during a free initial consultation if you have questions about forming a corporation or LLC in California.
How Do I Start an LLC In California?
Your best bet is to work with a business law attorney. There are steps you must take to create an LLC in California. Below are some of the first steps you may have to take when creating an LLC in California.
- Choosing a name. You must choose a unique name for your LLC. Additionally, LLC or L.L.C must appear in the name. There is a state database of registered businesses that can help you select a unique name for your LLC.
- File articles of organization with the Secretary of State. You would finish creating your LLC by filing articles of organization with the California Secretary of State. Consider working with an attorney, as the articles of organization must contain detailed information about your business.
- Choosing a registered agent for service of process. In California, you must choose a registered agent, which may be an individual or company, to accept legal papers on the LLC’s behalf in case it is sued.
- Choosing the management structure. Will you or a small team of managers operate the LLC? When creating an LLC, you may decide on its management structure.
- Preparing an operating agreement. You may benefit from creating an operating agreement, although it is not a requirement in California for LLCs.
- Filing a biennial statement of information report. Twice per year, you must file a Statement of Information Report with the California Secretary of State.
- Meeting additional tax and regulatory requirements. LLCs have specific tax and regulatory requirements in California. For instance, you may need an EIN or a certain type of business license to operate in our state.
There could be additional steps involved with this process. We strongly recommend working with a California business law attorney while creating an LLC.
Which Business Structure Should I Choose?
You may have a couple of options for creating a business in California. In California, you may form a corporation, sole proprietorship, LLC, limited partnership, general partnership and limited liability partnership. Which structure is the best for your situation depends on the circumstances and what your business wants to accomplish.
You can speak with our Redwood City business law attorney if you want to learn more about business structures in California. We can discuss your situation during a free initial 30-minute consultation.
What Is the Difference Between a FEIN and EIN?
Your business may need to register an FEIN (Federal Employer Identification Number) or EIN (Employer Identification Number) with the Internal Revenue Service (IRS). These are special numbers the IRS uses to identify your business and track its taxes.
In California, you must register an FEIN or EIN if you are a corporation, partnership or business with employees. However, if you are the sole member of an LLC or a sole proprietorship, then you do not need to register an FEIN or EIN to file taxes for your business. If you change the structure of your business, then you may also need to register a new FEIN or EIN.
Our Redwood City business law attorney can answer any questions you have about tax obligations for California business.
What Is the Difference Between a C Corporation and an S Corporation?
S corporations and C corporations offer protection for shareholders from liability. However, there are key tax differences between S corps and C corps. C corps must pay taxes on corporate profits and dividends paid to shareholders. While S corporations can pass on profits and losses to shareholders without being subject to corporate taxation, they can only have 100 shareholders.
Contact Our Redwood City Business Lawyer
Questions about how to manage your business affairs in California? Contact our Redwood City business lawyer for a free initial 30-minute consultation. You can reach us by dialing (650) 332-2994 or by using the contact form on our site.