Formation of an Entity Lawyers
Before any successful auto dealer is born, the business must first form a government-recognized legal entity. The entity will legally represent the company in any official dealings with the government and will be responsible for submitting all appropriate tax forms. For any aspiring business owner, determining what type of entity he or she wants to file under is the first step on a long professional journey. This early stage in the company is a crucial time as the type of entity that is formed will have many legal and tax implications, but with the help of a qualified attorney, a business owner can have the legal and financial advice necessary to make an informed decision.
At Arenson Law Group, PC, our auto dealership attorneys are dedicated to helping bold business owners form new entities for their automotive dealerships. We strive to assist our clients in every step of the entity formation period to ensure that their best interests are always protected. Contact our office at (319) 363-8199 to learn more about how our attorneys can assist in the formation of an entity.
Types of Business Entities
There are many different types of business entities, each presenting unique benefits and drawbacks, that a new automotive dealer could consider utilizing. No two companies are exactly alike and the optimal entity will vary from business to business. Below is a generic breakdown of the possible types of business entities that can be formed.
- Sole Proprietorship: This is the simplest form of business entity. In a sole proprietorship there is one single business owner who is responsible for all assets and liabilities associated with the company.
- Partnerships: There are several different forms of partnerships including general partnerships, limited partnerships, and joint ventures. Each offers different circumstances for a business owner, but in general a partnership is owned by two or more parties and all parties share responsibility for the company.
- Corporation: A corporation is a legal entity that is owned by shareholders; however, the company itself will be held liable for all assets and debts, not the shareholders. This form is typically reserved for larger companies with multiple employees.
- Limited Liability Corporation (LLC): LLC’s offer combined aspects from partnerships and corporations. In an LLC, one or multiple owners may exist and each owner will have limited liability in the actions of the company.
There are other more rare forms of business entities that exist and are not listed above. It is imperative that before forming a new entity, a business owner consults with an experienced attorney to learn about their legal options and which forms are most suitable for their circumstances.
Contact a Formation of Entity Attorney
If you or someone you know is wanting to start a new automotive dealership, know that deciding which entity to form the company under will have lasting impacts for the organization. At Arenson Law Group, PC, our attorneys have a thorough understanding of finance and the law and will be able to use this knowledge to assist you in forming a new business entity. Contact our office today at (319) 363-8199 to speak with our qualified legal professionals today.
Written by James H. ArensonLast Updated : December 3, 2021