Starting a business begins with a great idea, but it can be hard to know where to turn to put that idea into action. There is helpful information available for new and prospective business owners in Utah.
Business owners will need to choose an organizational structure. This affects the business owners’ liability, ownership rights and tax responsibilities. The most common business structures are sole proprietorships, limited liability companies, corporations and partnerships.
Sole proprietorships are formed by one owner who is responsible for all of the control, liabilities and management of the business. Limited liability companies are made up of members, managers and employees and they are generally not personally liable for the obligations of the business.
Corporations in Utah may only be created by permission of the state government. Corporations are a legal person and a legal entity independent of its owners. It is owned by shareholders and the business’s officers. The board of directors manages the business.
There are also general and limited partnerships. General partnerships have two or more persons who conduct business for profit. They each have unlimited liability for the obligations of the business.
Limited partners do not manage the business and they do not have liability for business debts.
It is useful for business owners to create a business plan. A business plan describes how the business will be managed and it provides details about how the owners will grow the business. This can be helpful to new business partners or investors who are interested in supporting the business.
An experienced attorney can help new and prospective business owners decide which structure is right for them and answer their questions.