When it comes to launching a new business, there are several factors you should consider during the initial planning process. One of the first steps you should take is to create a business plan. Once your business plan is out of the way, it’s time to consider how you will organize your business. What type of legal business structure should you choose?

There are various business structures to choose from. Where you will be operating your business can determine the types of structures that are available to you. And, the structure you choose will determine whether you need to register your business with the state, what forms you will need to file to establish your business structure, and your business/personal tax liability.

Although some will differ, most states offer 4 basic business structures for you to choose from. Those structures are sole proprietorship, partnership, corporation, and limited liability company (LLC).

Continue reading to discuss the four most common business structures used today…