Entity Selection and Business Formation
The initial launch of a new Montana business is a daunting process. Selecting the correct type business entity is an initial and very important consideration. From there, businesses must consider also business obtaining the necessary approval to transact business in Montana, the tax structure of the entity and more. There are many online sites that provide these services for minimal fees but generally they do not provide you with the level of detail that we do to ensure your business entity is set up correctly taking into account all relevant considerations.
The Montana business formation attorneys at Lee Law Office PC can provide the representation and guidance new businesses need. And our full-service attorneys can provide the ongoing counsel businesses will need as they grow and succeed.
Types of Montana Business Entities
The following are the primary types of Montana business entities :
- Sole Proprietorship:For the solo business owner, this is the least expensive and difficult form of business entity to form. However, the owner is personally responsible for all debts and liabilities of the company. There may also be tax disadvantages to this business structure.
- Limited Liability Company (LLC):The LLC provides liability protection for its members, but it is easier to run than a corporation. LLCs do not face many of the legal requirements for corporations, such as forming a board of director and holding shareholder meetings. LLCs also have greater tax flexibility for their income.
- General Partnership: For two or more people going into business together, ageneral partnership is the easiest form of business entity to utilize. However, each partner is responsible for the entire debts and liabilities of the partnership.
- Limited Liability Partnership (LLP):An LLP provides the partners with protection against liability for claims against the firm. Each partner is not responsible for the negligence or legal misconduct of other partners or LLC employees, unless that partner was personally involved.
- Limited Partnerships (LPs) & Limited Limited Liability Partnerships (LLLPs): These entities can be viewed as LLP hybrids. The limited partnership (LP) has one general partner who is responsible for claims against the business. The limited limited liability partnership (LLLP) is similar to an LP, but it offers the general partner more protection against liability.
- Corporation: A corporation is owned by its shareholders, who have limited liability. The shareholders must elect a board of directors, which will then select corporate officers. A corporation can be a C corporation or S corporation. For an S corporation, the corporation’s income is passed through to the shareholders as their individual incomes for tax purposes.
Basic Steps of Montana Business Formation
Any new Montana business will likely need to proceed through the following steps:
- Business Entity Selection: The business entity selection, from the types described above, will impact company control, liability, organization, and tax implications.
- Registration of Business Name: This must be done with the Montana Secretary of State.
- Legal & Regulatory Compliance: The business must identify all laws and regulations governing its industry, then ensure compliance with those laws and regulations.
- Business Licenses & Permits: The company will need to obtain all appropriate licenses and permits, including professional and occupational licenses.
Contact Lee Law Office PC to Discuss Your Montana Business Formation Needs
If you are forming a new business in Montana, contact the business formation attorneys at Lee Law Office PC to meet your legal needs. Call our offices at 406-434-5244 or contact us online to schedule a confidential consultation.