Making a business in Florida - Part 1 of 9
Your choices for making a business in Florida are one of three types of businesses or business entities in Florida. First there is the corporation, which is designated by the letters Inc. Second is the limited liability company, designated by the letters LLC. Third is the partnership with its various permutations that are represented by letters such as L.P. for limited partnership and L.L.L.P. for limited liability limited partnership.
Contrary to common belief, the S Corp is not a legal business entity, but is merely a tax election that a business owner makes with its accountant. I have a separate entry comparing the Inc. and LLC that provides additional detail as well as more detailed articles on my website.
It is very easy to set up a business
In Florida at present there really are no burdensome requirements to set up a business other than having a credit card and a physical address for a registered agent. For example, there are no citizenship requirements or bonds or a test to pass. That would seem to promote the open development of business in the State.
Which business entity is right for your business plan and situation is a good topic for discussion with you business attorney. Just as you plan the start and growth of your business so too should you have a discussion with your attorney about which entity is right, how each one operates, and what documents might be useful to promote stable growth and when those are needed.
Oftentimes corporate governance documents as they are known are not necessarily required when a business is first formed, but knowing what the options are and when to put those in place will help promote stable growth,
For example, with an LLC, which is the most common business entity in Florida today, the corporate governance document is the operating agreement. The LLC has become more popular than the corporation because that entity requires bylaws and a shareholder agreement and has formal procedures that must be maintained. In comparison the LLC only has the one document and less formalities. Why pay for two documents when you can pay for one is part of the logic.
There are other legal documents that promote growth and stability to address with your corporate lawyer. Some of those are non-compete agreements, non-disclosures, non-solicitation agreements, and trademarks, licenses, and other intellectual property registrations. Not all of these have to be drafted and put in place on day one, but understanding what they are, what benefit they can provide, and when to employ them will enhance your business and allow you to make informed and intelligent decisions.
For those reading this information, thank you, in advance for taking the time to do so. Please know that this information is not intended to constitute legal advice for your unique situation, but is only provided as a general and helpful means of information to those interested in doing business in the State of Florida. The author, Palm Beach Gardens business lawyer David Steinfeld, is a Florida Bar Board Certified expert in business law and provides advice that is tailored to the unique needs of business people. Other helpful information on Florida business law and real estate law is on this website ThePalmBeachBusinessLawyer.com
The Palm Beach Business Lawyer Blog
Board Certified expert in Florida business law, David Steinfeld has almost 25 years legal experience.