Business Structure Comparison

Structure Liability Taxation Best For
Sole Proprietorship ❌ Unlimited Pass-through Side hustles, very small businesses
LLC ✅ Limited Pass-through Most small to medium businesses
S-Corporation ✅ Limited Pass-through Profitable small businesses
C-Corporation ✅ Limited Corporate + Personal High-growth startups, VC-funded

Limited Liability Company (LLC)

✅ Pros

  • Personal liability protection
  • Pass-through taxation
  • Flexible management
  • Less paperwork than corporations

❌ Cons

  • Self-employment taxes
  • State formation fees
  • May be harder to raise VC funding

💰 Costs

Formation: $100-800

Annual fees: $0-500

Best for: Most businesses

Intellectual Property Protection

Trademarks

Protects: Brand names, logos, slogans

Duration: 10 years (renewable)

Cost: $250-3,000

When: File as soon as you have a brand

©

Copyrights

Protects: Original content, software, designs

Duration: Life + 70 years

Cost: $35-1,500

When: Automatic, but register for enforcement

⚙️

Patents

Protects: Inventions, processes

Duration: 20 years

Cost: $5,000-15,000+

When: Before public disclosure

Essential Legal Documents

  • Business license
  • EIN (Employer Identification Number)
  • Operating agreement (LLC) or Bylaws (Corp)
  • Contracts and service agreements
  • Non-disclosure agreements (NDAs)
  • Employee agreements
  • Insurance policies