Q: My business partner & I are starting an online graphic design company.Should we operate as Sole Proprietors or as a LLC?
We will be designing brochures, logos, flyers, etc. for businesses nationally.
A: By virtue of the fact that you have a business partner, you won’t be able to operate as a sole proprietor. It would be a partnership. The decision to operate as an LLC, partnership or a corporation will vary depending on the type of business, growth trajectory of the business, such as if you ever plan on bringing in outside investors etc. You and your partner will be best served by contacting an attorney to guide you with this process, as well as assist you in drafting either an operating agreement, bylaw or partnership agreement that include critical partnerships terms such as buyout of one partner etc.
1 user found this answer helpful
A: I agree with Attorney Chidolue, and add this determining the tax status for the long term is often a function of an accountant or tax attorney. I suggest that working with both an attorney and a accountant is a good first step.
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