Asked in Business Formation and Business Law for Rhode Island

Q: What advice do you have for partnering with someone in building a new company?... Like two of you owns the company

1 Lawyer Answer

A: In many instances, limited liability companies are a good form of business organization for a small business with two owners. Remember to include an easy quick way to resolve any disagreement between the two owners in the company agreement. Remember to elect to be taxed as a sub chapter S corporation or you’ll needlessly be paying payroll taxes on distributions instead of just on earnings for your personal services. And remember to use a lawyer to prepare your company agreement and formation documents.

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