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Selecting a business operational model in Florida

When starting a new business venture in Florida, one of the first decisions that must be made is which type of operational structure to create. There are different benefits and limitations to each business model and owners should review each one carefully before making their selections.

As outlined in an Entrepreneur article, the following four organizational models are available, each with its own set of risks when it comes to business disputes:

  • Sole proprietorships give individual business owners maximum control but also maximum risk as they are able to be held personally liable for any issues, such as a contract dispute or confidentiality agreement dispute that may occur.
  • Partnerships are essentially sole proprietorships for businesses owned by two or more people. In addition to personal liability, partnership disputes are another area of potential concern and should be discussed ahead of time.
  • Limited liability companies, or LLCs, protect individuals from being held liable in the face of disputes and also offer simplified record keeping.
  • Like LLCs, corporations also shield business owners from liability but do have more complex regulations for maintaining records and other operational processes.

The decision to set up an LLC or a corporation can be wise for businesses that are more prone to being involved in legal issues.

The state of Florida provides guidance on how to set up a new LLC or corporation to help business owners follow the right procedures and also provide resolution paths for issues like shareholder disputes. These include filing of articles of incorporation the identification of completely unique business names.

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