What Are the Different Types of Business Structures?

[niyati]

I’m planning to start a business but unsure about the types of business structures available. Can someone explain the main types like sole proprietorship, partnership, or private limited company? Which one is better for small startups?

 

[jatin]

There are several types of business structures, each with its own legal and tax implications:

1. Sole Proprietorship – Owned by one person, simple to set up, but owner is personally liable.
2. Partnership – Two or more owners share profits and liabilities.
3. Limited Liability Company (LLC) – Offers liability protection with flexible tax options.
4. Corporation (C Corp) – Separate legal entity, ideal for larger businesses; taxed independently.
5. S Corporation (S Corp) – Passes income directly to shareholders to avoid double taxation.
6. Cooperative – Owned and operated by a group for mutual benefit.

Each structure suits different goals and risk levels.

 

[devinluke]

Forms of business are sole proprietorship, partnership, limited liability company (LLC), corporation, and cooperative. They each have distinct legal, tax, and liability considerations. Sole proprietorship is the easiest, partners-in-common are jointly owned, limited liability companies are flexible, corporations are characterized by limited liability and elaborate rules, and cooperatives are member-owned, sharing profits among members.