Types of Business Structures in Ohio

As a lawyer providing legal advice for setting up a business structure in Ohio, there are several options available to you.

1. Sole Proprietorship

A sole proprietorship is the simplest business structure, where the business is owned and run by a single person. This type of entity does not have a separate legal entity, and the owner is personally liable for any debts and liabilities incurred by the business.

2. General Partnership

A general partnership is a business structure where two or more individuals own and operate the business. Partnerships do not have separate legal entities either. Each partner is personally liable for the debts and obligations of the partnership.

3. Limited Partnership

Limited partnerships consist of two types of partners: general partners and limited partners. General partners are personally liable for the debts and obligations of the partnership, whereas limited partners are only liable up to the amount of their investment in the business.

4. Limited Liability Company (LLC)

An LLC is a popular choice for many small businesses due to its flexibility and limited liability protection. LLC owners, called members, are not personally liable for the debts and obligations of the LLC. LLCs may be taxed as a corporation or a partnership, depending on the number of members.

5. Corporation

A corporation is a separate legal entity that is owned and operated by shareholders. Corporations offer limited liability protection to shareholders, but are subject to double taxation—meaning both the corporation and the shareholders are taxed on income generated by the business.

When deciding which structure is right for your business, consider your liability exposure, the complexity of the business, taxation, and administrative requirements. Consult with a licensed attorney for further guidance and advice tailored to your specific situation.