​​​​​​​​​​​​​​​​​ THE BOURNE FIRM

​​​​​​​​​​​​​​Experienced on-demand general counsel for small to mid-sized companies not yet ready for full-time general counsel. 

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Contact  : jon@thebournefirm.com  (  303.765.2436
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​​​​​​​​​​​​​​​​​​​Five key considerations concerning formation. 
Corporations, limited liability companies, partnerships and seemingly endless variations of each, as well as sole proprietorships. So many choices. Cut through much of the chaos with five key considerations: 
  • Limitation on liability. Do you want to limit your liability? Corporations, limited liability companies and some types of partnerships generally do this if properly formed and operated. Other types of partnerships, and sole proprietorships, do not. 
  • To tax or not to tax. Who or what do you want taxed?  Corporations and limited liability companies can be structured to tax either the entity or the owners. Sole proprietorships cannot. The amount of the tax can vary based on the type of entity, with sole proprietorships generally being subject to the highest taxable rate and limited liability companies most often offering the greatest flexibility. Deductions generally can be maximized with entities other than sole proprietorship. Are you sensing a tax theme? 
  • Capital is king. Capital can be raised in the form of equity or debt with nearly any type of entity. The primary difference with respect to equity is the name (e.g., stock or membership interests). Limitations on the number of owners apply to some corporations. And always be wary of securities law traps

  • Want more flexibility? Limited liability companies often offer the most flexibility, except with respect to incentive stock options. Operating agreements for such companies are subject to fewer requirements than the organizational documents of corporations.

  • Predictability can be prudent. Although in some ways not as flexible as limited liability companies, corporations generally provide more predictability. Corporation law, in particular in Delaware, is extremely well developed.

formation.
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THE BOURNE FIRM.