Legal Question in Business Law in California

Re: 2 different service websites under 1 company

If you are the sole shareholder, the only pro and con I can think of is that one site may be profitable and the other not, where the profitable site fails due to liabilities created by the unsuccessful site. At least you are thinking of creating a corp., which should protect your personal assets. Make sure you set it up correctly and hire an attorney. If not, all your efforts may not prove to be beneficial. Let us know if we can help.

Re: 2 different service websites under 1 company

There is no legal limitation on how many separate enterprises can be conducted by a single corporation. There is (or was?) a taxi company in New York that formed a separate corporation for each vehicle. This was for liability insulation purposes. Owners of multiple rental properties often place each house or building in a separate corporation or LLC for the same reason, or for tax reasons, but it isn't legally necessary.

Unless your two Web sites are huge operations and/or have unusual liability exposure, I see no real reason to operate each as a separate corporation. Remember, each would have to pay at least the minimum franchise tax every year (currently $800).

If you had two or more separate entities, you would have to keep two or more separate sets of books. If all your operations are in a single corporation, it's entirely up to you (usually) whether you have one set of books for all, and the level of sophistication you use in segregating and allocating joint costs such as your salary.

Forming, setting up and running a business as a corporation or LLC requires a certain amount of general business knowledge (as distinguished from the specialized business knowledge needed to make your product or provide your service). You need to know how to license and register, do certain required filings, open and keep books, comply with the tax codes, write, adopt and follow bylaws, and so forth. Lawyers usually recommend using a lawyer, and accountant or bookkeeper, and an insurance agent as at least one-time consultants in their areas of specialization. It is possible for the business founder to handle all these roles "in house" if he or she has the experience and time, but for most business founders it is preferable to pay the experts.