Legal Question in Business Law in California

Re: Business entity options in CA

There are several types of business entities available to a business. Which one you utilize is dependent on several factors, including but not limited to, management and control, agency and officers authority, liability of owners for business obligations, and tax reasons. I recommend you speak with a local attorney experienced in business formations.

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Re: Business entity options in CA

Theoretically, you could put your personal assets into a trust. You should have the business formed as a corporation to protect you, set up as a S-corp or other tax pass through variation - see your tax man for advice on which suits your needs. Feel free to contact me if serious about getting legal help doing these.

Re: Business entity options in CA

For the protection of personal assets, the simplest and most commmon business form used by small contractors is forming a corporation. My office is in San Diego County and I practice both corporate and construction like. Please contact my office for a free consultation regarding your needs.

Re: Business entity options in CA

The logical choices are insurance, incorporation, or both.

Changing your license from one held as an individual to one held by a corporation of which the formerly-licensed individual is the responsible party requires a new license application to the CSLB, but the process is considerably easier than getting a personal license in the first place, e.g., no test.

Go to the CSLB Web site; you can find the application and instructions without too much difficulty.

If you do form a corporation, remember that it will need a new taxpayer ID, new bank account, new bond, probably new stationery, new workers' comp, new EDD account, and on and on. It will also need a new set of books, but the Calif. statutes do provide a way to convert an LLC into a corporation which might be advisable if you have been operating as an LLC for a few years, as another post suggests.

I would talk with an accountant first about whether to convert the existing LLC or simply form a corporation de novo and then transfer the LLC's assets and liabilities to it. If the LLC then needs to be dissolved, maybe a lawyer's help would be useful.

Re: Business entity options in CA

The simple solution is to set up a corporation. Check with your accountant or CPA whether an S or C corporation makes most sense for your particular situation. Usually, an S-corporation is the best solution for small businesses, but check with your CPA to be sure.