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  • Picking Your Business Structure
    Game Plan
    In-Depth

    Business Structures for Professional Firms

    AdvantagesAdvantages

    advantages

    As you can see, there’s a professional version of three of the most common business structures: the corporation, the limited liability company, and the professional limited partnership. Each of these shields you from liability for a co-owner’s mistakes (although you would still remain responsible for your own errors). With the liability issue addressed, the choice among professional structures can be based on your fundraising needs and taxation preferences.

    DisadvantagesDisadvantages

    disadvantages

    Not all of these structures are available in every state. And some states may require special forms, and even approval, from the professional licensing organization in your company’s jurisdiction.

    Deciding FactorDeciding Factor

    deciding factor

    If you’re a professional who is subject to the possibility of high levels of liability, it’s a pretty easy call. These structures were all specifically designed to address the needs of professional firms like yours.