Creating a Business Entity

Oklahoma lets people organize several different types of businesses. Which of these is right for you depends on what you plan to do, whether you have a partner or employees you’d like to hire, and how you plan to raise money. We can help you understand the pros and cons of each type of company structure in depth with a personal consultation, but here’s a quick overview:

Sole Proprietorship

This may be the simplest structure you can choose. As a sole proprietor, you work on your own. You and your company are essentially one and the same, but you can choose a name that you “do business as.” This type of business can be an efficient starting place for people who turn a hobby into a business and want to see if it can grow.

A significant downside is that when you and your company are one and the same, your personal assets are vulnerable to any lawsuits or liabilities against the company.

Partnerships

Partnerships are like sole proprietorships with two or more people. You have flexibility and can dictate roles and responsibilities with a partnership agreement. But each partner is generally personally liable for all the company’s liabilities and losses.

Some specific types of businesses can form limited liability partnerships, in which each partner’s liability is limited to their contribution to the business.

Limited Liability Company (LLC)

An LLC has become a preferred small business entity. It’s a distinct entity from the business owner, so your family home, personal car and other assets are protected from the business debt and other liabilities. An LLC also has the benefit of income only being taxed once, as it flows through to the individual members. We help many new businesses in Tulsa start as LLCs and enjoy helping them grow into great success stories.

Corporation (C Corp)

Corporations can be private or publicly traded, either of which can make raising money fairly simple. Investors are often more comfortable investing in corporations than LLCs. A corporation is also a separate entity and provides liability protection. But, they have more reporting requirements and formalities than other entities and are taxed both at the corporate income level and the wage/distributions level.

Preparing Governing Documents

Governing documents formally dictate the rights and responsibilities of the company’s owners and each of their relationships to each other and to the company. Many of the disputes we handle between company owners have their origin in poor or nonexistent governing documents. Whichever business entity you choose, preparing precise governing documents is essential to building a solid foundation for your business.. Our business attorneys can help you draft the right forms for your company governance and ensure your new business starts correctly.

Initial Contracts

Many of the disputes we litigate also arise because of “handshake deals” or lousy contracts downloaded off the internet. Your new company is going to enter contracts with banks, partners, vendors, customers, and the like. Preparing your own contracts means that deals will be done on your terms, you can know what to expect, and you can prevent risk.

Drafting contracts takes experience, which the business lawyers at Davis Business Law bring to the table on your behalf. We have seen problematic or missing contract terms that have caused companies a lot of problems, and we can use that knowledge to help build you the best agreements.

Your Business Formation Lawyer in Tulsa

Running your own business is the American Dream, and the business law attorneys at Davis Business Law are in Tulsa to help you reach it. From our first consultation, to filing with the State and signing your governing documents, and even beyond, as your business grows and changes, we’re here to know the law and help protect your new company. No matter what stage you’re at with your business, contact us for a confidential consultation and advice about growing your business today.