Business Formation

In South Carolina, there are several types of business formations that you can choose from. These include:

• Sole Proprietorship: A business owned and operated by a single individual. It is the simplest and most common form of business entity. (The owner is personality liable for all debts and obligations of the business).

• General Partnership: A business owned by two or more individuals who share profits and losses. (Each partner is personally liable for all debts and obligations of the business).

• Limited Partnership: A business owned by two or more individuals, with at least one general partner and one limited partner. ( The general partner is personally liable for all debts and obligations of the business, while the limited partner’s liability is limited to the amount of their investment).

• Limited Liability Company (LLC): A business entity that combines the liability protection of a corporation with the tax benefits of a partnership. (Owners of an LLC are called members, and their liability is limited to the amount of their investment)

• Corporation: A business entity that is separate from its owners. Shareholders own the corporation, and their liability is limited to the amount of their investment. Corporations are subject to more regulations and formalities than other business entities1.

• Limited Liability Partnership (LLP): A business entity that combines the liability protection of a corporation with the tax benefits of a partnership. (It is similar to an LLC, but is typically used by professional service firms such as law firms and accounting firms).