LLC, Corporation, or Partnership? How to Choose the Right Structure for Your Business

Before you can launch your business, you need to decide how it’s going to be structured. Your choice—LLC, corporation, or partnership—impacts everything from taxes and liability to ownership flexibility and funding opportunities. 

Here’s a breakdown of the most common business structures and how to choose the one that fits your goals. 

1. Limited Liability Company (LLC) 

An LLC offers: 

• Limited liability protection for owners (called “members”) 

• Pass-through taxation (income is taxed on your personal return) 

• Flexible ownership and management structure 

• Fewer formalities than a corporation 

Best for: Small-to-midsize businesses, real estate investors, side hustles, and anyone seeking liability protection without rigid corporate rules. 

2. Corporation (C-Corp or S-Corp) 

A corporation is a separate legal entity that offers: 

• Strong liability protection 

• Perpetual existence (it continues even if an owner leaves) 

• The ability to issue stock and raise capital 

• More complex compliance requirements (board meetings, minutes, bylaws) 

C-Corp profits are taxed at both corporate and shareholder levels (double taxation). 

S-Corp status allows pass-through taxation—but with eligibility restrictions. 

Best for: Startups planning to raise outside investment or scale nationally. 

3. Partnership (General or Limited) 

Partnerships are easy to set up and operate but offer little to no liability protection unless structured carefully. 

• General Partnership (GP): All partners share control and liability 

• Limited Partnership (LP): Some partners contribute capital but don’t manage the business 

• Limited Liability Partnership (LLP): Offers liability protection for each partner’s individual conduct 

Best for: Professionals like lawyers, accountants, or family-run businesses with shared control and minimal liability risk. 

How to Choose 

Consider: 

• Your risk exposure 

• Number of owners and roles 

• Funding needs 

• Tax preferences 

• Long-term goals 

 We Can Help 

At Title Stream, we guide entrepreneurs and investors through entity selection, filings, and compliance. We don’t just check boxes—we help you build a business that’s legally sound and built to last.