How we help | Business formation
Getting the structure right is cheaper than fixing it later.
Entities, EINs, registered agents, operating agreements, licensing, and the ongoing filings nobody warns you about. Plus a clear line between what we can do and what needs a lawyer.
The formation sequence as a flow, or the three lanes showing which questions go to which professional.
1200 x 750Yes, we do the formation work
If you already know what you want, say the word and we'll handle it: the filing, the EIN, the registered agent, the bank account prep, the licensing checklist, and the calendar of what comes due afterwards. You don't need a lawyer standing by for a straightforward single-member LLC in your home state, and you don't need a CPA on day one either.
If you'd be more comfortable with an attorney or a CPA involved, that's a reasonable preference and we'll work alongside them. Some people want one, some people need one, and the two aren't the same thing. Nobody here is going to pretend you must have either in order to proceed.
Ian prepared tax returns professionally for more than twenty years, most recently for the 2025 filing year. NCC no longer prepares returns, so this is background rather than a service. What it buys you is someone who can explain how each structure is taxed and where the tradeoffs actually sit, instead of deflecting the moment the subject comes up.
We give no legal advice of any kind. Not on this page, not on a call, not as part of an engagement. We won't hand you a verdict on which entity to form, we won't tell you how protected you are, and we won't opine on your liability exposure. Those are legal questions and they belong with a licensed attorney in your state.
What's on this page is general education about how these structures work. Applying it to your specific situation, with your facts and your risks, is the part we don't do.
Who this is for
Three groups, and the third is the biggest
- People about to start a business who want the structure done properly rather than quickly.
- People operating as a sole proprietor, wondering whether to formalize and what that actually changes.
- Owners who formed something two years ago, haven't filed anything since, and have started to suspect that was a mistake.
The third group is larger than the first two combined, which nobody advertises. If that's you, the situation is nearly always recoverable, and the sooner it's looked at the cheaper it stays.
The options
What the common structures actually are
Descriptions, not recommendations. Which one fits you depends on liability exposure, ownership, how you want to be taxed, your state, and plans you may not have mentioned yet.
| Structure | What it is | Worth knowing |
|---|---|---|
| Sole proprietorship | Not a separate entity. You and the business are the same legal person. | No liability separation at all. It's what you are by default the moment you start doing business without forming anything, whether you meant to or not. |
| General partnership | Two or more people in business together without forming an entity. | Also a default, also without liability separation, and usually created by accident rather than decision. |
| Limited liability company | A state-created entity legally distinct from its owners, who are called members. | Flexible on management and on how it's taxed. Formed by state filing and kept alive by ongoing filings. |
| Corporation | A state-created entity with shareholders, directors, and officers. | More formal governance: bylaws, meetings, minutes. Different tax treatment, and different suitability if you'll raise money. |
| Limited partnership (LP) | A partnership with general partners and limited partners. | General partners manage and generally carry personal liability. Limited partners generally get liability protection but stay out of management. |
| Limited liability partnership (LLP) | A registered partnership giving its partners liability protection. | Common among professional firms. Availability and the protection it gives vary a lot by state, and several states restrict it to specific professions. |
| Professional LLC (PLLC) | A specialized LLC available in some states for licensed professionals. | State licensing rules apply. Not offered in every state and not open to every profession. |
| Professional corporation (PC) | A corporation organized to provide regulated professional services. | Used by licensed professionals where state law requires or permits it. |
| Benefit corporation | A for-profit corporation with legally recognized public-benefit obligations. | Pursues financial return alongside stated public benefits. Not the same as nonprofit status, and not a tax classification. |
| Nonprofit corporation | A corporation organized for qualifying purposes rather than distributing profit to owners. | Federal tax exemption is not automatic. It requires separate recognition from the IRS, which is its own application. |
| Cooperative | An organization owned or democratically controlled by its participating members. | Members take part in governance and share benefits under the co-op's own rules. |
| DBA / fictitious name | A registered trading name. Not an entity at all. | Creates no liability protection whatsoever. An existing LLC can trade under a DBA without forming anything new. People confuse this one constantly. |
| Anonymous LLC | An ordinary LLC formed in a state that keeps some ownership detail off public formation records. | Not a separate entity type. Public privacy, not legal anonymity. Banks, tax authorities, and courts can still get the information. |
| Trust-owned LLC | An ordinary LLC whose membership interest is held by a trust. | Combines the LLC's liability structure with a trust's succession and ownership goals. See estate planning. |
The thing nobody explains
Forming an entity and choosing how it's taxed are two separate decisions
This single distinction clears up most of the confusion people arrive with, and most formation sites skip it entirely. You pick a legal structure with your state. You pick a tax treatment with the IRS. They are different choices, made with different agencies, and one does not determine the other.
Once you see it that way, half the arguments online stop making sense. "LLC versus S corp" isn't a real comparison. An LLC is a legal structure. An S corp is a tax election that an LLC can make.
| Federal tax classification | Who gets it | What it means in practice |
|---|---|---|
| Disregarded entity | Default for a single-member LLC. | The IRS largely ignores the LLC and treats the activity as the owner's. Income typically flows onto the owner's return. The entity still exists legally; it just isn't taxed separately. |
| Partnership | Default for a multi-member LLC. | The entity files an informational return and income passes through to members. The LLC doesn't pay federal income tax itself. |
| C corporation | Default for a corporation. Can be elected by an LLC. | The corporation pays its own federal income tax. Money distributed to shareholders can be taxed again at their level, which is what people mean by double taxation. |
| S corporation | An election available to eligible corporations and LLCs. | Income and losses generally pass through to qualifying shareholders. Comes with eligibility limits and reasonable-compensation rules, and it creates payroll obligations that didn't exist before. |
So a single-member LLC can be taxed as a disregarded entity, a C corp, or an S corp, and it's the same LLC in every case. Nothing about the state filing changes. What changes is a form sent to the IRS.
Where the S corp question actually lands. The election exists to change how much of your income is subject to self-employment tax, by splitting it between a salary you pay yourself and distributions. That only helps once profit is high enough that the saving outruns the added cost: payroll, a separate return, and the work of defending a salary figure as reasonable. Below that line it costs more than it saves. Above it, the maths changes. Where that line falls depends on your numbers, and it's a conversation worth having with real figures in front of you rather than a rule of thumb from a video.
That's the sort of thing usually held back for a paid consultation. It shouldn't be. Knowing the question exists is what lets you ask it at the right time.
Two columns, two decisions: legal structure chosen with the state, tax treatment chosen with the IRS, and the lines showing which combinations are possible.
1600 x 686Current as of this review
Federal ownership reporting changed, and most sites still have it wrong
If you formed a company in the last couple of years you probably heard about beneficial ownership information reporting to FinCEN, and possibly paid someone to file it.
A final rule published on 14 August 2026 removed domestic companies from the definition of a reporting company. US-formed entities no longer file BOI reports. Entities formed under foreign law and registered to do business in a US state still report, generally within 30 days, and no longer have to report their US-person owners.
What that does not change: your state filings, your annual report, your tax returns, licensing, or any other disclosure obligation. "Non-reporting LLC" is a marketing phrase rather than a type of company, and it refers only to this one federal requirement.
Source: Federal Register, 91 FR 52508. Reviewed 27 October 2026. Rules in this area have changed more than once; check the current position before acting.
Who answers what
Three lanes, and knowing which one you're in saves money
People routinely pay an attorney's hourly rate for a question about a deadline, then ask us something that genuinely needed a lawyer. Here's the sort.
- What's the difference between an LLC and a corporation, in plain terms?
- How is each structure taxed, and what does that mean in practice?
- Roughly where do the thresholds sit on an S corp election?
- What does a registered agent actually do?
- What has to happen, and in what order?
- Which licenses might apply to my industry and location?
- How do I keep business and personal separated properly?
- What's due annually, and when?
- Am I anywhere near needing a CPA yet?
- A definitive call on entity choice, where the stakes justify one.
- How exposed am I personally, given what my business does?
- Drafting an operating agreement for multiple members.
- Partnership terms, buyouts, what happens if someone leaves or dies.
- Contracts, leases, and client agreements.
- Anything where someone is already threatening to sue.
- Converting or dissolving an existing entity.
- Preparing and filing the returns themselves.
- Representing you before the IRS.
- Multi-state tax obligations.
- Payroll once you have real employees.
- Reasonable salary positions you'd need to defend.
- Anything where the numbers are large enough that being wrong is expensive.
Most people land further left than they expect. The middle column is narrower than the industry implies, and the right-hand column is a level of complexity rather than a milestone you hit the day you form an entity. Nobody needs a tax attorney to open a one-person consulting LLC, however firmly the internet insists otherwise.
The moving parts
What forming an entity actually involves
Name availability and the state filing
Articles of organization or incorporation, filed with your state's office, with a fee that varies by state. The name has to be available and has to satisfy the state's naming rules.
Registered agent
A person or service designated to receive legal and state correspondence. Requirements are set by the state, and typically include a physical street address there and availability during business hours.
EIN from the IRS
Free, immediate online, one per responsible party per day. The online application needs the responsible party's SSN or ITIN and a US principal place of business. It times out after 15 minutes of inactivity and can't be saved, so have everything ready before you start.
Operating agreement or bylaws
The internal governance document. Required in some states and worth having in all of them.
Business bank account
In the entity's exact legal name. This is where separation stops being theoretical, and it's also where business credit starts.
Licenses and permits
Federal, state, county, and city layers, driven by industry and location. The city-level requirement is the one people miss most often.
Ongoing compliance
Annual or biennial reports, franchise taxes or fees in some states, registered agent upkeep, and keeping records current when details change.
The part people skip
Formation is a day. Maintenance is forever.
Entities are administratively dissolved for neglect far more often than for anything dramatic. No lawsuit, no drama - just a missed annual report and a change of address the state never heard about.
Keeps the entity healthy
- Annual or biennial report filed on time, every time.
- Registered agent current, and actually reachable.
- State records updated when the address, members, or officers change.
- Business and personal money kept completely separate.
- Following your own operating agreement rather than filing it away.
- Records kept: resolutions, major decisions, meeting notes where required.
How entities quietly die
- A missed annual report, then a late fee, then administrative dissolution.
- Mail going to an old registered agent address nobody checks.
- Personal expenses running through the business account because it's easier.
- A member leaving with nothing documented.
- Finding out you're not in good standing during a loan application.
- Reinstatement, which costs more than compliance would have.
A formation-to-maintenance timeline, or a compliance calendar showing what comes due and when.
1600 x 686Corrections
What forming an entity does not do
"Now I have business credit."
No. A commercial file needs identity, accounts that report, and payment history. The business credit page covers what actually builds one.
"Now my business is fundable."
Lenders underwrite revenue, records, and usually the owner personally. An entity is a prerequisite for some products, not a qualification for any.
"My personal assets are protected, whatever happens."
Separation has to be maintained to be respected. Courts can look past an entity where it hasn't been kept genuinely separate, where it's undercapitalized, or in cases involving fraud. And a personal guarantee you signed overrides the structure entirely.
"This will lower my taxes."
Tax treatment depends on elections and facts. Early on, an entity frequently costs more than it saves. Worth working out before you file rather than discovering the following April.
"I'm licensed to operate now."
State formation and a city business license are unrelated obligations. Forming an entity satisfies neither local licensing nor industry-specific permits.
Do it yourself
When you genuinely don't need help
A single-member LLC, simple business, your home state, no partners, no unusual licensing. That is well within reach of a careful person working directly through the state's own website and IRS.gov.
- Use your state's official filing office directly. States publish their requirements and fees.
- Get the EIN at IRS.gov. It's free and immediate, and any site charging for one is charging for a free government service.
- Open the bank account in the exact legal name, and never run personal money through it.
- Check city and county licensing separately. Formation does not cover it.
- Write down when your annual report is due, then set a reminder a month before.
- Free counseling is available through SBA-funded Small Business Development Centers and SCORE. Underused and worth your time.
Where we come in
What we'll actually do for you
Two versions of this, and most people want the first.
You know what you want
- We file it. Name check, articles, state submission, the fee.
- EIN obtained and documented.
- Registered agent arranged or confirmed.
- Paperwork organized so the bank doesn't send you away.
- Licensing checked at state, county, and city level.
- A written calendar of what's due, and when, from here on.
- Entity details recorded consistently, which matters later for business credit.
- Wyoming and New Mexico formations, including the privacy-oriented ones, handled in house.
- Trust documents prepared where a trust is part of the structure, with a handoff to a law firm when it gets complicated enough to need one.
You're still deciding
- We walk the structures properly, including how each is taxed.
- We lay out what your situation actually points toward and why.
- We tell you if an attorney's opinion is genuinely worth buying here.
- We tell you whether you're anywhere near needing a CPA. Usually not yet.
- Then, when you've decided, everything in the left column.
The work gets more involved with partners, multiple states, an existing business converting structure, or licensing you can't untangle. Those are the engagements where having someone track it properly earns its cost.
| What people ask for | Straight answer |
|---|---|
| Just form the thing for me | Yes. That's a service, not a referral. |
| Explain the options so I can decide | Yes. In plain terms, with the tradeoffs. |
| Handle the filings and keep them on track | Yes, including the ones that come due later. |
| Make sure my details are consistent everywhere | Yes, and it matters more than it sounds. |
| Tell me what's due and when | Yes. This is where most people get caught. |
| Explain how each structure gets taxed | Yes. Twenty years of preparing returns is behind that conversation. |
| Tell me whether I'm near needing a CPA | Yes, and the answer is usually "not yet." |
| Hand you a verdict on which entity to form | No. We'll take you through it properly, then an attorney confirms the call where the stakes justify it. |
| Draft my operating agreement | No, not for a multi-member entity. That's an attorney's work. |
| Prepare or file your returns | No. NCC doesn't offer tax preparation. |
| Advise on liability protection | No. That's legal advice and we give none. An attorney in your state answers it. |
| Give a legal opinion on anything | No. Not on a call, not in an engagement, not informally. |
Related
What usually comes next
Questions
What people actually ask
Which entity type is best for me?
This is a conversation we can actually have. Ian prepared tax returns professionally for over twenty years, so how each structure is taxed and where the practical tradeoffs sit is familiar ground rather than something to deflect.
What we won't do is issue a verdict on your specific situation. The right structure also turns on liability exposure, ownership, and plans you may not have mentioned, and a definitive answer for one person is legal territory. We'll get you far enough to make the decision yourself and tell you when the stakes justify having an attorney confirm it.
Do I need a lawyer to form a business?
Usually not. A single-member LLC, simple business, your home state, no partners, no unusual licensing - that's administrative work, and we can do all of it without an attorney involved.
An attorney earns their fee when there are partners and real money at stake, when ownership terms need drafting, when you're converting or dissolving something that already exists, or when the liability exposure in your industry is genuinely unusual. Some people also simply prefer having one, which is a fine reason on its own. We'll work alongside yours either way.
Do I need a registered agent service, or can I be my own agent?
In most states an owner may serve as their own registered agent if they meet the requirements, which typically include a physical street address in the state and availability during business hours. That address generally becomes part of the public record.
People use a service for privacy, for reliability when they travel, or because they operate in a state where they don't live. Requirements are state-specific, so verify yours with the state's own filing office.
Is an operating agreement required?
Some states require one, many don't, and "not required" is a poor reason to skip it. It governs ownership percentages, contributions, decision-making, what happens when a member wants out, and what happens if a member dies.
Single-member LLCs skip it most often, and single-member LLCs that later add a partner regret it most often. For a multi-member entity, have an attorney draft it.
Does an LLC protect my personal assets?
Whether you personally are protected, in your situation, is a legal question and we don't answer those. Take it to a licensed attorney in your state.
What we can tell you generally is that the protection is not absolute. Courts can disregard the separation where an entity hasn't been maintained as genuinely separate, where it's undercapitalized, or in cases involving fraud. A personal guarantee you signed also overrides the structure entirely, which catches people out.
The administrative habits that support separation are ordinary good practice and we'll help with them: separate finances completely, keep records, follow your own operating agreement, don't treat the business account as a second wallet. That's housekeeping, not a legal opinion about your exposure.
How much does forming a business cost?
State filing fees vary widely, and several states also charge an annual report fee or franchise tax that continues for as long as the entity exists. Check your own state's filing office for current figures rather than trusting a summary.
Budget for the ongoing cost, not just the formation. The recurring obligation is the part that surprises people.
What if I formed an entity and haven't filed anything since?
Common, and usually recoverable. Check your standing with the state first, because you may be delinquent without knowing. Most states have a reinstatement process involving back filings and fees.
It's worth sorting out before you need the entity to be in good standing, which is typically a loan application, a contract, or a bank asking questions at the worst possible moment.
Sources
Check our work
Federal facts come from the agencies that set them. State requirements differ in every respect, including fees, deadlines, and whether an operating agreement is required, so verify yours with your own state's Secretary of State or equivalent filing office.
Educational and administrative support. NCC is not a law firm, does not provide legal representation, and does not prepare or file tax returns or represent anyone before the IRS. Ian's tax preparation background is described above and is not a current license or registration. A definitive opinion on entity selection, liability, or a tax position specific to your circumstances should come from a licensed professional in your jurisdiction.
Want the formation work done properly without a month of research?
Tell us what the business does, where it will operate, and whether anyone else has ownership. We'll map out what needs to happen and in what order, and flag clearly which parts need an attorney or a tax professional rather than us.