Louisiana Business Formation Attorneys

Babcock Partners’ mission is clear: to help emerging companies throughout Louisiana become the giants of tomorrow and in the process, make compelling and resonant contributions to their respective industries and communities. We have considerable experience and know-how with start-up ventures of all kinds. Entrepreneurialism is, after all, in our DNA. Furthermore, if warranted, our robust and widespread ties within the Louisiana legal community allow us to turn to the most reputable outside counsel possible, should your matter require further specialization. Our goal is to provide clients with the best of both worlds – the specialized depth of a large firm, coupled with the agility and highly personalized attention of a boutique. 

The first step is to ascertain whether your new business should be formed as a Louisiana Sole Proprietorship, Louisiana General Partnership, Louisiana  Limited Partnership, Louisiana Limited Liability Company, or another type of business organization. Our lawyers will carefully examine all the facts and option to assist you in making this critical initial decision.

And because we want to help you get started now, we have provided these basic entity descriptions to help familiarize you with the alternatives.

Louisiana Sole Proprietorship. In a Louisiana sole proprietorship, one owner controls the business and assets. A Louisiana sole proprietorship is not taxed separately from the owner. The owner declares the business income or loss on the owner's personal income tax return ("pass through" taxation). However, the Louisiana business owner is personally liable for all the business's debts and obligations.

Louisiana General Partnership. In a Louisiana general partnership, two or more persons agree to operate a business together for profit. Every partner has the power to make contracts on behalf of the partnership and these contracts are binding on all of the partners, even if they did not consent. Each partner is personally liable for all of the partnership's liabilities, and a creditor is entitled to collect all monies due from a single partner. A Louisiana general partnership is not taxed separately from the partners. The partners declare partnership income or loss on their individual income tax returns ("pass through" taxation).

Louisiana Limited Partnership. In a Louisiana limited partnership, one or more general partners manage the business and are personally responsible for all of the partnership's liabilities. One or more limited partners contribute capital and receive a share of the business profits. Louisiana limited partners do not take part in managing the business, and if they are too active in the running of the business they are subject to losing their "limited" partner status and risk becoming personally liable for the business. A Louisiana limited partnership is not taxed separately from the partners. The partners declare partnership income or loss on their individual income tax returns ("pass through" taxation).

Louisiana Limited Liability Company. A Louisiana limited liability company has "members" who usually own and manage the business. However, a Louisiana limited liability company is allowed to have non-owner "managers" run the company instead of members. Louisiana allows a single person to operate as a limited liability company, but some states require that a limited liability company consist of two individuals. Members are not personally liable for the debts and obligations of the limited liability company. The Louisiana limited liable company is not taxed separately from its members. The members declare company income or loss on their individual income tax returns ("pass through" taxation).

Louisiana Corporation. Unlike a Louisiana sole proprietorship or a Louisiana partnership, a Louisiana corporation is recognized for all purposes as a legal entity separate from its owners. A corporation is a hierarchy. The shareholders are investors who have little say in the management of the corporation. Shareholders elect a Board of Directors and the Board of Directors designates officers to carry out the business of the corporation.

  • "C" Corporations. A "C" corporation is a separate tax-paying entity whose profits are subject to corporate income tax rates. Shareholders are not personally liable for the debts and obligations of the corporation.

  • "S" Corporations. An "S" corporation may have no more than seventy-five shareholders and they must be U.S. citizens or resident aliens. There can be only one class of stock. An "S" corporation is taxed like a partnership, and the shareholders are not personally liable for the debts and obligations of the corporation.

 

Don’t take any chances with your new business: Turn to Babcock Partners to make sure it’s a winner.