There are many types of business organizations that an entrepreneur must consider when starting their business. Business formation is a necessary first step in starting a business because an entrepreneur must know and understand the differences in creating a legal structure for their business. How an entrepreneur structures his or her business will have a significant impact on the company's tax liability, management and the owners' personal liability in the event of a lawsuit. In Laurence's article, she states that "the more you know about starting a business, the more power you have to form an organization that turns into a sustainable source of income and satisfaction." Therefore, the most common ways to organize a business would be to consider the following options: sole proprietorship, partnership, limited partnership, limited liability company (LLC), corporation (for profit), corporation non-profit (non-profit), and cooperative. Many business owners decide that the initial ownership is either a sole partnership or if ...