Establishing A Company With Partners
Detroit Real Estate Law defines partnership as any form of corporation, LLC, or multi-partnership. Partners should always anticipate and plan accordingly when forming a business. The attorneys with Detroit Real Estate Law will work through all the kinks of starting a new business, in order to plan for the worst but hope for the best. We suggest discussing the nature of your corporation with your partner, to determine if you need joint or separate attorneys with Detroit Real Estate Law. This will allow for your attorney(s) to have the power to redistribute across the company if necessary.
When Partner’s Don’t Get Along
When two or more investors invest in a project, they are considered equal partners. If not documented properly, a partner who invested more money would still be liable to sharing out any additional money earned from the company, if the partnership was dissolved. Any partner that puts in a capital investment should ensure that their investment is protected and documented. All investments should be paid back before ever receiving profits.
What To Consider, When Starting A New Company
- What type of entity will you become? Due to the nature of your business, this can be a significant determination. Most start-ups usually form an LLC, for owners to limit their liability to their investment into the company.
- Have you considered liability, complexity and taxes? This may also determine what type of company you will form, as a potential owner.
- Is the company a start up? If the company began formerly and is now buying assets of an existing company, different issues may arise. Make sure your situation is clear. This is also important with changes in ownership.
- Have you structured the transaction? The tax benefits are typically in favor of the buyer, when looking into purchasing into an existing company.
- How will you handle employees? When taking on employees from an existing company, you will need to determine if you’re going to terminate or rehire them.
- How secure are your revenue streams? If you’re an investor buying into a new business, you need to examine where the key revenue streams lie.