Virginia is a perfect location from which to operate your business. It is strategically located on the East Coast, lying adjacent to Washington DC. Statistically wise, its proximity to huge consumer power can be shown by the fact that 6% of all U.S. consumers live within 745 miles of it.
Transportation in the state is facilitative in air, land and sea for both trade and individuals. There are 14 commercial airports and 14 railroads in Virginia. The Port of Virginia offers first class shipping facilities with around 3,000 sailings a year to 250 ports in 100 countries. The state also has a robust economy, financial advantages and skilled workforce as a result of its great education system. The quality of life is also very high in the state, making it a great place to live as well as work.
There are several types of business structures available in Virginia, with their own benefits and limitations. Each has its own variant of taxes, owner relationships, and legal liability. The one best for you depends on your business requirements. The main choices are:
Sole Proprietorships
A small entity owned by a single person or a couple. The owner(s) are personally liable for all business debts. They can transfer all or part of the business and report profit or loss as personal income with regard to taxation.
Limited Liability Companies (LLCs)
These are one of the most popular company forms as they come with limited legal liability. In terms of taxation LLCs are similar to Sole Proprietorships or Partnerships.
General Partnerships
These let you share profit, loss and managerial duties between partners. Each person is liable for any debt and members file an individual personal tax return and income/loss.
Corporations
These come with more start-up costs and are owned through stock, with more complex licensing, taxation and regulation requirements. They have to issue stock certificates, hold annual meetings and keep minutes electing directors. This complexity and higher standard of requirements means corporations are better suited to larger, established companies with a lot of employees. There are three types of corporation in Virginia:
C-Corporations are legal entities, taxed separately from their owners and generally don’t own assets that go up in value. They protect against personal liability but unlike an LLC or limited partnership they do not have many tax and operating advantages.
S- Corporations protect their owners against personal liability but are limited on the number and type of eligible stockholders. They also offer less favourable tax and operating advantages.
Benefit Corporations are a new form of Stock Corporation that incorporate aspects of non-profit organisations.