What Are the Top Business Structures for Your Small Business?

 Posted on April 17, 2025 in Small Businesses

Illinois is home to a vibrant business community across industries, from restaurants to construction and everything in between. For entrepreneurs wishing to start their own business venture, a key early decision is the choice of corporate structure. A company’s corporate structure affects many aspects of its business, including the owners’ liability and taxation matters. That is why, before choosing a corporate structure, business owners should think about the advantages and disadvantages of each kind. An experienced Schaumburg, IL business formation attorney advises businesses on the right corporate structure for their venture.

Corporate structures are not one size fits all, and the right structure will depend on your goals for the company. Here are the top business structures for your small business:

Partnership

While partnerships are fairly easy to set up and have a low administrative burden, they benefit from having a partnership agreement setting out the terms of the partnership. Partnerships are fairly simple structures, but owners can be personally liable for a business’s debts, and partnerships are usually dissolved when one partner leaves.

Limited Liability Company (LLC)

An LLC is a very popular hybrid between a partnership and a corporation. Its main draw is that it provides small businesses with liability protection from lawsuits while offering fewer formalities than a corporation, meaning there is less administrative burden. LLC owners also pay lower taxes than corporations. However, LLCs do require the filing of an annual report and may be dissolved if an owner or member withdraws.

S Corporation 

As is the case with an LLC, corporate shareholders have limited liability. An S corp also has tax advantages as it is not taxed on top of the tax of its shareholders, meaning it is not subject to double taxation. However, setting up an S corp can be expensive, and there are limits to the type of stock this type of corporation can issue.

C Corporation

C corps offer very strong protection from personal liability, and continue to operate easily if a shareholder leaves or sells their shares. However, C corps are subject to double taxation (the company and the shareholders are taxed) and require a great deal of administration.

Call a Schaumburg, IL Business Formation Lawyer

At The Miller Law Firm, P.C. we represent small and midsize businesses making strategic decisions about the right corporate structure for their venture. If you need legal guidance to make the right informed decision, our experienced Schaumburg, IL business formation attorney is available to advise you. Call our offices at 847-995-1205 for a free consultation.