Website design By BotEap.comOne of the first things to do when starting your wedding planning business is to determine the legal structure of your business. The options are sole proprietorship, partnership, limited liability company, and corporation. Here I briefly explain what they consist of along with some of the advantages and disadvantages of each one. You should consult your attorney or accountant before deciding what is best for you.

Website design By BotEap.comSingle owner

Website design By BotEap.comYou are the sole owner of your wedding planning business. It does not mean that you cannot have someone working for you, it means that you are the sole owner and do not report to anyone. This is how most wedding planners start because it is the easiest and least expensive way to start a business. There are very few filings and registrations and few administrative matters. You can report your business on your personal tax return, which is a plus for many people. A disadvantage of this form of business is the fact that you are personally liable for the debts your business incurs.

Website design By BotEap.comGeneral Partnership

Website design By BotEap.comIf you and another wedding planner, florist, caterer or any other provider decide to start a wedding planning business together, you can co-own and form a partnership. You must be clear about each of your responsibilities and you must be equally committed to the business. You will all be personally responsible for the obligations and debts incurred by the company. If you want to have a partnership, hire a lawyer to draft a legal agreement, even if it’s with family or close friends. If you have the slightest feeling that something could go wrong in society, don’t do it.

Website design By BotEap.comlimited liability company

Website design By BotEap.comI would enter this type of partnership with the help of a lawyer. It allows someone to invest in your wedding planning business and limits your liability to the amount of your investment. They are not involved in running the business, that is left to the general partners. Any assets of the general partners can be used to pay debts owed to the limited partners.

Website design By BotEap.comlimited liability company

Website design By BotEap.comThis business structure combines the tax advantages of a partnership with the liability protection of a corporation. LLCs are owned by members, and members are not personally liable for the company’s debts. Each state has its own rules regarding LLCs, so if you want more information, talk to your attorney.

Website design By BotEap.comCorporation

Website design By BotEap.comYou can form a corporation whether you are alone or have business partners. Being a corporation makes you appear more professional to potential clients and other wedding vendors. Incorporating protects you from personal liability, but there are many rules and costs involved in having a corporation. Consult with your attorney and accountant to find out what it would take to set up and run a corporation in your state.