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Company Registration Type and Formation Rule

by Angelina
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If you are planning to set up a business, company registration is one of the vital things you need to do. There is a registration process that every business person has to follow in the US. The registration type depends on the type of legal structure.

Here, you will know about the company’s registration types and the rules on which they are formed:

Company registrations types

There are some legal structures for a business presence in the US, and all businesses have to fall in either of the four types. Only then can the business get registered in the country. Have a look at them:

Single Proprietorship

A single (sole) proprietorship business has only one proprietor (owner) of the business. The condition of the company entirely depends on his efforts and devotion to do business.

As per the formulation rule, a single proprietor has to invest a specific amount of money in opening a business and going through the registration process. The person is solely responsible for giving the taxes, fees and showing the employee expenses to get the registration.

A sole proprietor can flexibly run a business and can exit the market whenever they feel like it. Several manufacturing companies and service providers work as a business with a single proprietor.


Two or more individuals can possess ownership of a partnership business. A business can run on two systems like general; partnership and limited partnership. For the first, each individual has to spare the same investment. It can vary in the case of the limited partnership.

A partnership agreement is a must, and an attorney should legally make it. Businessmen can also structure an agreement, but the attorney should review it.

You can easily form a partnership business, but it has a complex formulation rule as you cannot exit the market easily, neither can you give standard taxes. You have to follow the special taxation rules.


Corporation businesses are of different types, and it is a company registration type not easily granted by the  US government. A group of shareholders can manage a corporation’s business. Here are the subtypes:

S corporation-  In the case of S  corporation companies, the shareholders can run the business without giving the special taxes. The share among every partner is variable.

C corporation: In the C corporation business, there can be multiple investors. All are treated as individual entities.

B corporation: A short name knows benefit corporations, and they work in a non-profit manner.

Open corporations: Open corporations are the best place for trade in the business field.


In the case of the Limited Liability Company business, the shareholders can have flexibility in the taxes. It is a legal business structure in the US and just another sub-variant of the partnership business. Like most other business types, an attorney is needed here too.

A lot of negotiations can be there in case of the formulation. You should read about this company registration type before stepping into the business.

Final words

In the US, opening a business is easy as there are online portals in most states where you can apply for registration. It will be best if you consult with an attorney and a business expert before taking any decisions.