Accountants!! Help me with this entity question please!?

Question

I own a brick and mortar retail store. I have recently found myself with an exciting opportunity to start an internet retail business. I am going to partner with someone who has the inventory, while I have the expertise to sell it.

Any advice on what kind of an entity to form (I want to protect my store from liability and of course any tax advantages)?

If you need more info, tell me and I will update.

THANKS!!!

Answer 1

An accountant (do you not already use one?) might advise a partnership or LLC, but you should really get legal advice.

Answer 2

LLC has the best liability protection. You DEFINITLY need a lawyer to draw up the agreement if you are going into business with someone. Everything needs to be in writing to void future disputes. Do not go 50-50, go 51-49 it avoids major decision problems and arguememts. Question: If you have the expertise why do you need his inventory - find out who his suppliers are and build you own inventory. I do not see a need for this partner and you will avoid a lot of potential problems. The only partners you should have are people who have complimentary skills - operational people.