This is quite a complicated topic. I will attempt to give you a simple overview. You will need to talk to your lawyer as well as your accountant in order to determine "how you shouls set up your business.

The simplest organizational structure is the sole proprietorship. The only paperwork required is completion of a "DBA" form in the town you will be doing business in. You are allowed by law to use your own name in the company name even if there are other companies with the same name (not that I would recommend this).

The LLC and LLP stand for limited liability corporation and limited liability partnership respectively. They are fairly new organization structures that have been set up in some states and not in others. As a very simple overview, they offer some of the liability protection of a full corporation without all of the paperwork. My recommendation for these structures is to look closely at the "less paperwork" promise which appears a bit hollow to me at least in Massachusetts.

The C Corp and the S Corp are fully incorporated entities that offer the maximum liability protection but do require extensive paperwork and fees. They are very good ideas if liability is a major concern. In addition, "Inc." after your company name is an added signal of permanency and professionalism if one feels that is important. "C" and "S" differ in their corporate structures.

As mentioned earlier, the details behind each of these entities are quite complicated. I would suggest that you do some reading on the subject as then discuss them with your lawyer and accountant. As an estimate my guess is that 70% of SPC members are sole practitioners while the remainder have chosen to Incorporate.

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