This section provides farmers with tools to help choose the best business entity for their farm operation: Entity Comparison Chart and Choose Your Entity Flowchart. Consciously choosing an entity is the first and probably most important step in running a successful farm operation. These charts will help farmers narrow down the options based on certain factors or characteristics of the business entity.
Entity Comparison Chart
The section that follows includes chapters on each of the main entities: sole proprietorship and general partnership, LLC, C corporation, S corporation, B corporation, cooperative, and nonprofit (incorporated and unincorporated). Once you have narrowed down your choice by using the above charts, the next step is to review the entity-specific chapter (or chapters if you’re still narrowing it down from two or three options). These chapters can help you affirm your decision, as they will give you a more thorough understanding of the characteristics, benefits, drawbacks and requirements for that particular entity. These chapters also include detailed information and tools such as checklists and sample agreements to guide you through the process of forming, organizing and implementing your business entity of choice.