Over the past few years, various industries have helped Georgia’s economy grow significantly, which is a good trend. The technological sector, however, stands out as having the state’s fastest growth rate. In Georgia, the technology sector has increased by more than 28% over the last five years, with more than 17,000 companies employing more than 200,000 people, according to a report by the Technology Association of Georgia. Companies like Google, Microsoft, and Amazon establishing operations in Georgia have contributed to this expansion.
Georgia’s technology sector is booming, but before starting a business there, you must carefully analyze the legal requirements. The choice of whether to create a limited liability corporation (LLC) or a “doing business as” (DBA) entity is one of the first choices a business owner must make. While an LLC is a legal structure that offers security for the business owner’s personal assets in the event of legal action against the business, a DBA is a fictional name under which a business conducts its operations.
A $25 filing fee is all that is required to register a DBA in Georgia. A DBA does not offer an LLC the same amount of protection, though. A DBA also does not offer the same tax advantages as an LLC, which permits pass-through taxation.
Georgia requires that articles of organization be submitted to the Georgia Secretary of State along with a $100 filing fee in order to establish an LLC. Due to the restricted liability protection offered by an LLC, the business owner’s personal assets are safeguarded in the event that the company is sued. An LLC also offers tax advantages because corporate profits are only ever taxed once, at the personal income tax rate.
The decision between an LLC and a sole proprietorship is crucial for firms in Georgia. The simplest type of business entity is a sole proprietorship because it doesn’t need to be officially registered. The owner’s personal assets are not protected by a sole proprietorship, however, and the business’s profits are taxed at the personal income tax rate.
In conclusion, Georgia’s technology sector is expanding at a rapid rate and offers several prospects for business owners. However, it is important to carefully study the legal requirements before opening a business in the state. Making a decision between a DBA and an LLC, as well as between an LLC and a sole proprietorship, will have an impact on the business’s tax and liability duties. A legal expert should be consulted by business owners to establish the best course of action for their unique requirements.