How to Form a Hawaii LLC, Corporation or Other Business Form
What Type of Hawaii Entity Should You Select?
You need to talk to your Hawaii accountant as to which entity is best for you. Your accountant will have the best understanding of your personal financial situation as well as your past business dealings and past tax status which may impact your future tax actions.
That said, you then need to select which type of Hawaii business entity is best for you. We recommend an entity that will give you some type of personal protection. For most people, a Hawaii limited liability company is a good choice.
The Hawaii LLC provides corporate protection from creditors as well as pass-through tax treatment, so you avoid personal liability but also avoid double taxation that occurs with Hawaii corporations. Hawaii LLCs are affordable to set up and flexible if you have a good Hawaii Operating Agreement (your Hawaii financial institution will probably require this to open a bank account).
Here are articles on Hawaii limited liability companies to help you understand them better:
- Why the State of Hawaii’s Articles of Organization Form May be a Mistake to Use if You Own Real Property
- Hawaii Limited Liability Company: Manager-Managed versus Member-Managed
- Why You Need a Hawaii Operating Agreement For Your Hawaii Limited Liability Company
What do I do Next After Selecting my Hawaii Entity?
You will need your accountant to help you with obtaining a Federal Employer Identification Number as well as a Hawaii general excise tax license, if applicable.
You should also obtain business insurance to not only protect the company from general/premises liability issues such as slip and falls, but also employment practices liability insurance to protect the company from employee claims, and directors and officers insurance to protect the people running the entity. The insurance policies all have exclusions where the insurance company tries to restrict what it will cover you for, so read it carefully.
You may need to obtain intellectual property advice in order to protect what you plan to do. Due to Mr. Natori’s past partnership in an international law firm, he has contacts with affordable national intellectual property attorneys and can put you in contact with them.
If you are entering into a commercial lease for office space, we can review the lease and negotiate problematic issues (see discussion on commercial leases).
More Articles on Hawaii Corporate and Business Law
- Duties Owed By a Hawaii Agent to its Principal
- Hawaii LLC Formation: Manager-Managed Versus Member-Managed
- How To Acquire An Existing Hawaii Business
- Incorporating In Hawaii
- Issues You Must Know About In Your Purchase or Sale of Medical & Dental Practices in Hawaii
- Owner’s Liability for the Debts and Obligations of a Hawaii Limited Liability Company
- Setting Up Your Hawaii Business Entity for the Small Business Administration’s 8(a) Business Development Program
- Transacting Business in Hawaii and Licensing
- What Happens When a Hawaii Corporation Has Been Administratively Dissolved?
- Why Using the Hawaii Department of Commerce and Consumer Affairs Business Registration Division’s Limited Liability Company Articles of Organization (Form LLC-1) May be a Mistake
- Why You Would Need an Operating Agreement for Your Hawaii LLC