Legal Question in Business Law in California

Good business to start. You don't necessarily need a corporation; just make sure you have adequate insurance (couple million liability coverage) which you should have either way. Corporations are expensive to set up and maintain; but consult with a CPA or attorney in your area. You will need a business license from the city. The city can tell you if there are any other licenses they require. Because you are dealing with pre-schoolers, there may be some kind of background check required. Good luck!

Kevin B. Murphy, B.S., M.B.A., J.D. - Mr. Franchise

Franchise Attorney

The choice of entity (and state of incorporation or formation) depends on several factors like tax implications, limitation of liability and shareholder issues and corporate governance. I tend to like Limited Liability Companies for small businesses (this is an over simplification). The reason is that they are easy to operate, less complicated, have good liability protection and the tax is flow through (so there is not double taxation). I would also say (again over simplification) that you could form it in CA if you are a CA resident. You can go to http://www.sos.ca.gov. , then �business entities�, then �forms and fees� and then select the entity you are looking to form and form it yourself. I would caution you that it may be prudent to speak to an attorney to make sure you are doing it right. It is very inexpensive to form the company but there is an $800 annual franchise tax fee you should be aware of for CA limited liability companies. If you would like to speak further about your specific circumstances, feel free to call me free of charge and I would be happy to give you some simple advice based on your circumstances.