Deciding on the Structure of your home health care Business
Now that you’ve decided to start a home health care business, and you’ve picked a launch date, and decided on a location for your offices, you are ready to decide upon the legal structure of your business. You may want to consider: Deciding on the Structure of your House Cleaning Business

a) A Sole Proprietorship

In this form of legal structure, the owner of the business simply applies to do business under a trade name from the appropriate authorities. You can choose a fictitious name and register it, so you’ll now be Mary Smith d/b/a (doing business as) Mary's Home Care (or whatever name you choose).

The advantage of doing business as a sole proprietor is that it’s easy and inexpensive to set up. The disadvantage is that the business is inseparable from you, legally, so that if there is ever a problem with the business (and problems do happen unexpectedly from time to time – ask me about some stories some time) you will be held personally responsible for all the debts of your business. If you’re sued, for example, people may go after all your assets, including your bank account, your house, your car, and any other assets you might have.


b) A Partnership

A partnership is where two or more people decide together to start and operate a business. It is more complicated to set up than a sole proprietorship (all partners must jointly sign a partnership agreement), and it has the same disadvantages.

c) A Corporate Structure

Forming a corporation is the most popular method of creating a business structure within which you will run your business. You will need a lawyer to help get the necessary documents in order. Requirements differ from state to state. The advantage of a corporation is that it is a limited liability entity. The assets and profits belong to the business, and if the business is ever sued, or goes bankrupt, your personal assets are not at risk. (No one thinks it will happen to them, but unexpected problems sometimes arise, and these things can and do happen sometimes.)

There are various different types of corporations, such as a “C Corporation”, or an "S Corporation”. Your accountant or lawyer can help advise you in which type of corporation will work best for you.

If you form a corporation, your business will be officially known as “Maine’s Home Health Care, Inc.”, for example.


d) A Limited Liability Corporation (LLC)

This is essentially another form of legal entity which you can create. If you form an LLC, your business will be known as “ABC Home Health Care, LLC”, for example.

Note: You should consult a lawyer and an accountant before deciding on what legal business structure to use for your home health care business. The information presented here is for advisory purposes only, and should not be a substitute for professional legal advice. A trusted lawyer should be able to help you select a structure for your Home Health Care business, based upon your needs, your tax status, your marital status and other factors.

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