Forming and operating a corporation or Limited Liability Company, or LLC, is a wise choice for some small businesses. The main benefit of an LLC or a corporation is that these structures limit the owners' personal liability for business debts and court judgments against the business.

What sets the corporation apart from all other types of businesses is that a corporation is an independent legal and tax entity, separate from the people who own, control and manage it. Because of this separate status, the owners of a corporation don't use their personal tax returns to pay tax on corporate profits. The corporation itself pays these taxes. Owners pay personal income tax only on money they draw from the corporation in the form of salaries, bonuses, etc.

LLCs are similar to corporations because they also provide limited personal liability for business debts and claims. But when it comes to taxes, LLCs are more like partnerships: the owners of an LLC pay taxes on their shares of the business income on their personal tax returns. Corporations and LLCs make sense for business owners who either 1) run a risk of being sued by customers or clients or run the risk of piling up a lot of business debts, or 2) have a lot of personal assets they want to protect from business creditors.

NOTE: Washington state law requires certain professions to form a different type of corporation that is referred to as a personal service corporation. Limited Liability Companies have the same requirement. If this requirement is not fulfilled, you fail to obtain the legal protection .

A nonprofit corporation is formed to carry out a charitable, educational, religious, literary, or scientific purpose. A nonprofit can raise much-needed funds by receiving public and private grant money and donations from individuals and companies. Federal and state governments do not generally tax nonprofit corporations on money they make that is related to their nonprofit purposes, because of the benefits they contribute to society.

Some people dream of forming a business where the owners are true equals: an organization owned and operated democratically by its members. These grassroots business organizers often refer to their businesses as a "group," "collective" or "co-op" — but these are usually informal rather than legal labels. For example, a consumer co-op could be formed to run a food store, a bookstore or any other retail business. Or a workers' co-op could be created to manufacture and sell arts and crafts.

Limited partnerships are costly and complicated to set up and run, and are not recommended for the average small business owner. Limited partnerships are usually created by one person or a company, the "general partner," who will obtain investment from other, “limited partners”. The general partner controls the limited partnership's day-to-day operations and is personally liable for business debts (unless the general partner is a corporation or an LLC). Limited partners have minimal control over daily business decisions or operations and, in return, they are not personally liable for business debts or claims. Consult a limited partnership expert if you're interested in creating this type of business.

For many new businesses, the best initial ownership structure is either a sole proprietorship or, if more than one owner is involved, a partnership. A sole proprietorship is a one-person business that is not registered with the state as a limited liability company (LLC) or corporation. You don't have to do anything special or file any papers to set up a sole proprietorship. You create it just by going into business for yourself. Legally, a sole proprietorship is inseparable from its owner, i.e., the business and the owner are one and the same. This means the owner of the business reports business income and losses on his/her personal tax return and is personally liable for any business-related obligations, such as debts or court judgments. Similarly, a partnership is simply a business — owned by two or more people — that has not filed papers to become a corporation or a limited liability company (LLC). You don't have to do anything special or file any papers to set up a partnership. The arrangement begins as soon as you start a business with another person. As in a sole proprietorship, the partnership's owners pay taxes on their shares of the business income on their personal tax returns, and are each personally liable for the entire amount of any business debts and claims. Sole proprietorships and partnerships make sense in businesses where personal liability isn't a big worry, for example: a small service business in which you are unlikely to be sued and for which you won't be borrowing much money make sense.

Dissolution of marriage is the name for divorce in the court system. “Dissolution” is frequently used in place of dissolution of marriage.

To qualify for a dissolution in Washington state, you must meet the following conditions:

1. You are married or you have a common law marriage in another state or county.
2. You or your spouse are a resident of Washington or in the military and will be stationed here for at least 90 days after you file and serve the petition for dissolution.
3. One spouse in the marriage believes that the marriage can't be fixed (it is irretrievably broken).
4. You or your spouse file and serve the summons and petition for dissolution properly.
5. At least 90 days have passed since the petition for dissolution was filed and served.

If you meet the above conditions, the court will grant a dissolution whether your spouse agrees or not. Your spouse can fight about other issues, including custody of children, visitation of children, child support, spousal maintenance (alimony), and the division of property and debts. If there is a fight over these or other issues, it may take more than 90 days before the dissolution is final.

The main difference between a legal separation and a divorce is that your marriage is not dissolved, so neither party can legally remarry unless the decree is first converted to a decree of dissolution. However, if either spouse wants a dissolution instead of separation, the Court will grant a dissolution. Another difference is that a legal separation does not affect how the Social Security Administration figures out benefits. The significant similarity is that the same issues are addressed, including parenting plan, child support, and the division of property and debt.

Not less than six months after the decree of legal separation is signed by the judge, you or your spouse may ask the Court to convert the separation to a dissolution.

A request for dissolution will not be affected by pregnancy. A judge cannot deny or delay the decree of dissolution of a marriage based on the sole reason that the wife is pregnant.

You may ask the court to waive (not require you to pay) the filing fee. To ask for the waiver, you must file a Motion to Proceed in Forma Pauperis. Be sure to check with the Clerk of the Superior Court in the county where you want to file your Petition for Dissolution to find out if they require a special form for the Motion. The Motion to Proceed in Forma Pauperis must be filed and the Order signed before you can file for dissolution.

The decree of dissolution sets forth the status of the relationship: dissolved. If the court has the jurisdiction (see below), the decree will also set forth the division of property and debts, any spousal maintenance, any name changes, enter restraining orders or an order of protection if needed, set custody and visitation for minor children, and set child support.

The decree of separation sets forth the status of the relationship: legally separated. If the court has the jurisdiction (see below), the decree will also set forth the division of property and debts, any spousal maintenance, any name changes, enter restraining orders or an order of protection if needed, set custody and visitation for minor children, and set child support.

The decree of invalidity sets forth the status of the relationship: none.

To qualify to have your marriage declared invalid, you must meet the following conditions:

1. Both spouses are alive.
2. You, or your spouse, is a resident of Washington or in the military and stationed here.
3. The court must find that one or both spouses were: too young; related to each other by blood; married to someone else at the time; mentally incapacitated; forced; induced by duress or fraud; or
4. any other reason for invalidity listed in the Revised Code of Washington (RCW) 26.09.040(4)(b); and the marriage has not been ratified after cessation of the invalidating factor.

Either spouse, or the guardian of an incompetent spouse, can file for invalidity. In the case of multiple marriages, any legal spouse or a child of a later marriage may file a petition for invalidity. If a court finds your marriage to be invalid, it is as if the marriage never happened.

Kitsap County has adopted a local rule requiring parties to a dissolution or legal separation requiring a parenting plan to participate and successfully complete an approved parenting seminar within 90 days after service of a petition on the responding parent. Similar rules have been adopted in other Superior Courts throughout Washington, including, but not limited to, King County; Pierce County; Thurston County; Spokane County; Lewis County; and Jefferson County. Lincoln County does not require a parenting seminar.

Jurisdiction depends on the current residency of the people (spouses and affected children) involved as well as their residency during the marriage. If you and your spouse currently live in Washington, the court has jurisdiction to decide all of the issues in your case. If you currently live here and your spouse does not, the Court will have jurisdiction over some of the financial matters only if your spouse lived in Washington during the marriage and is personally served. Property located in another state or country will be outside of the court's jurisdiction. The court will have jurisdiction concerning custody issues if the children have been living in Washington for at least six months and there have not been custody orders (including as part of a domestic violence protection or restraining order) entered in another state or country. If your situation is more complicated because your children have not been here for six months, your spouse lives elsewhere, or there have been custody/visitation orders entered regarding your children in another state (including as part of a domestic violence protection or restraining order) it is a good idea to consult with an attorney before filing for dissolution, separation or a declaration of invalidity.

You do not have to have a lawyer to get a dissolution. However, it is usually best to hire a lawyer if you can afford to do so. If you and your spouse agree about everything, it can be fairly easy for you to file the action and get a decree without a lawyer, but you may have rights that you don't know about and would lose if you did not get expert advice. For example, you may have an interest in your spouse's pension plan. If you don't want to get a lawyer involved, you can still get help. Many counties have a court facilitator who can help you complete the forms necessary to begin and complete a divorce. Some volunteer lawyer programs and legal services offices sponsor classes that help you fill out the forms you will need and tell you how to file your action.

You do not have to have a lawyer to get a dissolution. Though it is usually best to hire a lawyer if you can afford to do so, you should at least have a lawyer review your dissolution papers after you fill them out. It would probably be worth paying for an hour or two of a lawyer's time to protect yourself, and some lawyers have reduced rates for consultation sessions. There are several packets available with the forms and instructions needed to get your own dissolution, separation, or declaration of invalidity. Northwest Justice Project and Columbia Legal Services have forms and instruction packets for starting and for responding to a dissolution action on the internet. The Northwest Women's Law Center in Seattle also has many packets on specific dissolution issues, such as how to respond to a motion for temporary orders. Check with your court clerk or court facilitator for other packets. If you and your spouse have children, cannot afford a lawyer and you plan to file on your own even though you and your spouse don't agree, you can ask the court to appoint a guardian ad litem (GAL) to investigate the situation and make a report to the court regarding the children's best interests. Some counties have family court investigators, Court Appointed Special Advocates (CASAs), or GALs available free of charge. In other counties, the parents must pay for the services.

What are you doing reading about estate planning? You're supposed to be dancing until dawn. But keep reading — this won't take long. At your age, don't bother to put a lot of energy into estate planning. Unless your lifestyle is unusually risky or you have a serious illness, you're very unlikely to die for a long, long time.

Whether you're part of a mixed or same-sex couple, a will is a must-have document. Without a will, state law will dictate where your property goes after your death. Without a will, your closest relatives may inherit everything. Another option is to own big-ticket items such as houses and cars together in "joint tenancy" with right of survivorship. Then, when one of you dies, the survivor will automatically own 100% of the property.

Having children adds a level of complication to estate planning. Here's what to think about.

1. Write a will. Nothing fancy, just a document that leaves your property to whomever you choose and names a guardian for your children. The guardian will take over if both you and the other parent are unavailable. That's an unlikely situation, but one that's important to address. If you fail to name a guardian, a court will appoint someone, possibly one of your parents. The other big reason to write a will is that if you don't, some of your property may go not to your spouse, but directly to your children. The problem with the children inheriting directly is that the surviving parent may need to get court permission to spend or invest the money — a waste of time and money in most families.
2. Consider buying life insurance to replace your earnings if you're killed. Term life insurance is relatively cheap, especially if you're young and don't smoke. You can shop for the best bargain online by consulting free services that compare the rates of companies.

If you've made it to a comfortable time in life where you've accumulated some wealth and enough wisdom to know that other things matter, too, this is the time to reflect on what you want your legacy to be. But you may well live another 30 or 40 years, so there's no need to obsess about it. Chances are your conclusions will be different in ten or twenty years, and your estate plan will change accordingly. So here are several considerations.

1. Avoiding Probate To save your family the cost (and hassles) of probate court proceedings after your death, consider creating a revocable living trust. It's hardly more trouble than writing a will and lets everything go directly to your heirs, bypassing probate court. While you're alive the trust has no effect, and you can revoke it or change at any time. But after your death, trust property can be transferred quickly, according to the directions you left in the trust document. There are other, even easier ways to avoid probate: You can turn any bank account into a "payable-on-death" account simply by signing a form from the bank and naming someone to inherit whatever funds are in the account at your death. You can do the same thing, in almost every state, with securities.
2. Avoiding taxes If you have enough property to worry about federal estate taxes, consider how much you want to pay in taxes to Uncle Sam and the state. The amount of tax that will be owed by your estate is a changing number due to frequent revisions by state and federal lawmakers. Documents prepared by this firm will reflect current tax codes. One way to reduce these taxes is to give away property before your death. If you don't own it, it can't be taxed. An annual gift-giving plan can reduce the size of even a big estate, especially if you have a covey of kids and grandkids. Gifts to your spouse (as long as he or she is a U.S. citizen), direct payment of tuition or medical bills, and gifts to a tax-exempt organization are exempt from gift tax. Keep in mind that annual gifts larger than the current deduction per recipient are subject to gift tax at the same rate as estate tax. Another way to cut taxes is with trusts. Many older couples use an AB trust to leave property to each other for life, and then to their children. The surviving spouse can spend trust income and, in some circumstances, principal. An AB trust can shield up to twice the exempt amount from estate tax. Charitable trusts, which involve making a gift to a charity and getting some payments back, can also save on both estate and income tax. There are many other complex trusts; learn about them on your own and then have an experienced estate planning lawyer draw up the documents you want.
3. Directive to Physicians This legal document tells medical professionals what treatment you want in specific critical situations. The directive form custom-designed by Lynda McMaken received high praise from the Mayo Clinic, where doctors called it, “the best they'd seen.”

Now is the time to take concrete steps to establish an estate plan. Don't wait another moment.

1. The basics: a trust and/or will. Consider a probate-avoidance living trust and, if you're concerned about estate taxes, a tax-saving trust. (See above. Write a will or update your old one.
2. Power of Attorney Although no one wants to think about the possibility, at some time, you might become unable to handle day-to-day financial matters or make health care decisions. If you don't prepare for this possibility, a judge may appoint someone to make these decisions for you. No one wants a court's intervention in such personal matters, so make the choice yourself — ahead of when you need it. You can choose that person yourself, and give him or her legal authority to act for you, by creating documents called durable powers of attorney. You'll need one for your financial matters and one for health care. You choose someone to act for you (called your agent or attorney-in-fact) and spell out his or her authority. You can even state that the document won't have any effect unless and until you become incapacitated. Once it's signed and notarized, it's legally valid and your mind can be at ease.
3. Directive to Physicians This legal document tells medical professionals what treatment you want in specific critical situations. The directive form custom-designed by Lynda McMaken received high praise from the Mayo Clinic, where doctors called it, “the best they'd seen.”