Most small businesses are LLCs, sole proprietorships or partnerships. It’s important to consult with an attorney about what you file as and what your liabilities will be, says Kannard with Law Office of James Kannard. Owners of sole proprietorships and partnerships are 100 percent liable for damages that result from the company’s business. A person who sues the sole proprietorship or partnership can come after the owner’s car, home and personal assets, explains Kannard at the Law Office of James Kannard. A lawyer can best protect you and your assets. A limited liability corporation (LLC) provides many of the same protections as a corporation (S-corp), says Kannard, although there are still some circumstances where a person could sue the owner directly. One reason to choose an LLC over an S-corp is that all profits pass straight through to the the owner, says Kannard, so there is no double taxation. Always consult with a lawyer and accountant first to determine the best tax and business model for your new enterprise.