When starting a business in Georgia, many entrepreneurs feel overwhelmed by the different legal entity options available. The word “corporation” often makes small business owners think of Fortune 500 companies with strict formalities, boardrooms, and Wall Street reporting. While those features apply to large corporations, Georgia law also provides simpler structures that better suit small businesses.
What is a Statutory Close Corporation?
A Statutory Close Corporation is a corporation with fewer than 50 shareholders that elects this form in its articles of incorporation. Designed for smaller businesses, this structure offers the protections of a corporation while removing some of the costly and time-consuming formalities.
Benefits of a Close Corporation for Small Businesses in Georgia
Owners of a close corporation can avoid many of the requirements that deter entrepreneurs from adopting the traditional corporate model. For example, there is no need to maintain a formal board of directors or hold annual shareholder meetings. This is especially useful for businesses where ownership is limited to a small group already acting as decision-makers.
The structure also promotes continuity through a right of first refusal between shareholders. Instead of outside interference or hostile takeovers, shareholders can buy each other out in times of disagreement. This enables faster decision-making and protects the long-term stability of the company.
Other Options Beyond Close Corporations in Georgia
A Statutory Close Corporation is not the only simplified option. Many Georgia entrepreneurs opt for a Limited Liability Company (LLC), which offers liability protection with fewer requirements than a traditional corporation. The right structure depends on your goals, the number of owners, and how you want to handle decision-making in the future.
Choose the Right Corporate Entity for Your Georgia Business
If you are launching a business in Atlanta or anywhere in Georgia, choosing the right entity is one of the most important steps you can take. A Statutory Close Corporation may be the right fit if you want corporate protections without unnecessary complexity.
Call us today at 678-882-0830 to schedule a consultation. Our Atlanta business attorneys will help you evaluate the best structure for your company and guide you through the formation process with confidence.
