When starting a new business, it is important for the creator of the company to establish the proper business entity from the start. There are a number of options in California. Each type of business entity has different rules for directorship and ownership, as well as differences in tax and liability issues.A Limited Liability Company (LLC) generally offers liability protection and may be managed by one or more members of the LLC. Alternative business entities include Corporations (which involves taxation on both the corporation as well as the shareholders), Limited Partnerships (which includes at least one general partner and one limited partner), General Partnerships (which must have two or more persons engaged in a business for profit), and Sole Proprietorships (which allows an individual to own operate a business, with total control). Additional details and distinguishing features are set forth below, and more information on one or more of these entity types will be provided upon request.