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Business Structure

Jeff and Cindy initially structured Clover Valley Farms as a sole proprietorship. They formed a Limited Liability Company (LLC) in 2010 as a way to protect their personal assets from farm liability (see also Farm Business > Risk Management). They were also motivated by the record keeping requirements that would be reinforced by being an LLC (see also Farm Business > Finances).

Educator’s Perspective: Resource Tip

Business Structures

The decision about whether to incorporate a farm or use another business structure tends to be very specific to each farmer’s set of circumstances. Advice from a tax or legal professional is highly recommended, but the resources below provide a starting point for understanding the different options.

Michigan State University’s Beginning Farmers Web site has a useful post about Farm Incorporation.

The University of Wisconsin Center for Cooperatives has a comprehensive comparison chart of business structure types that is tailored to agriculture.

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