2025 predictions: How Much Will It Cost to Open a University in the US?
Choosing a Structure for Your Education Business Entity
May 12, 2021
We provide the licensing and accreditation needed to establish a new university and offer comprehensive guidance throughout the process.
This involves helping our clients understand all the legal and financial requirements around university establishment, as well as providing marketing and branding advice to ensure their university or college stands out from other educational institutions.
Our competitors can only offer a limited service, either licensing or accreditation, as most don't have the skills or team required to provide a turnkey service. This is why EEC stands out from the crowd – we can offer our clients everything they need to get their university off the ground easily and efficiently.
This involves helping our clients understand all the legal and financial requirements around university establishment, as well as providing marketing and branding advice to ensure their university or college stands out from other educational institutions.
Our competitors can only offer a limited service, either licensing or accreditation, as most don't have the skills or team required to provide a turnkey service. This is why EEC stands out from the crowd – we can offer our clients everything they need to get their university off the ground easily and efficiently.
We aim to provide a complete service that will give our clients every chance of success when setting up their university. With EEC, you get a complete package of expertise and support for your university startup project.
At EEC we're looking at building a long-term relationship with our clients, where launching a university is only the first step.
We are confident that no other company can match our team of experts and their specialized knowledge.
At EEC we're looking at building a long-term relationship with our clients, where launching a university is only the first step.
We are confident that no other company can match our team of experts and their specialized knowledge.
Every private college, university, or vocational education program needs State approval to operate a post secondary educational institution in the United States and must adhere to the regulations of the state. But before you even think about seeking the license to operate, you have first to consider the structure of the business you are building.
What Business Structure is Right For You?
There are essentially four main types of organizational structures for US businesses, and each has a unique tax structure and income and liability guidelines that dictate its operations. Today, we’re going to talk about those structures to help you find the one that’s right for you.
Sole Proprietorship
A sole proprietorship is one of the simplest and most common organizational structures for businesses. This structure gives the owner - or owners - total control over all business operations. However, while a sole proprietorship cuts out a lot of hierarchical complexity and red tape associated with large businesses, it also puts a lot of responsibility on the proprietor’s shoulders.
In this kind of organizational structure, the sole proprietor is in charge of keeping their own records and paying taxes for self-employment income. However, the proprietor is afforded virtually zero protection from their business dealings: they are solely—and personally—responsible for the company’s debts and financial obligations. Typical sole proprietorship businesses typically include home-based businesses, shops/retail businesses, and one-person consulting firms.
The flexibility of sole proprietorships can be beneficial for small businesses, but the lack of a safety net can be intimidating for some aspiring entrepreneurs.
LLC
LLC stands for ‘Limited Liability Company,’ which is just what it sounds like. But, unlike sole proprietors, LLC owners—called ‘members’—are protected from liability and many of the obligations that come with business ownership. So, if you chose to operate your company as an LLC, the structure effectively protects your personal assets from business claims and debts. Plus, it’s simple to set up and manage.
This structure is considered a hybrid, as LLCs can be formed from either partnerships or corporations. The structure of an LLC can also dictate its taxation. Certain companies like banks and insurance brokers are restricted from operating as LLCs, as lack of liability could compromise the organization’s ethics.
Corporations
Corporations are different from other kinds of businesses in that they are entirely separate legal entities. The traditional rules don’t apply to them, and they’re instead accountable to their very own set of guidelines. Corporation owners are protected from any claims that may be filed against the entity’s activities. While this may seem like an easy way to skirt rules and limitations, corporation owners are hemmed in by their obligations, responsibilities, and the financial resources needed to float this kind of business structure.
There are two different ‘subchapters’ of corporations:
- S-Corporation: An S-corporation has less than 100 shareholders. It operates as a partnership but offers additional legal protections to its owners.
- C-Corporation: A C-corporation is a distinct legal entity that is responsible for filing its own tax returns. In the court system, it is effectively treated like a human individual. Corporation owners are obligated to split ownership via stock shares.
Conclusion
Despite the simple overview, these structures are complex, and navigating them can be complicated and confusing. Fortunately, is here to guide you through the process and help you make the best choices for the future of your education startup.
Should you find yourself with questions or in need of personalized assistance, I encourage you to reach out. For personalized guidance, feel free to reach out to Expert Education Consultants via email at info@experteduconsult.com with any questions you may have. This service is complimentary.
To explore customized solutions tailored to your specific needs, schedule a personalized one-on-one paid consultation with Dr. Sandra Norderhaug here.
