One of the most critical decisions you will have to make early on when starting an Amazon FBA business is what type of entity to establish. Your choice will affect a number of key factors including record keeping, taxation and liability.

It is a good idea to choose a legal structure that separates your personal assets from the assets of your company. This will minimize your liability in the event that you are sued for damages or losses caused by the products you sell. It will also help you to avoid paying taxes that you aren’t required to pay.

Most FBA sellers choose to operate as an LLC (Limited Liability Company). This business structure is relatively simple to set up and provides personal asset protection. It is also a good option for those who want to minimize their management involvement.

Alternatively, you can opt for a traditional C Corporation. However, it can be more complex to set up and requires the filing of additional paperwork. It is also generally more expensive to maintain and subject to higher corporate taxes.

If you are unsure what structure is best for your Amazon FBA business, consider speaking with an attorney or tax accountant. They can provide you with more information on the different structures and help you select the one that will be most beneficial to your goals. They can also explain the advantages and disadvantages of each, so you can make an informed decision.