The Mane Point: a legal blog for smart horses and their people
By Allison J. Farrell of Jenkins Fenstermaker, PLLC on 03/16/2022
How to Structure Your Horse Business

Many horse lovers—like myself—dream of making a living doing what they most enjoy and decide to start a horse business. In addition to launching The Legal Equine, my husband and I founded our farm-based business, Almost Heaven Vanners, LLC, the same year. While it may sound like the perfect career, a successful horse business requires careful planning and consideration as well as grit and, sometimes, luck.  A passion for horses is certainly a requirement for a successful equine business; however, you will also need to know how to structure your horse business properly to protect your personal assets and to best help make your business profitable.

Image of three horses near a stable, representing how WV equine lawyer Allison J. Farrell helps you determine how to structure your horse business in West Virginia.

Why Choosing How to Structure your Horse Business Is Important

While operating a business as a sole proprietor may seem an easy route to take, it is a very risky way to run a horse business. It offers no protection to you and your personal assets. Formalizing your business by establishing it in a formal business structure can help provide credibility and protect your personal assets.

When starting a horse business in West Virginia (WV), Ohio (OH), or Pennsylvania (PA), choosing and implementing a form business structure is one of the first steps you should take. For example, if you set up a corporation, you can legally separate your individual assets from the assets of your business. Doing so can protect your home, personal bank accounts, and other personal assets from liabilities your business may incur.

There are several types of business structures. Choosing an equine business structure in WV—or any state—that’s right for your situation depends on your individual needs. Taking a little time to properly set up a formal business structure can pay off in liability protection and peace of mind.

Using a Limited Liability Company When Starting a West Virginia Horse Business

When considering how to set up a horse business in West Virginia, you may find your options overwhelming. While there are many organizational structures to choose from for your equine business, one of the most popular is the limited liability company.

The West Virginia Uniform Limited Liability Act provides that one or more persons can organize a limited liability company (LLC) by filing articles of organization with the WV Secretary of State and paying the required fees.

The obvious benefit of the LLC is that it limits the personal liability of the owners, but it does not add another layer of taxation. When properly set up, an LLC should have a good operating agreement that sets forth how the business will operate on a daily basis as well as the rights and obligations of each of the owners.

Using a Corporation When Starting a West Virginia Horse Business

A C-corporation is another popular organizational structure for an equine business. A C-corporation also limits the liability of its owners but is also a separately taxed entity. When properly set up  will have by-laws detailing the way the corporation will be run. However, it does not usually address how the day-to-day operations will be handled.

The West Virginia Business Corporation Act at WV Code §§ 31D-1-101 et seq. provides the requirements for legally establishing a corporation in the state, which includes filing the proper forms and paying the necessary fees with the West Virginia Secretary of State.

Other Types of Business Structures in West Virginia 

The West Virginia Secretary of State’s Office includes these and other business forms in a helpful list of the types of business structures recognized by the state. This list also helps explain the differences between the types of businesses and offers links to many other essential resources. That office also provides a business structure comparison chart that shows the benefits of each type of West Virginia business structure.

When starting a horse business in WV, OH, or PA, contact an experienced equine attorney to learn how to structure your horse business for maximum liability protection and set yourself up for success. Horsewoman and equine attorney Allison J. Farrell of Jenkins Fenstermaker, PLLC’s Clarksburg office can answer all your equine business questions and get your horse business off to a great start in WV, OH, or PA. To learn more from Allison, call (304) 521-6120 or complete this online contact form.