Hello, What type of Internet Business you are looking for? are you going to open SEO Firm ? i suggest you to start your with a Proprietorship firm if you start your Internet Business in India. because you need not to pay any service tax if your earning below 10 lac or if exceed then convert your firm to Pvt. Ltd.   Hope this Information is helpful to you.

I have started an internet business with a friend and have had a few past ventures with friends too and I do think it's good idea but also it can be a double edged sword.    But that is mainly due to legal reasons, I have set mine up currently in the UK so it will be totally different for yourself. Once you get past all the legalities of it, it's actually a very good thing for business. Being with a friend keeps you on track as your constantly keeping each other in check and if you're not pulling your weight you're letting the other person down.... So in that regard it's actually very helpful for keeping yourself motivated which is one of the biggest downfalls of the self-employed.   Also make sure to keep everything clear of how profits and overheads are split between you and your partner, so there are no ifs.   Obviously you could end up losing a friend if everything goes wrong, but if you make sure you're in the right business with the right friend you should be OK.   As long as you know what you're doing I would recommend going into business with a friend.

Lots of great advice here! One other piece I'd add is to divide up roles at the beginning and stick to it. Get it on paper. That way you're not stepping on each other's toes with duplicate work - and balls aren't getting dropped because you both thought the other person was handling it. Good luck!

I agree with bizjunkie that you don't need a lawyer to help you form your LLC as it's just a matter of filing simple paperwork that you can get from your state's corporation commission.   But, when a partnership is involved, I agree with davef.... have a lawyer draft a partnership agreement.  This step is easy to skip because after all, you're good buddies.  But things change over time.  Please don't skip this step - you're ensuring failure if you don't setup the terms of your partnership ahead of time.  Give your business the best start it can have and don't skip this step.

I am not going to get into great details because I think the others have done that in this post. I want to give my experience from a different angle the personal angle. I have an online business that has been around for 6 years. It is an LLC with a friend of mine. We have defined our roles and responsibilities and it works very well. Now those roles and responsibilities can change over time and have. We have always had them and they are great. I couldn't have asked for a better partnership and I have seen many partnerships fail. They can be great or they can be horrible. Make sure the person you are going in with is the type of person that you can make important decision with and rely on. There are people in my life that I would never be partners with. Pick wisely, or your work life can be miserable. Good luck and have fun! Chris

You don't particularly need an attorney - all you have to do is file with your state.  What you do is find your state's secretary of state's office or similar office and follow their directions on the type of business you want to form - partnerhip or LLC.  Fillout the paper work - which is really easy - they should also have instructions to their forms.  They send that in with the required fee.  Done.    Then you have to research and understand how your state and the IRS will tax your business's revenue - either tax the business or the money that flows through to the partners.   Regarding other aspects.  Some states don't require an operating agreement - but, I suggest you create one just to protect you and your partner down the road.  Never knwo what will happen or change in the future.  This agreement should spell out everything about how the business is to be operated like who does what, who can do what (like open an account or put the company in debt), how money and expenses are to be allocated, and what happens when someone whats to leave as ell as who makes the final decisions.

>>> Can anyone tell about them in layman's language as I find the legal documents very confusing. Don't avoid your legal documents just because they're confusing. If you don't understand legal, you should get an attorney to explain them. A few hours of an attorney's time are a lot cheaper than ignoring potential issues and having to fix big problems later. I don't know what you mean by going into business together and registering the business separately. If you are going to be partners, sharing the risks and the gain, you need to register as partners. If person one registers as a Sole Proprietor and you have an agreement to work together as partners, person one is taking all the risk upon him/herself, and person two is at risk of being on the outside looking in when you folks strike it rich. I wouldn't consider starting a business with a friend without a proper Partnership agreement. That means in writing. You guys (or ladies) have a lot to consider, such as: Who will be 'The Boss' Are you going to self-finance? Equally? Are you going to borrow money? How's your credit rating? Is your partner's worse credit rating going to hurt you? What skills do you each have, and who will do 'the work' Will you invest equally, and how will you split the business profits? Where do you each want to be in 5 years? 10 years? Do you have similar long-term goals? If one of you wants to sell the business and retire in ten years and the other wants to leave the business to his/her children, I'd say you have some details to hash out. You also need a plan. Do you know how to sell? Market? What do you know about bookkeeping? Who will have check writing authority? Will you have to hire employees? Who will make the hiring decisions? If you can't agree on something important, what's the business going to do? Just a few things to think about . . . .

You will want to have an attorney draw up a partnership agreement for the business even if you decide to register the business as an LLC or corporation. A partnership agreement will protect both of you in the event of a death, disability or retirement. It will also spell out how decisions are to be made, including financial ones.

Hi btsuccess, Take a look at our Online Business Guide for steps to starting your online business. Some laws and regulations vary from state to state, so remember to check out our state business guides to see what your state requires. Here are some online compliance issues you should be aware of as well. These blog articles on online businesses may be helpful to you as well: Starting and Growing an Online Business: An Entrepreneur's Checklist Getting Started with E-Commerce - An Entrepreneur's Checklist