This website uses cookies to ensure you have the best experience. Learn more

Limited Liability Corporation And Partnership Paper

901 words - 4 pages

Limited Liability Corporation and Partnership Paper

University of Phoenix
FIN/419

November 26, 2012

Every business has a basic idea of the entity in which to establish. Capitalization and protection is the main focus to establish the business with a question of which type of entity should a business use to move forward. Businesses have a host of factors when making this decision, the most common forms of these entities are, partnership, corporation, sole proprietorship, and S corporation. A Limited Liability Company (LLC) is a business structure allowed by the different state statutes. The following will list two of these entities and the business entity which I ...view middle of the document...

a.).
Partnerships
A partnership is "an association of two or more persons to carry on as Co-owners of a business for profit." The essential characteristics of this business form, then, are the collaboration of two or more owners, the conduct of business for profit (a nonprofit cannot be designated as a partnership), and the sharing of profits, losses, and assets by the joint owners. A partnership is not a corporate or separate entity; rather it is viewed as an extension of its owners for legal and tax purposes, although a partnership may own property as a legal entity (Partnership, 2012).
Collaboration is a role, which in a partnership allows the partners to understand what resources and expertise the other partner is good at. Whereas, one person who owns a company has the sole responsibility, a partnership allows the owners to work together to obtain the goals that the company has set. Having a partnership can allow each partner time to share with family, friends, and leisure activities that they may not have being a sole-proprietary.
Tax advantages come along with having a partner. Each individual receives profits from the company, which this is a personal taxable income. Unlike the corporation tax laws, while in a partnership the monies are taxed only on a personal level and not on the corporation level.
Preferred Method
The method in which I would form is a limited liability corporation (LLC), this entity would be the best method if one did not have stakeholders or investors involved in the business. When forming a limited liability corporation, it allows the business owner to be free of any creditors that stems from owning the business. The limited liability corporation would allow the business operate and function differently from the corporate businesses. For instance, if...

Other assignments on Limited Liability Corporation And Partnership Paper

Business Structures Essay

851 words - 4 pages Business Structures FIN 571 July 20, 2015 Business Structures When forming a business, there are three basic structures to identify and understand. Sole proprietorship, partnership, and corporation comprise the basic structures. The partnership can be a general partnership or a limited liability partnership and the corporation can be three types: general, subchapter S (S corporation), and limited liability company (LLC). For a

Lit1 Task 310.1.2-01-06 Essay

3037 words - 13 pages nor the partnership can truly be considered separate entities from the persons creating it. Corporations usually possess many of the economic powers that any individual would, for example: they can own property, sue in court, sell or transfer property, etc. Important characteristics of a corporation are the continuity of existence, lack of pass-through tax treatment, limited liability for investors, and the ease of adding investors and selling

Business Structure

458 words - 2 pages Business Structure Belinda Sintim FIN 571 March 14, 2016 David Johnson Business Structure When one decides or proposes to start a business, they must decide on the type of business structure that would best benefit the needs of their business. Each business structure has its advantages and disadvantages. The three different business structures are Sole Proprietorship, Partnership and Corporation. Each structure has different set of

Organizational Forms Of Business

2312 words - 10 pages entities. These types of restrictions are in place to ensure that these types of organizations are small. * * Limited Liability Company * A limited liability company combines many of the benefits of corporations and partnerships. This structure combines the benefits of a partnership and a corporation by limiting the exposure of the member like a corporation, but allowing profits to be taxed like a partnership. This type of business

Types Of Business (3)

2086 words - 9 pages limited partnership has pass-through taxation. Each person reports their share of business profits or losses on an individual tax return. Corporations: A corporation is formed under the state’s law and provides limited liability for the investors. None of the shareholders in a corporation are accountable for the debts of the corporation. Creditors can look only to the corporation's assets for payment. The corporation files its own tax return and

Lit Task 1

1827 words - 8 pages partner and one must be a limited partner to call this a structure a limited partnership. Liability - the limited partner is only liable up to what they have invested into the company while the general partner is held liable for all of the business’s liabilities. The limited partner’s personal assets are not to be touched. Income Taxes - similar to a general partnership, the limited partner and the general partner will have a pass through taxation

Business Models

1981 words - 8 pages Business Models When stating up a business, there are many different business models that can be chosen. Some of the most popular models are: Sole Proprietorship, Partnership, Limited Liability Partnership, Limited Liability Company, S Corporation, C Corporation and Franchise. When deciding which business model is most appropriate, there are two major elements to consider: taxation and liability. Each of the above business models has

Week1 Homework

822 words - 4 pages a term to that means a partnership with limited liability is only liability for their investment. Their assets cannot be seized to pay the company’s debts. 3. Which organizational forms give their owners limited liability? Limited Liability companies and some corporations give their owners limited liability. They can also run the business. 4. What are the main advantages and disadvantages of organizing a firm as a corporation? Some

Business Organization

1415 words - 6 pages at the different types of business structures and then decide accordingly. There are vast differences between the sole proprietorship, partnership, limited liability company (LLC), and corporation and understanding each is vital. A sole proprietorship is a business entity that is solely dependent upon only one owner. Once a business plan is made and the proper licenses have been obtained from the state that the business will be in the

Business Entities, Laws, And Regulations Paper

1112 words - 5 pages and Naomi would be best to create a limited liability partnership (LLP) to organize their business. By forming the LLP, the partners protect themselves from liability beyond their initial capital contribution should the partnership fail or face a lawsuit. Members of an LLP are also not personally liable for the malpractice of one partner and states require LLP to carry substantial liability insurance in exchange for this limited liability. The

Corporaion

263 words - 2 pages to be the shareholders. Advantages of a Corporation • Corporation shareholders have limited liability for the amount of debt or judgments in which the corporation may consume. • Shareholders of the corporation are liable for the stock in which they invest into the company • Funds can be raise through the sale of the company’s stock Disadvantage of a Corporation • Incorporating cost more and requires additional time as oppose to the other

Similar Documents

Legal Forms Of Business Organization Essay

1062 words - 5 pages Limited Liability Corporation, Limited Liability Partnership, Corporation Paper Angelika Evanoff FIN/419 July 20, 2015 Mrs. Michele Huss Limited Liability Corporation, Limited Liability Partnership, Corporation Paper The purpose of this paper is to discuss three legal forms of business organization; a limited liability corporation or company, a limited liability partnership, and a class C corporation. The paper begins with a brief

Legal Form Of Business Essay

1284 words - 6 pages establish a corporation or limited liability company. And because a general partnership is normally a " pass through" tax entity (the partners, not the partnership, are taxed unless you specifically elect to be taxed like a corporation) filing income tax returns is easy (Small Business Solutions, 2010). Limited Liability Partnership A limited liability partnership (LLP) is a partnership, which one or all partners have limited or partial liability

Business Organization Check Point Essay

453 words - 2 pages by state statue. ("Forms Of Business Organization", 2013). They are similar to a typical corporation except owners have limited personal liability for any debt and actions of the limited liability company. They also include things like providing management flexibility and benefit of pass-through taxation. Owners of a Limited Liability Company usually are called members and the owner can be an individual, corporation, other limited liability

Adminastration Essay

802 words - 4 pages , Subchapter S Corporation, or LLC. Business Comparison Chart   | C Corporation | Subchapter S Corporation | Limited Liability Company | General Partnership | Sole Proprietor | Owners have limited liability for business debts and obligations | X | X | X |   |   | Created by a state-level registration that usually protects the company name | X | X | X |   |   | Business duration can be perpetual | X | X | X |   |   | May have an unlimited