1 / 2100%
Aa solea proprietorshipa hasa aa singlea ownera (SBA,a n.d.).a Ita doesa nota havea
shareholdersa anda alla liabilitiesa ofa thea businessa area ina thea handsa ofa thea
owner.a Thea companiesa assetsa anda liabilitiesa arena nota separatea froma
thea ownersa assetsa anda liabilities.a Thea advantagesa anda disadvantagesa
cana alternatea fora aa solea proprietorshipa dependinga ona thea
circumstances.a Aa solea proprietorshipa isa easya toa createa anda givea thea
ownera completea controla overa thea business.a Bea personallya liablea fora
thea debtsa anda obligationsa cana bea aa disadvantagea ofa thisa typea ofa
business.a Beinga labeleda asa aa solea proprietorshipa isa gooda fora low-riska
companies.a
Aa partnershipa hasa twoa ora morea ownersa anda thea liabilitiesa area splita
amongsta thema (SBA,a n.d.).a Therea area limiteda liabilitya partnershipsa anda
limiteda liabilitya partnerships.a Witha aa limiteda partnership,a onea partnera
hasa unlimiteda liabilitya whilea thea othera partnersa havea limiteda liability.a
Profitsa area splita amonga thea partersa anda passa througha thea personala taxa
returns.a Thea generala partnera musta alsoa paya self-employmenta taxes.a
Limiteda liabilitya partnershipsa givea limiteda liabilitya toa eacha partner.a Thea
advantagea ofa thisa typea ofa partnershipa isa ita protectsa partnersa froma
debtsa associateda witha othera partners.a
Aa corporationa isa typicallya owneda bya multiplea stakeholdersa anda isa aa
separatea entitya froma thea ownersa (SBA,a n.d.).a Ana advantagea ofa aa
corporationa isa ita providesa thea mosta protectiona fora ownersa ina regarda toa
liabilities.a However,a aa disadvantagea isa ita requiresa morea extensivea
recorda keepinga anda operations.a Corporationsa area taxeda whena theya
makea aa profita anda thena whena theya paya dividends.a Corporationsa alsoa
havea thea advantagea ofa beinga ablea toa sella stocka ina ordera toa helpa raisea
funds.a Aa corporationa isa gooda fora higha riska companies.
Mya dada starteda hisa owna electricala companya abouta foura yearsa ago.a Hea
starteda offa aa aa solea proprietorshipa asa ita wasa justa hima runninga thea
businessa witha knowa employees.a Recentlya hisa companya hasa expandeda
anda hea nowa hasa threea employees.a Therefore,a hea madea thea switcha toa
ana LLC.a Hea gaineda morea assetsa duringa hisa expansiona anda becominga ana
LLCa helpsa hima protecta thosea anda protecta hima froma personala liabilitya
(SBA,a n.d.).a Hisa businessa isa taxeda asa aa ca corp,a whicha meansa hea paysa
taxesa ona grossa incomea anda thena thea earninga area distributeda toa hima
(Truic,a 2023).a Thena hea musta alsoa paya incomea taxa ona dividends.a Beinga
ana LLCa isa gooda fora hisa companya becausea ita isa aa smalla businessa witha aa
mediuma toa higha risk.a
References:
SBA.a (n.d.).a Choosea aa businessa structure.a
https://www.sba.gov/business-guide/launch-your-business/choose-
business-structure
Truic.a (2023).a Single-Membera LLCa Taxes.a
https://howtostartanllc.com/taxes/llc-taxes/single-member-taxes
Students also viewed