Ownership Project Smore

Madi Westbrooke

Sole Proprietorship

  • What is it? Is not a legal entity. It simply refers to a person who owns the business and is personally responsible for its debts.
  • Advantages & Disadvantages-The most common and simplest form of business. An individual proprietor owns and manages the business and is responsible for all business transactions.
  • Rules-Sole proprietors must file various tax forms with the Internal Revenue Service and pay any taxes due. must file a W-2 wage and tax statement for himself, as well as Medicare, Social Security and income tax withholding on Form 941, the employer's federal quarterly tax return.
  • Facts:
  1. simplest form of business ownership.
  2. The owner has the authority to make all the decisions relating to the business
  3. there is no need to hold policy


  • What is it? A business or firm owned and run by two or more partners
  • Advantages & Disadvantages- Partnerships are relatively easy to establish. the ability to raise funds may be increased. cost-effective as each partner specializes in certain aspects of their business. usually has limitations that keep it from becoming a large business. It may end upon the withdrawal or death of a partner.
  • Rules-This means that, in addition to the requirements outlined in this chapter, a PQ policy must also adhere to the requirements of HIPAA. The insured must be a resident of the state sponsoring the partnership program when coverage first becomes effective
  • Facts:
  1. There are 4 main types (1. Active Partners 2. Dormant Partners 3. Nominal Partners 4. Minor Partners)
  2. Every partner has equal rights.
  3. 20 partners is the limit

Limited Liability Partnership (LLP)

  • What is it? a partnership in which some or all partners have limited liabilities.
  • Advantages & Disadvantages- axing authorities in some states recognize the structure as a nonpartnership for tax purposes. are not recognized as legal business structures in every stateindividual partners are not obligated to consult with other participants in certain business agreements. liable for filing personal income taxes, self-employment taxes and estimated taxes for themselves.
  • Rules: must be an active member of the State Bar or otherwise authorized to practice law. must also have at least one thing called as a "general partner" with unlimited liability.
  • Facts:
  1. The general partner have full management and control of the partnership business but also accept full personal responsibility for partnership liabilities.
  2. Limited partners cannot participate in the general management
  3. The general partner can be either an individual or a corporation


  • What is it? a company or group of people authorized to act as a single entity (legally a person) and recognized as such in law.
  • Advantages & Disadvantages- shareholders are not liable for any debts incurred or judgments handed down against the corporation. Shareholders only risk their equitymay be able raise additional funds by selling shares
  • Rules- State laws require corporations that have any degree of liquidity after paying creditors and satisfying tax obligations to return excess funds to shareholders. require a corporation to verify that final state taxes have been paid before liquidation.
  • Facts:
  1. dominance of the global economy by corporations has allowed global wealth to become concentrated to a very frightening degree.
  2. Giant corporations have become so dominant that it has become very hard for small businesses to compete and survive in the United States
  3. Corporations not only completely dominate the U.S. economy, they also completely dominate the global economy as well.
  4. Example: 7-Eleven, Aflac, American Airlines.
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