By: Blake Cassell
-Most small businesses begin as sole proprietorships.
-Sole proprietorships are the most inexpensive businesses to establish.
-Because a sole proprietor and an owner are the same person, only one tax return needs to be filed.
-A partnership does not pay tax on its income. Instead each partner pays tax on he share of net partnership income each receives.
-If there is no agreement in place, each partner is deemed to own equal shares of each asset.
Limited Liability Partnership (LLP)
- In most states, LLPs are only available to a select group of professions, such as law and accounting firms.
- Like shareholders in a corporation, Limited Liability Partners are not personally liable for all the debts, obligations and liabilities of the partnership.
- Corporations can be private, nonprofit, municipal, or quasi-public.
- Most states don’t impose a corporate tax, choosing instead to tax the business’s profits on the shareholders’ personal tax returns.