Ownership Smore
By: John Pfeifer
Sole Proprietorship
Definition: A small business owned by one person who owns all the assets and profits.
Advantages
-Owners can get to be a sole proprietorship easily, inexpensive, and instantly.
-Owners can mix business and personal assets.
-They don't need to pay unemployment tax on themselves but have to pay the tax on their employs.
Disadvantages
- Owner are personally liable for losses and dept.
- Owners can't sell a part of the business.
- They rarely survive the death of an owner.
Regulations
They have to run the day to day operation in their business.
Facts
-Most small businesses start as a sole proprietorship.
-The owners are responsible for losses and dept.
-They receive all income made by the business
Real Life Examples
-Wyzant tutoring
-Jimmy's food store
-Peggy Sue BBQ
-Bánh Shop
Partnership
More than one people sharing ownership of a business.
Advantages
-May raise funds easier.
-Easy to create.
Disadvantages
- profits have to be shared.
-Disagreements will happen
Regulations
Must decide how much time and money they will put in the business up front.
Facts
-Have to have a legal agreement set up.
-It is likely to end if a partner dies or leaves the company.
Real Life Examples
-McDonalds
-Warner Brothers
-Microsoft
-Apple
Limited Liability Partnership (LLP)
Advantages
-You can only lose the money you put in the business.
-There are no limit of the number of members you can have.
- Income is treated as personal income so you don't get federal tax that corporations get.
Disadvantages
-Is harder to get investors.
-If you work in multiple states you have to follow all their laws.
Regulations
-LLC can't be more than 2 of the 4 of defining a corporation.
Facts
-It is a new type of hybrid business structure.
-You can have as many members as you want.
Real Life Examples
-Kelly M. Davis and Associates LLC
-Helene Parker & Associates LLC
-Nissenbaum Law Group LLC
Corporation
Advantages
- The company does not dissolve win the ownership is lost.
-The shareholders are limited liable for debt's in the corporation.
-Can raise additional funds through selling stocks in the business.
Disadvantages
-May get overall higher taxes
-The process takes more time and money.
- Watched by local agencies, states, and federal.
Regulations
- Shareholders elect a board of directors to make decisions and oversee the company.
Facts
- Has headquarters in a state where they are chartered.
-Owners of the business are shareholders
Real Life Examples
-7-Eleven
-AT&T
-Burger King
-CBS