Corporations

Front 1

The Five General Characteristics of a Corporation?

Back 1

1. Limited Liability for Owners, Directors and Officers.
2. Centrliazed Management in Board of Directors.
3. Free Transferability of Ownership.
4. Perpetual Existence.
5. Taxation-
a. C Corp: Taxed as an entity distinct from its owners.
b. S Corp: Taxed like a Partnership.

Front 2

Taxation: C-Corporation

Back 2

"Double Taxation"-

1. The Corporation pays taxes on profits.

2. Shareholders pay taxes on those profits when they are distributed to them.

Front 3

Taxation: S-Corportion (Check the Box)

Back 3

S Corporations, like Partnerships, are not subject to "Double Taxation"

1. Profits (and losses) flow directly through to the owners.

2. Restrictions: a. Stock can be held by no more than 100 persons. b. There can be only one class of stock. c. Generally, Shareholders MUST be individuals.

Front 4

Sole Proprietorship

Back 4

A sole proprietorship- A natural person (individual) doing business in his or her own name and in which there is only one owner.
- May form a DBA

Front 5

General Partnership

Back 5

“a partnership is an association of two or more persons to carry on as co-owners a business for profit, whether or not the persons intended to form a partnership”

1. An unincorporated business, intended to make a profit,

2. Which has two or more participants, who may be either individuals or entities,

3. Each of whom “brings something to the party”, such as efforts, ideas, money, property, or some combination,

4. Each of whom co-owns the business,

5. Each of whom has a right to co-manage the business, and;

6. Each of whom shares in the profits of the business.

Front 6

Partnership Types

Back 6

(a) Partnership at will – Each partner has the right to cause the partnership to come to an end, at any time without having to state or have “cause”.

(b) Partnership for a term – The partnership comes to an end at the end of the time period specified in the partner’s agreement.

(c) Partnership for a particular undertaking – A partnership comes to an end when the particular task or goal specified in the partners’ agreement has been accomplished.