Essay on Forms of Businesses

923 Words May 21st, 2013 4 Pages
Forms of Business

Antonio James

Business Law/LAW 531

March 29, 2013

One of the first great cares of starting a business is deciding on what entity that the owner or owners wish to become. Depending on the size and justification that the corresponding business prefers to be, it is a tax and business identity trait. Failure to decide on the right entity can result in penalties from the federal or state government, because this is one of the main reasons of taxation. Depending on what you chose for your business, your entity selection can change from a sole proprietorship to corporation within several years, it all depends on how well the business has progressed. For individuals who wish to start their own business,
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With the LLP, you have the owner(s)/limited partners that own the business and do not partake in the day to day operation and you have the general partners that run the business operation. General partnership has to have a written agreement to make it a partnership agreement, and this is a legal requirement. Businesses that benefit from this are professional services such as big law firms.
Limited Liability Company This is a business entity that structured by whatever state that the owner resides in or where the business has started in, normally the owner does not have to be in the state of where the LLC is located just as long as it has an agent that resides in that state. The owners are called members, and some states do not restrict the ownership in which corporations, foreign businesses or individuals may be included as members, furthermore; there is no set number of how many members who can be part of the LLC. An insurance company or financial service such as bank cannot be a LLC; however, any other type of service can be an LLC. Unlike C or S Corporation, LLC is less expensive and easy to start up, and there is no annual requirement of meetings to go to. A perfect example of LLC would be a home based type business like a computer

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