Limited Liability Companies

Forming a business entity requires a great deal of knowledge before any decision is made. There are advantages and disadvantages to each entity and without proper understanding of what they are, individuals could make costly errors and forfeit crucial perks that would be in the businesses best interest. In the situation in New State, Alex, Bill, Carl, and Devon have inherited their father’s operating organic farm and seek advice, in regards to which form of business organization would best fit their particular criteria. They have emphasized their immediate concerns, wants and needs from a business standpoint, but also stress their strong faith to uphold and operate in accordance with the Christian worldview. Their criteria is as follows, (1) create an entity which averts formalities or complexities, (2) develop a structure allowing cousin Xavier to handle the day-to-day, (3) minimize taxes on the entity, (4) avoid any personal liability, (4) keep business in the family only, (5) remain in accordance with the Christian worldview, (which will be the final topic in this discussion). After reviewing all criteria, it will be advised that forming a limited liability company (LLC) and electing for an S corporation status would be of best interest for the family. Discussed below, is the strengths and weaknesses of each form of business organization as it applies to their unique situation, to help better understand why an LLC/S corporation, is the best form of

Besides the sole proprietorship after reading I learned about three basic types of business organizations known as limited liability (LLC), partnership, and corporation. Sole proprietorship is a “business owned and operated by a single person. The business has no separate legal existence from its owner.” (Rogers, 2012) In the textbook it said “Partnership is an association of two or more competent persons to carry on a business as co-owners for profit. The business itself is not a legal entity.” (Rogers, 2012) The law says competent means a partner having contractual capacity and a partnership where each partners simultaneously a principle and agent. You can partner up with a minor but be wise to emancipation or be cautions because minors can void partnership agreements. Partners of a business are owners and managers automatically unless specified otherwise by partners but according to the law they presume equal rights. “Note that while there can be unprofitable partnerships, there is no such thing as a nonprofit partnership. The partners must intend to make a profit.” (Rogers, 2012)

A partnership is the best form of business given Shania’s situation. She has support from all angles that want to help her Christian coffee shop be a success. A limited liability partnership is best suited for Shania because of her possible partnerships with her husband, sister, and neighbor. According to the Limited Partnership (2015) article, this form of business is a “voluntary association where one or more partners contribute capital only, and those partners play no role in management.” Her husband wanted to make a contribution to Shania’s business but not in the lane of management, so by using this partnership he can still contribute his capital and maintain his partnership. The liability is limited to the amount of capital that the partner contributes. As a “silent partner” Marvin can make investments with the company, but not have any voting power or control over day-to-day operations.

Launching a new program must to be original “If you have always done what you always did, you'll always get what you always got” is a standard line of thought in many addiction treatment programs" (Leach, E. C., & R. M. (2007, May 1). However, in this case, Pam didn’t get what she expected to get due to the lack of knowledge of the group of people that she was trying to target with this new program at LDC.

Limited liability companies are the popular new choice for business start-ups. The "LLC" has only been in existence for roughly 26 years and there are some definite pros and cons.

To explore the topic of the tax consequences of when a member of limited liability company (LLC) treated as a partnership for tax purposes guarantees a qualified nonrecourse financing of the LLC, we will need to examine how a liability or taxpayer could be at-risk, what are the tax consequences of when a taxpayer with limited liability guarantees a debt,

It sounds like her sister, Kelsey, and her neighbor, Carlos, only want an income, but if Shania does not want to figure out payroll taxes then I would consider a partnership with her sister, neighbor and her husband as a silent partner. However, if they want limited liability considering debt then an LLC would be the best one to consider. Because under the structure of an LLC, each member or partner’s liability is limited concerning the debts or legal action of the business (Meggitt, J., 2016).

Did you start a corporation or LLC in Florida and receive suspicious notices? You can disregard them.

This business is a general partnership, meaning that both owners are responsible for management and the financial obligations of the business. Also, it’s easy to start, mainly due to the fact that each partner pays a minimal fee for the fees that are applied to new businesses. It’s easy to manage, due to many different ways each partner handles their responsibilities. There’s a lack

My goal is to inform Alex, Bill, Carl, and Devon of the different business forms, so they can feel educated and informed when making this important decision. I want to thoroughly explain Corporations, Partnerships, and Limited Liability Corporations to them, so they are aware of their options. The siblings’ father passed away after operating a successful sole proprietorship for many years, so there will be a definite change in business forms. A sole proprietorship is no longer an option due to the amount of members. Fleischman and Bryant (2000) explain that this form of business “is an option only for a business with one owner” (p. 2).

In order to properly plan the business that John and his wife are considering, they will need to consult a lawyer, multiple suppliers, and the municipal authority of the area. Consulting with these professionals will clarify that their business is created in a manner that protects them from the potential legal implications of taking on a business venture of its magnitude. Consulting a lawyer first would be the way to start. Meeting with a lawyer is necessary for first deciding what type of business they should start and what type of legal protection they are looking for, which in this case a C Corp would be a great recommendation.

For this type of business, Tom and his two colleagues can either decide to form a partnership or to incorporate their business.

As stated above, in this case the form of business organization used by the deceased father is a sole proprietorship. A sole proprietor is someone who owns an unincorporated business by himself or herself (Sole Proprietorship, 2015). This form of business organization is a business in which one person is in control of the management and profits. A sole proprietorship has its disadvantages and advantages. With being a sole proprietor, you have complete control of the management of the business. Everything is left in your

This brings us to the possibility of a partnership. Set-up expenses are still at a minimum, and the legal documentation required to form a partnership is simpler, more straightforward, and less complicated than what is needed for incorporation. Partners have more motivation than the investors that might be scrounged up in a sole proprietorship or a larger more expansively financed incorporation; as they directly share in the profits and most immediate business decisions. There are improved growth capabilities, something much more limited in a sole proprietorship, and generally it is easier to procure capital and further funding for financing a business operating under a partnership than it is for a sole proprietorship. The funding for startup costs and expansion is pooled with the resources of all partners. Multiple skill sets are brought to the benefit of the business as well. There is more flexibility found in decision making then with the multiple and varied investors of an incorporation. For this particular scenario, with the limited funding and growth costs of an individual family on a budget, but potential to tap a saturated market and create an unlimited amount of demand, and thereby an unlimited amount of profit, a partnership would be a vast improvement for the possibilities of “The Thunker” over a sole proprietorship.

Susan, Sonil and Shao have the options of two different business structures that they may consider; Partnership and Limited Company. A partnership is defined as a structure comprised of two or more partners coming together for a business venture that is looking to make a financial profit (Atrill, McLaney, & Harvey, 2015). A partnership is established through an agreement between the partners, either formal or informal (Atrill et al., 2015). Due to the fact that partnerships often fall out due to disagreements between the partners (Tasmanian Government, 2016), it is advised for any individuals seeking a partnership, to establish a formal agreement for security. A partnership has many advantages such as greater access to