The Company : A Sole Proprietorship

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Paula Moraru’s Submission for LIT1 TASK1 PART A SOLE PROPRIETORSHIP: It is an unincorporated business with one owner who pays personal income tax on profits from the business. With little government regulation, they are the simplest business to set up or take apart, making them popular among individual self contractors or business owners. The benefit of the sole proprietorship is the tax advantage. The disadvantage of a sole proprietorship is obtaining capital funding. Liability: Owner is liable for 100% of debts, taxes and liabilities. Income Taxes: As a sole proprietor you must report all business income or losses. The business itself is not taxed separately. Longevity: The sole proprietorship by law will terminate upon the death…show more content…
Income Taxes: The general partnership does not pay income taxes directly to the IRS, rather the partnerships revenue and expenses are included by the partners on their income tax returns. Each partner 's share of profits and losses is usually set out in a written partnership agreement. Longevity: The death or withdrawal of one of the partners dissolves the partnership. The original partnership is dissolved and a new partnership is created to carry on the enterprise. Control: The partners have equal rights and authority to participate in managing the business. Each general partner has an equal right to participate in the management and control of the business. Profit Retention: All profits go directly to the partners. The amount of each partner receives will be determined by the amount each partner has invested in the company. Expansion: To conduct business in a state, a general partnership needs to locally register an assumed business name and obtain any specialty licenses needed. Compliance: Unlike corporations, general partnerships are not required to hold annual meetings of the owners, issue partnership interest, and keep personal asset separate from business assets. LIMITED PARTNERSHIP: Two or more partners united to conduct a business jointly, and in which one or more of the partners is liable only to the extent of the amount of money that partner has invested. Limited partners do not receive dividends, but enjoy direct access to
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