Lit1 Task a Essay

| A general partnership allows for a pooling of capital and talent and a sharing of the risk. Additional benefits to a general partnership include additional expertise in decision making and a sharing of the workload. General partnerships are easy and inexpensive to start up.

Many believe that liability is a biggest issue in a general partnership than in a sole proprietorship. The owners of the company are still fully liable for any debts the company may accrue as well as the liability for any lawsuits that may be brought against the company. However, the bigger issue in a partnership is that now each partner can be liable for the other partner’s actions. If one partner is sued for malpractice, the other partner may suffer because of it.

There is also the concept of secondary liability. This means that if, for example, an employment agency

In Task 2, the owner is correct in his need to move away from a sole proprietorship and into an entity where his personal assets will be shielded in the event of a business failure. There seem to be three major ways to remove this liability, which include a C-Corp, S-Corp and LLC. For this situation, I would recommend an LLC for the business owner and will explain why it will benefit him in the issues of liability, continuity, income taxes, profit retention and control.

partnership to continue, in the event a partner withdraws from the group. Similar to sole proprietorship, general partnerships tend to have a difficult time rounding up funding and resources, since most of the necessary capital comes from each partner's personal assets. This in turn may hinder longevity and growth of the organization. 4. Control In a typical general partnership, all partners will have equal rights and control over the business. It allows any partner to act on behalf of the business to make decisions and negotiation with

Income taxes- All income generated through a sole proprietorship is taxed by the Internal Revenue Service. This is reported on the owner's personal tax return.

Without a partnership agreement, loss of income and profits are split between partners that wish. The partners then report individual amounts divided in their tax returns, pay taxes accordingly. Gains and losses are passed directly to shareholders, with each LLP partner personally liable only for its own negligence or the negligence of an employee who is under the direct supervision of the partners. The other

• Income Taxes: S- Corporations are tax paying entity, the business files tax returns but not taxed on earnings. The stockholders claim losses or profits on their personal tax returns.

Income Taxes- Taxed like regular income tax; owner claims it at year end and pays income tax on all earnings.

This protects the limited partners from the full liability that is shared by the general partners.   Income Taxes – The limited partner’s profits are considered personal income and taxed as such. All profits from the limited partnership are considered personal income and taxed at their personal tax rates.  Longevity / Continuity – The continuity of the business is not affected by the death or disassociation of a limited partner.  An advantage for a limited partner is that the limited partner’s investment takes priority in the general partnership dissolves due to a death or disassociation of one of the general partners.

INCOME TAXES – As a sole proprietor all business income or losses must be reported as personal income tax. The business itself is not taxed separately.

* The ownership of the partners is dissolved and they become mere employees who are responsible to the shareholders and Board of Directors

A number of business operations and behaviors can create liability exposure for diverse organizational structures. There is limited partnership in some businesses this is being sued for breach of contract, there is personal risk of exposure to liability, it can be moderate to a general partnership, this can mean property, now, and severe liability can mean individual property that is levied on partnership property that has been exhausted. Liability is not always based on intentional actions or even being negligence, sometimes liability can even be a way to brokers the peace between certain parties, rather than an injured party using more serious action (Mancuso, 2014).

Like most multinational corporations, the shareholders own the company and they may also be the board of directors. A Chief Executive Officer (CEO) will be appointed to nominate and manage the operation of the company as a whole. A Chief Operating Officer (COO) will be managing the company’s day-to-day operations and reports them to CEO. The Chief Financial Officer (CFO) will be managing the finance and account together with the

Bott 's type of business is that there are a lot of legal formalities required, which can be