BUS 082 Lecture Notes - Lecture 4: Sole Proprietorship, Double Taxation

• School: College of The Sequoias
• Department: Business (BUS)
• Course: BUS 082
• Professor: Tootle

Document Summary

Disadvantages: limited to 100 stock holders, no foreign ownership. Disadvantages: limited by many different state laws. Sole proprietorship: a business owned and operated by one individual. Advantages: easy to form, control, no double taxation. Corporations: legal entity, created by the state, whose assets and liabilities are separate from its owners. Advantages: difficult to form, liability is limited to the assets of the corporation (not shareholders), ability to have lots of owners and sell stock. Disadvantages: difficult to form, reporting to board of directors, double taxation, need to register and file tax returns in 50 states. Disadvantages: unlimited liability, not transferrable (many times death marks end of business), limited financial resources. Partnerships: association of two of more persons who own a business. Advantages: taxed as individuals, less of your own money invested (and risked) Limited: one partner who is an active manager, other partner or partners who have limited participation and liability. Advantages: limited liability for inactive partner, taxed as individual.