What are the different types of business entities and their characteristics?
Understand the Problem
The question provides an extensive overview of various business entities including their legal structure, liability, duties, and termination processes. It discusses types of business organizations such as sole proprietorships, partnerships, limited partnerships, limited liability companies, stock companies, cooperatives, government enterprises, and multinational enterprises.
Answer
The primary business entities are sole proprietorship, partnership, LLC, and corporation.
The main types of business entities are sole proprietorship, partnership, limited liability company (LLC), and corporation. Each has distinct characteristics concerning liability, taxation, and ownership structure.
Answer for screen readers
The main types of business entities are sole proprietorship, partnership, limited liability company (LLC), and corporation. Each has distinct characteristics concerning liability, taxation, and ownership structure.
More Information
Sole proprietorship is owned by one person, who is personally liable for business debts. Partnerships involve two or more partners. LLCs offer limited liability and flexible management. Corporations are separate legal entities, offering the strongest protection from personal liability.
Tips
A common mistake is not considering the long-term implications of liability and taxation when choosing a business entity.
Sources
- Business structures | Internal Revenue Service - irs.gov
- Types of Business Entities - ASHA - asha.org
- Types of Business Entities - NerdWallet - nerdwallet.com
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