Sole Proprietorships
These is a category of person who might prefer to own/operate a sole proprietorship because they are creative, enjoy risk, and don't like taking orders from others.
What is an entrepreneur?
This is the minimum number of partners required to start/have a partnership.
What is two (2)?
Legally, corporations are considered this.
What is a person or separate legal entity?
This type of partnership must have at least two partners -- one general and one limited.
What is a limited partnership?
This concept of the income and therefore tax liability of the S corporation transferring to the shareholders.
What is passthrough taxation?
This is what happens to a sole proprietorship if the owner dies or becomes incapacitated.
What is "it ceases to exist"?
This is the legal document that outlines each partner's rights, responsibilities, and profit-sharing arrangement.
What is a partnership agreement?
The owners of a corporation.
What are shareholders/stockholders?
This type of partnership provides limited liability to all its partners.
What is an LLP (limited liability partnership)?
The maximum number of shareholders allowed for an S-Corporation.
What is 100.
This type of liability means the business owner is personally responsible for all business debts and legal obligations.
What is unlimited liability?
Each partner in a general partnership has this level/kind of liability.
What is unlimited liability? (also, jointly and severably liable)
The concept that corporate earnings are taxed at both the corporate and individual shareholder levels.
What is double taxation?
The partner that runs the business and assumes unlimited liability in a limited partnership.
What is a general partner?
If the S corporation does not offer shares to the general public but instead is controlled by a few insiders, this is the term we use to describe it.
What is a close(d) (or closely held) corporation?
This disadvantage of a sole proprietorship means the are not as many options to get new funding for the business.
What is financing risk?
This is what each partner in a partnership is taxed on.
What is their share of the profits?
This the document that must be filed when a corporation is formed.
What is the corporate charter/articles of incorporation?
The type of partnership often used by service firms such as lawyers and accountants.
What is LLP?
This is the type of business many S Corporations start as because "S" Corporation is a tax status.
What is an LLC (limited liability company) or Corporation.
This is the minimum number of employees required to start a sole proprietorship.
What is 0 or none?
This is the concept that a partnership cannot exist indefinitely but is tied to the lives and decisions/will of the partners and/or their heirs.
What is indefinite life/limited life/non-perpetual existence/uncertain existence?
This governing body is elected by shareholders to oversee major corporate decisions and policies.
What is the board of directors?
This is the partner who provides funding to the partnership but is not a decision maker and is not liable for the partnership's decisions or actions.
What is the limited partner?
The governing document required for both all corporations, including S corporations.
What are bylaws?