Business Entities- Which One To Choose?

If you are looking to own a business, and need information on the many types of business entities, you are in luck. Come on in and let us tell you all about the many entities that you can choose from for your business.

Business entities like businesses come in many shapes and sizes. Depending on what kind of business you have, you may be limited in your choice of entities for that business. A short and to the point definition of a business entity, is a business that is created to make money. This business can be owned by a single owner, or a several owners. Depending on where your business is located, you may have to meet some legal requirements for your business entity.

Sole Proprietorship

One type of business entity and the most common that you will find is the sole proprietorship. Which is a business that is operated and owned by only one person. The owner is the one that benefits from all profits made by the business, but also resumes all responsibility for it as well.

General Partnership

When you have more than owner for your business entity, it is then called a general partnership. This type of company is owned by more than one person, which all share in the profits made by the company, as well as all of the responsibility that the company requires.

Corporation

A corporation is a business entity that has a board of directors. The board of directors make the major business decisions and vote on changes for the company. The money that is made from a corporation is split with the shareholders of the company.

Limited Liability Partnership

Another type of business entity is the limited liability partnership. This business is a lot like a corporation with the exception of  the board of directors. The owners can either manage the business themselves, or offer that position to someone else.

Limited Partnership

A business entity that is called the limited partnership is owned by general partners which are active in the company, and limited partners which are more or less just investors. This type of company is ran by the general partners, and the limited partners are somewhat limited in the role that they can play in the company.

With all of the many business entities that you can choose from, you are sure to find the best one that suits the business that you want. Be sure to thoroughly research each one of the entities and make sure that you are following all of the laws in the state that you are doing business in.