What is the best form of business for you?

[Know.to]

Some facts about the different legal forms of business …Essentially, here are three main legal forms that any enterprise can assume at start up. They are: Sole Proprietorship, Partnership and Corporation.

Sole Proprietorship: a business that is wholly owned by one individual, which is for all intents and purposes an extension of that individual. It is the easiest form of business to start up.

Partnership: a venture that is undertaken by two or more individuals who pool resources and share ownership. Each owner can specialize in an area which they find they can make a more significant contribution. One partner may have more expertise in management and administration, whereas another may be more of a creative force and focus on production. Partnerships are just as easy to set up as sole proprietorships, and banks may be more likely to lend since the owners can combine assets to secure funds.

Corporation: a legal entity that may buy and sell property and assets, engage in production, sell products, extend credit as well as go into debt. The most defining characteristic is that it is distinct and separate from the shareholders (owners) as individuals. Thus, when legal action is carried out against it, the shareholders will not be held personally responsible to pay damages, as that responsibility rests with the corporation as legal entity or being.

My question to the members is: What form of business is best for you and why? What are some of the advantages/disadvantages to this?

[The Stealthy One]

I always go into something as a sole proprietor. Of course, this does not mean I'll keep that status, but how seriously I take the business depends on how seriously it takes off.

[theapprentice]

I would say partnership because I like to share the excitement and dont mind sharing the overall profit, and because 2 minds are better than one

The Apprentice

[Bizzrick]

I would go with partnership but my partner would have to go through extensive screening( even probaly a backgrounnd check)!!lol

[Envydia]

In the beginning I would choose sole then go into Corporation!!

[akula]

boring question

duh, a corporation

what is the point of doing business as a sole proprietor or a partner?

it leads no where

simply unbelievable responses

[akula]

I would say partnership because I like to share the excitement and dont mind sharing the overall profit, and because 2 minds are better than one

The Apprentice

dude, that is the most backward thing I heard all day

you prefer to invest your self in partnership structures because you " like to share the excitement and dont mind sharing the overall profit, and because 2 minds are better than one"

how absurd is that

you can share this said "excitement", profits and enjoy a board of directors working through a corporation, without having to expose your self to partner liabilities (and suffer other disadvantages of partnerships)

the reasons you've outlined for choosing a partnership structure, are not unique to partnerships, whilst at the same time you've neglected to cover the many disadvantages of partnership which are you unique to this way of doing business

extraordinary

[NeeJam]

I'm currently a sole properietor so i voted for that.

[SSM]

You should probably LLC on there considering it's a HUGE option.

[bizman]

Hi All, I currently have a corporation for my catering company The Food Dudes. We chose this method because being in the food business is a good way to get sued if your not careful (we are and do an excellent job btw), but just for safety's sake this was the best option for us. However, I must warn that opening a corporation is somewhat of an undertaking. Firstly, here in Canada it costs about $500 give or take, and doing the taxes are not the easiest thing in the world. The most important piece of advice I can give you about opening a corporation is MAKE SURE you keep track of your bookkeeping (sales,expenses,profit,etc.) This will save you lots of headaches in the future.

[Joe426]

A sole propreitorship is great and all but you do have to deal with the other person's ideas and split all the profits. Only benefit of a partnership is really a boost in capital and more ideas.

[SSM]

I have an LLC so I didnt vote

[akula]

let me put forward a reflection

it is unbelievably disappointing to come across great business opportunities only to find out that the venture is a sole proprietorship

for the sake of rationality, don't invest your self in these business structures

you role as an entrepreneur is to create, inflate and sell corporate securities

if you do not do this, you will find less satisfaction in your career as an entrepreneur

[vishenda]

Two heads are always better than one ^__^

[jwwceo]

The S-Corp is the option you left off. This affords the legal protection of a corporation but the business is taxed at the individual owner level. That is, the business does not really file it's own tax return. All profits or losses are distributed to the owners and they are taxed at their own PERSONAL tax rates. So there is no corporate double taxation. S-Corp is the way to go for sure. OF course you need to qualify, but 99% of us biz owners would be fine. The rules are pretty crazy, like less than 75 shareholders...I think that covers most of us in here...