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Unformatted text preview: FINC 322 Chapter 1 supplementary note Forms of Organizations Advantages Disadvantages Corporation 1. limited liability for the owner(s) 2 easy transferability and sharing of ownership 3. potentially infinite life(at least it might surpass the owners lifespan) 4. easier access to the financial markets 1. legal obligations for corporations are sometimes quite complex 2. corporate income is subject to double taxation Sole Proprietorship 1. relatively easy start-up and record- keeping requirements 2. there is no double taxation 1. the sole proprietor has unlimited liability and his/her personal wealth is at risk 2. ownership is not easily transferred so company lifetime is somewhat limited 3. access to financial markets is linked to collateral provided by the proprietor General Partnership Same as sole proprietorship Same as sole proprietorship Limited Partnership 1. each limited partner can insulate personal wealth from litigation against the partnership (similar to limited liability by shareholders) Same as sole proprietorship 1 FINC 322 Chapter 1 supplementary note The difference between an S-corp and LLC Powered by SAVE THIS | EMAIL THIS | Close The difference between an S-corp and LLC An aspiring entrepreneur wonders which structure would better benefit his business. By Shara Rutberg January 10 2008: 3:38 PM EST (FORTUNE Small Business) -- Dear FSB: My friends and I often dream up ideas for small businesses. One question we can never seem to answer is whether we should incorporate as an LLC or an S-corp. What are the real differences between these two incorporation types? Are there tax benefits we should be aware of, or common pitfalls?incorporate as an LLC or an S-corp....
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- Fall '11