FIN 419 Week 1 DQs

FIN 419 Week 1 DQs - Week 1 DQ1 What is a limited liability corporation Gitman stated limited liability corporation(LLC as a corporation that

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Week 1 DQ1. What is a limited liability corporation? Gitman stated limited liability corporation (LLC) as a corporation that restricts the personal liability of the holder for debts and actions of the LLC. The LLC is responsible of providing its owner the S corps, limited liability and taxation as a joint venture. What is a limited liability partnership? It is defined as a liability that helps in providing the individual partners the limited liability to make some policies of partnership. Every partner has its own responsibility of his work of negligence and all the partners will have their own limited liability and are not liable for others partners negligence. What are the differences? In an LLC,you can have more than 80% of partners or you can have the individuals who are not the residents of USA can own LLC shares not like an S corp., of a different company, and companies. Whereas, in the LLP it has to give tax being as a partner. The common between LLC and LLP is that there owners are less than 100 and the owners of both enjoy limited liability. What are the advantages and disadvantages of each? Both have similar advantages and disadvantages though the limited liability company (LLC) and a limited liability partnership (LLP) is different from each other. We see that in LLP's there are no business procedures of yearly meetings and notes. When we look upon taxes, the LLP is not an entity with different taxes; In LLP every partner who has paid the taxes enjoys the earnings. It provides the big deal of flexibility because we see that an LLC has the power to elect whether to tax as a sole proprietor, partnership, S corporation or C corporation (as long as the partners wish other than that they have to pass through the tax treatment). The demerit of these comprises of the following: In case there is the absence of partner the other partner may bond the LLP. The Money and property which has been given to the LLP becomes possessed by the partnership if not otherwise stated and the donor is not permitted to its return with the exception that it has been mentioned in
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This note was uploaded on 02/26/2012 for the course FIN 419 taught by Professor Abdul during the Fall '11 term at University of Phoenix.

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FIN 419 Week 1 DQs - Week 1 DQ1 What is a limited liability corporation Gitman stated limited liability corporation(LLC as a corporation that

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