BUS 207 Lecture Notes - Lecture 4: Limited Liability Partnership, Sole Proprietorship, Uniform Partnership Act
Document Summary
01:08: form of business, important decision, options: Sole proprietorship - has only one owner and it is merely an extension of that owner. He makes all the management decisions and all the profits are his, he also assumes greater liability (personally liable for all obligations of the business. A sole proprietorship is not considered to be a legal entity. Thus, it cannot sue or be sued (i. e. , since the owner is the business, creditors must sue the owner and he/she must sue in his/her own name those who harm the business) Taxes: is not a tax paying entity for federal income tax purposes (i. e. , the owner pays all of the taxes himself as an individual; the sole proprietorship is not taxed). The sameis true with respect to deducting business losses. As a practical matter, few people consider their business form decision and it may therefore occur by default.
