BUSA 2106 Lecture 3: Business Organization
14 Feb 2019
School
Department
Course
Professor
Document Summary
Irs says, [a] sole proprietor is someone who owns an unincorporated business by. Most simple form and not a legal entity. Cannot raise capital by selling interest in business. Business and owner are one and the same. Formalities: none; no documents executed/filed; no separate accounts (business and personal comingled); no separate tax returns. Laws: type of business may require license, but no applicable code. Liability: unlimited liability, owner personally liable for all debts. Taxes: owner liable for all taxes; self-employment taxes, etc, taxes reported on personal income tax statements. Irs says, [a] partnership is the relationship existing between two or more persons who join to carry on a trade or business. Legal entity that can own property, enter into contracts, sue and be sued. Each partner (individual or legal entity) contributes money, property, labor, or skill. Formalities: no formal paperwork required; exists when it looks like one exists; can have partnership agreement to avoid code defaults.
