Business Structures Advice FIN/571 February 23,
Business Structure Advice
From: sent: February 23, 20
To: John Owner
Subject: Advice in starting your business
John, business structures research is imperative when starting a business in other to ensure the best structure needed for your company. There are various one needs to take into consideration because the structure of a business affects, legal and financial liability, taxation and as well as decision-making authority. I will advise you on your options, the advantages and disadvantages of each entity and the tax consequences which is connected with each of the entity. There are different types of business structures and they are sole proprietorship, partnership and Corporation. So therefore when starting a business one has several options in the type of business structure they can use. A sole proprietorship is known to be one of the simplest structure there is and is inexpensive to start off. It is about 75 percent of all business in the United States. The owner has full control over the business and is has sole rights of the profit the business acquire. All business decision-making is the owners responsibility and do not needs to have defer to partners for decision approvals (Parrino, Kidwell, & Bates, 2012). According SBA (2015), “Because you and your business are one and the same, the business itself is not taxed separately-the sole proprietorship income is your income”. Advantages:
Easy tax preparation,
Easy and inexpensive to form.
Unlimited personal liability because no legal separation between the owner and the business. •
Hard to raise money; challenges the sole owner will face...
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