It is so unfortunate that so many people are delving into business everyday without understanding what type of business they are venturing into, hence I present to you the 9 Types of businesses for 2022 and beyond.
And I expect you to study them carefully, before you know the right one to choose that will be beneficial to your business.
1. Sole Proprietorship.
As the name implies, sole proprietorship is the kind of business which a single individual operates.
The business remains part of the individual, and is never considered a separate entity.
Its profits and losses are matched up in the tax returns of the owner, and he also retains the personal liability for all the business debts and lawsuits.
A corporation is a kind of business entity which exists seperately from it’s owners.
This kind of business is formed under the states law that it’s operating, after being presented an article of incorporation.
3. Sub Chapter – S Corporations.
This is a kind of corporation which posseses the benefits of a limited Liability of a corporation, but is taxed as a partnership.
The income and loses of this kind of corporation flows through to the individual shareholders.
4. Professional Corporations.
This is a specific type of corporation for professionals, example doctors, accountants, lawyers etc.
These professionals possess the power to form a corporation, but with the exception that each of these professionals remains liable to their own wrongful professional actions.
Partnership is a kind of business entity which allows individuals to share the risk and benefits of a buiness.
It usually includes general partners, who are liable to partnership debts and actions.
It may also include limited partners who only invest but do not involve in the day-to-day operations of the business.
And they also do not share liability.
6. General Partnerships.
In this type of partnership, all the partners participate in the daily operations of the business, but they all bear personal responsibilities for debts and liabilities of partnership.
7. Limited Partners.
When a partnership has both general and limited partners, we often refer to it as “limited partnership”.
A limited partnership is therefore a business entity that exists distinctly from it’s partners.
As with a partnership, where all the partners engage in the daily operations of the partnership, as well as have liability for debts and actions of the partners.
However, limited partners neithe participate in the daily operations of the partnership, nor bear liabilities for the debts or actions of the partnership.
8. Limited Liability Partnerships.
It is the general partners that forms this kid of partnership, but all of them are shielded from liabilities for the actions of other partners and employees.
Limited Liability partnership is similar to a limited Liability company, the only difference is that it operates under partnership rules.
9. Limited Liability Companies.
Limited Liability Companies operates like a partnership, but it only has members instead of partners.
The advantage of this type of business is that the liability of it’s members are limited to their investment.
So therefore, before you begin your business in 2022 and beyond, make sure you study this 9 types of business to know the right one to choose.
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