Difference between a Corporation, a Sole Proprietorship and a Limited Liability Company - Essay Example

The paper "Difference between a Corporation, a Sole Proprietorship, and a Limited Liability Company" is a good example of an essay on business. A corporation is an independent legal entity. In this case, shareholders own a corporation, but they are not liable for the actions taken by the company. It has a sophisticated operational cost compared to other ventures ("The U.S. Small Business Administration SBA.gov"). The taxing system is different from other business ventures. Corporations are ranked as large successful companies that can meet all the minimum operation cost. The registration process requires individuals to follow the pre-established rules of the state in which it is registered. Business ownership can be transferred by selling shares through a stock offering.

On the other hand, Sole Proprietorship is the easiest form of establishing a business. An individual owns the business. There are few laws that surround the establishment of a single company. When one starts such a business, you are responsible for everything that it engages in ("The U.S. Small Business Administration SBA.gov"). An individual will be responsible for all its actions, profits, losses and branding a business. The tax system is simple compared to other companies. When an individual is taxed, the business is taxed too.
Also, Limited Liability Company (LLC) is a hybrid between a corporation and the legal structures to come up with better taxation programs. The owners of an LCC are referred to as members, depending on the state. An LCC can be owned by one or many more individuals depending on the priority of ownership ("The U.S. Small Business Administration SBA.gov"). Taxation is not separated from the company, and profits and losses are distributed equally among all members, depending on their ownership.
The business should have the first amendment rights of individuals
The process of separating business owners and business has complicated taxation strategies. Corporations are the most affected by the law. Shareholders are taxed two or more times, given that they have another job apart from being shareholders. The point of separating them from the business should be amended and include them as members as it is the case with the LCC. The results will be increased dividends for the shareholders, and they can use the money generated to other business platforms. Read More