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    Entity Formation Quick Look Sheet

    Uploaded by

    Kylee Colwell
    The document discusses different types of business entities including corporations, partnerships, LLCs, and others. It provides information on the formation requirements, characteristics, tax treatment, and liability for each type. The types of entities covered include general partnerships, limited partnerships, corporations, LLCs, LLPs, low-profit LLCs, benefit corporations, professional LLCs, and professional corporations.

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    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd

    Entity Formation Quick Look Sheet

    Uploaded by

    Kylee Colwell
    43 views1 page
    The document discusses different types of business entities including corporations, partnerships, LLCs, and others. It provides information on the formation requirements, characteristics, tax treatment, and liability for each type. The types of entities covered include general partnerships, limited partnerships, corporations, LLCs, LLPs, low-profit LLCs, benefit corporations, professional LLCs, and professional corporations.

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    The document discusses different types of business entities including corporations, partnerships, LLCs, and others. It provides information on the formation requirements, characteristics, tax treatment, and liability for each type. The types of entities covered include general partnerships, limited partnerships, corporations, LLCs, LLPs, low-profit LLCs, benefit corporations, professional LLCs, and professional corporations.

    Copyright:

    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd
    Download as docx, pdf, or txt
    43 views1 page

    Entity Formation Quick Look Sheet

    Uploaded by

    Kylee Colwell
    The document discusses different types of business entities including corporations, partnerships, LLCs, and others. It provides information on the formation requirements, characteristics, tax treatment, and liability for each type. The types of entities covered include general partnerships, limited partnerships, corporations, LLCs, LLPs, low-profit LLCs, benefit corporations, professional LLCs, and professional corporations.

    Copyright:

    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd
    Download as docx, pdf, or txt
    of 1

    Entity Formation

    Requirements for Articles De Facto Corporation Corporation by Estoppel


    of Incorporation Not a legal LLC, but parties treat it as - equitable remedy
    - name of the corporation such, as long as the following four - Where a body assumes to be a corporation and acts under a particular
    - name of the registered agent elements are satisfied; name, a third party dealing with it under such assumed name is
    - duration 1. proceeded in good faith estopped to deny its corporate existence.
    - number of authorized shares 2. under a valid statute
    - name and address of the 3. for an authorized purpose
    directors 4. have executed and knowledge of * Only where the agreement is inconsistent with
    - name and address of the articles of association pursuant to the mandatory statutory provisions will the members'
    incorporators people agreement be invalidated*
    - purpose of the corporation

    Type Formation Characteristics Tax Liability


    General - No writing requirement - all partners equally manage Pass through - all equally liable
    Partnership -Can be implied by conduct - right and obligation to share equally in
    -Parties must have legal capacity profits and losses

    Limited - certificate of limited partnership - all parties make contributions Income taxed once - GP personally liable
    Partnership - partnership name, office - GP’s manage and control - LP not liable
    location, names & addresses of
    general partners
    -submit to secretary of state
    Corporation - once its articles of incorporation - shareholders, officers, & directors tax on its profits as Shareholders not
    are filed with the state in which - LP don’t owe fiduciary duties earned and the personally liable for debts
    the corporation is formed shareholders (equity of the corporation
    investors) pay a second
    tax when those profits are
    distributed to them
    Limited Liability requires some paperwork and - Greater freedom in allocating profit and - Taxed once on its profits Liability shield for
    Company filings with a state agency. Some loss for tax purposes than a corporation - can take account on members
    states impose fees and taxes - investors called members their individual tax
    (generally modest) on LLCs that may be managed by all its members (as in returns of any losses of
    are not imposed on partnerships a partnership) or by managers, who may the LLC as those losses
    or may not be members (as in a incurred
    corporation)
    Limited liability -by filing a document with a state - all members can participate in - once as income of the limited liability only for
    partnership official management individual partnership debts arising
    - requires formal partnership - may have junior partners that do not - Pass through tax from negligence and
    agreement have a stake or liability similar misconduct, not
    for contractual
    obligations, although a
    few provide protections
    for both contract and tort
    liabilities.
    Low profit LLC Requires; - serves a socially beneficial purpose, main - Taxed once on its profits Liability shield for
    1. further charitable or education goal isn’t to maximize profit - can take account on members
    purposes - same structure as LLC their individual tax
    no significant purpose is returns of any losses
    production not income
    Benefit Required articles of incorporation - commit to creating public benefit and - taxed on profits earned No personal liability for
    Corporation value, while generating profit - shareholders subject to directors and officers
    taxes on profits
    distributed to them
    Professional LLC Requires articles of organization Owned and operated by members of the - no income tax -Individuals not personally
    filed with secretary of state in same profession, only offers services - pass through tax liable
    which it is formed, can only be related to its profession. - no protection for
    done by the license holder malpractice
    Limited liability by filing a document with a state - two or more general partners & 2 or - pass through tax general partners not
    limited official more limited partners personally liable
    partnership
    Professional Articles of incorporation - members & managers must be licensed tax on its profits as - owners not personally
    Corporation to practice the same profession earned and the liable for debts and claims
    shareholders (equity - no protection for
    investors) pay a second malpractice
    tax when those profits are
    distributed to them

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