Legal Forms of Business Paper

Joel Goodwin

Legal Forms of Business Paper

Business Law/531

April 29, 2013

Shannon Wall

Legal Forms of Business Paper

When choosing to start a business individually or as a member of a group, there are different forms of business in which they should be operated. The different forms of business: sole proprietorship, partnership, limited liability partnership, corporation, and franchise. In this paper, I will identify scenarios in which each of these forms of business would be the preferred form. For each scenario, I will justify why the corresponding business form is preferred.

The first legal form of business I want to indentify is the sole proprietorship. “A sole proprietorship is the simplest form of business organization. The owner of the business, the sole proprietor, is the business. There is no separate legal entity. Sole proprietorships are the most common form of business organization in the United States. Many small businesses and a few large ones operate in this way.” (Cheeseman, 2010) As a sole proprietor, you can conduct business under your own name or under a trade name. A perfect scenario would be for example, let's say I own my own construction business. I can conduct business under my own name, Goodwin Construction, or, I can conduct business under a trade name. As a sole proprietorship I could hire any number of employees that I choose, because the law makes no distinction between my self, and the business, and I am not considered an employee. Sole proprietorships may also hire any number of independent contractors. As a construction owner, my sole proprietorship starts to exist as soon as I do my first job, and because of that the legal and tax implications of doing business as a sole proprietorship will also exist as soon as I do my first work as a sole proprietor.

The next legal form of business I will identify is the general partnership. “A general partnership, or...