Forms of

Business Organizations
All by yourself?
Sole Proprietorship
Owned by one person

Owner keeps all the profits

Relatively unlimited control

Easy to form
No separation of owner from business
Owner responsible for all debts/liabilities
Business and personal property can be seized
How can I start one?
How can I start one?
Few legal requirements

Can be run from a home,

garage, or van
Do you have a friend…
Do you have a friend…
and a good idea?
Partnerships
Owned by two or more people
Share profits equally
(unless otherwise agreed upon)
Partnerships
Owners share all the risks equally
Fully liable without limit
(similar to a sole proprietorship)
 Forming a
Partnership
Partnership Agreement
More difficult than a
sole proprietorship
Corporations
Corporations
Legal entity/artificial person
Separate from its owners
Corporations
Owners risk losing their investments
Owners do not lose personal assets
Harder to form
Corporations
State Charter and Organizational Fees
 Let’s
Review
 Sole Proprietorship
Requirements for Organization None

Legal Status Owner is the business

Liability Unlimited Liability

Management Owner decides

Dissolution Owner decides/death

Ease of formation Just do it

Duration Death or disinterest

 Partnership
Requirements for Organization Agreement of Parties

Legal Status Owners not a separate

entity
Liability Unlimited Liability

Management Owner have equal say

Dissolution Owners decides/death/

withdrawal/Bankruptcy
Ease of formation Moderately Hard

Duration Withdrawal/Bankruptcy
 Corporations
Requirements for Organization State Charter/Org. Fees

Legal Status Separate entity from

Owners
Liability Limited liability of
Shareholders
Management Directors set policy and
Appoint officers
Dissolution Does necessarily end

Ease of formation Difficult

Duration Can be perpetual

Any Questions?
Any Questions?

D. Casey Robertson
mr.dc.robertson@gmail.com
slideshare.net/Giratorio
youtube.com/user/MrTeachingTech
Resources:

http://www.paopen4businessbriefcase.state.pa.us/BStructure/SoleProp.asp

http://www.portal.state.pa.us/portal/server.pt/community/reources/8826/corporation/533420

http://www.portal.state.pa.us/portal/server.pt/community/reources/8826/general_partnership/5
33421

http://www.dos.state.pa.us/portal/server.pt/community/business-related_boards/13772

http://www.allbusiness.com/business-planning/business-structures-corporations/686-1.html

http://www.dos.state.pa.us/portal/server.pt/community/corporations/12457/forms/571880