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Differentiate between two legal forms of doing business. Dis

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Differentiate between two legal forms of doing business. Discuss their differences and the benefits and liabilities between the two. Provide an example business. What would be the preferred form of business, and why?

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Two vastly different forms of doing business would be a sole proprietorship (SP), and a limited partnership (LP). In a sole proprietorship, the owner "is" the business. The business is not recognized as a separate legal entity from the owner, which means that all of the liabilities of the business are the sole responsibility of the owner, and the owner is accountable for 100% of the actions of the business, with full and complete liability. In a SP, the owner reports all income and expenses directly on their 1040 tax return *(Schedule C), and the net profit or loss is taxed at the ordinary income rate. The owner also must pay self-employment tax, which also appears ...

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Differentiate between two legal forms of doing business. Discuss their differences and the benefits and liabilities between the two. Provide an example business. What would be the preferred form of business, and why?

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