Types of Business Organization
Bean Counter Dave Marshall has this to say about the different types of business organizations:
Types Of Business Organization
One of the first decisions that a person(s) needs to make is how the company should be structured. The four basic legal forms of ownership for small businesses are a Sole Proprietorship, Partnership, Corporation, and Limited Liability Company. There are advantages and disadvantages as well as income tax ramifications associated with each type of organization. We aren’t going to delve in to this area but a brief description of the different types of organization and what they are is needed.
- Sole Proprietorship
Most small business start out as sole proprietorships. These firms are owned by one person who is normally active in running and managing the business.
A partnership is two or more people who share the ownership of a single business. In order to avoid misunderstandings about how profits/losses are shared , who’s responsible for what, and other management, ownership, and operating decisions the partners normally have a formal legal partnership agreement.
A corporation is an organization that is made up of many owners who normally are not active in the decision making and operations of the business. These owners are called shareholders or stockholders. Their ownership interest is represented by certificates of ownership (stock) issued by the corporation.
Two types of corporations:
- Regular or “C” Corporation
Earnings are taxed to the corporation. Shareholders not personally liable for income taxes unless dividends are paid.
A special type of corporation allowed by the Internal Revenue Service (IRS) that passes or transfers its earnings to the individual shareholders who personally pay the income taxes.
- Regular or “C” Corporation
- Limited Liability Company (LLC)
The LLC is a relatively new type of business structure that combines the benefits of a partnership and corporation.
Factors To Consider
Some Factors and a brief description of what to consider when choosing a type of organization:
- Tax Consequences – Federal and State
What taxes do you have to pay to the federal and state taxing authorities ?
Is the business organization a pass-through (income only taxed once) or is the income taxed twice ?
- Ease and cost of formation and recurring registration fees
What documents do you need to file and what are the initial and recurring costs for the type of organization ?
- Degree of control
Do you want to call all the “shots” ?
As a sole owner you get to.
- Liability (personal)
Do your personal assets need protection from legal liability ?
Are you willing to be liable for others (partners) ?
- Ability to get money (capital)
Do you need other investors to get your business “off the ground” ?
- Type of Business
If your type of profession requires a special license, is it limited to what type of organization that can be selected ?
All the different types of organizations listed above have some unique methods and rules for accounting for their transactions associated with their equity (ownership) accounts. This tutorial in order to keep it simple and since many small businesses start out organized as sole proprietorships will focus on bookkeeping for a sole proprietorship.
The Death of Network Marketing With Mike Filsaime
I’m moving an old post from an old blog – so the post is a bit outdated but still worth revisiting…
The Death of Network Marketing by Mike Filsame has been causing quite a stir in the Network Marketing Community.
You can read more about it here http://www.the-death-of-networkmarketing.com after watching this provocative video.
You will find the following techniques helpful in maximizing the success and satisfaction of working in teams. You may want to use this as a checklist when working as a team.
Tips for working in groups:
1. Participate fully, whatever your role.
2. Pick a leader, being sure they possess team leader skills.
3. Leader asks members what they are each most interested in and able to contribute, and members respond honestly.
4. Collectively establish written guidelines for team’s performance, including rewards
5. Collectively establish a written work plan, including “pad,” “plan B,” and checkpoints.
6. Be sure the labor is divided wisely, fairly, and equally.
7. Identify problems early on and solve them mutually.
8. Implement the plan, making adjustments if needed.
Using the “TEAM” approach (source – Communication Briefings Video):
1. Teach teammates what you do, and learn about what they do: identify strengths,
skills, and roles.
2. Empathize with teammate’s feelings and attitudes: show that you understand and
care about their feelings, opinions, and worries.
3. Ask questions to spark creativity: build greater understanding, increase
communication and participation, and encourage creative thinking.
Use open-ended questions to solicit input, build consensus, or invite creativity.
Use closed-ended questions to gather specific information and decide on action.
Use clarifying questions to understand, be understood, and invite feedback.
Use what if question to open team thinking to the big picture and maximize creativity.
4. Motivate each individual to work toward the common goal.
Express your own enthusiasm.
Demonstrate your own commitment.
Recognize your teammates’ achievements.
Need More Money for a Fundraiser or Project?
Need more money for a fundraiser or project?
Struggling to make ends meet?
Just want some play money for the weekends?
Or maybe you want an experience that will take your business to a whole new level?
Then please take a minute or two out of your life to read this.
I’m contacting you because I think you’re the kind of person that would be interested in working with a transformational training company that’s about giving people the tools they need to live their passions.
I’m working with the Health and Wealth Annex to put in a 3 day workshop for people that want to jump start an existing business or get on the fast track to starting one. They have many of the country’s top entrepreneurs, Start Up Consultants, educators, and speakers flying in to share their transformational stories, their experiences, and the wisdom they have learned from creating their own success. The 3 day event that brings the inner laws and success mindset and foundation with the outer world tools and strategies for people looking to turn their visions into a reality.
They’re putting in the workshop for a ridiculously low price of $149.00.
Now if that wasn’t mind blowing enough they’re even including a free Ipod that they’ll be loading up with as many resources as they can to help people really kick start their businesses.
AND – they’ve included a way that you can reduce your own expense for attending – AND – walk away from the event with a war chest of money.
They have an affiliate program that you can make 20% (or even more) of the ticket sales price from every person you refer.
If people want their free Ipod for going – they HAVE to use your affiliate code when they sign up.
What could be more beautiful than that?
Let me know if you’re interested and we’ll get started on kick starting YOUR finances – and THEIR business!
Email me or call me at 305-476-8633.
WHAT: Health and Wealth Annex
WHEN: May 8th, 9th, and 10th
WHERE: Embassy Suites Fort Lauderdale – 17th Street
HOW: $149.00 (use code tp4444 when signing up to get your free Ipod (smile) or sign up for your own affiliate code!)
WHY: Are you kidding? It’s a steal at $149.00. Seriously.
With all my love,
Brands – Namestorming
Here’s a great article by Business Week on naming your company.
Here’s a brief excerpt to get you started:
“Catchy, original, evocative—the right name defines your company and is an invaluable marketing tool. Here’s how to find it.”
By Jeremy Quittner
Lisa Tep wanted her spa to have a waterfall, bamboo floors, and a tranquility lounge. After six years, the former accountant had everything set. But her Vienna (Va.) company still didn’t have a name. For inspiration, Tep pored over books about Thailand, where her mother was born, and searched the Internet. She considered Lotus, which was taken, and Nail Nirvana, which didn’t quite fit. After a year of researching Asian culture, she hit on Sesen Spa. “Sesen” is the ancient Egyptian word for the lotus flower, a symbol of beauty and purity. Perfect. “People would be able to pronounce it, but it was different enough, and it would prompt people to ask, ‘What does this mean?’” says Tep, whose company now has 15 employees and revenues of $1.5 million.”