Partnership vs. Corporation
Eric R. Gant
Advanced Federal Taxation 317
Strayer University
Brenda Adams
May 20, 2017
Compare and contrast Partnership and Corporation and their Tax treatment
In a general sense, a Partnership is a business entity that is basically establish and owned by two or more owners with the sole purpose of increasing profit. A partnership meanwhile is the organization of an entity that is more structure and has many owners that are refer to as shareholders, with the sole purpose of increasing their wealth and expanding their business. A partnership is not a legal entity and as such the business is separate from its owners which mean that if the business incurred a lost or have court proceeding, …show more content…
Justify why you elected to become a partnership as opposed to a corporation. Indicate tax rules that influenced your decision.
I will rather become a partner in a LLC than a Corporation because in the LLC partnership, the normal partnership rules will apply. Another good reason that will elect to become partner other than a corporation is the fact that LLC partnership file partnership return pays self- employment tax on their share of partnership earnings. LLC can decide to be taxed as a sole proprietorship, partnership, or corporation simply providing a great deal of flexibility. Another reason is that LLC partnership in most states is treated as separate legal entity and hence, the tax is treated that way.
I will rather choose to become a LLC partner rather than a LLC corporation because a LLC partner in some cases can be organized by one person and will be treated as an entity, less administrative paper work and less employees and bureaucracy in the Management of the affairs of the business
Imagine that you are a consultant and make the recommendation that the most advantageous business structure is a C-corporation. Justify why you would recommend a Corporation over a Partnership. Indicate tax rules that influenced your
Eric R. Gant
Advanced Federal Taxation 317
Strayer University
Brenda Adams
May 20, 2017
Compare and contrast Partnership and Corporation and their Tax treatment
In a general sense, a Partnership is a business entity that is basically establish and owned by two or more owners with the sole purpose of increasing profit. A partnership meanwhile is the organization of an entity that is more structure and has many owners that are refer to as shareholders, with the sole purpose of increasing their wealth and expanding their business. A partnership is not a legal entity and as such the business is separate from its owners which mean that if the business incurred a lost or have court proceeding, …show more content…
Justify why you elected to become a partnership as opposed to a corporation. Indicate tax rules that influenced your decision.
I will rather become a partner in a LLC than a Corporation because in the LLC partnership, the normal partnership rules will apply. Another good reason that will elect to become partner other than a corporation is the fact that LLC partnership file partnership return pays self- employment tax on their share of partnership earnings. LLC can decide to be taxed as a sole proprietorship, partnership, or corporation simply providing a great deal of flexibility. Another reason is that LLC partnership in most states is treated as separate legal entity and hence, the tax is treated that way.
I will rather choose to become a LLC partner rather than a LLC corporation because a LLC partner in some cases can be organized by one person and will be treated as an entity, less administrative paper work and less employees and bureaucracy in the Management of the affairs of the business
Imagine that you are a consultant and make the recommendation that the most advantageous business structure is a C-corporation. Justify why you would recommend a Corporation over a Partnership. Indicate tax rules that influenced your