In a business environment, the most common forms are sole proprietorship, corporation, partnership, S corporation. Each of these types of businesses comes with their own forms of tax issues and different types of tax concerns.
This type of business is the simplest, the reason for this one person is involved who will own and operate this type of business this type of business is good for a single person. Taxes in this type of business appeal to individuals, where taxes filed in the standard 1040 form and the business losses and profits. In a Sole Proprietorship, the profits and losses for tax purposes when filed on a schedule C form this filed with 1040 when the company files taxes. This is beneficial to the company because any losses the company incurred will offset your personal income that the business owner has earned form any other sources. One of the disadvantages of a Sole Proprietorship puts the business owner in complete responsibility for all liabilities. This can result in the owner placing their assets at risk (Carter, 2013).
A group of individuals operates this type of business; the two types are limited and general partnerships. General partnerships own and manage the business together but each partner assumes all the responsibility for the company’s obligations and debts that the company occurs. Limited partners serve in the capacity of investors only these types of partners do not possess any control over any operations of the company, limited partners also do not assume any of the debt or liabilities the company incurs. The advantages of partnerships is the tax situation this type of business can use a partnership will not pay taxes on income the company earns but will pass the profits and losses to each of the individual owners. One of the disadvantages of a partnership is this type of business requires a...