Lit1

General partners are those who are responsible for the day-to-day management of activities, whose individual acts are binding on all the partners, and who are personally responsible for the partnership's total liabilities. Limited partners are those who contribute only money and are not involved in management decisions and whose liability is limited to the amount of their investment.

Joint Venture
Joint Venture acts like a general partnership, but is clearly for a limited period or a single project. If the partners in a joint venture repeat the activity, they will be recognized as an ongoing partnership and will have to file as such, and distribute accumulated partnership assets upon dissolution of the entity.

Advantages of a Partnership
Partnerships are easy and inexpensive to establish. With more than one owner, there would be no difficulties in raising fund. Shared responsibility. The tax consequences are less as your profits are recorded directly onto your personal income tax return (no double taxation). Potential employees may be attracted to the business if given the incentive to become a partner. The business usually will benefit from partners who have complementary skills.

Disadvantages of a Partnership
General partners have unlimited liability. Partners are jointly and individually liable for the actions of the other partners. Profits must be shared with others. Since decisions are shared, disagreements can occur. Some employee benefits are not deductible from business income on tax returns. The partnership may end upon the withdrawal or death of a partner.

Corporations
A corporation is different from a sole proprietorship or a partnership in that a corporation is separate statutorily created legal entity from the people who manage, own, control, and operate it. A corporation can be taxed; it can be sued; it can enter into contractual agreements. Being incorporated essentially means the owner receives limited liability. Those with