Business Entities, Laws & Regulation Paper
February 4, 2011
Business Entities, Laws & Regulations
When starting your own business, you have to do research on licensing, state laws and regulation. A person has to also research other requirement as well like, business entities, taking control taxation and taking liability issues into consideration. With all this done and in motion this will help the business to protect itself from anything. In my paper I will examine three different scenarios, restaurant/ bar business, and extermination business and construction scenario. The paper will explain the kind of business, taxations, liability and employment laws they have to take in consideration. Restaurant/ Bar Business
Lou and Jose want to open a sport bar but don’t have much money to open the bar but they have Miriam a wealthy investor. But the thing is Miriam doesn’t have time to participate. In this situation, the three individuals can form a general partner with all three owning the business. General partners’ is partners in a limited partnership who invest capital, manage the business and are personally liable for partnership debts. With being general partners this will make Miriam the investing partner with Jose and Lou being the managing partners. This will allow Jose and Low to control the business and Miriam share in the business profits. “A business must meet four criteria to qualify as a partnership under the UPA [UPA Section 6(1)]. It must be (1) an association of two or more persons (2) carrying on a business (3) as co-owners (4) for profit” (Cheeseman, 2010). With all the criteria meet this is why general partners fit for Lou, Jose and Miriam.
When it comes to taxation in a partnership this is none, a partnership doesn’t have to pay federal taxes. “Instead, the income and losses of a partnership flow onto and have to be reported on the individual partners’ personal income tax returns. This...
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