Bob has a sole proprietorship, John has an LLC. A group of business men have a general partnership and the Jones family has a limited partnership. What are all of these entities? Following are brief basic definitions that can be helpful in deciding what entity to create as part of your business plan.
SOLE PROPRIETORSHIP. This is a business owned by an individual and created without formal filing requirements.
REGULAR C CORPORATION. This is created by filing articles of Incorporation with the State of Ohio. Ownership is evidenced by stock certificates. Fifty-one percent ownership controls the decisions of the corporation.
S CORPORATION. This is a federal tax election that allows the income to pass through to the shareholders each year and avoid double taxation.