1. Jody Blanke, Professor Computer Information Systems and Law Mercer University, Atlanta

2. Sole Proprietorship General Partnership Limited Partnership CorporationLimited Liability Company Limited Liability No No - gen. part. Yes - lim. part. Yes Flow-Through Taxation Yes No (double taxation) Yes Management/ Control Yes Yes - gen. part. No - lim. part. NoYes Right to Share In Profits Yes NoYes

3. Sole Proprietorship easy to form no formalities unlimited personal liability no legal identity apart from owner e.g., Diversity Heating and Plumbing James Schuster Jerry Schuster

4. General Partnership easy to form two or more people run a business for profit no formalities unlimited personal liability joint liability on contracts and debts may continue after death of partner should have written partnership agreement

5. Limited Partnership statutory creation must have at least one general partner and one limited partner limited partner has limited liability, but cannot participate in management

6. Corporation statutory creation must satisfy legal formalities e.g., articles of incorporation, bylaws perpetual existence limited liability of shareholders free transferability of shares

7. S Corporation can avoid double taxation, but can have no more than 100 shareholders all of whom must be individuals, estates or trusts cannot be corporations or partnerships can have only one class of stock cannot own more than 80% of another corporation

8. Limited Liability Company relatively new statutory creation (1977) “best of all worlds” members have limited liability members can participate in management can choose to be taxed like a corporation or like a partnership

9. Limited Liability Partnership generally available only for professionals no general partner partners are not personally liable for the debts of the LLP or of other partners partners are liable for his/her own negligence, malpractice, etc.

10. Piercing the Corporate Veil Alter ego theory commingling of funds ignoring formalities Undercapitalization e.g., Walkovsky v. CarltonWalkovsky v. Carlton