Business Lawyer in Norman, OK

SOLE PROPRIETORSHIP

A sole proprietorship is easy to form and gives you complete control of your business. You're

automatically considered to be a sole proprietorship if you do business activities but don't register

as any other kind of business. Sole proprietorships do not produce a separate business entity. This

means your business assets and liabilities are not separate from your personal assets and liabilities.

You can be held personally liable for the debts and obligations of the business. Sole proprietors are

still able to get a trade name. It can also be hard to raise money because you can't sell stock, and

banks are hesitant to lend to sole proprietorships. Sole proprietorships can be a good choice for

low-risk businesses and owners who want to test their business idea before forming a more formal

business.

PARTNERSHIP

Partnerships are the simplest structure for two or more people to own a business together. There are

two common kinds of partnerships: limited partnerships (LP) and limited liability partnerships

(LLP).

Limited partnerships have only one general partner with unlimited liability, and all other partners

have limited liability. The partners with limited liability also tend to have limited control over the

company, which is documented in a partnership agreement. Profits are passed through to personal

tax returns, and the general partner — the partner without limited liability — must also pay

self-employment taxes.

Limited liability partnerships are similar to limited partnerships, but give limited liability to every

owner. An LLP protects each partner from debts against the partnership, they won't be responsible

for the actions of other partners.

LIMITED LIABILITY COMPANY (LLC)

An LLC lets you take advantage of the benefits of both the corporation and partnership business

structures. LLCs protect you from personal liability in most instances, your personal assets — like

your vehicle, house, and savings accounts — won't be at risk in case your LLC faces bankruptcy or

lawsuits. Being an LLC protects your personal assets and separates them from business assets

Profits and losses can get passed through to your personal income without facing corporate taxes.

However, members of an LLC are considered self-employed and must pay self-employment tax

contributions towards Medicare and Social Security.



LLCs can have a limited life in many states. When a member joins or leaves an LLC, some states

may require the LLC to be dissolved and re-formed with new membership — unless there's already

an agreement in place within the LLC for buying, selling, and transferring ownership.