Question
If a law or accounting firm wants partnership-style management with liability protection, what form fits best?
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Answer
An LLP.
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Question
How does a sole proprietorship differ from a corporation in legal identity?
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Answer
It has no separate legal identity from the owner.
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Question
Why is owner liability a major drawback of a sole proprietorship?
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Answer
The owner has unlimited personal liability for business debts.
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Question
How are profits typically taxed in a sole proprietorship?
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Answer
Pass-through to the owner’s personal tax return.
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