BLaw 210 1st EditionLecture 14Outline of Last Lecture I. GriswoldII. WTOIII. CorruptionOutline of Current Lecture I. Business – what are you doing?II. Business Organizationa. Sole Proprietorshipb. Partnershipi. Generalii. Limitediii. Limited LiabilityCurrent LectureSyllabus amendments: Quiz 3 still on 10/30, Extra Credit Bonus Quiz – points added to exam 2 score, 11/4 Exam 2URL to know: www.sos.gov/corps/registration_structures.aspxIII. Do you know who are doing Business with?a. Student self-observation (have a look per business organizational structure)b. Ask…why has this business organized itself as it hasc. State mandated Public disclosuresd. How does this business seek to protect itself from you? (Customer? Client?) Are you protected in the event of…?e. Due diligence and buyer beware. Goods? Services?f. Liability (limitations) aspects/litigationg. Query: Avoid vs EvadeIV. Business Organization: Issues and Considerationsa. Formationb. Taxc. Liabilityd. Agencye. Costf. Governanceg. Employmenth. Law & Representationsi. Insurancej. Accountant and Financing (K Law)V. Sole Proprietorshipa. One individual or married couple in business aloneb. SP’s are the most common form of Business structure. Simple to form and to operatec. May enjoy greater flexibility of management and fewer legal controlsThese notes represent a detailed interpretation of the professor’s lecture. GradeBuddy is best used as a supplement to your own notes, not as a substitute.d. But, the business owners are personally liable for all debts incurred by the businesse. Tax: Personal (marginal) tax rateVI. General Partnershipa. Composed of 2 or more persons (usually not a married couple) who agree to contribute money, labor, and/or skill to a business (profit motive expectation)b. Each partner shares the profits, losses, and management of the business and each partner is personally and equally liable for debts of the partnershipc. Formal terms (contractual) of the partnership are per a written partnership contract (K)d. Tax: personal marginal rate(s) (draw)e. Key phrase: Joint & several liabilityVII. Limited Partnershipa. Composed of 1 or more general partners and one or more limited partners. The GP’s manage the business and share the profits and losses. LPs share in the profits but their losses are limited to the extent of their investmentsb. LPs are not usually involved in day-to-day operationsc. Tax: per GP (same)d. Must register with SOS – Div. of Corps. And CharitiesVIII. Limited Liability Partnershipa. Similar to GP, except normally does not have personal liability for negligenceb. Business structure used most by professional (Lawyers, accountants, etc)c. Tax: same as GPd. Must register with SOSIX. Limited Liability Companya. Formed by 1 or more persons through special written agreementb. Agreement details managerial provisions, assignment of interests, and distribution of profit/lossc. Permited to engage in any lawful, for-profit business other than banking or insuranced. Personal liability: shielde. Tax: may yield tax or financial benefitf. PLLCg. Must register with SOSX. Corportationa. Separate legal entity, has own rights, privileges, and liabilities beyond those of anindividualb. Personal liability shieldc. Tax: corp rated. Must register with