liability

How Does Business Structure Affect Liability?

The choice of business structure has a significant impact on the type of liability an entrepreneur faces. Here’s a brief overview:
Sole Proprietorship: The owner has unlimited personal liability for all business debts and obligations.
Partnership: Partners share unlimited personal liability for the debts and obligations of the business.
LLC: Members enjoy limited liability protection, meaning their personal assets are generally protected.
Corporation: Shareholders have limited liability, protecting their personal assets from business debts and obligations.

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