Types of organizational structure in management can include flat structures as well as functional, product and geographical-structured organizations. Flat Organizational Structure Many small companies use a flat organizational structure, where very few levels of management separate executives from analysts, secretaries and lower-level employees.
White Papers Structuring Ownership Of Your New Organization There are several different ways to legally create and structure a new business, and it is best to learn a bit about your options before etching anything into stone. The choices you make for your organization at the very beginning of its creation will affect your business path in the future.
It is of the utmost importance that you structure your business to fit the plans you have made for the future of your organization. Here is a brief look at just a few of the specific ways you may set up your new business in the eyes of the law.
C Corporations A C Corporation setup is better suited for a larger business entity. Because a C Corporation structure allows for a wider base of ownership through shareholders, this business structure is more attractive to potential investors. Most big businesses in the U.
Sole Proprietorship The easiest and simplest setup for a business is the Sole Proprietorship. A sole proprietorship is not a legal entity, but it refers to the person who owns the organization. When you run a sole proprietorship, you are legally responsible for any debts relating to your business.
Either way, the legal responsibility falls on the individual.
Unlike the perpetual nature of a C Corporation, choosing to form an LLC means that you have the right to dissolve your organization at any time without financial penalty.
Partnerships Forming a partnership takes two or more investors who have agreed to share in the good and bad times of the business.
One of the disadvantages of forming a partnership is that there is personal liability for the financial obligations of the organization. The taxation is different. S Corps only have to file once per year, and they are not subject to double charges from the IRS.
The downside of forming an S Corporation is that it is exceptionally expensive. There are also extensive rules and regulations on S Corps regarding record-keeping as well.
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