Essay Example on Starting a new business or running an own Business

Starting a new business or running an own business is one of the life goals of most of the people in the world Some people were running a business from their early age of life from a being a member of a family business or starting by own Others may be starting a new business due to financial difficulties or financially backups in the life United State is known as the land of opportunities anyone can start a business and be a success There are so many benefits of starting a business and there are many risk factors too When considering starting a new business it's very important to choose what type of business organization you going to establish The structure of the business affects tax issues financial legal issues personal liability etc Basically it is three different legal forms of business structures organizations Sole proprietorship Partnership Corporation A sole proprietorship is a business owned and functioned by one person This is the simplest business type and the most numerous form of business organization in the United States Today there are 23 million sole proprietorships and it is over 70 percent of total US businesses 

Sole proprietorship includes small businesses such as a local grocery small daycare providing a service IT consultation art Music class painter local food truck etc The proprietor is personally legally and financially responsible for the business Simple steps to establish the business as getting a business registration and easy to dissolve too The startup cost can be very low and low operational overhead cost in this business Most of the business can be starts for less than 1000 There are true stories that how small idea turned into a successful business One owner he can own all the profit This is definitely going to be a new income source or additional income for the family Sole proprietorship typically got fewer rules and regulations Being your own boss gives an opportunity to control the business Most of the owners got to work long hours in some cases but it may also allow having flexible hours depending on the business Most beneficiary fact in a sole proprietorship does not need to pay corporate business income tax rates in the business Taxes are calculated as personal income The possibility of double taxation is zero In the sole proprietorship the owner has unlimited liability for the business All the profit as well as the loss of the business belongs completely to the owner This unlimited liability gives access to the creditors to overtake business assets as well as personal assets for any debts According to the Forbes Entrepreneurs records in the year 2014 514 332 new businesses started in the country unfortunately there were 548 159 closures and more than 55 000 bankruptcies In many cases the life of sole proprietorship is limited to owner s lifespan Most these businesses end when the owner dies In a sole proprietorship the capitol is depended on the proprietors personal wealth This is a barrier to develop the business due to lack of insufficient capital It is not easy to raise a capital by an individual But for small businesses there are some ways to get financial help The common way for funding is personal savings or personal loans other ways are can ask money from friends and families apply for a Small Business Administration Loan look for business grants open a business line of credit card are the other options A well organized business plan may be the key to a success of any business A strategic plan fine market analysis better market strategies strong management skills would lead any business to the victory not only the sole proprietorship 

The second forms of business organization is partnership This is basically similar proprietorship except there is more than one owner Two or more individuals can start a partnership business This can be simple as two brothers or few friends starting a business or several physicians sharing the same building as partners most of the law firms are in partnership business structure and many real estate offices too Partners are working as co owners of these businesses Usually the partnership is necessary to register with the state There are few different types of partnerships general partnership limited and limited liability partnership The general partnership all the partners share the profits or losses and all have unlimited liability for all partnership debts Limited partners will invest in the company and share in its profits but are not responsible for daily business activities and do not share in the business's liabilities Partnerships can be more successful than the sole proprietorship taking the advantages from two or more partners strength in the business while Sharing individual skills and resources Normally in a partnership contain a partnership agreement This can be simple as informal oral agreement or formal written document Always it's better to have a decent agreement to avoid future problems in the business It Protects yourself and your business when a question arises written agreement as a guide The partnership may have fewer regulations than corporations but more than a sole proprietorship Since there are many partners in the business there is more opportunity to invest the capital A partnership must file an annual information return to report the income debts profits but it does not pay income taxes The income taxes can be taxed as personal income to the partners The partnership owns a limited life A partnership terminates when a general partner attempts to sell the share or dies It's complicated when it comes to a transferring the ownership Partnership likewise has more benefits and disadvantages for the other business organizations