It determines how a company is organized, managed, and operated.

It affects various aspects of the business, including ownership, control, and liability.

A sole proprietorship is a business owned and operated by a single individual.

Easy and inexpensive to set up and manage.

Direct control over business operations and decision-making.

Minimal legal formalities and reporting requirements.

Unlimited personal liability for business debts and obligations.

Limited ability to raise capital or attract investors.

No separation between personal and business assets.

A partnership is a business owned and operated by two or more individuals.

Shared decision-making and complementary skills and expertise.

Ability to pool resources and share financial responsibilities.

Flexibility in terms of ownership and profit distribution.

Unlimited personal liability for general partners.

Potential conflicts and disagreements among partners.

Difficulty in transferring ownership or adding/removing partners.

A corporation is a separate legal entity from its owners.

Limited liability for shareholders, meaning their personal assets are protected.

Access to capital through the issuance of stocks and bonds.

Perpetual existence, not affected by changes in ownership or management.

Complex and costly to set up and maintain.

Increased regulatory requirements and reporting obligations.

Double taxation on corporate profits (unless it qualifies for certain tax benefits).

An LLC is a hybrid business structure that combines elements of a corporation and a partnership.

Limited liability for members, protecting their personal assets.

Flexible management structure and tax options.

Allows for pass-through taxation, avoiding double taxation.

Varying regulations and requirements across jurisdictions.

Potential for disputes and conflicts among members.

Limited ability to raise capital compared to a corporation.