However, general partners manage the day-to-day operations of the firm and are liable for the debts of the business, while limited partners do not manage the business and are only liable for the funds they've invested in the company. Limited Partnership.Ī Limited Partnership (LP) is similar to a General Partnership. This is the simplest form of a partnership with minimal paperwork. In a GP, the partners split profits evenly and share liability. In Michigan, a General Partnership (GP) must have at least one general partner and one limited partner. It is the best option for a small business as it is flexible, easy to set up, and requires minimal paperwork. An LLC separates the owner/s and the company from a business and liability perspective. It can be formed by an individual who may, but need not be a member. Limited Liability Company.Ī Limited Liability Company (LLC) is the most common business structure. In Michigan, a corporation must have at least one director. The business is authorized to act as a single entity and is recognized as such in law. Corporation.Ī Corporation is a very formal business structure with unlimited shareholders. It is relatively easy and inexpensive to form. The business is owned and operated by one individual who is personally liable for all the debts of the business. Sole Proprietorship.Ī Sole Proprietorship is the simplest business structure.
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