WHAT IS THE DIFFERENCE?

PROPRIETORSHIP Vs. PARTNERSHIP

PROPRIETORSHIP

*A business owned by one person, also called a sole proprietorship

*All debts of the business are debts of the owner.

*The proprietor has the right to all the profits from the business and also responsibility for all the firm's liabilities.

PARTNERSHIP

*A business in which two or more persons combine their assets and skills.

*Each partner shares a fixed proportion of profits and losses.

*Both owners are equally and personally liable for the debts from the business.

PROPRIETORSHIP ADVANTAGES AND DISADVANTAGES

*In most cases, there are no legal formalities to forming or dissolving a business.

* A sole proprietorship often has the advantage of the least government regulations.

*This form of business will have unlimited liability, therefore, if the business is sued the proprietor is personally liable.

*The life span of the business is also uncertain.

PARTNERSHIP ADVANTAGES AND DISADVANTAGES

*You don't have to register with your state and pay an often hefty fee, as you do to establish a corporation or limited liability company.

*New partners can bring in new skills and experience that may help the business to make more profit.

*All partners are personally liable for business debts and liabilities.

*At some point, there most certainly will be disagreements in management plans, operational procedures, and future vision for the business.