Week 2: Entity Structures

Question 1

What types of entity structures can you form?

Answer 1

Sole proprietorship

Partnership

C corp

S corp

Question 2

Sole Proprietorship

Answer 2

One owner

Files a schedule C

Only pay taxes on net income

High liability

Question 3

Partnership

Answer 3

More than one owner

Files a 1065

Only pay taxes on net income

High liability

Question 4

S Corps

Answer 4

Requirements: Less than 100 shareholders, one class of share. and they need to be US taxpayers

Files a 1120 S

Only pay taxes on net income

Limited liability

Question 5

C Corps

Answer 5

No limit to shareholders

Files a 1120 C

Double taxation, paying taxes on both net income and dividends, but can use NOL carry forward

Limited liability

Question 6

NOL carryforward

Answer 6

Net operation loss carryforward

Can carry over losses into future years for tax refunds

80% can be carried forward

Question 7

3/15

Answer 7

S Corp have to pay tax

Question 8

9/15

Answer 8

Extention for S Corp to file taxes

Question 9

4/15

Answer 9

C Corps and individuals have to pay tax

Question 10

10/15

Answer 10

Extention for C Corps and individuals to file taxes