Form of Organization: One of the most important decisions business owners make is the form of organization they select for conducting business. Read the article "forms of organization" attached and provide your thoughts or opinions on that.This article summarizes the pros and cons of company structures. Since this decision will affect nearly every aspect of a firms operations, it is important that the finance professionals understand the tax and economic implications of the company structure. Posted the article below:

C Corporation, LLC, or Sole Proprietorship?

What Form Is Best for Your Business BY GARY M. FLEISCHMAN, CMA, CPA, AND JEFFREY J. BRYANT, CPA Choosing the optimal company structure is a difficult decision and one of the most important a business owner will ever have to make. Type of ownership, capital formation, management, myriad tax considerationsthe form chosen to structure the business will affect nearly every aspect of its operations. It is important, therefore, that management accountants be familiar with the pros and cons of the various forms under which an entity might be set up. Because the choice of business structure will determine many features of its design, no one factor should dominate this decision. While tax consequences should not be considered in isolation, they are nevertheless a major consideration. C corporations traditionally have been viewed as the vehicle that maximizes nontax advantages, for example. Recent legislation, however, has spread many of the C corporations strengths to other organizational forms. Because nontax benefits are now widely available in other structures, tax variables have become a more complicated and significant factor in choosing a form for a company. Selecting a suitable business form increasingly is becoming a matter of choosing among the most appropriate tax attributes. Tax and economic environment change requires that business owners not only must choose an optimum structure for their start-up, but they also must continually reassess their original choice. The appropriate choice inevitably will shift as the business evolves. For example, a tax conduit that passes losses directly to owners tax returns during the initial years of operation is often a good beginning choice. Then, as the business grows and profits increase, a C corporation that facilitates capital formation and shields owners from profit taxes may become a better alternative. The importance of reviewing structure at all stages in an organizations life cannot be overstated. In an intensely competitive world, a wise initial selection and the diligent monitoring of that choice can significantly impact an enterprises long-term viability. Lets look at the current status of four business structures: sole proprietorship, partnership and LLCs, S corporations, and C corporations. For the legal background of the limited liability company (LLC) and limited liability partnership (LLP), see sidebar, The Evolution of LLCs and LLPs. THE ART OF CHOOSING THE BEST BUSINESS STRUCTURE Selecting the most appropriate structure for an organization is more an art than a science.