Your three friends are planning to go into business together. 1) Briefly discuss their options as to the form(s) of entity they might choose, but only from the standpoint of payroll taxes.

2) Those three friends now want your advice as to selecting a legal entity through which to do business, but only from the standpoint of ease of disposition (getting out) when one of them decides to retire or otherwise move on at some point. Not selling the entire business (or entity), just selling the individual ownership interest(s), regardless of whether (i) back to the entity (a redemption) or (ii) to some new equity participant(s).

3) Now that youve answered (2) above for your friends, it occurs to them to ask the obvious and corresponding question about ease of disposition of the entire business (or entity) to some third party. Describe the advice you would give.