Under law, a corporation is considered to be a legal person distinct from the shareholders (or stockholders) who own it. This means that individual shareholders (or stockholders) are not personally liable for the debts and obligations of the corporation. If a corporation fails the shareholders (or stockholders) will only lose the assets they originally invested to purchase their shares (or stocks). In a corporation, income is taxed at two levels: first on income for the corporate entity, and then at the shareholder (or stockholder) level where shareholders (or stockholders) are taxed on any dividends they have received. You create a corporation by filing Articles of Incorporation with the business regulatory body in your jurisdiction. The document that governs internal business activities of the corporation are called 'Bylaws'. In most jurisdictions you do not have to file your bylaws.
Limited liability partnerships are generally restricted for use by professionals, such as accountants and lawyers, and function to limit the liability exposure of individual partners to acts of professional negligence committed by fellow partners or employees. Limited liability is granted to all partners in an LLP. Please note that our partnership agreement is intended for a general partnership and is not suitable for use by a limited liability partnership.
A Will is a legal document stating how your money and property will be distributed after you die. Most, but not all, of your property can be disposed of in a Will. The proceeds of a life insurance policy naming someone as a beneficiary or property owned jointly with someone else cannot be disposed of by a Will. A Will also allows you to state a preference for the guardian of your minor children.
A Will enables you to:
choose who will get your property after your death;
choose how your property will be divided among your various beneficiaries;
give specific items of property to specific people;
appoint someone you trust to administer your estate; and
appoint a guardian for your minor children.
If you die without a Will, your property will be distributed by a court-appointed administrator according to statutory rules for "intestate succession." Your property will be divided among your surviving spouse, children, and possibly other relatives in whatever manner the law of your jurisdiction specifies. You will not have a chance to give property to non-relatives or to exclude relatives. Additionally, if you have no relatives, your property will go to the state rather than to a friend or charity of your choice.
A partnership is a form of business organization in which two or more individuals manage and operate the business with a view to making a profit. Each partner shares a fixed proportion of the partnership profits and losses. Depending on the type of partnership, each partner may be personally liable for the debt and obligations of the company. One benefit of a partnership is that partnership income is only taxed once. Partnership income flows through to the individual partners who will be taxed on their partnership income. This contrasts with a corporation where income is taxed at two levels. Corporation income is taxed twice: first as a corporate entity and also at the shareholder level where shareholders are taxed on any dividends received.
A joint venture can be distinguished from a partnership where a joint venture is usually limited in scope to a single project or is limited in duration to a specific time frame. In addition although the members of a joint venture will share the burden of costs in the venture, profits will be managed by each member. For example: Two related companies may work together in a joint venture to research and develop a specific product but once the product is complete each member will take the resulting product to their respective marketplace to be marketed and sold for the exclusive profit of that individual member. In this case each member would not share in the profits of another member. Each member will benefit from their own ability to exploit the product within their respective marketplace. This differs from a partnership where partners share directly in a common cost and profit pool.
Depending upon your jurisdiction there may be tax benefits for a joint venture over a partnership where a member of a joint venture may be treated differently from a partner in a partnership.