Eli5 what is the tax advantage in a General Partnership business organization?
In: Other
You never, never, never, ever want to have a legal partnership. Just never. Get a corporation.
If you have a partnership, and you have $10 million in a bank account, the partner can take the $10 million out and just keep it, and you can’t do anything about it.
However, in a corporation, there are specific laws set up in each state. You can’t do that.
In addition to a lot of other benefits. Like limited liability. If your partner is an idiot and f-cks up, you will be personally liable – your home, your car, your future income can be garnished, retirement funds, all kinds of ugly things.
This cannot happen in corporations (unless there is illegal stuff, malfeasance (doing bad things with a company), piercing the corporate veil).
So splurge the $400 or $800 to get a corporations. There are a lot of incorporation businesses that will do it for you in any state, for $50 if you take the least expensive choice ($50 is for the companies profit and does not include the state fees, if any – those state fees are in the amount of whatever your state charges.).
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