Considerations in Selecting a Business Entity - Explained
What are the Characteristics of a Business Entity?
Written by Jason Gordon
Updated at September 24th, 2021
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Table of Contents
What are the main characteristics of a particular business entity?Discussion QuestionAcademic ResearchWhat are the main characteristics of a particular business entity?
There are numerous characteristics that make a business entity unique. The major characteristics of a business entity are as follows:
Creation & Maintenance - The effort associated with forming and maintaining the entity;
Continuity - The continuity or stability of the organization upon given occurrences;
Ownership & Control - The ownership rights and control of those involved with the business;
Personal Liability - The potential for the personal liability of those involved with the business;
Compensation - The compensation and division of profits among business owners; and
Taxation - The taxation of the organization's earnings and its distributions of profits to the owners.
Next Article: Creating a Business Entity Back to: BUSINESS ENTITIES
This list is certainly not exhaustive; however, these primary characteristics provide a great deal of necessary insight for understanding and choosing a business entity.
Related Topics
- What are Business Entities?
- Holistic (Detailed) Overview of Setting Up a Business Entity
- What is a Closely-held vs Publicly-held Business?
- What are the main types of business entity?
- What is Creation of a business entity?
- What is Maintenance of a business entity?
- What is Continuity of a business entity?
- What is the Ownership structure of a business entity?
- What is Control of a business entity?
- What is Personal liability of owners of a business entity?
- What is Compensation of business owners?
- What is Taxation of a business entity?
- What is Sales & Use tax?
- What are payroll and self-employment taxes?
Discussion Question
Why do you think these are the primary characteristics of a business entity? Can you think of any other characteristics of the business entity that would be important to understand when selecting and forming a business entity?