Taxes and Business Structures

FICA taxes

U.S. payroll taxes for Social Security and Medicare.

Federal and State income taxes

Taxes paid on income to the federal and state governments.

Corporation Taxes

Taxes paid by businesses on their profits.

Sole Proprietorship

A business owned by one person with unlimited liability.

Unlimited Liability

The owner is personally responsible for business debts.

Pass-through Taxation

Business income passes to the owner and is taxed as personal income.

Partnership

A business owned by two or more people.

General Partner

A partner responsible for running the business and its debts.

Limited Partner

A partner who invests money but isn’t involved in day-to-day operations.

Partnership Agreement

A legal document outlining the rules of a partnership.

Limited Liability Corporation (LLC)

A business structure that protects owners from personal liability.

S/C Corporation

Types of corporations with different tax and ownership rules.

Corporate Charter

A legal document that creates a corporation.

Shareholders

People who own shares (stock) in a company.

Board of Directors

A group that oversees a company’s management.