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Choose a Business Structure Comparison Chart

A Brief Comparison of Types of Business Organizations

  • Sole Proprietorship
    • North Carolina Governing Statute N/A
    • Document Filed to Create N/A
    • Ownership One Person
    • Management One Person
    • Owner Liability Unlimited
    • Federal Income Taxation Flow through sole proprietor
    • Annual Report Required to SOS No
  • General Partnership
    • North Carolina Governing Statute
      N.C.G.S. 59
      Article 1,
      Article 2,
      Article 3,
      Article 3a,
      Article 4
    • Document Filed to Create N/A
    • Ownership General Partners
    • Management General Partners
    • Owner Liability Unlimited
    • Federal Income Taxation Flow through partners
    • Annual Report Required to SOS No
  • Business Corporation "C-Corp"
    • North Carolina Governing Statute
      N.C.G.S. 55
      N.C.G.S. 55D
    • Document Filed to Create Articles of Incorporation
    • Ownership Shareholders
    • Management Board of Directors
    • Owner Liability Limited to capital contributions
    • Federal Income Taxation Income taxed to corporation; dividends taxed to shareholders
    • Annual Report Required to SOS Yes
    • Business Corporation "S-Corp
    • North Carolina Governing Statute
      N.C.G.S. 55
      N.C.G.S. 55D
    • Document Filed to Create Articles of Incorporation
    • Ownership Shareholders
    • Management Board of Directors
    • Owner Liability Limited to capital contributions
    • Federal Income Taxation "S-Corp" is a tax election. Flow through to shareholders
    • Annual Report Required to SOS Yes
    • Nonprofit Corporation
    • North Carolina Governing Statute
      N.C.G.S. 55A
      N.C.G.S. 55D
    • Document Filed to Create Articles of Incorporation
    • Ownership Members
    • Management Board of Directors
    • Owner Liability No liability for members/board of directors
    • Federal Income Taxation No tax on income
    • Annual Report Required to SOS No
  • Limited Liability Company
    • North Carolina Governing Statute
      N.C.G.S. 55D N.C.G.S. 57D
    • Document Filed to Create Articles of Organization
    • Ownership Members
    • Management Managers
    • Owner Liability Limited to capital contributions
    • Federal Income Taxation Flow through to members or taxed as "C-Corp"
    • Annual Report Required to SOS Yes
    • Limited Partnership
    • North Carolina Governing Statute
      N.C.G.S. 59
      GS 1101 - GS 1106
    • Document Filed to Create Certificate of Limited Partnership
    • Ownership General and Limited Partners
    • Management General Partners
    • Owner Liability Unlimited for GPs; limited to capital contributions for LPs
    • Federal Income Taxation Flow through to partners
    • Annual Report Required to SOS No
    • Limited Liability Limited Partnership
    • North Carolina Governing Statute
      N.C.G.S. 59
      GS 210
    • Document Filed to Create 1. Registration of an LLLP if already registered as an LP. 2. Certificate of LP including registration as LLLP.
    • OwnershipGeneral Partners and Limited Partners
    • Management General Partners
    • Owner Liability Limited to capital contributions for both general partners and limited partners.
    • Federal Income Taxation Flow through to partners
    • Annual Report Required to SOS Yes
    • Limited Liability Partnership (RLLP)
    • North Carolina Governing Statute
      N.C.G.S. 59
      GS 45
      GS 84.2 - GS 84.3
    • Document Filed to Create Application for Registration as LLP
    • Ownership General Partner
    • Management General Partner
    • Owner LiabilityUnlimited for general obligations; limited to capital contributions for professional services of partners
    • Federal Income Taxation
    • Annual Report Required to SOS >Flow through to partners
    • Professional Corporations or LLCs
    • North Carolina Governing Statute
      N.C.G.S. 55
      N.C.G.S. 55B
      N.C.G.S. 57D
    • Document Filed to Create Articles of Incorporation or Organization
    • Ownership Licensee Shareholders or Members
    • Management Board of Directors or Managers
    • Owner Liability Unlimited for professional service provided
    • Federal Income Taxation Income taxed to corporations; dividends taxed to shareholders or members
    • Annual Report Required to SOS No