However, a recent survey provides information which may be useful in dealing with corporation commissions in your state or in your own planning. Business entities defined Business entities are one of three types. Proprietorships are entities without agreement or special structure. There is one owner who has all authority and is liable for debts and liabilities. Partnerships consist of two or more owners who often have oral or written agreements providing for the sharing of profits and dealing with other matters.
All partners are liable for business debts and liabilities.
A corporation is treated as if it were a person and only the corporation is liable for business debts and liabilities. Corporations have centralized management through a board of directors and officers. Moreover, if a partner or proprietor dies or retires, it often means the end of the business enterprise. Corporations can have an existence that survives their owners. For many years, state laws prohibited professionals from incorporating for a variety of reasons.