What Are The BENEFITS of a CORPORATION? Is It BETTER Than a SOLE PROPRIETORSHIP?
- attorneilabayon
- Feb 9
- 1 min read
YES, a Corporation is better than a Sole Proprietorship (“Sole Prop”), especially since we now have One Person Corporations, which is managed like that of a Sole Prop but with the advantages and benefits of a regular corporation.
One of the important distinctions and advantages of a Corporation from a Sole Prop is the extent of the liabilities of its owners; which is summarized as follows:
In a corporation, personal assets of the shareholders are protected; meaning, if the corporation goes bankrupt, the creditors cannot go after the personal assets of the shareholders since a corporation incurs debts and/or liabilities in its own name due to its separate legal personality from its shareholders.
Whereas in a Sole Prop, there is no separate legal personality between the owner and the Sole Prop; meaning, if your business goes bankrupt, your creditors can go after your personal assets.
Comments