Summary information excerpted from the Michigan Department of Consumer and Industry Services, Corporation, Securities, and Land Development Bureau, Corporation Division's Entrepreneur's Guide:

Note: In all cases there are one or more legally required annual forms, with typical filing fees of approximately $10.00 each. Forms are also required to be filed in the event of any sort of changes to the organization, such as withdrawal of a partner, changes to business structure, or amendments to required information, and certainly for mergers and similar significant events.

Sole Proprietorship

I'm assuming we don't care about this model, and won't list characteristics unless I'm asked for it. - Istvan

Copartnership

A copartnership is a legal entity that is jointly owned by two or more persons. The owners are personally responsible for all debts of the business, even debts in excess of the amount they have invested in the business. Generally copartners enter into a written agreement governing the copartnership and an attorney should be consulted to prepare such an agreement.

Filings:

• "Certificate of Copartnership", with: County Clerk, fee: (set by county) (required for each county in which the copartnership conducts business)

|Advantages |Disadvantages| |easy to form|unlimited liability to owners| |low startup cost|terminates on death or withdrawal of a partner| |partners can provide add'l capital| |broader mgmt voice|

Limited Liability Partnership (LLP)

A limited liability partnership is a business entity formed by two or more persons. The owners of the partnership are personally liable for all debts of the business, except those debts resulting from acts committed by another partner or representative of the partnership not working under the supervision or direction of the partner at the time the acts resulting in liability occurred. The joint and several liability of partners for debts and obligations of the partnership arising from other causes is not limited.

Filings:

• "Application to Register a Limited Liability Partnership", with: Corporation, Securities, and Land Development Bureau, fee: (not listed)

|Advantages |Disadvantages| |some limited liability to partners|some liability for partnership debts and general liability for own acts| |relatively easy to form|terminates on death or withdrawal of a partner| |low startup cost|divides authority among partners| |partners can provide add'l capital|

Name must contain "LLP", "L.L.P", or "Limited Liability Partnership".

Limited Partnership

A limited partnership is a partnership formed by two or more persons under the laws of Michigan and having one or more general partners and one or more limited partners. The general partners are liable for all the debts and obligations of the firm, while limited partners are responsible only for the debts and obligations of the amount they contributed. A limited partnership must have at least one general partner and one limited partner.

Filings: "Certificate of Limited Partnership", with: Corporation, Securities, and Land Development Bureau, fee: $10.00

|Advantages |Disadvantages| |limited liability to limited partners|unlimited liability for general partners| |investment by limited partners is potential source of venture capital|lack of management voice for limited partners| |no management responsibility for limited partners|divided authority if more than one general partner|

Name must contain "Limited Partnership".

Corporation

A corporation is an association of individuals, created by law and existing as an entity with powers and liabilities independent of those of its members. In the case of profit corporations, its owners are shareholders, but the owners of nonprofit corporations are members. The management of a corporation consists of directors and officers, usually elected by shareholders or members. Governance of a corporation is prescribed by law, bylaws of the corporation, and the resolutions and decisions of its shareholders or members. Individuals acting as incorporators must be 18 years of age, but need not be U.S. citizens nor residents of Michigan. Directors are responsible for managing the corporation's affairs. Officers are chosen by the board of directors to run day-to-day operations.

Filings: "Articles of Incorporation", with: Corporation, Securities, and Land Development Bureau, fee: $10.00 + $50.00 Organization Fee.

|Advantages |Disadvantages| |limited liability for owners|may be more expensive to organize than sole proprietorship| |ownership easily transferrable|more extensive record keeping required| |continuous existence|

Name for a profit corporation must include: "Corporation", "Incorporated", "Company", "Limited", or abbreviation "Corp.", "Ltd.", "Inc.", or "Co.".

Limited Liability Company (LLC)

A limited liability company is a business formed by at least two members. It is a business entity with powers and liabilities limited to the financial contribution made by each member. The owners are members of the company. The management of the company is carried out by its members, unless otherwise stated by the Articles of Organization. Governance is set forth by the Articles of Organization or operating agreement of its members. To receive favorable tax treatment, a company must choose between centralized management, free transferability of ownership or continuity of life. The members must state this in their Articles of Organization.

Filings: "Articles of Organization", with: Corporation, Securities, and Land Development Bureau, fee: $50.00

|Advantages |Disadvantages| |easy to form|complex tax filing system| |low startup cost|new body of law| |broader management base| |limited liability to members

Name must contain the words "Limited Liability Company", or the abbreviation "L.L.C.".