What is an enterprise?
An enterprise is a synonym for a business of any kind, although it’s often used to describe for-profits with an entrepreneurial focus. The word ‘enterprise’ can also be attached to a product or service to signal that it’s intended for larger businesses. For example, software that is labeled as ‘enterprise level’ is usually created to help companies with hundreds, or even thousands, of employees manage their business needs.
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Types of enterprises
As it’s essentially a synonym for business, an enterprise can take the same form as any legal business model. Some of the most common examples of enterprises include:
Sole proprietorship: A business owned by one individual, where the legal responsibility lies with the individual and is not separated from the business.
Partnership: A formal agreement between two or more partners who agree to work together towards a mutual goal.
Corporation: A business considered to be its own legal entity. This status allows it to operate almost entirely as an individual does, while limiting the financial and legal repercussions company actions can have on its owners.
Limited Liability Company (LLC): A hybrid model that combines the tax benefits of a partnership or sole proprietorship with the legal and financial protection of a corporation. As a result, business earnings are only taxed once through the owner’s individual tax filings and the business is legally separated from its owners.
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