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Construction Contracting: A Practical Guide to Company Management, 8th Edition by Richard H. Clough, Glenn A. Sears, S. Keoki Sears, Robert O. Segner, Jerald L. Rounds

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Chapter 2Business Ownership

2.1 Introduction

Construction contracting companies, like other business entities, can be established and operated as different forms of business enterprises. Each of the different forms of business ownership that a construction company owner may choose has associated benefits and drawbacks. For a business owner, the form of business ownership he selects is a momentous decision, and one that should engage the input and consulting services of business, tax, and legal experts. All of the variations and all of the complexities involving various forms of business ownership cannot be discussed here. However, this chapter will provide an overview of some of the advantages, disadvantages, and considerations inherent in the most common forms of business ownership, especially as they relate to ownership and operation of construction firms.

2.2 Alternative Forms

The typical forms of business ownership for construction contracting companies are the individual proprietorship, the partnership, and the corporation. Some of these basic forms of ownership have subsets or variations of the form they may take. A company owner's selection of the proper type of ownership for the business entity involves a great many considerations and is a matter that merits careful analysis and deliberative decision making. Each form of business organization has its own financial, taxation, and legal implications, all of which must be thoroughly investigated and understood. The selection ...

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