Khalid Is a 39-Year-Old,married Business Owner Who Runs a Dry

Multiple Choice

Khalid is a 39-year-old,married business owner who runs a dry cleaning service with three locations.His personal obligations are the home that he owns with his wife who works for a well-known insurance company;the health needs of his family;and his commitment toward saving for the future higher education needs of his three children.Khalid knows that two of his locations require a large infusion of cash to pay for new and expensive dry cleaning equipment.Although his wife's job provides the family with health insurance,it also places the family in a higher income tax bracket.Khalid would certainly like to minimize his taxes.Which of the following forms of business ownership would you suggest for Khalid? Khalid should consider:

A) A sole proprietorship due to the fact that it pays its own taxes and it has limited liability.
B) A sole proprietorship due to the fact that it has unlimited liability and it will protect the family's personal assets.
C) A corporation because he can avoid the negative aspect of limited liability.Corporations are always taxed at a lower rate than individuals.
D) A limited liability company because he will only be liable for what he has invested in the business.His personal assets will be protected,and he can be taxed like a sole proprietorship.