Definition: A business entity is an entity that is a group of people organized for some profitable or charitable purpose. Business entities include organizations such as corporations, partnerships, charities, trusts, and other forms of organization. Business entities, just like individual persons, are subject to taxation and must file a tax return. Some business entities are exempt from federal income tax. These include non-profit charities, S-corporations, and partnerships. Business entities may be subject to state income tax, depending on the laws of the state or states where they conduct business.
See also the following more specific terms: corporations, s-corporations, partnerships, non-profit organizations, sole proprietors, trusts.
Also Known As: Business taxpayer.
