MANDATORY
December 15, 2012 12:51 PM Subscribe
What does "Individual / Partnerships" mean on a credit application?
My wife's company used a vendor. She needs to fill out a credit report and they have this field. It's marked mandatory, but doesn't explain beyond that. It's an entire line. What should she put here? There is a separate line for owner's name, which also doesn't make sense since it is an S corp.
My wife's company used a vendor. She needs to fill out a credit report and they have this field. It's marked mandatory, but doesn't explain beyond that. It's an entire line. What should she put here? There is a separate line for owner's name, which also doesn't make sense since it is an S corp.
IANYL, TINLA.
The vendor is probably trying to figure out whom it would have to sue to get paid (assuming it gets stiffed on an invoice). If you put a company name there, but the company doesn't have much history or many assets, then the vendor might reasonably decide not to risk allowing the company to take a large amount of products or services on (say) a 30-day invoice. Sometimes a vendor will insist that someone from the company be personally liable for the company's bills (and sometimes it makes sense to accept that liability).
As for what your wife should put there, it depends...if it's your wife's company, as in "your wife is the CEO and owner of 100% of the company" then she can put either or both names. Company name alone is probably somewhat safer for her, but may not be acceptable to the vendor, as explained above.
If it's your wife's company, as in "the company where your wife works as an employee, but which is owned by somebody else," then she should put the company name, and if the vendor doesn't like it, it's the company owner's problem.
If there are plans to spend a lot of money with this vendor, and there's any question about the ability of the company to pay the vendor's invoices as they come due, then the company should consult with a lawyer before continuing.
IANYL, TINLA.
posted by spacewrench at 2:45 PM on December 15, 2012
The vendor is probably trying to figure out whom it would have to sue to get paid (assuming it gets stiffed on an invoice). If you put a company name there, but the company doesn't have much history or many assets, then the vendor might reasonably decide not to risk allowing the company to take a large amount of products or services on (say) a 30-day invoice. Sometimes a vendor will insist that someone from the company be personally liable for the company's bills (and sometimes it makes sense to accept that liability).
As for what your wife should put there, it depends...if it's your wife's company, as in "your wife is the CEO and owner of 100% of the company" then she can put either or both names. Company name alone is probably somewhat safer for her, but may not be acceptable to the vendor, as explained above.
If it's your wife's company, as in "the company where your wife works as an employee, but which is owned by somebody else," then she should put the company name, and if the vendor doesn't like it, it's the company owner's problem.
If there are plans to spend a lot of money with this vendor, and there's any question about the ability of the company to pay the vendor's invoices as they come due, then the company should consult with a lawyer before continuing.
IANYL, TINLA.
posted by spacewrench at 2:45 PM on December 15, 2012
Best answer: Once upon a time partnerships were businesses carried on by two or more people in conjunction. In the eyes of the law each partner was responsible for the whole business, so anyone supplying goods to that firm wanted to know the names of all the partners so (as spacewrench says) they knew who to sue if they didn't get paid. This has now been changed by legislation in most places, so rather than qualify my statement I'll just call this "once upon a time".
Anyway, the other standard forms of business are (a) sole practitioner (a single person carrying on a business, possibly with the aid of employees); and (b) a corporation. Both sole practitioners and corporations are "individuals" (i.e., persons) in the eyes of the law. From what you've said your wife is employed by a corporation, so just put the name of the corporation down. The line for "owner's name" is probably there in case a sole practitioner fills out their trading or business name instead of their real name.
TL/DR: Corporation (company) name goes in the "Individual / Partnerships" line, strike out the word "partnerships", nothing goes in the owner's name line.
posted by Joe in Australia at 4:32 AM on December 16, 2012
Anyway, the other standard forms of business are (a) sole practitioner (a single person carrying on a business, possibly with the aid of employees); and (b) a corporation. Both sole practitioners and corporations are "individuals" (i.e., persons) in the eyes of the law. From what you've said your wife is employed by a corporation, so just put the name of the corporation down. The line for "owner's name" is probably there in case a sole practitioner fills out their trading or business name instead of their real name.
TL/DR: Corporation (company) name goes in the "Individual / Partnerships" line, strike out the word "partnerships", nothing goes in the owner's name line.
posted by Joe in Australia at 4:32 AM on December 16, 2012
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posted by jeffamaphone at 12:51 PM on December 15, 2012