The common law definition of a business is an investment of capital or property by individuals which creates the means to carry on towards the goal of generating a profit. Every state recognizes different legal formats to conduct business. The simplest and most common is the sole proprietorship. Other forms include partnerships, limited liability company and of course corporation status (S-Corporation is a federal tax option of a corporation). However, two states actually recognize another legal format – business trusts.
A business trust is a hybrid form of legal entity status combining attributes of a corporation, limited liability company and a trust. It is well documented in both Massachusetts and Florida. It is commonly used for the purpose of holding property for income purposes.