A legal entity is an organization or individual that has legal rights and responsibilities. This can include businesses, corporations, partnerships, and even government bodies. Legal entities can enter into contracts, sue or be sued, and own property, making them distinct from the individuals who manage or own them. There are different types of legal entities, such as sole proprietorships, limited liability companies (LLCs), and corporations. Each type has its own legal implications, tax obligations, and levels of liability protection for its owners. Understanding these differences is crucial for anyone looking to start or manage a business.