2006-06-08 15:06:08 · 9 answers · asked by snowboardtravelfun 1 in Business & Finance ➔ Corporations
all depends on your company and your situation, I would have a good business law lawyer go threw this with you, not some morons on the net.
my sister is a lawyer and she has told me for one of my ideas an LLC would be bad for that kind of company.
2006-06-08 15:09:59 · answer #1 · answered by Anonymous · 0⤊ 0⤋
The LLC is just a limited liability company. It also has limits on number of shareholders, and the income is subject to normal payroll taxation including FICA and Medicare. Professional service firms are many times LLCs because they are small, need the protection, and do not see large variances in tax payments.
An Inc. is really quite different. A C-corporation has all of the protections of an LLC, but the tax structure is entirely different. Corps. can retain earnings which can be reinvested into other businesses. Likewise, the corporation has more formal procedures which must be followed (annual shareholder's meeting, state filings, etc.) in order to maintain your legal protections. A corp would be appropriate for capital intenstive businesses, large numbers of shareholders, or a company that intends to buy other businesses with its retained capital.
2006-06-09 01:05:51 · answer #2 · answered by Jeff S 3 · 0⤊ 0⤋
Both entity types are excellent business forms. A corporation (Inc) is the most independent business entity type. It affords the greatest legal protection of all business entity types. An Limited Liability Company (LLC) is also an excellent business entity. It too provides legal protection, but not to the same extent as provided by a corporations corporate veil.
In choosing which type to form, the real consideration should be placed on the nature of your business. Does the business that your forming require strong legal protection. Do you plan on having stock holders, etc?
There are considerable tax differences to. If you decide to file a corporation be sure to look at the benefits of the S-Election filed with the IRS. If you have few stockholders, etc, you may save yourself a lot of tax monies.
A CPA would be best to advise on tax issues. An attorney if you are concerned about legal protection issues.
RASi's website below provides links to all of the states websites, which may help you find more specific information regarding the state in which you want to for a business.
2006-06-08 22:15:38 · answer #3 · answered by dean_thomas800 1 · 0⤊ 0⤋
You should probably consult a lawyer or at least read about both types of company carefully and understand the differences well before deciding. While both types of company limit your liability, there are big differences in how the profits are taxed. Also, an LLC cannot be taken public and there may be more variation in how different states treat them for tax purposes. So there are many things to think about, among them: how profitable the company will be the first few years and whether you want the profits to be treated as your income or as the income of the company, whether you are thinking of taking it public and in which states the company will be operating.
2006-06-08 22:20:47 · answer #4 · answered by debo 3 · 0⤊ 0⤋
Both have their pros and cons, but both have better tax benefits than sole-proprietor.
There's also such a thing as forming a company too early. Sometimes, sole-proprietor is enough. One of the reasons behind this is the associated accounting/bookkeeping fees involved. They're higher for LLC and INC. Of course, these fees are tax deductible.
2006-06-08 22:11:38 · answer #5 · answered by MikeSideline 2 · 0⤊ 0⤋
i personally would form a LLC so as to protect my personal assets in case of failure or someone sues me for something... then the most u can lose is your company
susan
2006-06-09 00:04:25 · answer #6 · answered by notfromaround_here 4 · 0⤊ 0⤋
llc is right, my company is in china,in the meantime, we regitered a company in the us,which is llc
2006-06-08 23:46:31 · answer #7 · answered by peng t 1 · 0⤊ 0⤋
All depends.. There are various legal benefits for both and there are numerous tax implications and benefits to both.. Consult a TAX attorney or a reputable CPA.
2006-06-10 23:08:14 · answer #8 · answered by j_darpino 1 · 0⤊ 0⤋
Both of these are legal proceedings. You need legal assistance, many like to incorporate in Delaware because of Delaware laws .
2006-06-08 22:17:16 · answer #9 · answered by jeanric33803 2 · 0⤊ 0⤋