can someone help explain the pros and cons of having a corporation and how taxation works?
2006-10-04 18:58:21 · 2 answers · asked by ooh la la 1 in Business & Finance ➔ Investing
You might as well get the words from the horse's mouth.
Go to IRS site, http://www.irs.gov/businesses/small/article/0,,id=98359,00.html
Click on all the different business structures to compare the difference.
One major area that isn't covered by IRS is business liability. Liabilities of a Sole Proprietorship and Partnership are passed to the business owners. In the other structures, damages are generally contained inside the business and wouldn't affect owners' personal assets.
For most small business, LLC is the best choice. It is easy to setup with almost no special reporting requirements.
Best wishes.
2006-10-04 19:07:14 · answer #1 · answered by JQT 6 · 0⤊ 0⤋
Pros: limited liability, perpetutity.
Cons: tax rate is higher but corporations are allowed to take many more deductions than individuals. Government reporting.
2006-10-05 00:27:52 · answer #2 · answered by Anonymous · 0⤊ 0⤋