Sacramento Finance

Jan 14 2018

Compare Business Structures – LLC vs

#business #structure, #business #structures, #business #entity, #llc #vs. #corporation, #llc #vs. #s #corp, #llc #vs. #c #corp, #llc #vs. #inc, #s #corporation, #c #corporation, #difference #between #llc #and #corporation, #start #a #business


#

What would you like to talk about?

Welcome back

What business type is right for you?

When you re starting a new business, you want to determine the business structure that s right for you. What s the difference between a limited liability company (LLC) and a corporation (Inc.)? And how is a C corporation different from an S corporation? Use these charts to help decide what business type is best for your needs.

LLC vs. Corporation

Limited Liability Company (LLC)

Shields personal assets from business liability

Requires separation of business and personal finances

Allowable in all 50 states and the District of Columbia

Highly flexible management structure

Flexible tax reporting options

Preferred by outside investors

Preferred for IPO

Recognized outside of the United States

Corporation (Inc)

Shields personal assets from business liability

Requires separation of business and personal finances

Allowable in all 50 states and the District of Columbia

Highly flexible management structure

Flexible tax reporting options

Preferred by outside investors

Preferred for IPO

Recognized outside of the United States

Start my Corporation

What is an S corporation?

After you create a corporation or LLC. you also have the opportunity to decide how you d like your business to be taxed.

Single owner LLCs can be taxed either as a sole proprietorship or a corporation. LLCs with more than one owner can be taxed either as a partnership or a corporation. Income from LLCs treated as sole proprietorships or partnerships is reported directly on the owner s individual tax returns.

New corporations, as well as LLCs considering corporate taxation can choose between filing taxes as a C corporation ( C corp ) or an S corporation ( S corp ). An S corp is considered a pass-through entity, which means the business itself isn t taxed. Instead, income is reported on the owners personal tax returns. Businesses taxed as C corporations are not pass through entities. Income is taxed at the corporate level, and, if dividends are distributed, at the individual level as well.

We can help you understand your options so you choose what s best for your business. Talk to one of our network of attorneys today.

C-corp or S-corp

Here s a comparison of some key characteristics of businesses that choose to be treated as C corps and S corps.

C Designation

Owners pay personal income tax on profits

Business must pay corporate income tax

All business income/loss is passed through to owners each year.

No more than 100 shareholders

Shareholders must be U.S. citizens or resident aliens

S Designation

Owners pay personal income tax on profits

Business must pay corporate income tax

All business income/loss is passed through to owners each year.

No more than 100 shareholders

Shareholders must be U.S. citizens or resident aliens

You don t have to decide about S corp status right away. You have 75 days after the formation of your business to file with the IRS. If you re still not sure what to do, you may want to consult with one of our attorneys or tax specialists .

Step-by-Step Guide on Starting Your Business

Easy as 1-2-3

Ask away. We have answers.


Written by admin


Leave a Reply

Your email address will not be published. Required fields are marked *